WGA and SAG Mount Aggressive Campaigns for Change

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LOS ANGELES -- Members of Hollywood's two biggest unions don't like branded entertainment. They’ve recently made that pretty clear interrupting conferences, threatening to call in the FCC and issuing position papers about the perils of product integration.
Writers Guild of America West protestors dressed as Donald Trump demonstrated outside an Advertising Week branded-entertainment seminar in September. Their clothes are festooned with commercial promotions, much like the brand-integrated scripts they are protesting.

They say the creative process is suffering and viewer backlash is just around the corner.

But they could be wasting their time.

Embedding marketers

That’s because the practice of embedding marketers into entertainment content won’t be going away anytime soon. The current economic climate, in which prime-time audiences have decreased while the cost of producing shows has increased, dictates that networks and production companies look outside Hollywood for money to help create programming.

At the same time, viewers are arming themselves with ad-skipping devices that can bypass the commercial breaks, and advertisers, in response, are pushing for more involvement in the content itself.

The Writers Guild of America and the Screen Actors Guild aren’t happy with that.

The two guilds held a news conference this week, issuing a position paper and threatened to call in the FCC if networks and studios did not respond to their request to create a voluntary code of conduct for product integrations. The recently-elected leadership of those unions, who had campaigned on platforms of aggressive change, said actors, writers and other behind-the-scenes talent need to have a voice in how, or even if, products will be integrated into TV shows and films.

Share in the financial gain

They also want to share in the financial gain from such deals.

In a related development, WGA West members crashed a gathering of network entertainment chiefs on Tuesday in New York, asking for better pay, benefits and working conditions on reality shows—many of which integrate brands into the series. Writers and editors on reality programming aren't represented by the Hollywood unions, whose leaders are fighting fiercely to bring those 1,500 workers under their wing.

Industry watchers say the fight is more over a matter o f money than artistic integrity, yet the unions are mistaken if they think everyone except their members are making money hand-over-fist from brand integrations.

"There's this perception that there's a great party going on and the unions haven't been invited to it," said Jonathan Prince, a TV producer who now works with brand integration firm Madison Road Entertainment. "That's just not the case. Brand integration is the gas that keeps the car running."

'American Dreams'

Mr. Prince, a producer of the critically-lauded NBC drama "American Dreams," is considered one of the few TV producers to successfully integrate brands into a scripted show. He and his staff worked in Ford and Kraft into storylines of the show, and created an eight-episode arc that revolved around Campbell's Tomato Soup.

Though he wouldn't disclose financial details, Mr. Prince said that the commitment from Campbell's meant that he could license appropriate '60s music, hire additional writers and shoot in Los Angeles instead of Canada.
"We live in a branded universe—human behavior is branded behavior," Mr. Prince said. "It makes your script more organic, more real if you have products in it."

It's counterproductive to have brands crammed into shows in awkward ways, he said. "That's the last thing a brand or a producer wants, and the audience knows the difference between something that's organic and something that's a shill."

The leadership of the WGA and SAG insist that there is an overriding creative issue and that they're concerned about the quality of programming that has brands embedded into it. They contend that product integration, when overdone, can be to blame for driving away viewers. They say there have been violations of current FCC rules on disclosing those integrations and that writers have been called upon last minute to shove in marketer messages in ways that don't naturally fit.

Sensitivity of the issue

Studio executives, while they don't want to speak for the record because of the sensitivity of the issue, said they disagree.

"Showrunners are asking for opportunities to help enhance the production values of their shows," said one studio executive. "Nothing gets by them—no one is going behind their backs to do these deals—and nothing gets by the writers. Everyone is looking for outside money to help pay the cost of producing shows."

The majority of brand integrations help pay for production costs and overhead, especially in a show's early stages before it turns a profit from syndication, foreign sales or DVDs. In the case of "American Dreams," Mr. Prince said, the integration money kept the modestly-rated show on for an extra season. It ended after three years.

There is no standard for how the money is divvied up from such deals, however—still a major stumbling block for the business of branded entertainment.

Mark Burnett Productions

Executives from the WGA and SAG leadership have pointed repeatedly to Mark Burnett Productions and the myriad multi-million dollar deals with such marketers as Toyota, Home Depot, Unilever and Burger King. Those are the exceptions rather than the rule, say those involved in forging the deals. Few, if any other producers, can command the top dollar rates that Mr. Burnett has over the years.

Mr. Burnett's success with such shows as "Survivor" and "The Apprentice" has given him a singular level of negotiating clout with marketers and networks. He has commanded upwards of $2 million for integration deals, plus a cut of networks' ad time in some cases.

After a few disappointing shows like "The Contender," "Rock Star: INXS" and "The Apprentice: Martha Stewart," even Mr. Burnett may not be able to barter the high-flying deals he once did. Sources close to his negotiations have said the integration fees his company charges advertisers have dropped considerably over time.

The current dustup could result in some lasting changes, however.

Hot-button issue

By latching onto a hot-button issue, the unions are joining an argument already set in motion by Consumer Alert and other watchdog groups outside Hollywood, said Jim Johnston, a partner in entertainment law firm Davis & Gilbert.

"It will crystallize in some pre-emptive action," he said. "The FCC won't wait for a crisis like the quiz show scandals."

Still, he thinks it will be confined to disclosure issues, where viewers will be told upfront that certain brands are embedded into entertainment content. That move would not address the central matter of compensation for WGA and SAG members.

The integrations, themselves, could also become more thoughtful, executives said. And standards could also be developed for how such deals are put together.

"There's no one way that these deals get done," said Rob Donnell, president of branded entertainment firm Brand Arc, based on Santa Monica, Calif., who reps Toyota. "Each network is different, each production company is different. If there could be some standards across the board, then people would have a better grasp going in on how to proceed."

A representative from the WGA West said late Tuesday that executives there are having ongoing discussions with the FCC but have not filed a formal complaint yet. The networks and studios have not responded to the unions' call-to-action.
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