Top Industry Members Want Half of Studio Budgets to Go To Indies
On the heels of the Federal Film Incentive comes more promising news for independent creators and the industry at large.
Major players have come together in an effort to help protect original and independent content from mass media consolidation.
It’s called the American Entertainment Alliance, and it’s pushing for legislation that would require major studios and streamers like Netflix, Disney, and Skydance to allocate at least 50% of their original content budgets to independent productions.
Members include top agencies CAA, WME, and UTA, as well as producers like Blumhouse, Imagine, Legendary, North Road, and MRC.
To protect the future, these powerhouses are looking to the past.
In the 1970s and ‘80s, iconic shows like Seinfeld, Roseanne, and The Mary Tyler Moore Show were successful thanks in part to the Financial Interest and Syndication Rules of 1970, or ‘Fin-Syn’.
Regulated by the FCC, these rules kept major broadcasters ABC, CBS, and NBC from owning the shows they aired. They also weren’t allowed to control the shows’ syndication rights. This paved the way for independent talent and creator-led entities like Mary Tyler Moore’s MTM Enterprises, Castle Rock, and Lorimar Television.
‘Fin-Syn’ was repealed in the ‘90s with the rise of cable, when competition seemed more robust. Without these protections, however, media consolidation went up, making it harder for independent producers to thrive and leading to the contracted landscape we find ourselves in today.
Now that ‘peak TV’ has ended, the number of original TV series has fallen dramatically in the last few years. Currently, there are 41% fewer scripted submissions from independent producers than there were even four years ago. Mergers also make it more likely for studios to produce in-house content aired on networks, channels, and streaming services they own.
The AEA wants to ensure at least half their content comes from production companies outside the studio. This would allow more creators to own their work, which would in turn create more jobs and opportunity.
These days, there are fewer decision-makers controlling what gets made. Streamers already collect subscription fees and ad revenue. If they also own the content, it gives creators very little leverage.
The AEA wants to bring back a version of ‘Fin-Syn’ for the streaming era. If production companies own their own shows, they control licensing rights, which allows them to sell their show again to a different streamer. It would also give new life to shows that get cancelled, allowing them the opportunity to sell to another streamer.
The AEA is advocating for ‘modern creative ownership rules that reflect today’s streaming marketplace’. Because the FCC has little oversight when it comes to streaming, the alliance is proposing legislation as a solution. The goal is a regulatory framework to help drive competition and growth.
Much like the Federal Film Incentive, it’s also designed to support policies that would make the U.S. a more competitive production destination.
While it could face pushback from a divided Congress as well as the studios, which have lobbying power in Washington, the Federal Film Incentive might help pave the way for these additional protections. Members of the AEA are meeting with the backers of that bill, which could be adopted after the November midterms. The American Entertainment Alliance is hoping to introduce a bill of their own next year.
When creatives have more control over their work, it fuels more creative competition, which benefits everyone, not just a select few. Once again, cultivating independence is key to the future of film and TV.
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