Directors Guild of America negotiates higher streaming video residuals under new contract
As consumers continue to flock to on-demand streaming video services like Netflix and Amazon Prime, the Directors Guild of America has approved a new contract that will allow its more than 16,000 members to take a bigger slice of a growing pie by boosting residuals while also increasing wages.
Members of the DGA still have to ratify the three-year contract, which the guild’s national board voted unanimously to approve Thursday.
If ratified, the new contract with the Alliance of Motion Picture and Television Producers will take effect July 1 and run through June 30, 2020. The guild’s current three-year contract went into effect in 2014.
The new agreement will augment the residuals that directors receive from shows that meet a certain production cost threshold on streaming services such as Amazon Prime, Netflix and Hulu. While the guild didn’t release details of the new structure, it said the deal more than triples residuals for members working on original content for the biggest streaming companies.
If three years of reuse of original content would yield less than $15,000 in residuals for a DGA member under the current contract, the amount would more than triple to $50,000 under the new contract, according to the guild.
The new contract also increases residuals for feature-length streaming movies and establishes for the first time residuals for DGA members whose content streams overseas. Both Amazon Prime and Netflix have been aggressively expanding their presence overseas in recent months in a bid to stoke subscriber growth.
The increases in residuals will be paid by the streaming services themselves and the production companies behind the TV series or features.
The DGA said the new contract will boost wages, with an increase of 2.5% in the first year of the agreement and 3% in the second and third years of the agreement. The deal also will increase employer contributions to the guild’s pension plan.
Negotiations for the new contract began Dec. 5 and were led by directors Michael Apted and Thomas Schlamme, and by the guild’s chief negotiator, Jay Roth.
The DGA declined interview requests, but Apted said in a statement that the residual increase “goes a long way toward addressing how people make and consume television content these days.”
DGA President Paris Barclay said in a statement that the deal is the “result of more than a year of research and preparation, and weeks of tough negotiations.”
Inside the business of entertainment
The Wide Shot brings you news, analysis and insights on everything from streaming wars to production — and what it all means for the future.
You may occasionally receive promotional content from the Los Angeles Times.