from Forbes.com Labor Why The Writers Must Win Lacey Rose, 11.07.07, 6:00 AM ET
Hollywood scribes had to strike, and now they have to prevail. When 12,000 Hollywood writers traded pencils for picket signs this week, they took a huge risk. Even riskier: not striking. Losing to the studios now could doom their union as television gives way to the Internet. "We know that the future of the industry is the Web, and that in the near future television sets and computer monitors will merge into the same screen," says Kate Purdy, a writer for CBS' (nyse: CBS - news - people ) Cold Case and a blogger behind a new strike-related writers' blog, United Hollywood. Hollywood writers want compensation for work on new media platforms like the Web--the central fight in three-plus months of acrimonious negotiations with the studios and networks. But as scripted television sheds viewers and work jurisdiction to other genres (like reality) and media (like the Web), they continue to lose leverage at the bargaining table. That's a harrowing prospect for a union that's already been fighting for nearly two decades to overturn a stingy VHS/DVD residual formula negotiated in 1985. Worse, the guild is no longer squaring off against a cadre of studio heads as it did during the last strike. Now it faces media giants like News Corp. (nyse: NWS - news - people )Walt Disney (nyse: DIS - news - people ), with massive pockets and businesses big enough to withstand a walkout. The companies are equally desperate to keep the Guild from grabbing jurisdiction- -and profits--from a new medium with unknown future revenues. They see the union's efforts as prohibiting them "from experimenting with programming and business models in New Media," according to Nick Counter, president of the Alliance of Motion Picture & Television Producers. The way Jonathan Handel, an entertainment industry attorney with TroyGould in Los Angeles and a former associate counsel for the Writers Guild, sees it, the stakes are huge: "If the guild does not succeed in cutting an effective deal, it loses leverage, stature and will suffer continued erosion," he says. Reality TV shows, not covered under current contracts, already occupy 35% of broadcast networks' primetime schedule, according to TVtracker.com. Most cable providers offer packages with well over 100 channels filled with content unaffected by the labor strike: news, news magazines, sports, movie channels, cooking shows. What's more, nearly 20% of homes are equipped with DVRs, which allow endless reruns for viewers, and Netflix (nasdaq: NFLX - news - people ) and Apple's (nasdaq: AAPL - news - people ) iTunes serve as supermarkets of entertainment. And that's just TV. "Will they flee to the Internet? A lot of kids are already doing that," says Kevin Falls, whose TV credits include Sports Night, The West Wing and the General Electric-owned NBC freshman drama, Journeyman. Americans now spend nearly 27 hours a month online, up 8% from just two years ago, according to comScore Media Metrix. And advertising dollars are following: Internet ads registered a 17.7% increase in the first half of 2007, to $5.5 billion, while the broadcast networks saw ad spending slip 3.6%, to $11.8 billion, during the same period, according to TNS Media Intelligence, a division of Taylor Nelson Sofres that tracks ad spending. "It's all about the Internet, it's the big Kahuna, and both sides know it," says writer/director Josh Pate, whose credits include Friday Night Lights and Surface. "The deal that's made this year is the most important for both sides in decades."
