Saturday, July 28, 2007

Monkey Points

When Frank Capra was asked what made his films so appealing, he described his famous "Capra Touch", highlighting his choice of lighting, his great actors, and all manner of things... everything, in short, except the script. The next day, Capra received a script in the mail from a writer he'd recently worked with. Capra eagerly opened the script to find all 120 pages were totally blank. On the front page, the writer had scrawled: "Put the Capra Touch on this!"—Richard Walter, Screenwriting: The Art, Craft, and Business of Writing for Film and Television

Today I learned a new filmmaking term: "monkey points". This is odd because, having worked in low budget filmmaking for so long, you'd think I'd have heard about it sooner. I read it in the opening speech by John Bowman at the WGA's salary negotiations:
What other business but ours has the accounting term, "monkey points?"

What the hell?, I asked myself.

And here's what Wikipedia said:
In the motion picture industry, the term monkey points refers to the practice of many low budget production companies offering talent, such as actor or writer, a percentage of a film's profits, as opposed to a percentage of the film's gross, or a fixed salary. In this case, 'monkey' is intended to be derogatory. This term was coined by Eddie Murphy, who also stated that only a fool would accept net points in their contracts; always insist on gross points. Since such projects usually never make any money—at least on paper—the talent who accepts a percentage of the project's profits usually never makes any money. This is due to the infamous Hollywood accounting, where a studio manages to list every conceivable expense associated with running a studio as an expense of the film in question—eating up any gross profits. Writers and other lesser persons often get stuck with monkey points. Being a gross player, someone with enough clout to be given gross points, is not common in Hollywood.

I've been offered, and have taken, net points on films, and they rarely pay (although that's mainly because the films didn't make money, not because of the Hollywood accounting system). Usually, net points are used to convince you that the car you're driving is actually a beautiful painting, even though all evidence points to the contrary.

The fact that this term even exists is a sign for how creative financing can often be to get films made... and how foolish people are to accept this kind of lottery ticket salary. Writers are often stiffed in this process, especially when it concerns residuals. For example, of all secondary markets like broadcasting movies on TV, pay-per-view, and home video, the residual formulas dictate that writers are supposed to collect 1.2% of what the companies make, which the companies didn't want to pay, so in 1985, the companies decided to apply that 1.2% formula to only 20% of what they made. After two strikes by the WGA, the policy currently rests at the much-hated 1.5%–1.8% of 20% of what companies make on VHS and DVD.

So let's ask ourselves: if a screenplay is well written and the movie does well, doesn't the writer deserve a fair amount of that movie's residuals? Sure, producers and investors and actors all deserve a slice of the residuals pie as well, but without good writing, what is there to produce? What is there to invest in? What is there to act?

Nowhere was this salary divide clearer than when the new Battlestar Galactica produced webisodes to bridge the story from season 2 to season 3 and build buzz for its season 3 premiere:
The Webisodes themselves have caused a conflict between NBC and those involved in their development, relating to the royalties that the developers should receive. NBC Universal, the major studio behind the reimagined series, refused to pay or credit the webisode writers on the grounds that the webisodes were promotional materials. In response, Ronald D. Moore said he would no longer release any webisodes. NBC Universal then took control of the webisodes and filed an unfair labor practices suit against the Writers Guild of America. The Guild told Moore and other NBC Universal television show producers to halt production of any further webisodes until a deal over residuals had been reached.

Every three years, the Writer's Guild of America (WGA), and the Alliance of Motion Picture and Television Producers (AMPTP), meet to hammer out how much professional writers get paid, and for what kind of work (treatments, rewrites, polishes, etc.). The finished document is called a Schedule of Minimums, as in minimum payments writers are to receive. With the rising popularity of streaming media, the issue of residuals is again a key negotiating point because nobody knows how the revenue stream for online digital entertainment will play out.

This opening speech by John Bowman on behalf of the WGA's Negotiating Committee perfectly articulates the issues writers face in modern-day Hollywood (my highlights are in boldface):
There is a real disconnect between what the [production] companies are reporting to Wall Street and what they’re saying to the talent community. Investors are hearing about the changing landscape in entertainment and exciting new markets to exploit. In contrast, the AMPTP communicates nothing but problems to the Writers Guild. Problems like—and this was mentioned by AMPTP at a recent press conference—ad skipping, even though NBC Universal had just announced a one billion dollar DVR deal. And while WGA member revenues have not kept pace with industry growth—we are a line item that is definitely under control—the companies balk at giving us a fair and reasonable share of the industry’s success.

I don’t think anyone in this room is arguing about the right of writers, actors, and directors to residuals. As collective authors of a work, we are entitled to a portion of the revenue generated by that work. But you have publicly stated that you no longer want to pay us residuals on shows that are not in profit. Here’s why that is untenable: Writers are a cost of doing business. They have no say in production, marketing, on advertising and publicity, directors, casting, the decision to spend tens of millions of dollars advertising, etc. They can’t be expected to be paid from profits when they have no say in the costs which affect those profits. Profits are under the control of CEOs and their executive staffs.

Intellectual property has rights, just as physical property does. Management has no problem paying the person who made the DVD box before a film turns a profit; they shouldn’t have any problem paying the artists who created the intellectual experience that came in that box either. To claim that intellectual property has lesser rights than physical property is a dangerous argument for anyone in our business to make. You are making the same argument to us that digital pirates make to you.

According to Hollywood accounting, The Simpsons is not in profits. How can we trust that kind of bookkeeping? What other business but ours has the accounting term, “monkey points?”

Residuals from shows not in “profit help” support a writing middle class, and keep writers in the business until they finally create that one great thing. Do away with residuals, and you do away with late-blooming careers like Marc Cherry and David Chase - they couldn’t afford to stay in the business. Your proposal transfers money from developing, promising writers, actors, and directors who need them the most to established pros who need them the least. It’s bad for the business.

This article has been a summary of two excellent pieces from The Artful Writer:
John Bowman - First Shot Fired

The Average Writer's Non-Biased Guide To The Upcoming WGA Negotiations

No comments: