Directors reach deal with Hollywood studios

January 17, 2008 3:05:12 PM PST
Hollywood directors have reached a tentative contract deal with studios after five days of negotiations, the directors union said Thursday.

The agreement puts pressure on striking writers to end their walkout that has lasted more than two months and idled work on dozens of TV shows.

"Two words describe this agreement - groundbreaking and substantial," said Gil Cates, chairman of the Directors Guild of America's negotiations committee. "There are no rollbacks of any kind."

Among other things, the agreement increases both wages and residuals for each year of the contract.

It also establishes guild jurisdiction over programs produced for distribution on the Internet and sets a new residuals formula for paid Internet downloads that essentially doubles the rate currently paid by employers, the guild said.

It also set residual rates for ad-supported streaming and use of clips on the Internet.

Payment for programs offered on the Internet is a key sticking point between the studios and striking writers.

The rapidly concluded directors' contract could serve as an industry template for the central issue of new media compensation among other unions in Hollywood.

The writers guild, however, has said directors do not represent their interests.

Writers repeated the same refrain when asked how their walkout might be affected if directors reached a quick deal.

"It's important to remember that they do not represent actors and writers," the Writers Guild of America has said.

The directors guild was prepared when it started negotiations Jan. 12. It had spent $2 million researching the potential value of new media over the next decade and held a series of meetings with key studio heads to establish a basis for the formal talks.