Article by Ethan Drogin, one of the writers on Netflix’ “Suits” who points out that the residuals he received for the show are minuscule and in no way match the long-lasting success of “Suits”
Article by Ethan Drogin, one of the writers on Netflix’ “Suits” who points out that the residuals he received for the show are minuscule and in no way match the long-lasting success of “Suits”
I don’t have an opinion on whether the writers are receiving a fair shake or not, but royalty deals can also apply to physical goods.
If I own a patent and you have a business that would like to produce my invention we can enter into a sale of the patent, enter into a yearly fix rate license, or enter into a deal that includes a lump sum and/or royalty.
It depends on how each party sees the revenue developing and striking a deal that seems to work for both parties. The royalty model doesn’t work for the buyer in the table example, thus the buyer only accepts a one time fee and transfer of ownership.
Mind you, plenty of people enter into other types of contracts: leases, layaways, etc. And they pay a different fee structure than those buying outright. A writer could enter into a lump sum contract, but would likely demand a higher fee to cover future earnings. This isn’t in the best interests of the studio, as they have no idea how successful the show will be.
I’ll also point out that car manufacturers are literally moving to annual fees for certain features. Was it BMW with heated seats? Could pay monthly, yearly, or lifetime access. Same amount of work for BMW, but wildly different payment models.