Agent Ari Butts Into Strike Ass-Backward

ariemanuelphoto.jpgOf course, Endeavor co-founding partner Ari Emanuel couldn't keep quiet about the looming writers strike. But while most of the top agencies sound determined to stick by their WGA members' side, Ari throws them under the bus. Not to mention quotes from AMPTP's playbook. (And here I thought it was primarily CAA that was repping the studios and the networks to the detriment of its clients.) Talk about faulty facts: no one told Emanuel that this summer was the best ever in the domestic history of the movie biz. Too bad that Ari, one of the genius dealmakers of Hollywood, didn't use his blog on The Huffington Post endeavorlarge.JPGto map out a residual package that both sides could live with. But that would require focus, and Emanuel has the attention span of a gnat:

Writers' Strike: Is Political Posturing About to Trump Good Economics?

I'm about to get myself in a lot of trouble. So be it... Listening to both sides in the looming writers' strike, it's clear to me that politics is about to trump sound economics. Neither the Writers Guild nor the Alliance of Motion Picture and Television Producers is looking at the issue properly.

If you look at the amount of money that was at issue during the last writers' strike in 1988, I bet it was less than the amount the strike ended up costing all concerned. And I believe that will be the case this time around, too.

Expecting movie studios and television networks to change with the times is not asking too much. New technologies have dramatically altered Hollywood's economic landscape, but the AMPTP is still clinging to a revenue model that was created back in the days of Lew Wasserman and Abe Lastfogel - and was, as I understand it, adopted from the record business (you remember records, don't you?). The movie business took the formula used for calculating record royalties and basically transferred it to the sale of videotapes (you remember videotapes, don't you?). What's more, the current royalty formula for DVDs factors in the cost of manufacturing (today's electronic DVDs and web downloads, of course, cost absolutely nothing to "manufacture"). Clearly, the media world has gone through a major evolution since Lew and Abe, and it's time for its business practices to follow suit.

On the other hand, what the representatives of the Writers Guild have to remember is that all union contract negotiations are to set minimums, and that the effect of the change in residuals from DVDs and New Media they are seeking will not rise to the level of revenue they are asking for - or what the strike is going to cost the Guild's active members. Once again, the eventual cost of a strike will exceed the financial gain being sought.

Going on strike to lose more than you gain is not smart negotiating.

Both sides should also keep in mind that TV ratings have fallen significantly over the last few years, and the movie box office hasn't been all that great either.

But, who knows, maybe clearer heads will prevail - and sound economics will supersede political posturing. Let's hope so, not only for the sake of the writers, the studios, and the networks but for the millions of people in the community who will be hurt by a strike, including below-the-line workers and all those who aren't in show business but whose livelihood is dependent on a Hollywood that is up and running.

31 Comments »

  1. He is correct about TV and this fight is about TV’s new model. Sitcoms are a shrinking market after the now de facto explosion of cable content, so the syndication money and advert dollars are not what they used to be.

    In general tho… it’s a fight between well to do white guys and really rich white guys meanwhile the rest of us are disposable. When execs of a sitcom tell their crews that they have to take a stand on residuals while most of the IA crew has already eaten at minimum a 33% pay cut after the transition to HiDef fucked the 3 for 2 day pay standard of yore (and most have only one show per season instead of two), you can only ask yourself if the execs give a crap about the below the line folk.

    Comment by Dan Rhys — November 1, 2007 @ 2:24 pm

  2. From: Joe Gillis
    (fareside@pacbell.net)

    “If you look at the amount of money that was at issue during the last writers’ strike in 1988, I bet it was less than the amount the strike ended up costing all concerned.”

    I’ll take that bet. Even though revenue lost to writers was about $50 million during the strike, the amount in lost residuals (due to the change in the DVD formula) is now $1.75 billion. Not even close. Emmanuel has a Bush-like grasp of the facts.

    Comment by Anonymous — November 1, 2007 @ 2:26 pm

  3. Well, that’s sad. The agents could’ve played the voice of reason and helped settle this so much quicker and gotten the shows I love to stay on the air!

    Too bad only the fictional Ari believes you should “hug it out.”

    Comment by Ms. TV Fan — November 1, 2007 @ 2:37 pm

  4. He is somewhat right. Overall dollars were large for this summer BUT overall attendance did not beat two years previous. I’ll do some searching for actual figures.

    Comment by Shaun — November 1, 2007 @ 2:37 pm

  5. He made slightly more sense when he had his panties twisted over Mel Gibson. And you have to wonder - writers who are repped by Endeavor - how can you stay in that house when daddy doesn’t love you equally as the other kids? Because, really, you have to realize that if the directors go on strike, Ari wouldn’t be out there with quotes like this because directors are higher profile stars to an agency and they make an agency lots more money than writers do.

    And someone explain to him that it’s not about short-term economics. And ask him to roll-back his perk package.
    Signed - non WGA writer on the outside looking in.

    Comment by outsidelookingin — November 1, 2007 @ 2:37 pm

  6. I agree with the posting by Dan. The only real losers all around tend to be the BTLer’s. But what the hell, no one cares about us anyway.

    Comment by shaun — November 1, 2007 @ 2:40 pm

  7. Throw the writers under the bus?!? Did we read the same piece, Nikki? I guess common sense and a collaborative approach aren’t wanted in this toxic environment.

    Damn, it’s going to be a long strike when voices of reason are attacked as cranks.

    Comment by Resigned — November 1, 2007 @ 2:41 pm

  8. Hey all-writers-repped-by-Endeavor: Do you really want this guy (or his minions) representing your interests? Just sayin’.

    Comment by Repped At Other Agency — November 1, 2007 @ 2:43 pm

  9. Mr. Emanuel says:

    “On the other hand, what the representatives of the Writers Guild have to remember is that all union contract negotiations are to set minimums, and that the effect of the change in residuals from DVDs and New Media they are seeking will not rise to the level of revenue they are asking for - or what the strike is going to cost the Guild’s active members.”

    I’ve read this four times. I still have no idea what this sentence means. Anyone?

    Comment by Ashley — November 1, 2007 @ 2:47 pm

  10. As one of the seemingly “disposable” ones in Hollywood, I have to agree with both Dan and Resigned. I think Nick Counter and his lot are greedy and arrogant, but I also think that the WGA’s lemmings-to-the-cliff approach isn’t helping either. The two sides are like schoolkids on a playground who both need to shake hands and figure out what’s best for the community as a whole and not just their own — albeit important — concerns.

    Comment by Average Joe — November 1, 2007 @ 2:50 pm

  11. I strongly disagree with your analysis that Ari is “throwing the writers under the bus.” Instead, I think he makes it perfectly clear that, in his opinion, a strike is bad for EVERYONE including the writers, and that both sides need to get their acts together and negotiate a deal. He’s not pro-studio or anti-WGA, he’s simply anti-Strike. What’s wrong with that?

    Also, Ari’s a pretty smart guy who knows his facts. By saying that box office “hasn’t been all that great,” he’s probably referring to the fact that the FALL’s box office is down some 6% from last fall. Maybe he should have clarified, but to say he’s got his facts wrong is not right.

    Despite my defense of Ari’s post, I DO agree with your disappointment in the lack of any public leadership or creative advice he (or any of the agency heads) have offered during these negotiations. Tenpercentaries are smack in the middle of this situation and, as they are run by some of the best dealmakers in town, could truly provide a bridge between the two parties.

    Comment by agencyassistant — November 1, 2007 @ 2:54 pm

  12. I’ve read this four times. I still have no idea what this sentence means. Anyone?

    I took that quote as a reference to the fact that while the WGA sets minimum salaries for the various positions governed by the CBA, most WGA members earn more than that, because typically you only make “scale” for your first few gigs. As a writer’s salary increases, they no longer make scale but instead are paid “their quote.”

    That’s why you’ve seen so much attention given to the residuals issue rather than seeing any talk about salaries/guaranteed minimums. It’s the residual issue that has the potential to impact a writer’s compensation at every stage of their career.

    Comment by Anonymous — November 1, 2007 @ 2:58 pm

  13. Endeavor has been courting me and I’d almost made up my mind to go with them.

    Not anymore.

    Comment by Showrunner — November 1, 2007 @ 3:05 pm

  14. I have no idea what Mr. Emanuel is saying and I doubt he does either. He simply likes to hear himself talk. His position in the business enables him to play a leadership role, but all he wants to do is point out how smart he is. But he has no clue. Talk about a waste of an opportunity.

    Comment by Veteran Writer — November 1, 2007 @ 3:11 pm

  15. Ashley, it means that Ari is an assmaggot who’s trying to lull us into thinking our goals aren’t worth the effort.

    Thanks for weighing in, Ari. Run along now.

    Comment by Never signing with Endeavor — November 1, 2007 @ 3:11 pm

  16. Ashley, what Ari’s referring to is the fact that (part of) what the strike is about is raising the minimum amount they are to get paid for something. For example, if the current minimum for a screenplay is $56,000, they’ll wait to raise it to $56,500. BUT, as Ari says, raising the minimum won’t raise the amount most are actually earning because they’re already paid above the minimum… they will not be paid more just because the minimum is raised.

    Comment by Enrique — November 1, 2007 @ 3:18 pm

  17. I believe his point was that the strike isn’t about agreeing on a set level that all writers will receive, it’s about setting the base from which all negotiations will begin.

    My guess is that if Ari was talking to a client, he’d say, “Listen, if you want 4 cents per DVD, I’ll get you that. But don’t expect studios to give EVERYONE that much.”

    (I’m a wannabe screenwriter currently working in reality TV)

    Comment by Kevin — November 1, 2007 @ 3:46 pm

  18. No one is talking about striking over minimums. In fact, no one really wants to strike at all. But if there is a strike-worthy issue it’s compensation for the re-use of literary material delivered via new media. There is a number somewhere between the .3% the companies convinced the Guild to accept in ‘85 for the “new, unpredictable, expensive to manufacture VHS cassette market,” and the 2.5% the guild is asking for the virtually cost-free delivery of product through downloads, streaming, etc. What people like Ari should be doing to help avoid a strike is getting in the middle and figuring out what that number is. Isn’t that what he does for a living?

    Comment by DLW — November 1, 2007 @ 3:58 pm

  19. Is political posturing about to trump good economics? Maybe, maybe not. But is political posturing about to trump sanity? Absolutely! Yes, the writers got less than we deserved in the last contract negotiations, and yes, everything the WGA is asking for is fair and reasonable, but that said… without much leverage – and the threat of strike is the best leverage we have – there unfortunately isn’t a hell of a lot we can do about it. All the chest thumping and pissing matches in the world aren’t going to change that. If a strike doesn’t hurt the studios much and in fact may help their bottom line in the short term, what does the WGA think they are going to accomplish other than tarnishing their image further and taking the rest of town down with them? If a strike lasts longer than six months, then the only certainty will be the demise of the WGA.

    As to whether or not Ari is representing his clients’ best interest… Is only telling your clients what they want to hear serving their best interests? I think not.

    Lets stop with the inane chest thumping and make a deal or everybody loses.

    Comment by Lets step back from the edge — November 1, 2007 @ 4:03 pm

  20. I’m making 50 cents on the dollar that I made two years ago. Is that due to the shrinkage of the market for comedy writers? The drying up of residuals as series don’t sell in syndication, or if they sell, they sell to a sister company of the original company that made/owned the show? Don’t get me wrong, I know that we make more then most people in this country, WHEN WE ARE WORKING, but the future is now, and new media is fast becoming current media and the things we want are fair, and we know how much pain a strike will cause everyone. It is a terrible thing, but I don’t know what else we can do at this point.

    Comment by showrunner2 — November 1, 2007 @ 4:06 pm

  21. What Ari is referring to is the fact that his specific clients have long since ceased to be concerned with the minimums, so Ari assumes that we all make above minimum, because in his world, his people do. And it’s Ari’s world right?

    Comment by showrunner2 — November 1, 2007 @ 4:08 pm

  22. It’s not about chest thumping, it’s not about lemmings off the nearest cliff. It’s about making a simple calculation, and facing some simple facts. The latter? The Companies do not want to give one penny more in residuals, not matter what the delivery system. The former? Will a strike force them to act reasonably in this regard.

    Nobody wants to strike. But there comes a time when you either take a stand, or make it very clear to the Companies that they can do whatever they want in the future, to anyone’s detriment. And trust me, they will.

    Comment by Harley — November 1, 2007 @ 4:35 pm

  23. >>
    Nobody wants to strike. But there comes a time when you either take a stand, or make it very clear to the Companies that they can do whatever they want in the future, to anyone’s detriment. And trust me, they will.
    >>

    You know, I want to believe this. But it feels like the WGA has something to prove and they believe this is the only way to do it. Their concerns are extremely valid, but the powers-that-be have been itching for a strike for not just weeks or months, but years.

    Comment by Average Joe — November 1, 2007 @ 5:15 pm

  24. Mr. Gold (perhaps inadvertently) has part of it right – the strike is bad news for working writers who are making more than the minimums (and for the agencies who represent them like Mr. Gold’s). Their already short careers are going to be shortened further right at a time when they don’t need to worry about WGA minimums but do need to worry about making as much as they can to sustain themselves long after they are no longer the flavor of the month. So, why are even these writers so impassioned about getting a better deal? People have long memories, and they know what it’s like to be shat on by the system. The WGA agreement with producers guarantees a modicum of pay and dignity for the people who are starting out so that they can’t be taken advantage of. Even with that guarantee, lots of writers have been and are been taken advantage of. The fact that people who have already “made it” are also mostly on board with a strike is very telling. Fairness and respect are core issues being overlooked in the rush to put dollar figures on everything. That’s part of the reason why you see lots of rancor and anger coming out of the negotiations. I anticipate a very long strike.

    Comment by Money? — November 1, 2007 @ 5:22 pm

  25. Mr. Emanuel (perhaps inadvertently) has part of it right – the strike is bad news for working writers who are making more than the minimums (and for the agencies who represent them like Mr. Emanuel’s). Their already short careers are going to be shortened further right at a time when they don’t need to worry about WGA minimums but do need to worry about making as much as they can to sustain themselves long after they are no longer the flavor of the month. So, why are even these writers so impassioned about getting a better deal? People have long memories, and they know what it’s like to be shat on by the system. The WGA agreement with producers guarantees a modicum of pay and dignity for the people who are starting out so that they can’t be taken advantage of. Even with that guarantee, lots of writers have been and are been taken advantage of. The fact that people who have already “made it” are also mostly on board with a strike is very telling. Fairness and respect are core issues being overlooked in the rush to put dollar figures on everything. That’s part of the reason why you see lots of rancor and anger coming out of the negotiations. I anticipate a very long strike.

    Comment by Money? — November 1, 2007 @ 5:26 pm

  26. Nice, Ari, but here’s the problem with your thinking.

    Even if your math is correct, and I doubt it is, strikes can rarely be measured in simple short term dollars and sense (please spare me the spelling correction. It’s intentional). Yes, I know that’s the currency you traffic in, but it’s short sighted.

    The fight is always about tomorrow. The fight is always about your brother/sister and his/her family. The fight is about principle.
    That being said, this IS Hollywood so I know your eyes are starting to glaze over.

    We can all add. In addition some of us feel. Deeply.

    Comment by Gottasayit — November 1, 2007 @ 6:23 pm

  27. (Per Nikki’s request, I identify myself as a non-guild writer, working on assignment, and a pro script reader.)

    Emanuel’s argument against the economic logic of the WGA position is that it will cost more to strike than the writers will gain. The problem with this claim, however, is that he is basing this explanation on the last strike, and only on his opinions of the last strike at that. He writes, “If you look at the amount of money that was at issue during the last writers’ strike in 1988, I bet it was less than the amount the strike ended up costing all concerned.”

    “I bet?!” So the entire crux of his argument rests on his own speculation? Well, that’s a convincing argument!

    Now beyond that, there could also be the argument (even if his bet is valid) that if by striking and potentially costing more than is gained, the writers lose LESS than they would have by not striking, it would also still make economic sense. Not sure if I’m being clear about that, but if the losses due to a strike were less than the shortchanging that the writers face without a new CBA, then it makes good economic sense in that case as well.

    Nice try, Mr. Emanuel. But it seems your only angle here is that if there is no stoppage of work, your company can continue to make its 10%. So only the lack of a strike would make economic sense, TO YOU!

    Comment by Fun Joel — November 1, 2007 @ 8:06 pm

  28. Residuals were originally designed as a deferment on salary, which you’re taking on the backend. It was a way to pay writers less up front. While we WGA members were voting on whether or not to give strike power to the guild, the AMPTP was denying existing residuals. One agent told me, “that was a negotiating tactic on their part.” To which I responded “bad tactic.” They were hoping to negotiate the status quo at a time when DVD’s are going the way of the dodo, and they don’t want to give residuals on electronic delivery. The overwhelming corporate greed of the studios, which has already walked all over writers for years, requires a stand — and now is the time to do it. And this Ari Emanuel asshole can suck my balls. Let’s not forget the mass “firings” of WGA clients from Endeavor months back. He’s not on our side — he’s on his own side.

    Comment by WGA writer — November 2, 2007 @ 7:02 am

  29. Having worked with Ari, “attention span of a gnat” about sums it up. And gnats shouldn’t be weighing in on grown-up topics like a writers’ strike…

    Comment by Ex-Endeavor Guy — November 2, 2007 @ 7:44 am

  30. Everybody needs to remember that the agents are now producers, paid by the studios to work for the studios. That should really be all anybody needs to know. That, and a hyphenate should never, ever have a union position of power. That’s partly what got everybody into this mess.

    TV and film need to go the way of the music industry: Independent. Technology now affords cheap production and independent distribution. The guilds need to form their own production and distribution entities and create a New Entertainment Order. It’s just sitting there, waiting for them to do it.

    I’m sure agents and producers are aware of this, but entire crews have been discussing the reality that they can produce and distribute the shows they’re working on by themselves. If necessity is the mother of invention, it just might be that the AMPTP and the agents are making it necessary for TV to go indie.

    Comment by FuckDaAgents — November 2, 2007 @ 9:42 am

  31. Emanuel: “If you look at the amount of money that was at issue during the last writers’ strike in 1988, I bet it was less than the amount the strike ended up costing all concerned.”

    Hilariously, and quantifiably, false. The writers left much MUCH more on the table under the terms of their ‘88 CBA than they lost during the strike itself. The reason the writers are more entrenched this year is that they don’t want to repeat the mistakes of ‘88 (sorry if that sounds like a campaign slogan).

    Comment by Anonymous — November 2, 2007 @ 10:06 am

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