PERFORMERS' UNIONS AND ADVERTISING INDUSTRY TENTATIVELY AGREE

Joint Study to be Conducted Over Next Two Years

New York and Los Angeles (August 4, 2006) – Screen Actors Guild (SAG) and the American Federation of Television and Radio Artists (AFTRA) and the advertising industry’s ANA/AAAA Joint Policy Committee on Broadcast Talent Union Relations (JPC) today announced a tentative agreement on a two-year extension to the Commercials Contracts that cover advertisements appearing on TV, radio, the Internet and new media, that would run through October 29, 2008. The extension agreement must now be ratified by both unions’ joint national board and approved by both union memberships through a joint referendum, as well as approved by the boards of both ANA and AAAA.

If approved, the extension engages a yet-to-be-determined consultant to conduct a joint study that will examine alternative methods to compensate performers for their participation in commercials appearing on television and radio, and especially the growing array of new media.

In addition to a study, AFTRA, SAG and the JPC agreed that:

· Along with advertisements that appear on TV, radio and the Internet, the agreement will also cover all commercials that appear in new media—for existing platforms such as cell phones and for future platforms yet to be developed.
· Actors will receive a 6% increase in basic compensation, and the contribution to both unions’ Pension & Health plans will go from 14.3% to 14.8%.
· The agreement provides advertisers with more flexibility to edit commercials for the Internet and new media.
{Important note: SAG and AFTRA would like to add the following clarification: If the advertisers wish to obtain broader Internet or new media editing rights, for commercials made initially for use on broadcast or cable television, then, in addition to the minimum use payments called for by the contract, they must bargain with the performer regarding the additional compensation to be paid for such editing rights. The extension agreement does not provide for a specific minimum payment as the basis of such bargaining.}
· A New Media Committee, comprised of representatives from both the unions and the industry, will be formed. This Committee will be empowered to make adjustments to the agreement to accommodate changing technologies and shifting paradigms within the commercials industry.
· Advertisers will receive a one-year waiver, which will allow advertisers to experiment with a shorter cycle of use in the new media and Internet areas.

SAG Chief Negotiator John McGuire and AFTRA Chief Negotiator Mathis L. Dunn Jr. issued the following joint statement: “Because of the tremendous growth of the Internet and digital technology, the unions have agreed to a two-year extension to conduct a comprehensive joint study that will allow us to determine whether existing pay structures should remain the same or be modified. This agreement also means that actors will have achieved increased opportunities for work and better wages and benefits. In a rapidly evolving media environment, our agreement demonstrates that performers and advertisers can work together to deal with change and build a stronger partnership that benefits us all.”

JPC Chief Negotiator Doug Wood issued the following statement: “This early collaborative effort between the unions and the industry is a balanced compromise, and provides the time needed to develop a comprehensive model that fairly compensates performers and ensures that advertisers receive a fair return on their investment. Today’s call for accountability at all levels of business requires nothing less. I echo the comments of both John and Mathis that this breakthrough agreement was made possible by both sides working together and recognizing one another’s critical needs going forward.”

The results of the joint study will be considered in the next bargaining process surrounding the advertising industry’s collective bargaining agreement with SAG/AFTRA. Nine consultants from the industry and academia were invited to respond to a Request for Proposal (RFP) for the joint study on May 17.

Since the early 1960s, AFTRA and SAG have jointly negotiated the collectively bargained recorded commercials contracts.