This is pretty dense with industry-specific terms, but I think I figured it out.
"Packaging" is a talent agency bundling up different creative roles (writer, producer, actor) for a project (film or tv show) and then pitching that group of people for that specific project to the studios. The agency takes a percentage of the _project_ revenues instead of a percentage of each individual _talents_ pay for the project.
This is apparently the standard way things work in Hollywood now and has some consequences:
1. It screws up the "Agent" part of the talent agency. They no longer directly represent an individual's interest (like a Real Estate agent or a Lawyer) because they just want to get people into a "package". This is the main problem described in the article, that there are some massive conflicts inherent to this process.
2. Packaging projects make agencies way more money than directly representing clients.
3. It reverts movie and tv making back to something like the studio days. Every actor isn't really able to work with every director, in order to get something made they need to be "packaged" which means working with someone else from within the same agency.
4. It messes up people lower on the rung more than top tier folks because they're less able to buck the system.
It seems to me that it's not just a conflict of interest, but the interest of the agency is actually diametrically opposed to the interest of the talent. By keeping the pay of the talent they purportedly represent as low as possible, they make the overall 'package' easier to sell to a studio (which is how they actually make money).
Yes, Simon points this out explicitly: "Why bother to fight for 10 percent of a few dollars more for this story editor or that co-executive producer of some actor or director when to NOT do so means less freight on the operating budgets of the projects that you yourself hope to profit from? Why serve your clients as representatives with a fiduciary responsibility and get the last possible dollar for them, when you stand to profit by splitting the proceeds of a production not with labor, but with management — the studios who are cutting you in on the back end? Why put your client’s interest in direct opposition to your own?"
Hypothetically the more the package costs... wait, the "packager' isn't taking a cut of how much the package costs like they do as an agent (where they take a cut of how much their client gets paid, so a cut of what the studio is _spending_, so they want the studio to spend more, at least on their clients), they're taking a cut of project revenue??? (Or profits, or something in between, either way).
Oh yeah, that's evil. They're not representing their client at all anymore.
The obvious way to align these interests is that the "packager" should share a portion of their "packaging" cut with the people "packaged". But of course, the point of the whole "packaging" economy seems to be so they don't have to do this.
Real Estate agents are famous for not representing their customer's interest. In real estate, half the time (buy-side) your agent is being paid their entire income for the transaction by your adversary. In several states, "your agent" is legally required to disclose the fact that they are not your agent!
The incentives are also very messed up, because of the way commission is paid. Freakonomics [1] famously covered this:
Commission is typically 6%, which is split 4 ways to the buying agent, their agency, the selling agent and their agency. So your agent personally takes home 1.5% of the selling price -- on a $300,000 sale, they are making $4,500.
The difference between selling your house for $300,000 and $310,000 after commission is $9,400 in your pocket -- and a paltry $150 for the agent. Are they going to take the risk of leaving it on the market for an extra week (and spending more time showing it, etc) hoping to make an extra $150? Of course not. (Spoiler alert for the book: unless it's their own home, in which case they leave it on the market for an extra 10 days and sell for an extra 3% on average).
Another incentive problem exists on the buy-side: your agent gets paid more money the more you pay for the house. It's literally working against their interest to negotiate a lower price, other than when it's above your absolute maximum.
And as a buyer's agent, they make more money the _more_ you pay for the house you are buying, where of course you'd rather pay as little as you can get it for.
Even if the amount more they'll be making is trivial, it ends up being the same as the seller's agent problem in reverse. At best their incentives are to not care how much you pay, but want you to buy a house already without them showing you more. At worst, they actually want you to pay more.
This is why, when selling, its better to use a la cart brokers. You pay a set fee to MLS your place, and set fees for other things. You still need to pay a commission to the buyer broker/agent, otherwise they won't show your place. So, 2.5% or 3%.
Traditionally, the commission paid was 5% (split 4 ways), but some markets that got as high as 7%. I once had an agent explain to me (who was bad at math) that this was due to inflation.
Yeah, I’ve had supposedly educated people try to tell me they tip 20%+ for standard waiter service instead of 15% due to inflation. Some work in finance. And sometimes on tip on the tax too. Crazy times we live in.
If your buddies work in finance, they should tip as much as they want (50%? Why not?). The poor restaurant workers need the money a whole lot more than they do.
The financial services industry has been skimming gajillions of dollars off the whole economy. Might as well pay at least some of it back to folks doing honest work.
The real value of wages for waiters has decreased significantly because of inflation. Though that's not really inflation's fault as much as a lack of meaningful wage increases.
Your agent, no matter who is paying them, has a fiduciary duty to you. I’ve bought and sold a lot of property and can guarantee you that the fact that commissions are paid by sellers makes zero difference. Really, it’s coming out of the purchase price, which is netted to the seller but technically is being paid by you.
Your agent, no matter who is paying them, has a fiduciary duty to you.
This isn't universally true. In some US states, the frequent problem is that the agent who is showing you homes (and who you tend to think of as "your agent") is not actually your agent (with fiduciary duty to you), but a subagent of the seller (with fiduciary duty to them). Here's an excerpt from recent report on this:
---
For many years, a large majority of home buyers and sellers have worked with real estate agents. Most consumers believe that these agents always or almost always are required to represent the interests of the home buyer or seller with whom they are working. ... Yet, real estate agents often are not required by law to represent the interests of the buyer or seller with whom they are working, and many do not.
In reality, there are a number of different types of relationships allowed in most states between real estate agents and their clients.
• Single agent: The agent works solely for the client
and has fiduciary responsibility. A fiduciary agent
is “obligated to procure the greatest advantage to
his client.”
• Designated agent: The agent is recruited by the
listing agent to work with a buyer and has fiduciary
responsibility to that buyer.
• Subagent: The agent works with the buyer but has
fiduciary responsibility to the seller.
• Dual agent: The agent somehow is expected to represent the
interests of both the seller and buyer in a home purchase.
• Transactional agent: The agent works with both buyer and
seller to facilitate a sale but has no fiduciary
responsibility to either party.
So while it's possible that you live in a state where you are correct, where subagency and dual-agency are forbidden, in the absence of a signed contract for the services of a buyers agent, others should not follow your advice until they are certain the same is true for them.
End of the day, an attorney represents your interests. A real estate agent may represent you but their actual duties are fairly minimal.
Real estate agents fiduciary responsibility is held to a reasonable care standard for matters relating to real estate. That means they need to be competent. Many of the things that buyers seek advice from agents are answered like "In my experience, blah blah blah". Those are usually legal questions, which agents are not able to answer. Often when people get in trouble, its because they don't understand what they are asking and mistake salesy fluff for an answer.
End of the day, 99% of what a "buyers" real estate agent does is bullshit that makes you feel better. "Sellers" real estate agents get listings, period. Buyers agents exist because people good at getting listings have a disincentive to talk to buyers. The buyers agent's primary task is getting ahold of keys quickly and pushing sellers to accept offers. Shitty agents who are incompetent or dishonest may slow-roll things to get you to accept offers quickly.
They may help you identify the type of home you want, but that isn't a fiduciary duty.
> In many US states, the frequent problem is that the agent who is showing you homes (and who you tend to think of as "your agent") is not actually your agent (with fiduciary duty to you), but a subagent of the seller (with fiduciary duty to them).
Subagency was common up until the 90s but is exceedingly rare in today's market (and outright illegal in many states). In 2019, it is not at all a "frequent" problem.
You are right, and I probably overstated the frequency of that particular form of agency to point out a worst-case-scenario. I likely should have stuck with the main message that for a variety of reasons, an agent who is showing you a house does not necessarily have your best interests at heart. Do you happen to know how common it is for current buyers to be represented by an agent who does owe them sole fiduciary responsibility?
Even with fiduciary duty, most agents undersell property.
When the first offers are underpriced, a lot of agents will pressure you into selling, because their income is tighly coupled with the number of transactions per year.
There’s a couple of studies from the US that concluded that most sellers close the deals way too early, and that rationally they should have waited for more offers.
It is up to the seller, but when an experienced professional who tells you they have your best interests in mind tells you to underprice (because it's better for their bottom line)...
Actually, that's the poster child for a conflict of interest.
In our state, there is a well known realtor who has grown his practice using unethical methods. As one example, his agents routinely hang on to bids and don't present them to sellers within a reasonable time, using them to get buyers who have contracted with them to put in bids. ("You better put in a bid above asking - other people have put in bids"). This allows him to get the full commission instead of sharing it with other companies.
Real Estate agents are hopelessly conflicted. I don't use them so the seller's agents ends up working for me too. They tend to slip into a mediator role more than a fiduciary.
Lawyers would get disbarred it they operated similarly.
It's worse that that. First, all of the money comes from the buyer; that's why they're called the buyer. It goes to the seller who pays the closing costs. So the entire BPP = Buyer's Price of House is (Seller's Price of House + Closing Costs). The buyer will then pay sales tax on BPP. Yes, you are paying sales tax on the closing cost. It's worse still. You then pay property taxes on the BPP which means that you pay property taxes on the closing costs.
You can and I did negotiate the BPP and then tell the seller that you will be paying the closing costs yourself and deducting them from the BPP. Then you avoid paying sales tax on the closing cost service and paying property tax on the closing cost service.
Oh, and don't even get me started on the financial services industry scam of mortgage interest deductions.
As usually, the disclosure is done as two crimpled pink pieces of paper with light gray print. The text on the paper tries to be legally correct and understandable by non-lawyers at the same time and fails to achieve either of these purposes.
Interesting. It seems the only way to get a movie made that's not a studio-originating project, with people who _you_ want to work with, is 1) get your own financing (like DiCaprio schmoozing the 1MDB guy to fund Wolf of Wall Street), or 2) play tit-for-tat with something the studio really wants to make (like George Clooney giving them Ocean's 12 in exchange for them funding his Good Night, and Good Luck).
Yes, basically this: the big agencies that run the vast majority of the entertainment business have transformed from talent representation into "deal makers"... essentially producers who represent everyone involved in deal. In theory this streamlines the whole process. In practice is royally fucks everyone involved who is not already in a power position.
Essentially now, if you are a writer or b-list celebrity, you almost need an agent to represent you when dealing with your agent.
Idk anything about movies, but the idea of packaging "talent" sounds potentially interesting for the startup space. 2-5 people "packages" that can already work well together and know what they can and can't do well.
I know I've been in circumstances where something like this would have worked really well.
Wait, do consultants do actual work instead of just giving advice? (Serious question.) I always thought consulting is just looking at the existing/planned processes and products and saying “You should do X using best practice Y. Here are the details of my deep knowledge.”
In contrast, I thought anyone actually working on processes or products but not being an employee is a contractor. If anyone can enlighten me, I’d be glad. I always wondered what consultants do.
Yes, there are plenty of consulting firms that will make you an iOS app, web site/application, data processing pipelines(my company). IBM and Accenture are large companies that provide these services. Outside of tech, there are large firms like PwC that audit your books, and do other things you don't have the in-house skills for. Pharmaceutical firms ofter consult out their marketing to companies like ZS Associates.
The consulting you're talking about is "management consulting", but there's a huge world of stuff out there.
It's worth noting that companies like IBM and Accenture are also clients of those kinds of consulting firms that will make you an iOS app, web site/application/etc.
"Consulting firm" is often used as a generic term for any company you hire to do business work for you.
For example if you need a mobile app and hire a company that specializes in building mobile apps for their clients, there's a good chance the contract will say "consulting agreement" across the top.
But, in general conversation among technologists, those are more often called vendors, or contracting firms, or agencies.
When it's an individual person, the label usually depends on their role: consultant has some ownership of the result (in theory), contractor does skilled labor as assigned, temp does less skilled labor as assigned, intern, etc.
Yah, it's kind of a continuum. Plenty of consultants do execution, not just in tech. Accenture are "consultants" who will try and build you whatever you ask for, but they actually started as a subsidiary of Arthur Andersen.
What you're proposing sounds doable (and has been tried a couple times). But the Hollywood packaging equivalent would be that first:
1. An "Agent" who was repping you doesn't disclose that they're also repping the Project Manager for the team (who is really well known) and you lose out.
2. Because of the incentives, there's little interest from the agent that is repping you to look for work for your solo projects or if it intersects with another agency.
"[Andreessen Horowitz] aims to flip the venture industry on its head by acting more like a talent agency - specifically Creative Artists Agency, which became so prominent in Hollywood that it was hard to do deals without them being involved."
Writing like that, in a showboating over-the-top style, is effectively its own special genre. It's not supposed to be economical. It's not solely meant to communicate a specific message. It's the "hold my beer" of writing. It's the kind of writing other writers appreciate for what it is -- like the jokes that comics tell each other -- not meant for general consumption.
If you want to label it as "bad writing", you're certainly within your rights. But it's reductive, it misses the point, and worst of all, as an insult, it's rather boring.
Too bad, too, because I make the same criticism myself, of the New Yorker style of "make me wade through 500 words just for an inkling of what this is actually about". But yeah, it's a matter of taste.
Keep in mind that he’s writing to convince other writers, statistically you probably aren’t the target audience. My gym buddy who’s a professional tv writer says that this entry had a big impact on getting WGA to do something.
I would go even further and add -- "over-the-top" or "showboating" relative to what?
I think it's more that the consensus style of much business communication, technical documentation, and academic literature is very sparse and dry and focused. Which is most definitely a style and not a baseline which represents some sort of "normal".
You can make the argument that the style of the blog post supports its content and purpose by showing and emphasizing the outrage with Simon felt/feels.
So yeah, labelling it as "bad writing" is ridiculous. Agreed. : ).
Sorry for the rant - I have strong feelings about the written word : ).
All his acclaim would seem to dismiss any thought that it's bad writing. Someone's boat must have no show if this is showboating. Someone's top must be pretty low if this is over it.
Although there are still a few things that jump out and you have to forgive. Like how I had to forgive Frank Sobotka's angry blue-veined diamond cutter. Actually I don't know that I've forgiven him for that even yet.
This article is a little bit old because he mentions the upcoming union vote. The vote has now been cast, and 95% of writers have voted to only work with agents signing a code of conduct that bans packaging:
Funny side note I learned from my girlfriend who is an aspiring writer and has worked at an agency: agents call this practice "getting points on the package" which may be a term that rings a bell if you've watched the wire, https://www.urbandictionary.com/define.php?term=Points%20on%...
David Simon's books "Homicide: A Year on the Killing Streets" and "The Corner: A Year in the Life of an Inner-City Neighborhood" (co-written with former homicide detective Ed Burns) are the kind of stories that change your thinking forever.
Personally I avoid profanity in my writing, because I don't think it would add anything. But this essay illustrates that it can add quite a lot, if you know how to use it. Deployed with expert timing and creativity, in the context of other effective rhetoric, it conveys the depth of Simon's outrage and disgust. I still don't think I would achieve anything by peppering my comments with f-bombs, but I think he has earned them.
I disagree. This is an excellent way for the author to express himself. The meaning is clear, and the author avoided cliche and in doing so ensured that I would respond freshly to the word. If he'd simply said "fuckwad" or "bastard" or some other word I read a lot, my response would have been muted. It also makes it clear to me that his feelings towards these people are raw and fresh. The author has achieved excellent communication; I can literally feel his anger towards and frustration with these people (I'm feeling it right this second, as I type), rammed into my mind with a pithy "fuckbonnets" - it's almost like a kind of emotional punctuation.
I enjoyed reading it. The creative language implies a seething rage and firmly sets an emotional and moral agenda based on a perceived sense of outrage, something a vast majority of articles these days try to avoid or hide and for that reason, it is immensely refreshing to read in an increasingly neutral, dull and grey landscape of fence-sitting rhetoric.
I'm sure there's other more rational, balanced and nuanced articles but I am dead certain that's not what this particular writer wanted to convey, and the language to me seems intentionally polarising, not accidentally so.
It is sure to ruffle some feathers, more so than a nuanced essay, which likely would have garnered little more than a "hm" from most people. Sometimes shouting in the street gets attention, and when you have that attention is when you hit with the logic.
This is from the guy who wrote "The Wire" (appeal to authority notwithstanding) so I'm willing to lend him some credibility that he understands how to use language, and accept that he has creative freedom in expressing opinions on a subject matter which has personally affected him and other creatives in an industry he deeply respects.
That is not to say I don't think that there needs to be other more balanced and informative essays written on the subject, I just don't think that this article is meant to achieve that purpose.
This guy wrote The Wire, which famously had a scene comprised entirely of two detectives saying ‘Fuck’ in different tones of voice while examining a crime scene. I’m not sure what you would expect.
Probably not much different in substance from the treatment of musical artists by the big recording companies, or of novelists by publishing houses, or ... insert any comparable paired relationship of creative maker and avaricious exploiter and you'll get the same outcome.
It seems the easy win here is for everyone who gets packaged to walk into the studio the next day and say "cut out the agent and we will take the agency's 20% and give you back 5%"
If acted on like a union (Equity) then the whole process would stop in a month
Spare me the j-school varsity social criticism takes, especially if they’re gonna go after that kind of language play without even referencing Armando Ianucci.
There's a union vote up for the relationship between the WGA and the big 4 agencies, and he is on the WGA council. So this is him giving a stump speech for voting for the restrictions on agencies. Here's an article on the subject:
> The WGA aims to revise its decades-old rules to bar agencies from taking packaging fees from production entities on TV series and movies, and the guild seeks to bar WGA members from working with talent agencies with parent companies active in the production arena.
Can you at the very least expand on why it's so terrible, maybe a couple of examples so we can understand where you're coming from. All we really have is "Good God, my eyes" and similar epithets implying your stance that this is simply intellectual masturbation and hubris, but no real substance into what exactly makes you feel this reaction to the article. I am genuinely curious because I thought for what it was worth, it conveyed its point pretty well regardless of whether the guy is some big shot writer or not.
At least two cliches per paragraph, buried lede some 500 words in on what "packaging," actually is and why it's bad, voice changes mid paragraph (first, second, third), to start. If these didn't merit a "Good God, my eyes," by themselves there are some great resources online about how to write.
For a topic like the ethical (fiduciary?) obligations of agents to the people they represent, the issues above raise doubts about whether the writer can think clearly enough to represent a credible and honest case.
To triple down, when you are a pro writer, producing ostentatiously poor work is a forfeit and an expression of contempt for readers.
Are you seriously arguing that because he buried the lede and changed voices, you doubt his ability to think clearly enough to opine on fiduciary duties? I appreciate fine writing as much as the next person, but the standard you seem to be applying is hardly correlated at all with clear thinking - it's correlated with lots of training and taking care to write in that style.
On a tangent: your original comment is missing a possessive comma. But I would never make the argument that such a lack of attention to detail brings your entire line of thinking into question. I'll take issue with the content of your post rather than the form.
We're way deep into a thread now, but it's an important problem.
I would very seriously argue that someone who does not write clearly in their native language has not reasoned clearly enough about what they are trying to express.
They may experience, feel, believe, express, or desire, but without the language, they have not reasoned about it with clarity. What's more, they are relying on something other than reason to prevail. It's analogous to the "you only know something as well as you can teach it," or Feynman's "explain it to a child," learning technique.
Regarding the apostrophe, it's a fine catch and I would ask whether the effort the writer made was commensurate with their intended purpose.
>buried lede some 500 words in on what "packaging," actually is and why it's bad,
His primary audience is not HackerNews. I assume that most of the people subscribed to David Simon's blog are probably working in Hollywood and thus do not need so much explanation as to what Packaging is. He even explicitly calls out the fact that we are not the intended audience for his rant in the first substantial paragraph of the piece, and implicitly through his repeated references to the Writer's Guild of America.
So I find this criticism rather unfair. Imagine a Facebook group for bird watching complaining about how a Medium post ranting about the evils of object-oriented programming didn't sufficiently explain what it is to people with no experience in programming.
"Packaging" is a talent agency bundling up different creative roles (writer, producer, actor) for a project (film or tv show) and then pitching that group of people for that specific project to the studios. The agency takes a percentage of the _project_ revenues instead of a percentage of each individual _talents_ pay for the project.
This is apparently the standard way things work in Hollywood now and has some consequences:
1. It screws up the "Agent" part of the talent agency. They no longer directly represent an individual's interest (like a Real Estate agent or a Lawyer) because they just want to get people into a "package". This is the main problem described in the article, that there are some massive conflicts inherent to this process.
2. Packaging projects make agencies way more money than directly representing clients.
3. It reverts movie and tv making back to something like the studio days. Every actor isn't really able to work with every director, in order to get something made they need to be "packaged" which means working with someone else from within the same agency.
4. It messes up people lower on the rung more than top tier folks because they're less able to buck the system.