SAG-AFTRA strike: Negotiations fail over AI, streaming revenue sharing, pay rises and more

Fran Drescher and Duncan Crabtree-Ireland at the SAG-AFTRA Press Conference at SAG-AFTRA Plaza on July 13, 2023 in Los Angeles, California.

Michael Buckner for Variety

SAG-AFTRA and the big studios remain at odds over a dizzying array of issues as film and TV actors picketed Friday for the first time since 1980.

According to sources on both sides, the biggest sticking point is the union’s demand for 2% of revenue generated from streaming shows. The two sides are also far apart when it comes to the basic increase in the minimum rates: the studios are offering 5%, 4% and 3.5% over the three contract years, while the union is asking for 11%, 4% and 4%.

But that only scratches the surface. The parties are at odds on dozens of issues, only a handful of which have been publicly reported.

In some cases, the two sides don’t even agree on the disagreements. They engaged in a rare public row Thursday over using artificial intelligence to recreate background actors.

Duncan Crabtree-Ireland, the union’s chief executive, claimed the studios want to pay a premium to scan a day’s work and then reuse that image forever. The Alliance of Motion Picture and Television Producers strongly disagreed, saying their proposal specifically limits reuse to the project the extra was hired for.

Here’s a breakdown of the major and minor disagreements that led to the strike.

SAG-AFTRA wants 2% of the revenue each show generates for a streaming platform to be paid out to the performers. The union would use Content Valuation, a measurement tool launched by Parrot Analytics last fall, to determine how much each show is worth to the platform.

Parrot Analytics uses Google searches, social media mentions and other data sources to measure the demand for each show. This metric does not attempt to measure viewership, but rather the impact each show has on a company’s revenue. Quarterly revenue data is used to estimate this, and revenue – including subscriptions and ads – is split across each show on the platform.

SAG-AFTRA — led by union leader Fran Drescher — argues that it’s important to pay artists for a show’s success. The union states that it is not affiliated with Parrot Analytics, but that the studios have not offered any other method of measuring performance in return. The studios said they stated early and often that the entire concept was unworkable given the challenges of accurately measuring success.

According to Crabtree-Ireland, Drescher was the “inspiration” behind the proposal. As she broached the subject in the room, she told AMPTP negotiators that her father, Morty, was a systems analyst and that she “sees systems.” She also made it clear that this contract issue was her top priority.

The AMPTP has offered SAG-AFTRA the same commercial terms approved by the Directors Guild of America. This includes a 5% increase in most minimum tariffs in the first contract year, followed by increases of 4% and 3.5%. SAG-AFTRA argues that this is not keeping pace with inflation and calls for 11%, 4% and 4%.

The AMPTP also offered additional raises for specific categories of performers: 11% for background actors and 58% for guest stars on streaming shows. (On the latter point, SAG-AFTRA accepted the increase.)

SAG-AFTRA is also targeting a 230% increase in overseas streaming residuals, according to a studio source. The AMPTP offers the same increase as the DGA: 76%.

SAG-AFTRA does not want to ban AI, but wants to ensure that any use of an artist’s likeness to generate a new performance is done with compensation and consent. AMPTP says it agreed, but Crabtree-Ireland said the devil is in the details.

“It’s a very cleverly put together proposal that a layperson looking at it might not see all the holes in it,” he said. “There are huge gaps you can drive a Mack truck through.”

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The union wants to require an artist to agree to their performance being used to train an AI system. The AMPTP would accept this for AI training intended to alter or restore the actor’s image. But according to Crabtree-Ireland, the AMPTP would give studios carte blanche to train AI systems to create “synthetic” performers or for other purposes.

SAG-AFTRA also wants studios to seek union approval for individual AI applications, which the studios have refused. Added to this is the argument about background actors.

SAG-AFTRA wants to limit the use of self-taped auditions, which have become the industry standard in the wake of the pandemic. The union would like to limit such auditions to a maximum of five pages of material. The AMPTP offers a limit of eight pages. The two sides are also working on turnaround time conditions and a provision that would clarify that no special lighting or equipment is required.

  • pension and health insurance contributions

Up to a certain limit, the producers pay contributions to the pension and health insurance schemes, which are based on the artist’s income. For a half-hour episode, the cap is $15,000; for an hour it’s $24,500. SAG-AFTRA wants to increase these caps to $45,000 and $75,000 respectively to account for 40 years of inflation. The AMPTP has agreed to increase the caps to $20,000 and $30,000.

Actors Access is a website that has a virtual monopoly on publishing casting announcements. Actors can sign up, post their biographies and audition materials, and network with Jobs. The site has both a free and premium tier and there is a charge for uploading roles. SAG-AFTRA argues that those who pay for the premium tier get preferential treatment. The union would dictate that actors seeking work under the contract do not have to pay to access jobs.

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Gary Marsh, who runs the company, said actors don’t have to pay to upload casting materials. He said he didn’t know how his company was involved in the negotiations. The AMPTP has argued that it cannot agree to a provision addressed to a third party not involved in the negotiations.

  • Option periods for TV actors

In the streaming age, actors have had to wait longer and longer to know if their show has been renewed. This is one of the main reasons why the shift to streaming has impacted actors’ salaries. SAG-AFTRA struck a deal with Netflix last year that limits option periods to 18 months from the start of a season’s production. The union wants to make the same arrangements with the rest of the companies represented by the AMPTP. The studio group said it has agreed to do this for actors making less than $65,000 per episode for half-hour shows and less than $70,000 per episode for hour-long shows.

  • Background actors outside of Los Angeles and New York

The SAG-AFTRA deal only covers background actors in a few locations across the country — primarily in New York and Los Angeles. The union would like to represent extras across the United States. The AMPTP argued that it could not use the treaty negotiations to extend its jurisdiction and that this was a non-compulsory item for negotiation. SAG-AFTRA withdrew the proposal.

SAG-AFTRA also argues that its contract should also cover performance capture acting. Performance tracking is not explicitly covered, although much of this work is done under contract terms anyway. As with the issue of background actors, the AMPTP has stated that the union is improperly using the negotiations to extend its jurisdiction.

(Pictured: SAG-AFTRA President Fran Drescher)