Lack of Deal Lets Ad Shops Get a Piece of Talent Agencies

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LOS ANGELES ( -- After voting against allowing ad agencies and advertisers to buy into talent agencies, the actors union may have inadvertently opened the door to allow that very thing to happen.

Members of the Screen Actors Guild voted April 19 against a new agreement that would have allowed advertising agencies or advertisers to own up to 20% of talent agencies. All parties were adhering to the previous Agency Franchise Agreement, which had expired Jan. 20 but was extended by both parties until the result of the ballot referendum process was completed.

The old agreement did not allow for advertisers or agencies to buy into talent agencies, out of conflict of interest concerns.

Deals doubtful
Now that no agreement

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is in place, advertising agencies and advertisers are technically free to purchase equity stakes with some talent agencies that were franchised by SAG. But industry watchers doubt any deals would occur while the contract process is in limbo.

A spokeswoman for the Screen Actors Guild said the union's talent agency board is convening soon to decide on a plan of action. No talks between the unions have been scheduled.

Talent agencies -- represented by the Association of Talent Agents and the National Assocation of Talent Representatives -- pushed for the change to allow for financial investment to help agencies compete financially with managers and other executives representing actors. Investment would also help talent agencies combat restrictive talent fees.

Adding to the confusion, earlier this week the national board of the smaller American of Federation of Television-Radio Artists approved the new agency franchise agreement. About 30,000 of AFTRA's 80,000 members also belong to SAG. SAG, which has 98,000 members, is the actors' union for high-profile theatrical films and filmed TV sitcoms.

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