Future of New Media

The writer’s strike might end by Sunday. A bright future of new media ahead. Apparently, the new tentative agreement assures writers that it “protects a future in which the Internet becomes the primary means of both content creation and delivery.” That’s a major victory for new media stake holders. The end of the strike will also bring relief to thousands of workers and support businesses idled by the strike.

In the new contract the heads under which new media / internet content is being recognized and paid for are as follows:

  • Creators of original new media material
  • Internet Residuals
  • The Writing for Made-for New Media
  • Reuse in New Media
  • Download Rentals
  • Download Sales (Electronic Sell-Through)

And many more. Source: Hollywood Today

For those of you who don’t know which strike I am talking about read the following post I originally wrote for another blog on 19 Dec 2008

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The Writer’s Guild of America is on strike. Hollywood is in trouble. The strike is against AMPTP, a trade organisation that represents the interests of American film and television producers. Over 12,000 members of WGA are on strike. The writers wouldn’t write any new script or screenplay, won’t modify the existing ones, its an absolute pen down.

Now this news is extremely significant for new media / web2.0 stake holders. Why?

Because, of the many conflicting issues, one pertinent issue is the compensation for ‘new media’ content written for (and/or distributed through) emerging digital technology. AMPTP is not ready to give the writers any percentage on new media content namely, through delivery channels such as Internet downloads, IPTV, streaming, smart phone programming, straight-to-Internet content, and other “on-demand” online distribution methods, along with video on demand on cable and satellite television.

A lot of speculations over the bright future of new media have already been taking rounds over the past couple of years. The buzz is huge, money is enormous, possibilities are endless, User is the King, open source is justice. But I think the writer’s strike, by far, is an issue with the greatest implications ever on future of new media. Questions both AMPTP and WGA pondering upon being “what is the future of new media, how far is it going to go, what revenue it might yield in next 3 years.”

AMPTP contends ‘there is no money in new media’. Is it? I thought there is just no end to money in new media.

Nora Cletter writes,

As it stands on television, WGA members get 2.5 percent of a film or television series gross revenue. That means for every buck networks make in ad revenues on television, writers get 2.5 cents. Networks also collect ad revenues for episodes they air online. Of that revenue writers see exactly zero, zilch, nada. The AMPTP insists that they shouldn’t have to pay writers because the online episodes serve as “promotional material.” They also insist that there isn’t enough money in new media to pay writers what they make on television, and they’re right, there isn’t … yet.

However, in the not too distant future, television and the Internet will merge and new media will become the dominant media. Where media conglomerates stand will make billions off this merger, writers will lose their shirts. Without a percentage deal in place that guarantees writers will continue to receive their 2.5 percent of revenue, the AMPTP will have no obligation to pay writers any residuals.

The only formula for new media that makes sense is one based on revenues where if they make money, we make money — that’s what we’re proposing. If, as they claim, there really is no money in new media, we can do the math; 2.5 percent of zero is zero. So why can’t we just take $250 per episode now and renegotiate when this fateful merger occurs, so you can get back to watching “The Office”? Because the AMPTP doesn’t play nice.

While Googling more about this issue I came across an article by Froma Harrop where he / she has highly criticized the business intentions of the founders of Huffington Post, a popular liberal blog written by Hollywood fellas. The article exposes how few people are making money out of the blog which is being written by 100 others who are not being paid for the content.

This is an issue about which I too have pondered some time or the other. The question is when a blogger creates a content who should have the right to make money out of that content, the blogger or the platform where he blogged. Where a blog is a collaborative blog who all would get copyright over the content, how will you decide the share?

Throwing more light upon the strike and new media connection is this series of interesting debate published last week, under the opinion section on L.A. Times weekly “dust up” feature, between writer-producer Craig Mazin (representing WAG) and web entrepreneur Matt Edelman (representing AMPTP). On Thursday they debated upon questions like, “What will new media look like in five years? Will writers and producers have to negotiate every time technology changes?”

Matt says,

We’re barely five minutes into the digital media marketplace movie. So much will change in the next three years. Every supposition being made by the studios and the writers about where their revenue will be generated will be challenged, and most will yield as many surprises as classic films such as “The Sting” (or, for TV fans, like the good seasons of “24″).

Technology is advancing at a staggering rate. High-definition video soon will be more efficiently delivered via broadband than any other distribution platform…

The question really should be, how far into the future will this vision become a reality? Three years? Five years? Ten years?

So why all the fuss right now?

…they (writers) are fighting over relative peanuts compared with what will come out of even a slightly better DVD deal. Home video, as increasingly represented by video-on-demand and other subscription services in addition to rentals, will remain a much more lucrative business for the studios (and therefore the writers) than the Internet in the near term.

To which Craig replies,

Getting a fair rate on Internet distribution isn’t about avenging the bad home video deal. It’s about not repeating it. You suggest that attempting to figure out the future of the Internet is akin to palmistry.

It’s not. Here’s how this works.

From now until the end of time, any work distributed over the platform known as “the Internet” (defined as the worldwide, publicly accessible series of interconnected computer networks that transmit data by packet switching using the standard Internet protocol) should be subject to a fair and decent residual rate for the artists who make those works possible.

I don’t need to concern myself with your idea of ratios of Internet revenue to total revenue, because I have this nifty bit of advanced mathematical technology called “the percentage.” If you make very little money, so will I. If you make a lot of money, so will I.

Simple as that.

In another debate, Matt said,

“The future of new media is that it will be mainstream media….Between now and the time of the tipping point that represents the arrival of that future, the economics of the entertainment business will remain in dramatic flux.”

That, I think is the whole crux. We don’t know what the future of new media holds for us. A friend, the other day said, new media wouldn’t be there in the future at all. I don’t understand economics. But I would be interested hear from some one who does.

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