But that’s just the feeling I got when I read the always sharp Joseph Menn of the Los Angeles Times, who penned an interesting piece earlier this week about writers in Hollywood turning to venture capitalists as the strike drags on.

Wrote Menn: “At least seven groups, composed of members of the striking Writers Guild of America, are planning to form Internet-based businesses that, if successful, could create an alternative economic model to the one at the heart of the walkout, now in its seventh week.”

That includes meetings with Silicon Valley VCs like Jim Breyer of Accel Partners, whose investment in Facebook gives it insight into the creation of new audiences.

The hope for the–let’s just say it, shall we–unnatural pairing of tech VCs and Hollywood folks?

That the sour lemons being thrown between studios and writers–ironically over future Internet revenues–will actually yield delicious lemonade, spurring the creation of quality online programming using the Internet’s massive distribution system that could also make lots and lots of money.

“Could” is obviously the operative word here, because–as we have noted many times in this column–very little original content created on the Web has had any true payoff yet.

Um, well, none, actually. (Save porn, which is an almost perfect content format for the Web.)

To be fair, there have been promising signs.

Ex-Yahoo exec and Hollywood player Lloyd Braun struck a deal with PepsiCo to pay for and create online content.

MySpace has been backing a range of online-only shows made by Hollywood types (although none has shown strongly increasing popularity and even seem to display worrisome declines in viewership, despite the justified potential touted by creators).

Of course, there’s the high-profile Sequoia Capital-backed and Will Ferrell-fronted FunnyorDie.com, as well as MyDamnChannel.com, from former MTV executive Rob Barnett.

And Viacom agreed this summer to create a new online entertainment studio in a 50-50 split with the creators of the popular “South Park” TV program.

Finally, Creative Artists Agency, which is the biggest talent agency in Hollywood, is apparently working with Silicon Valley VC firm Draper Fisher Jurvetson to raise up to $200 million to invest in the digital entertainment sector, even as other such firms as UTA and William Morris are making similar moves.

While that is a very little amount of money considering the billions of dollars that slosh around Silicon Valley to fund things like dopey widgets and yet another movie-comparison site, it is still a start.

The presumable goal is that by creating and distributing content for the Web in a lower-cost way, many kinds of revenues could be garnered via everything from advertising to getting back investments by selling the online material to television and the movies.

That sounds like a plan, except for the fact that the current state of advertising innovation related to Web videos is quite nascent, even pre-fetal.

While a lot of companies are focusing on this and advertisers seem willing to move in the direction of more online ad spending, it will simply be a long time before these investments pay off.

Which is just not part of the no-risk-and-all-reward mentality of most players in Hollywood, who wouldn’t know a start-up unless it took their prime table at the Ivy.

In all seriousness, it seems unlikely that the high cost of production now in place in the entertainment industry would in any way lend itself to the critical need for that kind of massive shift in economics required to make online content pay off now.

Currently, studios still only grudgingly want to consider sharing ownership of content, and the talent seems even less willing to take the burden of risk required onto its shoulders.

Still, I admire all the efforts on the part of writers to not just strike, but strike out from their current comfort zone and move into the future, where online entertainment production and distribution seems obviously inevitable.

The problem is that it might take a longer while than those creators have patience for and they will prematurely abandon their efforts and return to propping up a system that is destined for, while not oblivion, then certain diminution.

So what’s needed–as in all marriages–is a crazy leap of faith, like this one from “Heroes” Peter Petrelli on NBC.

I am definitely no expert on this topic, except to say that the problem is that the delta between falling flat and succeeding is frighteningly close.

In other words, I Has No Idea what to do.

With the strike now in its sixth week, the studio reps–the Alliance of Motion Picture and Television Producers–and the Writers Guild of America took aim at each other at a Los Angeles hotel, accusing the other side of negotiating in bad faith and being uncooperative.

The two sides still appear far apart on a lot of issues, including unionization of reality shows, but a lot of the issues center on how to split up revenues from new media.

Of course, most of those revenues from the Internet–via downloading and streaming, for example–are still tiny, so the two sides are essentially arguing over nothing, except that that nothing might be something someday.

Got it? (Kind of like Facebook being worth $15 billion!)

In honor of News Corp. officially getting ownership of Dow Jones this week, here’s a recent take from Headzup on the strike from the perspective of AllThingD.com‘s new boss (Welcome, Rupe!):

To keep you abreast of tech news while he’s away, we’re compiling a daily digest of 10 must-read tech stories. Our Tech 10 appears below.

1. Coming to a PDF Near You: Adobe announced today that it is teaming with Yahoo to put text-based ads in PDF files, reports The Wall Street Journal, noting that publishers will be paid for running ads from Yahoo Inc. next to the PDFs.
2. But Will It Be Able to Leap Tall Buildings in a Single Bound? The new and improved version of Apple’s iPhone will be able to download from the Internet at a faster rate, AT&T CEO Randall Stephenson announced last night, Bloomberg reports. Speaking to the Churchill Club in Santa Clara, Calif., Stephenson also divulged that the new iteration of the device will debut next year and will operate on third-generation wireless networks. (AT&T is the exclusive carrier for the iPhone in the U.S.)
3. Nothing’s Set in Concrete, After All: Responding to criticism from MoveOn, Facebook execs are looking into changes to the recently launched Beacon advertising tool, according to BusinessWeek, adding that adjustments to the system could come as early as today.
4. Democracy Comes to Search Results: Google is experimenting with a system that enables users to change the rankings of or delete sites in personalized searches, according to Loren Baker of Search Engine Journal, explaining that the new system will allow users to manipulate search results by simply hitting dedicated buttons.
5. Reining In Comcast: Federal Communications Commission Chairman Kevin Martin is proposing a rule to keep cable colossus Comcast from growing larger, the New York Times is reporting, adding that the new rule comes as Martin attempts to regain the upper hand after his earlier proposal to broadly control the cable industry was shot down.
6. The Faster the Better: Verizon Wireless will upgrade its network in 2008, according to Reuters, using long-term evolution technology to achieve higher speeds. The new system could end up challenging Qualcomm, which developed the CDMA technology Verizon’s current network is based on, as well as supporters of WiMax.
7. Strike This Strike? ABC and the Writers Guild of America, East, announced today that they had come to a tentative agreement for about 250 ABC News writers, editors, graphic artists and desk assistants in New York and Washington, D.C., according to the Hollywood Reporter. The union, which has worked without a contract since Jan. 31, 2005, will vote on the new agreement Dec. 13.



8. Cartman, Kyle and Kenny–Free: Following the online popularity of “The Daily Show With Jon Stewart,” MTV Networks will make all episodes of the animated comedy “South Park” available for free in 2008 according to Reuters, noting that the move is part of Viacom’s strategy to boost TV viewership.
9. Just When You Thought Things Couldn’t Get Any Worse: Along comes Warner Music Group’s gloomy forecast for 2008. In today’s fourth-quarter earnings call, CEO Edgar Bronfman Jr. predicts a continuing decline in physical music sales as retailers cut back on shelf space, while the digital-music and mobile sales growth will be slower than expected, reports Peter Kafka of Silicon Alley Insider.
10. No Wii? Waaaaa! The popularity of Nintendo’s gaming console coupled with “a maxed-out supply chain that can’t be ramped up to meet holiday demands” means it could be next to impossible to purchase a Wii before Christmas at retail stores, explains Chris Kohler at Wired.

–posted by Associate Editor John Sullivan

That’s because people there are too busy fighting over nothing these days.

Still, Hollywood’s writers and studios come back to the bargaining table again today, resuming their discussions to settle the strike that has been going on for three weeks now.

The Writers Guild of America is adamant about getting its writers a fair share for work that gets distributed over the Web.

And studios are just as stubbornly resisting, saying shares are not forthcoming anyway right now, given how paltry the revenues from Internet content are at this point in time.

While the wrangling has gotten lots of attention–no late night shows, the horror!–what’s really more appalling is exactly how slow all of Hollywood has been actually trying to change that equation.

Good thing, then, for producers like Pete Gibbons, the series producer of “KateModern,” an interactive online-only series being made in London and now appearing regularly on the Bebo social network. Each episode–not including all the other side videos and posts that hang all around each one–garners around 300,000 page views.

So far, of course, it is a fledgling effort, but a step in the right direction, even as Hollywood fiddles and its business burns.

Here’s an interview I did with Gibbons when I was in London:

(I am still having problems with my Brightcove player, so I uploaded it to YouTube.)

Hollywood writers or studios have yet to produce anything as interesting and innovative as this online. In fact, to my mind, neither side has made any effort in leading the way in creating a new kind of online-born content that will garner the kind of profits that are perhaps really worth fighting over.

Why is that? The basics–greed, laziness and fear–cannot be underscored enough.

Greed because it is still a nascent industry and the up-front, pay-now attitude that much of Hollywood still operates under will not work in a situation that clearly needs to have more of a venture-backed, risk-embracing mentality.

Few in the entertainment industry are willing to give up their still lucrative–although obviously declining in influence and audience–business for what’s next.

Laziness because it is easier to shovel stuff made for other mediums online or make professional Web material that is clearly derivative of current media like television, rather than try to imagine a whole new way of creating content that reflects and excels on the online platform.

I hear over and over that it is an impossible medium to create in–doubtless the same complaints heard at the time of the invention of radio or television.

And fear? Well, that’s often Hollywood’s most motivating force and one that precludes the atmosphere of true invention that is required for the new medium to blossom.

Of course, the real breakthrough hits will probably not come from Hollywood, whose first order of business remains filling the multiplexes or plugging that hole on the network’s lackluster Thursday night.

And, of course, in escalating costs, even as tech costs get lower and lower and tech companies are started on almost nothing.

By contrast, “KateModern” is produced at much lower costs–a necessary change that is almost impossible for Hollywood to get its head wrapped around–and changeable by the second by its audience. Gibbons and his team move the action along with startling speed.

Done by the creators of “Lonelygirl15″ (who are Los Angeles-based), “KateModern” is set in East London and follows a “troubled young art student named Kate and her three closest friends: an Australian wild-child named Charlie, a young entrepreneur named Tariq and a mischievous computer whiz-kid named Gavin.”

The series (now in its 17th week) is done in partnership with Bebo, which sells ads against the content, paying for it before it is made.

So, take a gander down the road a bit and check out “KateModern’s” latest episode, starring its Charlie character:

Watch More Videos       Uploaded by www.bebo.com/ChazOnToast

United Hollywood is a nifty Web site chronicling the strike in a blog and video, and it also has a page on YouTube.

After all, why shouldn’t people whose work is often ripped off on the site use it for their own benefit too?

Here’s a video of the writers of “The Office,” who are as goofy as you might expect, but who make cogent arguments about why they should share in the Internet wealth:

And how much do we love the chant, “How greedy can you get, they won’t even share the Net,” with “Grey’s Anatomy” cast member Sandra Oh carrying a picket sign? As much as we like donuts, that’s how much!

What, oh what, can we say about the latest inane quote from yet another Hollywood mogul about Apple’s Steve Jobs and his hugely popular iTunes and iPod products.

The latest piece of hoo-ha comes from former Disney CEO Michael Eisner (pictured below), pointing a finger at Apple as the real villain in the ongoing strike between the Writers Guild of America and Hollywood entertainment behemoths

At fault? Steve Jobs, of course!

Of course, it has been those greedy studio execs who have been shafting creators of content for decades now, by giving them a minuscule cut of revenues from DVDs and video cassettes.

Now that they are trying to do the same with income they will be getting as content moves to digital media, including the Web, cell phones and other new devices, Eisner comes out with an appalling analysis in an interview yesterday at the Media and Money conference.

Said Eisner:

“[Movie and television studios] make deals with Steve Jobs, who takes them to the cleaners. They make all these kinds of things, and who’s making money? Apple! They should get a piece of Apple. If I was a union, I’d be striking up wherever he is.”

Oh my goodness, considering how many businesses hang off the entertainment industry. Should the writers get revenues from the sales of television sets? Popcorn sold at the movies? From TV Guide? Of course not.

This comes after NBC Universal CEO Jeff Zucker noted in another interview recently that Apple owed him some money too for its success with the iPod.

“We don’t want to replace the dollars we were making in the analog world with pennies on the digital side,” said Zucker, who suggested entertainment companies should get a piece of the action. “Apple sold millions of dollars worth of hardware off the back of our content and made a lot of money.”

As I noted then: “That’s sort of like Britney Spears asking the tabloids to hand over a big bag of Benjamins for making such bank covering her riveting high jinks and crotch emergencies. Frankly, she has a better argument than Zucker.”

Eisner is even worse, making the score thus far: Britney 2, Hollywood 0.

At least according to former Disney CEO Michael Eisner who, in his keynote conversation at the Media and Money conference today, suggested that Apple is eating up the digital media profits the Writers Guild wants a larger share of. The studios “make deals with Steve Jobs, who takes them to the cleaners,” Eisner said. “They make all these kinds of things, and who’s making money? Apple! They should get a piece of Apple. If I was a union, I’d be striking up wherever he is.”

And please, pretty please, it just can’t be “lonelygirl15″ (pictured below) and some clever music videos.

The lack of lasting and profitable professional content online is once again in sharp relief with the writers’ strike now taking place in Hollywood.

In a Wall Street Journal piece yesterday on the struggle between the Writers Guild of America and entertainment studios, Ken Hertz, a Los Angeles lawyer who has worked on digital music issues, made an interesting observation:

If anything, the strike could create an opportunity for the online world to step up and prove its value to the guild. A strike could in a strange way damage the studios by creating online competitors who come forward to offer the union writers a new model that no one would have otherwise had the time or effort to conceive of.”

If only.

Because, while the main point of contention between the two sides is how to split future revenues from digital distribution, I am not sure exactly when it will become more than the middling revenue (and not much income) online content generates today, which is more like splitting up a tip jar at Starbucks than raking in big bags of dough from some Hollywood blockbuster.

That is likely to remain true for a while, given that consumers still are not used to paying anything much for what is considered entertainment on the Internet today (which is largely user-generated content) and that there is still a major piracy problem when it comes to premium stuff.

What’s considered a hit? “Lonelygirl15″ on MySpace TV? Its creators, who also produce the “KateModern” online serial for Bebo, put out a press release this week noting “more than 70 million views for the original hit show, ‘lonelygirl15,’ and the spinoff ‘KateModern’ reaching over 15 million views in its first two months online.”

Not bad, and its attempts to integrate brands into the plot are well and good, if annoying, such as when “Johnson & Johnson’s Neutrogena became a brand integration with a character–Dr. Spencer Gilman, a scientist from the company–was featured across two months of programming.”

There are scads of such projects now in production in Hollywood, all trying to recreate the kind of programming that made television a lucrative industry way back when.

But, so far, these are still baby steps, as are all attempts so far in getting a true payoff from online video, despite new ad paradigms from YouTube and others.

Also interesting are new online video sites like Hulu.com from NBC Universal and News Corp., as well as Joost from the creators of Skype.

But their efforts still fall well short of a system in which consumers can truly manipulate and control their content anytime, any place and from any device.

And even real offline hits don’t cut it yet–NBCU’s Jeff Zucker complained in his recent goofy attack on Apple’s iTunes that the company only generated $15 million in revenue for its video fare on iTunes in its last year, including for its wildly popular series “Heroes” (which we certainly forked over cash money for!).

So what to do? I guess exactly what the writers are doing–banking on the hope that Hollywood will eventually get it right when it comes to digital distribution and asking for their fair share when it does.

Writers, quite reasonably, want to be paid more as their work moves online–to the Web, cellphones and anywhere else that gadgets send content in the future.

It’s an especially pointed desire, given that they were essentially shafted in the last digital transformation when DVDs and videocassettes appeared.

As John Aboud, who is a strike captain for WGA, noted in a comment to my post last week on the strike, that even with all the money Hollywood has made, most writers are not well paid (although those at the tippy-top are copiously compensated).

“Median earnings of all members of the Writers Guild is only $5,000,” he wrote. “How can that be? About 48% of members do not earn any money from writing in a given year. Of those writers who do make some money, one quarter earn less than $37,700 a year.”

Ouch!

Still, he is entirely correct when he also added: “The distribution of entertainment over the Internet is not the future, it’s NOW. If the producers succeed in gutting our right to compensation for digital reuse and delivery, that is income that’s gone forever.”

Seems writers and producers still can’t agree on pay schedules for content distributed on the Internet and via other digital media. Or rather, the Alliance of Motion Picture & Television Producers is a bit too attached to the lousy DVD deal it convinced the writers to agree to 20 years ago, which gives writers, directors and actors a combined 20 cents for each DVD sale–30 cents less than the sum given to manufacturers of DVD packaging material.

“The companies refused to continue to bargain unless we agree that the hated DVD formula be extended to Internet downloads,” the guild said in a statement. “[W]e presented the AMPTP with a comprehensive package of proposals that included movement on DVDs, new media, and jurisdictional issues. We also took nine proposals off the table. The companies returned six hours later and said they would not respond to our package until we capitulated to their Internet demand. After three and a half months of bargaining, the AMPTP still has not responded to a single one of our important proposals.”

Too bad for the writers then. Because AMPTP president Nick Counter says increasing the DVD formula (a huge money-maker for the studios) is a nonstarter. “We want to make a deal,” he told WGA negotiators. “We think doing so is in your best interests, in your members’ best interests, in the best interests of our companies and in the best interests of the industry. But, as I said, no further movement is possible to close the gap between us so long as your DVD proposal remains on the table.”

Way to extend that desiccated olive branch, Nick. As John Scott Lewinski notes over at Wired, the producers offering to settle if the Guild drops all that is like the Galactic Empire telling Luke Skywalker, “OK, we’ll surrender … but only if we get to keep the Death Star.”

The talks between Hollywood studios and the Writers Guild of America ground to a halt as of last night and a strike could happen anytime, since the contract between them expired at midnight.

The big problem? Digital issues, which are sure to be an increasingly vexing issue for the entertainment industry, as more and more content moves or is even born online.

At issue are low-ball DVD residuals that writers also fear will be replicated in the digital arena, such as Internet downloads. They also want a piece of the online video ad market, which is still in its formative stages.

In a statement, the Writers Guild noted: “Every issue that matters to writers, including Internet reuse, original writing for new media, DVDs and jurisdiction, has been ignored.”

Studios, repped by the Alliance of Motion Picture and Television Producers, argue that the nascent digital entertainment industry, which so far is paltry in comparison to other distribution methods, needs time to breath before being pummeled by higher costs.

What NBC Universal CEO Jeff Zucker said the other day, referring in this case to its not-so-lucrative deal with Apple’s iTunes (only $15 million in video revenue in a year), is perhaps apt: “We don’t want to replace the dollars we were making in the analog world with pennies on the digital side.”

Except that might actually be the case for a while until Hollywood figures out a low-cost, high-standard way of producing for the digital medium. Instead, the industry is beset by piracy (which, sad to say, works well) and ever-higher production costs it seems unable to control.

In the new paradigm, one might assume that the creators of content–i.e., the writers–would have more power, as the proliferation of distribution platforms of all kinds continues.

No longer under the stranglehold of clueless and most definitely overpaid studio hacks, oops, executives, one might imagine a future where the creator and the distributor are one and the same.

Well, not yet, as creators still remain largely overpaid minions to the Hollywood machine, held in place by a system that seems sure to fall apart just as soon as a Google of the entertainment industry is created.

That is, a method for paying these creators and also for the production of content that rivals the current and obviously broken way it is now done.

Many years ago, writer Herman Mankiewicz wrote to Ben Hecht about Hollywood: “Millions are to be grabbed out here and your only competition is idiots. Don’t let this get around.”

That moment can’t come too soon for digital Hollywood.

We have nothing to do, the writers aren’t here. So a guy’s gonna come in and shave me. Fifty-five minutes, ladies and gentlemen! Fifty-five minutes to go!”

–David Letterman wings it during the last writers’ strike in 1988.

Unscripted reality TV, box-office bombs, endless reruns–dreck. There’s plenty of it on television now and there will be even more if the industry’s writers and producers cannot agree on a new contract by the end of the month. Because the writers’ unions–the Writers Guild of America, both West and East–have voted overwhelmingly to authorize a strike should negotiators determine that a fair deal cannot be reached with producers.

At the top of their list of grievances: pay schedules for content distributed on the Internet and via other digital media. The guilds were screwed years ago when they agreed to a discounted pay schedule for DVDs, only to see that business blossom. And they’re determined not to make the same mistake. “The guild made a bad deal 20 years ago, and they’ve been angry ever since and they don’t want to do it again,” entertainment industry attorney Jonathan Handel told the Los Angeles Times. “That’s why we’re seeing a line drawn in the sand.”

Problem is, the Alliance of Motion Picture & Television Producers doesn’t seem to be paying that line much mind. It claims there have been profound economic changes in the industry in recent years that make the terms and conditions of writing for digital platforms the guilds have proposed untenable. And hey, just because writers are paid residuals whenever their work is rebroadcast or sold on DVD doesn’t mean they should be paid residuals when their work is streamed over the Web–even if distribution costs are lower.

“[The guilds] continue to pursue numerous financial proposals that would result in astronomical increases in our costs,” said Nick Counter, president of the producers’ alliance. “Their proposals would also further restrict our ability to promote and market TV series and films and prohibit us from experimenting with programming and business models in new media. Instead of working toward solutions that would give the industry the flexibility it needs to meet today’s business challenges, [they continue] to hold onto demands that would impose unreasonable restrictions and unjustified costs.”

We have nothing to do, the writers aren’t here. So a guy’s gonna come in and shave me. Fifty-five minutes, ladies and gentlemen! Fifty-five minutes to go!”

–David Letterman wings it during the last writers’ strike in 1988.

Unscripted reality TV, box-office bombs, endless reruns–dreck. There’s plenty of it on television now and there will be even more if the industry’s writers and producers cannot agree on a new contract by the end of the month. Because the writers’ unions–the Writers Guild of America, both West and East–have voted overwhelmingly to authorize a strike should negotiators determine that a fair deal cannot be reached with producers.

At the top of their list of grievances: pay schedules for content distributed on the Internet and via other digital media. The guilds were screwed years ago when they agreed to a discounted pay schedule for DVDs, only to see that business blossom. And they’re determined not to make the same mistake. “The guild made a bad deal 20 years ago, and they’ve been angry ever since and they don’t want to do it again,” entertainment industry attorney Jonathan Handel told the Los Angeles Times. “That’s why we’re seeing a line drawn in the sand.”

Problem is, the Alliance of Motion Picture & Television Producers doesn’t seem to be paying that line much mind. It claims there have been profound economic changes in the industry in recent years that make the terms and conditions of writing for digital platforms the guilds have proposed untenable. And hey, just because writers are paid residuals whenever their work is rebroadcast or sold on DVD doesn’t mean they should be paid residuals when their work is streamed over the Web–even if distribution costs are lower.

“[The guilds] continue to pursue numerous financial proposals that would result in astronomical increases in our costs,” said Nick Counter, president of the producers’ alliance. “Their proposals would also further restrict our ability to promote and market TV series and films and prohibit us from experimenting with programming and business models in new media. Instead of working toward solutions that would give the industry the flexibility it needs to meet today’s business challenges, [they continue] to hold onto demands that would impose unreasonable restrictions and unjustified costs.”