Ken Ziffren, a veteran entertainment attorney and the film czar of Los Angeles since 2014, expressed doubts about the progress of negotiations between the Writers Guild of America (WGA) and the Alliance of Motion Picture and Television Producers (AMPTP). He commented that the recent meeting between the two parties did not lead to any significant progress, indicating that they still remain far apart.
Speaking at an event for media and entertainment lawyers hosted by the Beverly Hills Bar Association, Ziffren questioned whether the lack of programming to view would incentivize the studios or other industry organizations to continue negotiations. This statement suggests that the current impasse may hinder future meetings and progress in resolving the strike.
The AMPTP and WGA had a meeting on Tuesday to discuss the counter-offer provided by the studios on August 11. The fact that WGA East leadership flew into Los Angeles for the meeting indicates that talks have become more serious since the first formal return to the negotiating table in May. However, after the meeting, studio sources informed The Hollywood Reporter that a deal was not imminent and that both sides are still working through the issues. Interestingly, the WGA did not share any post-meeting communication with its members.
Ziffren cited the recent agreement secured by the Directors Guild of America (DGA) as a “good deal” and suggested that it could serve as a template for resolving contentious points in the negotiations. The DGA quickly reached an agreement with the AMPTP during the writers’ strike, securing a new residuals formula and an obligation for companies to consult members when using generative AI in connection with creative elements. Ziffren highlighted the new formula for foreign subscription video on-demand (SVOD) residuals, which now revolves around the number of international subscribers on a given platform. He emphasized that the largest streaming services are required to pay significantly higher residuals under this deal.
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Residuals have emerged as a crucial issue in the strike. The WGA has asked for viewership-based residuals for streaming titles on top of existing fixed residuals to reward programs with greater viewership. However, the AMPTP has refused to make a counter-offer because it would require data transparency, which streamers strongly oppose.
With more than 100 days into the strike, there is no clear pathway to resolution. Ziffren criticized the way both sides are approaching negotiations, suggesting that a more constructive approach could lead to progress. He proposed that each side should submit a written document regarding artificial intelligence (AI) and trade those documents before sitting down to talk it through in a room, rather than engaging in posturing and rhetoric. Ziffren believes that this approach could lead to closer negotiations and eventually full employment in the industry.
Ziffren also commented on profit participation, stating that his clients prefer the new bonus methodology on TV talent deals, which allows studios to have unrestricted control over program distribution. Despite the downside of this new model, which is based on profit participation according to modified adjusted gross receipts (MAGR), Ziffren believes that it can lead to higher average payouts for industry professionals. He pointed out that due to the reduction in episodes per season, it may be more advantageous to aim for consistent moderate successes rather than occasional blockbuster hits.
In addition to the strike, CEO pay has also come under scrutiny. Barry Diller, chairman and senior executive of IAC and Expedia Group, and a former Hollywood studio chief, suggested that top executives and the highest-paid stars should take a 25 percent pay cut to reduce the salary gap between them and lower-tier employees. When asked about this suggestion, Ziffren dismissed it, stating that compensation decisions for executives are made independently by each company.
In conclusion, the negotiations between the WGA and AMPTP have not made much progress, and doubts remain about their ability to reach a deal to resolve the strike. Ziffren’s comments highlight the need for a more constructive approach to negotiations and the potential benefits of using the recent DGA agreement as a template for resolving contentious issues. However, with the current impasse and divergent interests, it remains uncertain when the strike will come to an end.
