Disney Limits New-Show Pay

Walt Disney Studios, seeking to limit spiraling production costs, is informing Hollywood talent agents that it will not pay more than $25,000 an episode for lead performers in new TV shows next season.

The action--which represents a rollback of more than one-third from what stars have gotten for new shows--is the latest example of how the cost-conscious Hollywood studio is coming to grips with the deteriorating economics of prime-time TV programming.

In recent years, the cost of producing TV shows has shot up, while the license fees networks pay to air those shows has fallen, and rerun proceeds have shrunk.

“It’s not an edict, but I won’t pay it,” Walt Disney Studios Chairman Richard Frank said.

Hollywood talent agents began getting the word from Disney this week as they began to pitch clients for upcoming roles in new Disney-produced series.

“They said if an actor balked at their ceiling then, fine, they’ll get someone else,” one incredulous agent said. “It’s pretty amazing.”

The policy does not apply to performers on returning series. Indeed, stars on established hits such as “Golden Girls” can earn more than $75,000 an episode because of salary escalator clauses in their contracts. In recent years, big-name stars have commanded starting fees of $40,000 an episode for new shows.

A full order on a TV series totals 22 episodes, meaning that lead performers in Disney shows can still earn $550,000 a season. “For somebody not known and out of work, that’s still a lot of money,” Frank said.