Hollywood writers end strike threat with deal

The Union representing Hollywood's screenwriters said yesterday that it had struck an 11th-hour deal with the big studios on a new three-year contract, thus averting a strike that the entertainment industry had been dreading for months.

The Union representing Hollywood's screenwriters said yesterday that it had struck an 11th-hour deal with the big studios on a new three-year contract, thus averting a strike that the entertainment industry had been dreading for months.

The old contract expired at midnight on Tuesday but the two sides kept talking day and night until late yesterday afternoon. The Writers Guild of America, led by John Wells, producer of ER, must now put the deal to its 11,000 members but everyone agreed yesterday that the worst was almost certainly over. No details of the deal were as yet available.

The final round of talks, which began in mid-April, have been subject to a news blackout for the past 10 days so as not to jeopardise chances of a deal. The agreement with the writers greatly increases the chances that peace will break out between the studios and the Screen Actors Guild, whose contract runs out at the end of June. Since last autumn, studio executives have faced a nightmare scenario under which both guilds would walk out together, bringing most television and film production to a halt.

Both guilds wanted an improved structure of royalty payments, or "residuals", for secondary use of their material on cable, video, DVD and the internet. Until now, they have usually had one-off payments for such usage ­ with no reward from repeat broadcasts.

The militant mood prevailing earlier this year changed sharply, however, as the stock market fell and economic gloom spread. Both sides suddenly began looking for a deal.