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The Future. Apple and Netflix have both started signaling that they’re going to change how writers, directors, actors, and producers get paid to make films and shows for their streamers, opting for one based on a title’s performance on the platform as opposed to just writing big checks to attract name talent. If the new models are implemented, creatives may gravitate to more cost-conscious, commercial projects that have a greater chance at becoming mainstream hits.
Performance pay
The new Hollywood will soon look a lot like the old Hollywood.
- Apple and Netflix are looking into transitioning from a “cost-plus” model (paying the talent’s typical fee plus a premium bonus) to a “performance-based” model (one where bonuses are paid when a movie or show hits a certain threshold).
- Apple told talent representatives that it’s considering three criteria for bonuses: the number of people who signed up for Apple TV+ to watch the title, how much time they spent viewing it, and the cost of the title relative to the size of its audience.
- New Netflix film head Dan Lin plans to introduce a similar model to reduce the budgets of its blockbusters — the Russo Bros.-directed The Electric State is costing the streamer about $300 million, when it would cost under $200 million at a typical studio.
Other than saving costs, streamers hope that the change will incentivize talent to put even more effort into making their projects great, knowing that the better they turn out, the more likely they’ll get paid extra. It’s exactly how box office bonuses and residuals work.
But for any of this to work, streamers will need to get a lot more transparent about viewership metrics.
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