Some smiling, others shaking over Sony deal with writers
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LOS ANGELES (CNN) -- Some Hollywood insiders are for it, some are against it. But whatever side they choose, a controversial deal signed earlier this month between 30 screenwriters and Sony Pictures Entertainment is the talk of the movie industry.
The groundbreaking pact allows the signed screenwriters -- including popular writers like Ron Bass ("My Best Friend's Wedding," "Stepmom"), Aaron Sorkin ("A Few Good Men") and Richard LaGravenese ("The Horse Whisperer") -- to receive at least 2 percent of a movie's gross receipts. It's the first deal giving scribes a cut of the gross profits; they were formally relegated to net profits, which often don't exist, even in the most successful films.
'The fact of the matter'
Sorkin, for example, received just a little more than $200,000 for his screenplay to 1992's "A Few Good Men," a film that has grossed $237 million worldwide.
"Believe me, for a 28-year-old writer, getting a check for $200,000 was a big deal indeed," admits Sorkin, who has since graduated to creator of the hit ABC show "SportsNight. "But the fact of the matter is 'A Few Good Men' made hundreds of millions of dollars, and I'm entitled to share in that money along with the studio and the stars and the director."
Now he'll get his chance. Before the new deal, it was accepted -- still is accepted at rival studios -- that screenwriters should be on the low end of the financial totem pole.
This changes everything. Under the arrangement, the 30 writers signed by Sony have agreed -- in return for an up-front fee and 2 percent of gross profits -- to each write at least one script for Sony over the next four years.
Sony served, too
The structure of the deal ensures Sony is getting scripts from established talent, without putting them at much risk. To qualify for the pact, Variety reports that the writers had to have previously earned at least $750,000 as a front-end payment for a feature script, sold a spec script for at least $1 million, or received a nomination for an Oscar or Writers Guild of America award.
If the movie they write for Sony bombs financially, the studio won't have to pay nearly as much because the profits won't be there.
"We're putting less cash up when we're at risk," says Gareth Wigan, co-chairman for Columbia Motion Picture Group, under the Sony umbrella. "We're paying more money when we've made money."
According to Variety, up to 60 writers were in the running. The deal was negotiated without the help of the Writers Guild of America, and under the noses of the writers' agents and managers.
But writers and agents agree that the deal is good for their business.
"It's about time," says Scott Frank, who is part of the deal, and whose screenplay for "Out of Sight" recently won a WGA award. "It's an incredible breakthrough and I think it will get people talking about it in a more real way for a long time to come."
That's what angers Sony's rival studios, who haven't commented on the record but grumble that the deal puts them in a financial pinch to do the same.
"This comes at a time when profitability is under siege in the movie business," one anonymous studio executive told Variety recently.
"We're in a business that doesn't make any money, and anything that adds extra costs is insane," said another executive.
Another reason the deal is rubbing rival studios the wrong way -- Sony has a reputation for hiking the prices of talent. It's the same studio that reportedly paid Jim Carrey $20 million to be "The Cable Guy," and consequently launched the salaries of several other top Hollywood actors and actresses.
CNN Showbiz Today Correspondent Paul Vercammen and CNN Interactive Senior Writer Jamie Allen contributed to this report.
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