DGA Deal Provides Pay Hikes, But Streaming Residual Still Not Tied to Show’s Success

The Directors Guild of America announced a tentative deal with the studios on Saturday night, providing pay hikes and an improved residual for international streaming. But a summary provided by the DGA makes no mention of pegging the streaming residual to viewership. That indicates that residuals will be continue to be the same on streaming platforms — whether a show is a hit or a flop.

The DGA residual term is an especially significant provision, because it tends to be applied to the other guilds in “pattern” bargaining. According to the DGA summary, the deal will provide a 76% increase in foreign residuals for the largest platforms.

Both the Writers Guild of America and SAG-AFTRA have been interested in getting a residual based on views. But the streamers have adamantly refused to turn over the data that would be required to make that work.

The WGA and SAG-AFTRA have both indicated they will not be limited by the terms reached by the DGA. SAG-AFTRA begins its bargaining on Wednesday, and its contract is due to expire on June 30. The WGA has been on strike since May 2′ there are currently no plans to restart talks with the Alliance of Motion Picture and Television Producers.

Another significant term in the DGA deal is the increases in minimums. The DGA won a 5% increase in the first year, followed by increases of 4% and 3.5%. Those numbers represent the exact midpoint between the positions taken by the WGA and the studios when talks broke down on May 1. Those increases, which are higher than normal due to inflation, could also form a pattern that is applied to other guilds.

According to the DGA summary, the guild also obtained language on artificial intelligence, making clear that “AI is not a person and that generative AI cannot replace the duties performed by members.” The summary makes no mention of a prohibition on AI training, which has been a proposal offered by the other two guilds.

The provision stating that “AI is not a person” appears to mirror language that was offered to the WGA. The WGA contract already specifies that a writer cannot be an “impersonal purveyor” of literary material, and the AMPTP offered an AI side letter that would have underscored that.

The WGA has also sought language requiring that if a screenwriter uses AI, that will not reduce the writer’s credit and compensation.

Further details of the DGA deal are expected to be released after the terms are presented to the DGA board on Tuesday.

The WGA has yet to respond to the DGA deal. The Writers Guild has issued several statements over the last few days, however, that anticipated the possibility that the directors would reach an agreement.

The guild has called on the Alliance of Motion Picture and Television Producers to reach a “fair contract” with the DGA. But it has also made clear that the DGA is pursuing “unique priorities” and that the AMPTP cannot expect a repeat of the 2008 writers strike, when the DGA agreement formed the template for a WGA deal that ended the work stoppage.

“Any deal that puts this town back to work runs straight through the WGA and there is no way around us,” said Chris Keyser, the co-chair of the WGA negotiating committee, on Friday. “We are strong enough — we have always been strong enough — to get the deal we need with writer power alone.”

The WGA is pursuing a minimum staffing level for TV writers rooms, as well as provisions guaranteeing a minimum number of weeks of employment and ensuring that TV writers are employed throughout production. The AMPTP has balked at what it calls a “hiring quota,” saying that it is not creatively necessary.

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