Letter from an LA Talent Agent.

by Kenji Maeda on April 19, 2009

Below is a letter written by a Talent Agent in Los Angeles to their clients (about the scene down in LA).  I’ve been forwarded this message a few times now through friends in the industry, so you may have already read it.  Even some agents here in Vancouver have chosen forwarded it to their actors.

You might feel that the letter is disheartening but most people in the industry I’ve talked to are optimistic about our future growth.

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Dear Clients,

I wanted to take a moment and give you a number of important updates….Before I begin, however, I wish to tell you all that I am so very proud of you all for your dogged determination during these most difficult times. Hollywood is being challenged on multiple fronts labor uncertainty, paradigm shifting and the ‘great recession’.

I know a lot of your are getting antsy to get out more, and frankly many of you are in a tight financial pinch; as such, I wanted to describe to you all the current climate in LA and the factors influencing the current environment.

1. SAG STALEMATE:

Since the SAG contract expired on June 30, 2008, there have been few to no STUDIO feature films (this does not include companies such as Lionsgate and the Weinstein Company who are not in AMPTP and as such have completion agreements). Some analysts say there are up to 200 feature films on hold. Around September, we started to see a mass movement of film actors to TV projects. Many of my “name” actors have done one-day guest stars this is very typical right now), and we are seeing a number of Guest Star level actors doing CO-STAR roles. Remember from November of 2007 to March of 2008, due to the Writer’s Strike, again there were no feature films shot. So for the film actor, there has only been 4 months of work in the last 17 months.
THE BOTTOM LINE: Due to the lack of studio feature film production, BOTH film and TV actors are now competing for a limited number of jobs in the episodic and pilot environments.

2. PILOT SEASON:

During the Writer’s Strike of 2007-2008, Studios adapted and used the void to eliminate pilot season as we know it. Gone are the days of hundreds of pilots. In fact, this year, there are only 67 pilots to have registered for production – of which only about 35 have been green lit for production.

http://www.variety.com/article/VR1118000479.html?categoryid=3284&cs=1&query=pilots+casting+2009

And this year, due again to a sagging economy, studios and networks believe that by committing named stars to their projects, they will receive more money from this year’s up-fronts from ad agencies. They are banking on star power to leverage better buys at the all important UPFRONTS. So, stars and pop-stars like Richard Dreyfuss, Chevy Chase, Brittany Snow, Elle McPherson, Rebecca Romijn, Ashley Simpson, Scott Caan, Skeet Ulrich, and proven TV talents like Kelsey Grammar, Eric McCormick, John McGinley, Joel
McHale, Jenna Elfman, Donald Faison, Maura Tierney, Peter Krauss, Craig T. Nelson, Dax Shepherd, etc…. You do the math, 37 pilots… top stars being sought…
BOTTOM LINE: the conflagration of the economy and a lack of roles being cast, means that this pilot season may be even more competitive than the concurrent regular TV market right now. So those of you who have gotten auditions for series
regulars… feel great about that!

3. TV:

While TV has been steady, again due to the conflagration of film and named actors doing Guest Starring roles, we have seen a horrible trickle down. Many Guest Stars are now doing Co-stars and Co-stars/Developmental Actors (those with less than 5 primetime credits) frankly are not getting seen much. One CD recently told me that she had over 25 women who would be considered ‘working actors’ going for a co-star role.
BOTTOM LINE: Again, due to the abundance of name and working actors, many less-developed actors are not even being seen right now.

4. ECONOMIC IMPACT I – THE EROSION OF QUOTES/RATES:

There are really three major impacts to actors during this economic crunch. First, we are seeing the erosion of quotes. Due to the availability of so many talented actors, CD’s and Producers are in the driver’s seat in negotiations. When they say, “well we got someone else who will do it for less”, they ain’t kidding. I have spoken to a number of my peers who have confirmed this erosion of pay for their actors. In short, right now, quotes are eroding and for many, the minimum has become the maximum pay.

5. ECONOMIC IMPACT II – THE CONCLUSION OF SAG STALEMATE:

Many are hoping that with the end of this stalemate, Hollywood will get back to normal. I have to say,
that I am not one who necessarily believes this. First off, due to the economic conditions, most studios have lost their millions of dollars from hedge funds; and European, Asian and Middle Eastern money has dried up. Even Stephen Spielberg has had to beg, borrow and steal to get his company financed …. And it wasn’t anywhere near what he originally asked for. I believe that, even after the SAG stalemate is over, there is probably not enough money for 50 Studio Feature Films to be done right out of the gate.

BOTTOM LINE: While this will help us move towards normalcy, it will not be the cash cow some people think it will be. One side note, is that I expect that more formulaic projects will be down out the gate as Studios will be less likely to take significant risks since most of these projects will be financed by both the studio and their investors. In short, you will see more Iron Mans, Animation, and SAWs… they are money in the bank when you factor in ratios, etc.

6. ECONOMIC IMPACT III – OVERALL STATEMENT OF ENVIRONMENT:

It is important that everyone follow the economic conditions closely. I know it is easy to be skeptical over the studios, networks, cablers, production houses, show runners, etc, losing money, but it is a cold-hard fact right now. These entities are truly in a difficult spot. If you have read much lately, there have been dramatic cut backs at every studio and network, from firings to asking show runners to cut between 2-7% of their budgets (not to mention the 25+% cutback shows like the Sarah Silverman were asked to swallow recently).
Furthermore, these networks and studios are largely owned by conglomerates who have lost in the billions over the last 6 months. When I attended NATPE in January, all the talk was how to get ‘thinner.’ Everything is getting tight. Budgets, Marketing, Staffing, etc., and this will undoubtedly impact the actor. Also, the foreign sales market (where much of the TV and Film money is made, is being hit hard by the erosion of the US Dollar. So these entities are not able to recoup the costs they were in better days by the one-time explosion of the foreign markets.
BOTTOM LINE: The economic conditions are forcing the industry to be as ‘thin’ as possible.

7. COMMERCIALS – INDUSTRY AND ECONOMIC IMPACTS:

One analyst said last year, that 2008 was the worst commercial market since maybe 1974. I would not argue with this. Think about it: three of the top products/services for ad agencies are banks, cars and other financial services – all of which were struck down in 2008/early 2009 by this recession. This was confirmed when news struck that even the Super Bowl did not sell out advertising this year. The good news is that the advertising industry tends to be one of the first ones to be negatively impacted by a recession, but one of the first to grow as the recession moves to an end as advertisers of products want to start accumulating market share before the turn of the economy. Another impact relates to the overall conditions of the TV/FILM/PILOT situation. Many strong actors have made enough money on TV/FILM, etc so that they have not had to do commercials in years. Due to the last few years and the lack of work, many top actors are now back in the commercial market; thus again, causing a logjam in casting.
BOTTOMLINE: The economic slowdown has caused a dramatic decrease in ad sales and the lack of work has caused more actors to re-enter the commercial market.

THE GOOD NEWS!!

Okay, so that is where we are today. You know me, I try to always call it straight as I see it. So, I am not going to sugar-coat this either. I anticipate that 2009 will be a tough year overall for actors (and agencies). First off, the economy will not likely get straightened out until at least the 3rd to 4th quarter of this year and so all the factors above will remain in place through most, if not all, of 2009. Secondly, until the labor situation gets straightened out, we will not be seeing dramatic amount of film production, and this seems to be dragging along as well (as we enter the 8th month of the stalemate – it was announced today that SAG is thinking now about taking AMPTP to court for anti-trust violations). But again, even if it was finalized, there is not enough investor money to see the film production level normalize and increase for most, if not all, of 2009. Also, since movies cost around $40 for two (tickets, popcorn, etc) – this is not a recession proof field anymore. During our last significant recession, there were few choices for guilty pleasures to get away from the stress of our times – so many people flocked to the theatres. NOT SO THESE DAYS, one can go to the web, TV, cable (not around in 1974, 1982, 1988 much), Video Games, Netflix, RedBox (movie for a $1). So studios are probably not in any big rush to make films – as people cannot afford this once cheap diversion – better to divert for a few bucks to all the many other sources of guilty pleasures.
OKAY, so that didn’t sound like good news…

The good news is that there are some paradigm shifts occurring that make 2010 -2012 look like it might be one of the most prolific times in Hollywood history. Due to technological developments, there are more platforms being developed than ever. The internet is driving millions of new viewers each year. Zillion is going to transform the way we view advertising. For those who don’t know, it has recently been unveiled by the maker of Real Player and the ‘mouse.’ It is a system that makes you watch ads before downloading movies (they already have 14,000 Titles ready for download), TV, other forms of entertainment to your TV Screen. However, the consumer can choose the products they want to see (let’s say you go retail clothing and watch a Macy’s ad and love the jacket; you can immediately click on the ad/jacket and go directly to their website where you can buy it). Also, you earn points by watching the commercials that you can use towards purchases. Furthermore, SONY and others are now selling TVs that wirelessly connect to your computer, so you can download TV/FILMS at anytime from your computer (websites like Hula, Netflix, etc) directly to your TV. In short, technology is making more platforms which will require more content than ever. Also, Cablers are all embracing doing scripted shows, some have up to 5 shows this year… again, more content is needed and thus MORE ACTORS!

BOTTOM LINE: More platforms = more content = more actors! So as long as SAG/AFTRA can protect your rates and jurisdictional issues, there will be more good compensated work than ever in Hollywood by 2010-2012.

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Now that you’ve read the letter.  What are your thoughts on this?  Share your thoughts in the comments below.

{ 2 comments… read them below or add one }

James Bell April 20, 2009 at 6:42 pm

SAG NATIONAL BOARD OF DIRECTORS APPROVES TENTATIVE TELEVISION AND MOTION PICTURE CONTRACTS AND RECOMMENDS RATIFICATION

Los Angeles (April 19, 2009) – The Screen Actors Guild National Board of Directors today voted 53.38 percent to 46.62 percent to approve and recommend to members, new, two-year successor agreements to the 2005 Producer-Screen Actors Guild Codified Basic Agreement and 2005 Screen Actors Guild Television Agreement.

The proposed agreement, covering actors in motion pictures and television delivers 3.5% effective annual increases comprised of a 3% wage increase and a .5% pension and health contribution increase upon ratification, and a 3.5% wage increase in year two.

The board passed the below motion shortly after 4:00 p.m. today:

It was moved and seconded that the National Board directs the Interim National Executive Director to send the tentative agreement between the Producers represented by the AMPTP and the Screen Actors Guild for successor agreements to the 2005 Producer-Screen Actors Guild Codified Basic Agreement and the 2005 Screen Actors Guild Television Agreement to the membership for ratification, with a recommendation from the Board to vote ‘Yes.’ Approved: 53.38% -46.62%

“I urge members to carefully review both the pros and cons in the referendum materials, and exercise their right to vote,” said Screen Actors Guild National President Alan Rosenberg.

Interim National Executive Director David White said: “We are pleased that Screen Actors Guild members will soon be voting on a deal for television and motion pictures. We’re eager to get our members back to work and to focus now on the challenges ahead, particularly on initiating a comprehensive effort to thoughtfully plan for the future.

“Our negotiating committee, task force and professional staff have worked countless hours on this agreement over the last year. On behalf of the National Board, I thank them for their time, commitment and expertise.”

Chief Negotiator John McGuire stated: “This tentative agreement delivers increased contributions to the SAG pension plan, increased minimums, a significant gain in background actor numbers from 50 to 55 over the term of the contract, and it tracks the new media provisions achieved by other entertainment industry unions. The term of the agreement puts SAG in sync with the other unions, and does not include the extended term recently proposed by the AMPTP.”

Provisions of the proposed deal include: • A two-year term of agreement concluding June 30, 2011. • Effective annual increases comprised of 3.0% in wage increases and .5% in pension contributions upon ratification, and a 3.5% wage increase one year following ratification. • A new media structure that tracks those achieved by other industry unions, resulting in gains for actors including: o Jurisdiction on all derivative, made-for new media productions; automatic jurisdiction on all high-budget, original, made-for new media productions; plus jurisdiction on low budget original, new media productions that employee at least 1 covered performer. o Residuals for exhibition of TV and Theatrical motion pictures on consumer pay platforms (Electronic Sell Through) at a greater percentage than those paid for DVD distribution. o Residuals for ad-supported streaming of feature films and television programs. o Residuals for derivative new media programs. • Additional 5 covered background actors in feature films. From 50 to 53 covered background positions upon ratification of the contract, and from 53 to 55 covered background positions in year 2. Adds 1 covered background position in TV, from 19 to 20, upon ratification. • Increased compensation for guest star premium from 7.5% to 10%. • Increased trailer money break from $2,500 to $3,000, or more per week. • Increased overtime money break for three-day performers from $2,700 to $3,000.

Ratification ballots will be mailed to eligible SAG members in early May, with an expected return date at the end of the month. Tabulation will occur immediately upon the conclusion of balloting.

Bargaining for a successor agreement to the 2005 SAG TV/Theatrical Contract began on April 15, 2008.

kindredvampyre May 6, 2009 at 2:01 am

fantastic. thanks for taking the time to post this. thank you to Catherine Hardwicke for bringing Twilight to life… the world will never be the same. long live Vancouver for 2009 & 2010

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