HomeTvAll major streamers, including Apple TV+, now pay IATSE’s higher fees
All major streamers, including Apple TV+, now pay IATSE’s higher fees
January 28, 2023
Apple TV+, Peacock and every other major streamer still pushing for a lower production rate quietly gave up that fight in July, according to IndieWire.
In fall 2021, Apple relied on a clause in its industry-wide contract with the entertainment industry union IATSE to save production costs. The world’s largest company (by market capitalization) announced its Apple TV+ streaming service to the International Federation of Theater Employees had less than 20 million subscribers from July in the United States and Canada. Under a preliminary agreement, this allowed a studio to pay a reduced rate to production crew members in the union. Nascent streamers Paramount+ and Peacock also took advantage of the lower levels at the time.
By July 2022 (these measurements/publications are timed for July), all major streamers have agreed to pay IATSE workers the higher of the two fees, two people familiar with the negotiations told IndieWire. Streaming spread rapidly and it became increasingly difficult to define a “subscriber”.
For example, NBCUniversal’s Peacock service has a free tier, an ad-supported $4.99 monthly subscription, and an ad-free option for $9.99. It’s also included in a bunch of cable subscription plans, including (but not limited to) Comcast’s own Xfinity service.
The feud between Apple and IATSE was based on bundling, although Apple had more to do with hardware. Apple makes most of its revenue from smartphone sales, and regularly includes a year’s worth of subscription services, including Apple TV+, with the purchase of an iPhone or iPad.
But Apple didn’t believe those customers should be counted in the total number of Apple TV+ subscribers, one of the people said, because the consumer wasn’t proactively paying for the streaming TV service. IATSE disagreed.
While Apple TV+ is the last streamer to never publicly announce subscriber numbers, for the purposes of this fight it had to reveal where it was within the IATSE threshold. We believe that today, with or without these freebies, Apple TV+ subscribers are well over 20 million.
An Apple representative did not respond to requests for comment for this story.
Paramount+ must have crossed the threshold some time ago. At the end of September 2022, parent company Paramount Global reported that its basic service had more than 46 million global subscribers. We’ll get an update on that number on February 16, when Paramount Global reports its fourth-quarter and full-year 2022 financials.
On Thursday, Comcast reported that NBCUniversal’s streaming service surpassed 20 million subscribers in the U.S. at the end of 2022, meaning it has officially passed the IATSE threshold, no matter what. No matter: the writing was on the wall six months earlier when major players, including Peacock, agreed that the higher IATSE rate would be the going rate.
The IATSE never announced the new July 2022 agreement because, well, they don’t want to publicize that the lower pay level still exists. When reached by IndieWire, the union had no comment for this story. Representatives for Peacock and Paramount Global also declined to comment.
The issue of what exactly constitutes a qualified subscription has never been litigated, as far as we know, technically, to the extent that the previous impasse has not yet been fully legally resolved and can still be challenged in court. But nobody seems to care about that these days, including Apple, which makes this condition moot. This could change if new streamers emerge from growing studios, or if an existing streamer loses a significant number of subscribers. Or the contract can be officially updated.
The IATSE-AMPTP (Association of Motion Picture and Television Producers) basic agreement was last renegotiated in 2021. It will be discussed again from 2024. The same applies to the Territorial Standards Agreement for productions outside of New York and Los Angeles. .