Disney shares the wealth. Will others follow?

In what is an obvious effort to get out in front of a brewing (ice) storm, Disney Theatricals just informed the actors participating in the upcoming Frozen lab that they’d be getting a piece of the profits.

According to The Wall Street Journal, anyone in the show from the lab through opening night will be entitled to receive a piece of 0.5% of net profits from the first three English-language productions for the first 10 years of profitability.

Pretty sweet, right?

Well, the ripple effects of this decision will go well beyond the actor’s bank accounts.  This precedent is about to cause an avalanche of changes in how our industry develops its material.

Obviously, the reason this issue is front and center is because of The Hamilton Effect.  I’m sure I don’t have to tell you that after Hamilton‘s place in financial history was secure, the actors, who helped shape the piece throughout its many readings and labs, held their own revolution off the stage and asked for a piece of profits in exchange for their creative DNA, which was undeniably all over that stage.

The issue was eventually settled (after some Shakespearean-like drama which was just revealed two weeks ago), and I wrote about it here.

Fearing that if super-profitable Hamilton was a target then the execs at uber-profitable Disney wisely decided to get out in front and give the actors in Frozen an offer that they did not have to make (that offer was half of the 1% that the Hamilton actors got, btw).

Smart.  Because at the end of the day, .5% of net profits (which is money AFTER recoupment) isn’t going to be noticeable on a p/l like Disney.

But it will be noticed by the rest of the industry.  And I wonder how much of this was done unilaterally, or if they had the support of other Producers and the Broadway League.  It’s no secret that there have been a lot of conversations with Actors Equity and the League over this issue, with Equity looking for this kind of profit sharing across the board (can you blame them – listen to Steven Pasquale talk about why it’s deserved on his podcast here).

I’ve always been in favor of a little profit sharing . . . provided however there is a bit of a give on some of the more financially challenging aspects of the lab contracts (most specifically, the right-of-first-refusal, as I wrote here).

And on shows produced by non-corporate entities, it’ll be individual investors who have to share their profits with the actors as a thank you for helping to create the show.  Shouldn’t the authors pitch in as well – since the actors are helping to develop the creative?  Isn’t it risky enough for our investors?

But it’s not clear whether Disney asked for, or got anything, in exchange for what they gave.

Now the question will be whether this precedent will make this profit participation status quo . . . or whether it’ll only apply to shows like Hamilton and Frozen, when the Producers know they’re going to be swimming in money.

Once again, Disney gives us a master class in producing, and keeping up company morale (every actor in town is gonna want to develop shows for them now), but will their model work for everyone else?

 

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Comments
  • Bill says:

    Could Tennessee Williams have asked for 5% of all of Marlon Brando’s future earnings since it was his play that launched his career? Might Jule Styne have asked for a % of Barbra Streisand’s earnings for ten years after his song People brought her to maximum attention in the world? A director or an actor can say whatever he or she wants to the writer. The writer has to decide. The writer makes the choice. He or she owns the structure and all decisions related to the invention. Writers write. Actors interpret. Writers, producers, investors hope for royalties. They risk time and money. Actors are paid. Profit participation for actors who are in the show might make sense. Producer and writer as partners in the venture can come to an agreement on that. But ongoing for actors who are IN the production as they night after night perform the piece. Not the original actors in perpetuity. Otherwise, no more developing shows – writers just have to get it right before rehearsals begin. If an actor has a comment writers may simply refuse to hear it, and who could blame them.

  • Midge says:

    I’m struck by the difference of character creation in these two shows. Hamilton characters, though based on real people, really did rely on the creativity and perspective of the original performers, many of whom had been with the project for years since the first workshop, to see these characters fully realized.
    On the other hand, Frozen presumably will remain quite loyal to the source material. These characters have already been created. They are already well known and audiences will have certain expectations when they come in to the theater. I question how much creative input that gives the Frozen actors to justify this bonus.

  • Lowell Achziger says:

    Too bad Disney doesn’t pay the crews very good.

  • Ann Tares says:

    Interesting article and comments so far. From a writer’s point of view: even if the .05% sharing becomes a precedent or at least a common bargaining chip, could that impact years of Dramatist Guild legal rulings about the stage play writer’s rights to all contributions unless a partnership is made explicit from the start? And, riffing off the comment about the difference between creating and replicating, what are some ways to define what types of contributions are worth a share in the 05%?

    (I ask because people will ask for anything they want, regardless of contribution quality and scope: A director volunteered to read my play, did a good copyedit, made about 10 staging suggestions for a future production, including the only action that most audience members in a table reading hated, gave me the bills for the table reading’s studio rental and food. Then asked me to sign a contract where the director would direct all future production or be paid the director’s fee for every future production.)

  • Gary Perlman says:

    What strikes me here is that the actors are seeking the rewards of creating a new show without accepting any of the risks. They are presumably being paid from start to finish, and I can’t imagine that they would agree to accept a lower fee or return any money if the show fails – unlike the show’s creators and investors, who go into the process knowing that they could lose everything. You can bet that actors will start asking for similar terms for shows not on the lofty level of a Hamilton or Frozen, which will only add to Broadway’s already inflated costs. That doesn’t sound healthy to me. As long as actors are being paid a fixed salary at no risk, i.e., all upside with no potential downside, their claims for compensation seem pretty bogus.

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