The Writers Guild of America (WGA) and Screen Actors Guild‐American Federation of Television and Radio Artists (SAG-AFTRA) have successfully negotiated a new residuals model for streaming shows, marking a significant shift in how creatives are compensated in the streaming era. This new model, part of their three-year agreements, introduces success-based bonuses for series on major streaming platforms like Netflix, Amazon, Apple, Disney+, HBO Max, Peacock, and Paramount+.
Key Takeaways:
- WGA and SAG-AFTRA have secured success-based bonuses for streaming series.
- The new model applies to major streaming platforms including Netflix, Amazon, Apple, Disney+, HBO Max, Peacock, and Paramount+.
- Shows like “Stranger Things,” “Wednesday,” and “Bridgerton” are expected to benefit from the new system.
- The bonus structure triggers additional payments for titles meeting specific viewership thresholds.
- The model defines “views” as hours viewed divided by the runtime of a project.
- For the WGA, credited writers receive an additional 50% of their fixed domestic and foreign residual if the show meets the criteria.
- For SAG-AFTRA, surpassing the viewership threshold triggers a payment to each principal performer equivalent to 100% of the fixed residual.
- The new bonus structure is estimated to yield approximately $40 million per year.
- The model raises questions about data transparency and the calculation of subscriber counts for bundled services like Amazon Prime.
Understanding the New Model
The Bonus Structure
The new model is designed to reward the success of streaming titles based on viewership. To be eligible for the bonus, a title must receive enough domestic “views” in its first 90 days to be equivalent to 20% of the streaming service’s domestic subscribers. This calculation is based on the hours viewed divided by the runtime of a project, rather than the true number of unique accounts that interact with the title.
Impact on Creatives
For the WGA, the credited writer for each episode will receive an additional 50% of their fixed domestic and foreign residual if the show meets the above criteria. For SAG-AFTRA, any title that surpasses the viewership threshold will trigger a payment to each principal performer equivalent to 100% of the fixed residual. However, performers will only receive 75% of that payment, with the remaining 25% being funneled into a fund controlled by both SAG-AFTRA and AMPTP trustees.
Challenges and Considerations
The new model, while a step forward, is not without its challenges. Determining the exact viewership for streaming titles is difficult due to the lack of extensive viewership data from streaming services. Additionally, the calculation of subscriber counts for bundled services like Amazon Prime poses its own set of challenges.
Future Prospects
The new streaming residuals model is seen as just the beginning of a larger compensation model for creatives in the streaming era. It opens the door for future negotiations aimed at lowering barriers to bonuses and increasing data transparency.
Conclusion
The introduction of the new streaming residuals model by WGA and SAG-AFTRA represents a significant development in the compensation of creatives in the streaming industry. While it addresses some of the challenges faced by writers and actors in the streaming era, it also highlights the need for greater transparency and more equitable compensation models as the industry continues to evolve.
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