Honest Partisan has a brief post on the writers' strike, and the money at stake.
I haven't commented on the writers' strike yet, but it seems like they're getting a raw deal. My understanding is that the studios are trying to deny writers revenues from online showings of their products, arguing that such online showings are merely "promotional." Funny, I bet the studios don't have so much equanimity about online content when it comes to piracy of it.
Of course, there is a clear and obvious difference between piracy and promotion. It's the difference between an intellectual property owner showcasing said a property in a medium like YouTube, and a random person doing it.
But on to the topic at hand. Online showings are obviously promotional in nature. To the extent they earn less than broadcasts, the foregone revenue is promotional. AOL probably pays a token amount, and revenue from hosting on the network's own site? Banner ads?
(Comic from Kevin and Kell)
Plus, it is the network who foots the expenses involved in coordinating the showing of online streams.
There's also the reality that the more revenue one expects, the more you want to charge for your intellectual property. If a series is struggling, you're more willing to accept promotion. If you don't know if the series will succeed or fail, you'll accept one price, but if it's a successful series, suddenly you want a lot mroe. Look at the problems in releasing DVDs of WKRP in Cincinnati with all its music intact.
There's a reason why the back side of a badge to attend GenCon or the like has legalese as follows:
In accepting this badge and in consideration for being admitted to the Event, the holder consents to being recorded (by audio and/or visual means) for exhibition and exploitation by any means in all media, including without limitation the Internet, worldwide in perpetuity. Holder also hereby: (1) releases Gen Con LLC from any liability for loss or damage to persons or property, infringement of any right, or any other claim or course of action of any kind; (2) authorizes and permits Gen Con LLC and its designees which include but is not limited to all sponsors, exhibitors and contractors to use and authorize the use of his/her name, voice, likeness, and all reproductions thereof by any means and in all media, now and hereafter known, including without limitation the Internet, for all purposes worldwide in perpetuity; and (3) agrees to comply with all the rules and regulations of the Event.
I suggest the entertainment industry could use a standard model. The total revenue stream can be divided up in percentages between the intellectual property owners (for a TV series, writers, actors, licensed music intellectual property owners, etc.) and the financial risktakers (the networks). It would be X% until fixed costs are met, then Y>X% afterwards. Each time a new revenue stream arises, the same calculations can done.
I think people would be shocked as to what the proper share for the networks would be under this model. Either their share, or the fixed cost duration, would be rather large, to account for the many failures. NBC made a lot from St. Elsewhere, but rather less from Manimal.
Of course, my proposal is a pipe dream until entertainment accounting is seriously reformed. Only government accounting is more screwed up. Sarbanes-Oxley clearly targeted the wrong industry.