Video: 'Seinfeld' heading for DVD

By Garrett Glaser Correspondent
CNBC
updated 3/1/2004 6:48:33 PM ET 2004-03-01T23:48:33

It's the most successful comedy of all time. When "Seinfeld" comes out on DVD later this year, it is expected to generate billions of dollars.

But the co-stars of the show — Jason Alexander, Julia Louis-Dreyfus and Michael Richards — were only going to get a few pennies for each copy sold. After all, DVD sales weren't in their contracts.

So they declined to help promote the DVDs. After weeks of negotiations, however, press reports indicate they may be getting a bigger piece of the pie. How much bigger, though, no one will say.

But the greater issue of DVD royalties for most actors, writers and directors remains unanswered.

"I think risk is not the absolute entitlement to return ... there are other factors here," said Mona Mangan of The Writers Guild. "One of the factors that is really obvious to everybody is creative input ... people who actually made a product out of their heads — out of a blank piece of paper — certainly ought to share in the rewards for that product."

Actors, writers and directors get residuals when their shows are repeated on television. Most have a very small piece of the pie if the show comes out on videocassette or DVD. Typically, a few pennies a copy.

DVDs are a hot topic not just because there is little precedent for deciding numbers, but because DVD as a business is exploding in size.

In 2003, for instance, DVD sales jumped 46 percent over the prior year. That's $12.3 billion — just in DVDs, just in the United States.

In fact, feature films now generate more revenue when they go to DVD and home video than they do in the movie theater.

It's understandable, then, that everyone wants a piece of the action.

"Well, 'sufficient and fair' is something in the eyes of the beholder. From the producer's point of view, obviously there's a very different perception from the performer's point of view," said Michael Rudell, a veteran entertainment attorney who has represented both sides of the issue in past negotiations.

"But the producer will tell you it has an enormous stake in how much money it put into the production of the movie or television show and it wants to recoup that first. The real question is, what does recoupment mean?"

Unlike Jerry Seinfeld and Executive Producer Larry David, Louis-Dreyfus, Richards and Alexander do not own a stake in the show.

Alexander is quoted in one story Monday, saying, "In the years that we've been in syndication, Julia, Michael and I have probably individually seen about $250,000 out of residuals, whereas our brethren [Seinfeld and David] have seen hundreds of millions of dollars."

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