p2pnet.net News:- Having recorded 2003 as its second biggest year ever with official MPAA (Motion Picture Association of America) box office figures at $9.5 billion, Hollywood is pleading poverty in talks with movie and TV writers who want a bigger cut from the DVD market and help with health care costs.

This is the same industry that claims profits are plummeting because of online file sharing.

Talks are due to start tomorrow on a new three-year contract, says Associated Press here.

But, “Producers counter that they can’t afford to pay writers more because the cost of making movies and TV shows has increased as changing economics and viewing habits make it tougher for studios to recoup their investments.

The WGA contract covers 11,000 writers and is set to expire on May 2, says AP, going on that the last strike by the union came in 1988 and delayed the start of the fall TV season.

“The upcoming talks are shaping up as a sequel of sorts, with many of the same economic issues on the table that dominated the last round of talks in 2001,” it says.

“Those negotiations were settled when writers dropped demands for an increase in home video payments and won a share of video-on-demand revenue. At that time, DVD sales were only beginning to become a major revenue source for studios. By 2003, however, sales of DVDs had soared to $16 billion, with TV shows accounting for $1.5 billion, according to industry figures.”

Writers now get only about $1 for every $300 in studio profits, the WGA said, based on a formula used since 1985 – “the beginning of the VHS boom”.

Studios will argue that writers are already well-compensated, receiving an average payment of $654,000 per movie from films released between 1996 and 2000, says AP, adding:

“Movie costs have also skyrocketed, with the average film costing $102.9 million to make and market in 2003, according to the Motion Picture Association of America. That’s compared to an average cost of $82.1 million in 2000.

“Studios must now gross at least $120 million per film to recoup all their costs, which means that six of 10 movies never break even, industry sources said. That compares to four of 10 just a few years ago.:

Awwww

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