VIP+ Analysis: Why compensation for shows like “Suits” on streaming will hang over the WGA's next contract battle.
it’s a new formula, based on subscriber totals and viewership, and designed to allow actors to share in the success of all SAG-AFTRA-covered work on SVOD platforms.
In a certain sense, this is the way the business has always worked. The new viewership-dependent residual bonus for streaming shows is the first of its kind, as TV residuals have never previously been tied to ratings. It seems logical, then, that streaming would follow a similar percentage-based model derived from license fees. But looked at another way, streaming is a unique economic model that requires its own unique form of compensation.
“Broadcast is diminishing, year after year after year, and even if you do a broadcast show, your residual is going to be greatly cut,” Bryan Cranston of “Breaking Bad” fame. “When we first started coming up in this business, a long time ago, we relied on residuals to be able to pay our bills. I mean, part of the equation of working was residuals, international residuals, DVD sales and things like that. But those are gone.
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