Hulu’s Success Creates Intellectual Property Rights Headaches

The following is a press release from this past May, from the Rights Camera Action! website, which followed on the heels of a Boston Globe story. It's reprinted here, FYI.

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The new media revolution led by upstart Hulu is changing the way we watch television, and creating a new market for old TV shows and archival films. But the additional rights needed to rebroadcast on the Web and handheld devices is also creating a scramble for a piece of the profits.

Earlier this month, Disney struck a deal with Hulu to air a bunch of its ABC subsidiary content on the Web provider’s bandwidth. With the explosion of TV content heading for the Internet, the "re-clearing" of content for the Internet is a new and costly problem for producers and broadcasters. At the same time, this new market is creating a new growth opportunity for a niche of pros and companies that specialize in rights clearance.

A Boston Globe story on May 3, 2009 cites programming outlet WGBH, which is having to negotiate new licenses for documentaries in its archive for web consumers:

“It's only 30 seconds out of a 90-minute film, fleeting glimpses of then-President Jimmy Carter as seen in a 1976 Playboy magazine interview. But to secure the rights to use these five photos in the documentary series 'The Presidents,' which re-aired last fall, WGBH had to pay Playboy $12,400.

“That was all well and good for the show's broadcast and even for its release on video. But now, in the age of digital downloads - when TV networks are hungry to find new ways to attract larger audiences - the challenge has started all over again. WGBH has to go back and strike a deal for the digital rights to each photo of Carter.”

Actors have also upped the ante. The new union contract which has been tentatively approved by the Screen Actors Guild, as reported several weeks ago by CNN, and after months of protracted negotiations, includes so-called "New Media" provisions to protect actors whose performances are reused on the internet and other downloaded formats.

According to the the Alliance of Motion Picture and Television Producers, "Because both sides were willing to compromise, we now have an agreement that will provide SAG members with meaningful wage boosts, pension increases, first-class health benefits and a complete set of new media rights and residuals," the Alliance's Web site said. Producers have yet to see the actual contract provisions as it hasn’t yet been fully ratified by the membership.

Obtaining the new and expanded rights is a complex business, and can be a costly one for content owners. Professionals in the rights clearance business usually have extensive backgrounds on the production side of the business, often in the trenches of the Hollywood entertainment and music industries. They use the their accumulated contacts and knowledge to get negotiations done quickly, efficiently and on-budget. Clearance experts do the legwork of locating the rights holders and negotiating for photo rights, performance rights of actors and musicians. They will also handle directors and writers payments, deal with any guild requirements, in addition to any needed music clearance.

Rights Camera Action! is a rights clearance company based in Los Angeles, specializing in research and clearance for film, TV, merchandise and advertising. According to the Boston Globe story and industry sources, the demand for content for the Web is creating new opportunities for content producers to monetize their archives, and for those individuals and companies who specialize in rights clearance, the business of obtaining the necessary third party intellectual property rights for TV programming.