The Directors Guild of America and the major studios agreed Friday to begin formal negotiations on a new contract today, embarking on high-stakes talks that could determine when Hollywood gets back to work.
People familiar with the talks said a deal could be reached within days, in contrast to the standoff between the studios and writers that has resulted in a two-month strike. The dispute is over how much writers should receive when their work is distributed online.
Although the directors' contract doesn't expire until June 30, they have long been laying the groundwork for negotiations. In the last month, they have held informal talks with the Alliance of Motion Picture and Television Producers to establish economic parameters for a deal. Those discussions escalated over the last 10 days, when DGA leaders met with News Corp. President Peter Chernin and Walt Disney Co. Chairman Bob Iger to narrow the terms on new media.
In a letter sent to DGA members Friday, President Michael Apted said: "We would not enter negotiations with the AMPTP unless we were within shouting distance of an agreement on our two most important issues: jurisdiction for our members to work in new media and appropriate compensation for the reuse of our work on the Internet and other new media platforms."
The directors said their broader goal was to help end the strike that has taken a toll on their 13,400 members.
"I am very mindful of how many members are unemployed and believe that our reaching a deal will bring the industry closer to getting back to work," Apted also said in his letter.
Hollywood has a history of "pattern bargaining," in which the first contract settled by one talent union tends to become the template for the other guilds.
Consequently, writers might be pressured to accept a deal reached by directors, potentially undercutting their own goals -- and those of actors. The Screen Actors Guild, whose contract expires in June, has supported the striking writers.
There is no guarantee, however, that writers or actors would adopt the directors' deal.
On Friday, WGA and SAG stressed that point in a joint statement: "We wish the DGA well and hope that they achieve a fair deal that incorporates principles that will benefit all creative artists. The DGA has to do what is best for its membership, but it is important to remember that they do not represent actors and writers."
Meanwhile, Thomas C. Short, president of the International Alliance of Theatrical Stage Employees, which represents more than 50,000 workers, said in a statement: "The industry is in trouble and tens of thousands of people are out of work. I hope that the DGA and the AMPTP can reach an agreement that puts us all on the road to getting back to work."
The strike has shut down the TV industry and thrown thousands of people out of work.
On Friday, Disney terminated the development deals of more than a dozen television writers at its ABC Studios, a move likely to be followed by other media giants, such as News Corp.'s 20th Century Fox and Time Warner's Warner Bros.
These are the first terminations of what are known in the industry as "overall" deals, agreements under which studios pay the overhead costs for writers and their staffs in hopes that they develop hit movies and TV shows. Among the casualties at ABC are longtime sitcom writer Larry Charles ("Curb Your Enthusiasm"), Bill Callahan, ("Scrubs") and Sean Bailey ("Gone Baby Gone").
Most of the major studios suspended overall deals with writers shortly after the strike began. Provisions in these contracts enable the studios to suspend and then terminate these deals in the event of a crisis such as a strike.
"The ongoing strike has had a significant detrimental impact on development and production, so we are forced to make the difficult decision to release a number of talented, respected individuals from their development deals," ABC stated. For their part, writers have viewed the directors' talks with a mixture of fear and hope.
In recent weeks, several leading TV writers have been quietly lobbying directors to stress their mutual concerns, such as payment for work on the Web, and to make it clear they won't accept a deal that mirrors what the studios have already offered.
Writers are especially concerned that directors might undermine what they view as a fair cut of revenue from movies and TV shows distributed on the Internet, cellphones, digital video players and other devices.
The fear reflects long-standing tensions between the unions. Many writers still blame directors for negotiating a much-maligned formula for home video residuals more than two decades ago that became the standard for all talent unions. Writers felt shortchanged by the rate, which pays them about 4 cents for every DVD sold.
Times staff writer Joseph Menn contributed to this report.