December 29, 2005

Hollywood unions get no reply on branding demands

By Gail Schiller

LOS ANGELES (Hollywood Reporter) - More than six weeks
after Hollywood unions sought a code of conduct governing
product placement and a financial stake in such deals for
writers and actors, their demands have largely fallen on deaf
ears, written off as a publicity stunt or negotiating tactic.

Network and studio insiders say writers and actors should
have no rights to product integration revenue, and believe the
Writers Guild of America (WGA) is using its salvo against
branded entertainment to gain leverage in its battle -- so far
a losing one -- to represent reality TV writers.

The five major networks and the Alliance of Motion Picture
and Television Producers, which represents the industry in
contract talks, all declined official comment.

Network, studio and WGA sources say there has been no
discussion of product integration since the WGA and Screen
Actors Guild held a November 14 news conference to publish a
white paper that demanded not only a creative and financial
role for their members, but also full disclosure of product
integration deals at the beginning of each TV show. The WGA
also threatened to file a complaint with the Federal
Communications Commission if the companies did not open
negotiations on the issue.

"Since they threw that initial stink bomb, they have not
reached out to anybody to start any formal conversations," one
network insider said. "There was a big stunt designed to get
attention, but there haven't been any efforts to reach out and
start a dialogue."

WGA West president Patric Verrone said the unions
"unequivocally asked the companies for discussions on product
integration in every newspaper, radio and television station"
that covered their news conference. "Is an engraved invitation
necessary?" he asked. The WGA also said it soon would send out
a letter signed by other unions asking for formal talks on the

But even if networks and studios agree to sit down with the
guilds to discuss product integration, it appears highly
unlikely they will give in to their demands for a code of
conduct or a share of the revenue. "They're paid a huge wage,
and how the network or producer makes the money to pay them is
none of their business," said a high-placed studio insider who
declined to be named. "They're not getting paid by the word or
the kind of word they write. It's part of their job to be

Further dissuading networks and studios from taking the WGA
demands seriously is their perception that the guild is not
truly interested in product integration but rather is using it
as a negotiating tactic to win concessions in its campaign to
represent reality writers as well as on other issues it
considers more critical, such as residuals from DVDs and the
repurposing of content for off-air platforms.

"It's a negotiating tactic to get what they really want --
representing reality TV writers," said Jim Johnston, partner at
the law firm of Davis & Gilbert Llp. "The FCC threat seems to
have little if anything to do with their real goals and seems
to be a repositioning in order to get some traction on an issue
they haven't made any significant headway with so far."

Michael Davies, executive producer of such shows as "Who
Wants to be a Millionaire," "Wife Swap" and "Iconoclasts," said
the white paper seemed to be more about "throwing firebombs at
reality television" than wanting to be part of the conversation
about brand integration. "I'm not convinced how genuinely felt
any of this is."

Several industry insiders said they didn't expect product
integration to come up at all until new contract negotiations
get under way -- probably sometime in 2007, when the current
WGA contract expires. "I would say certainly at this point ...
there's nothing the producers and networks are going to do,"
Johnston said.

But Verrone warned in a statement Wednesday, "If this
matter isn't resolved in a timely fashion, further action with
the FCC is assured."

However, even the threat of FCC intervention doesn't seem
to be having much impact. Networks, studios and producers say
they don't expect much action from the agency under a
Republican administration more concerned with indecency than
interfering with free-market issues. They believe the current
disclosure of product integration during a show's end credits
satisfies FCC regulations and say that because the FCC already
is investigating product integration because of a complaint
filed in 2003 by the consumer watchdog group Commercial Alert,
they don't expect that an additional complaint from the WGA
will change much.

"The FCC is already involved, and if it (product
integration) was something they were really concerned about,
I'm sure we would have heard about it by now," said Alan
Brunswick, labor attorney and partner at the law firm Manatt,
Phelps & Phillips Llp. "They apparently have bigger fish to

Reuters/Hollywood Reporter