*alert Did the DGA sellout writers and actors in their new agreement with the AMPTP? Let’s go to the DGA summary on that one.

Did the DGA sellout their sister guilds, WGA and SAG, with their current deal with AMPTP? This is the question that many members are asking themselves after reviewing the summary of the deal released by the DGA.

Well, in light of the fact that pattern bargaining is a reality, I think one could make a case that in regards to a spirit of solidarity, that if not reaching that threshold, they have at the very least, nudged it--by settling for a deal that falls far short of what the WGA has been on strike to secure for its members. (In revenue about $90 million dollars shy according to numbers provided on unitedhollywood.com)

But, then, it is their negotiations, and they are free to negotiate for whatever they want.

On the other hand, perhaps, it is time for the writers and actors to make it clear that when it comes to making decisions that affect their ability to make a living, they are not on a set, or sound stage, and therefore not obliged to follow anyone’s direction but their our own.

This seems to be the attitude of SAG’s NED Doug Allen, expressed in a just released statement:

"It is up to the board and membership of the Directors Guild of America to determine if their tentative agreement with the AMPTP is acceptable. That decision will not determine what will be satisfactory for the leadership and membership of the Screen Actors Guild."

That should be comforting to SAG members, because, as you will see, to accept the deal, as presented in the DGA summary, without dramatic changes, would be disastrous to actors ability to make a living in their chosen field.

Let’s look at what would be in store for actors if pivotal elements regarding residuals in new media accepted by the DGA were accepted by SAG.

In the DGA summary, they ballyhoo that they achieved jurisdiction over all new media content that is derivative of product already covered under current contracts.

I don’t know about DGA’s jurisdictional agreements with the AMPTP, but this is from Sideletter I of the basic agreement, signed by AMPTP President J. Nicholas Counter, to SAG Interim NED/CEO Peter Frank: Re: Exhibition of Motion Pictures Transmitted via the Internet.

“This Sideletter confirms the understanding of the Screen Actors Guild (“The Guild”) and the Producers (collectively “the parties”) concerning the application of the 2005 Producer-Screen Actors Guild Codified Basic Agreement and Screen Actors Guild Television Agreement to the exhibition of covered theatrical motion pictures, the principal photograph of which commenced on or after July 1, 1971, and covered television motion pictures, the principal photography of which commenced on or after July 20, 1952, on or after July 20, 1952, on or by means of the Internet or other similar delivery systems. (“Internet”).”

There is also another Sideletter (H) from Mr. Counter that confirms SAG jurisdiction over programs made for the Internet. (They can be read on pages 247/249 of the 2005 Screen Actors Agreement)

As we saw before our break, it is plain that SAG already has jurisdiction. But as they say, “The Devil is in the details.”

So let’s look at those details. The debate, currently in arbitration between SAG and the AMPTP, on one of those details is, whether downloads from the Internet to devices like iPods should be paid using the DVD format or the Pay per view format.

The former (DVD) pays about a quarter of what the latter pays (Pay Per View). So, guess which one, our buddies, the producers want to apply to these downloads.

The problem with the producers logic, on this matter, is that it is clearly already spelled out in the agreement that the lower (Cassette/DVD) formula for payment (1%) applies to devices that CONTAIN the product, while higher Pay-per-view residual formula (3.6%)pertains to a device that RECIEVES the product.

And an iPod or computer does what? Contains, or receives the product.

, Part Deux! (To read more on this with the actual language used in the agreement click this link http://sagwatchdog.com/cgi-bin/admin_config.pl/read/593 )

Although the DGA is characterizing their deal with producers on downloads as a gain, because it is based the Pay-per-view formula’s distributors gross, instead of the VHS/DVD’s formula’s, so-called producers gross, which whacks 80% percent off the top, what they are failing to mention is that what they settled for is, actually, half of the applicable pay per view formula, already in their contract, by which they should be paid.

If you check section 5.2 of SAG’s agreement, you’ll notice that both the cassette and pay-per-view formula’s are based on Distributor’s gross receipts: For Pay TV it’s 3.6%, for cassettes it ends up being 5.4%. But, here’s the rub in regards to cassettes, as stated in the agreement, “if the producer is the Distributor, or the Distributor is owned by or affiliated with the Producer, the “Distributors gross receipts” derived from the distribution of such picture by “cassettes” shall be twenty percent (*20%} of the worldwide wholesale receipts derived by the Distributor.) This little maneuver by the producers’ brings that cassette rate down to a paltry 1%: So if a cassette of a movie sells for 12 bucks, 12 cents is split between the entire cast.

In the same section of the agreement, it states that “If the Distributor is not the Producer and is not owned by or affiliated with the Producer, the “Distributor’s gross receipts” shall be one hundred percent (100%) of the fees received by the Producer from licensing the right to distribute such picture by cassette.”

It might be that producers conceded to the DGA the distributor’s gross formula, because they knew that their bogus claim that downloads fell under the DVD producers’ gross formula would not hold up. But, then, with a little DVD bait and switch, they managed to convince DGA negotiators that they were actually doubling the rate of paid Internet downloads, even though the rates clearly should have been paid under the higher pay per view formula.

It’s the Ol’ bait and switch tactic. Hey, this is great guys; we got you double the DVD rate for downloads that should be under the pay-per-view rate already in place-which is double. But, but…

The good news is that the possible precedent set by the AMPTP/DGA in accepting the pay-per-view formula for these downloads, could work in SAG’s behalf, since SAG is still in arbitration arguing that very point, that these paid downloads should be under the pay-per-view formula rather than the DVD formula. And SAG has not conceded the higher 3.6 % rate specified in the agreement.

As to producers claiming they are owner/distributors of the product to justify the lower DVD rate for downloads, they could be between a rock and a hard place. For instance, can they provide a movie to, oh, say, Netflix, or Blockbuster, to download to their customers, then turn around and claim that they are the producer/distributors? Ahhh, I don’t think so, and, perhaps neither do they.

So, bottom line, if SAG was to accept the current deal reached by the DGA concerning these paid downloads, members would receive about half of what they are already entitled to under the present agreement.

For instance, under the rate accepted by the DGA, a $1.99 movie download would generate about four cents for SAG, instead of what the current SAG pay per view formula of 3.6% would generate--a little over seven cents.

Personally, the Ol’ Dog will take his share of the higher rate, and, of course, any late fees owed because of producers failure to pay what they owe in a timely matter.

Bottom line, again. Both sides talk about directors getting double the DVD rate for these paid downloads, but fail to mention that, in fact, they got no increase in regards to actual DVDs.

Okay, let’s move on to another troublesome part of this deal if accepted by SAG--and that is the ADD-supported Streaming provision. This is a provision that allows producers to run a series produced for TV on the Internet with a 17-day window (24-day window for series in their first season) for a whopping grand total of 3% of the residual base. For Directors that amounts to $600 bucks.

Now let’s apply that 3% to the SAG Day player, who makes minimum of $759 dollars. Yikes! After that 24 day window, (Hmmm, I wonder if AFTRA helped negotiate this contract) for a twenty-six week run, that Day Player would receive, get ready to smile, $23 dollars. (Personally, the Ol’ Dog thanks SAG NED Allen should inform Nick Counter that we’re actors--and we don’t do windows.)

But wait, hey if you’re a high-profile member, and, say, you’re a regular on a series, you know sort of one of the stars, well, it won’t be that bad, right? Of course not, shucks, with SAG’s residual cap of $3280 bucks, you would stand to make more than four times as much as those day players, ah, ah, NINETY-EIGHT BUCKS. But, but…

But wait, it gets worse for shows made for cable. Under the cable contract you get $129 bucks for that first rerun. Okay, three percent of that would be, ah, wait, hmmm…Yikes! THREE DOLLARS AND EIGHTY-SEVEN CENTS.

Hey, it couldn’t get any worse than that, could it? Hmmmm, wait, what if it’s an AFTRA basic cable dramatic show where your initial compensation usually includes 15 exhibition windows virtually guaranteeing NO residuals the first year.

Hmmm, again. Let’s see if you get zero residual money the first year, and your Internet residuals are 3% of your residual base…let’s see, 3% of nothing, carry the zero, carry the zero…hmmm, better get out the Ol’ Calculator for this one.

I’ve seen the argument made on the Internet, justifying this deal: Yeah, 3% ain’t real good, but we can negotiate that percentage up later. Hello? Yeah, like we negotiated the VHS/DVD percentage up? Over a quarter of a century later, and the same deal, and percentages are still in place. It took us twenty years to get a barely perceivable increase in basic cable residuals, and, of course, SAG had to go on strike to finally get a fair increase in cable TV residuals. So, this idea that the formulas and rates can be fixed in posts is not realistic. What is realistic is that whatever you accept now, you better be happy with because it’s gonna be in place a long time.

Look, I could go on, and on, and I have, but, but, I think you get the idea why NED Doug Allen stated, concerning SAG’s negotiations: the DGA’s, ”…decision will not determine what will be satisfactory for the leadership and membership of the Screen Actors Guild.”