- The Washington Times - Saturday, June 30, 2001

Hollywood's studios and actors face a midnight deadline tonight to agree on a new contract, which is needed to avoid a strike that would shut down production on most movies and television shows.
The six-week-long negotiations which have focused on compensation for lower-paid actors continued in Encino, Calif., yesterday. Both sides have refused to talk to reporters about the progress of the talks, but entertainment trade journals reported that a deal is expected this weekend.
Industry analysts say an actors' strike would just about shut down Hollywood and result in fewer movies and more reality TV shows like "Survivor" and "Temptation Island," which do not require actors.
In this week's newsletter to members of the Screen Actors Guild, the largest of the two actors' unions involved in the talks, chief negotiator Brian Walton said he was "cautiously optimistic" a deal would be made by the deadline but also suggested it could be extended.
"[I]f it is made a few long days and nights thereafter, no matter," Mr. Walton wrote.
This spring, the guild for Hollywood's screenwriters extended the deadline for its negotiations with the studios for three days past the May 1 deadline before a deal was announced.
Fears of an actors' strike subsided when the screenwriters and producers reached their agreement. Most observers said the actors would use the writers' deal as a model for their talks and predicted the negotiations would conclude quickly.
"It is weird that these talks are still going on," said Steven D. Currall, a professor of management and psychology for Rice University in Houston.
The negotiators involved could be inexperienced, or they could be "very strategic," he said.
Before the actors' talks began, the unions said a key issue was compensation for so-called mid-
dle-class actors, who typically earn between $30,000 and $70,000 a year doing small roles in the movies and guest shots on TV.
The unions want these actors to receive higher "residuals" the royalties made from the sale of films and shows overseas and for cable television, videos and DVDs.
Producers have said it is tough to pay higher residuals as film production costs increase.
They also point out that studios are increasingly turning to bankable stars to draw audiences. Julia Roberts can earn as much as $20 million a film, and Kelsey Grammer recently inked a deal that will pay him more than $1 million for each episode of his situation comedy "Frasier."
"This is not like the steel industry or the auto industry, where you are negotiating hourly wages for workers. Here you're dealing with different formulas for compensation based on many factors," said Daniel J.B. Mitchell, a professor of management for the University of California at Los Angeles.
The unions represent roughly 135,000 actors.
The Screen Actors Guild comprises performers in movies and prime-time TV dramas and sitcoms. The other union involved in talks, the American Federation of Television and Radio Artists, represents performers in daytime TV soap operas and actors who do voice-overs.
Most of the economic effect of a prolonged actors' strike would be felt in the Los Angeles area, which could suffer a $3.2 billion revenue loss, according to a study commissioned by L.A. Mayor Richard J. Riordan, a Republican.
A prolonged strike could cause as much as a $200 million loss to the Washington area's economy and affect 3,000 to 4,000 temporary and full-time jobs, the researchers said.
Most of the jobs involve contractors or temporary workers, such as caterers, makeup artists and background actors who work only when a movie or TV show comes to Washington to film scenes for a few days.
* Tom Ramstack contributed to this report.

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