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In a move that will keep union members working for at least the next three years, negotiators for the Writers Guild of America agreed to a new contract on May 4, three days beyond the date of a threatened strike. The WGA had agreed to let its members keep working as discussions continued beyond the renewal date for the old contract, which expired May 1.

The city of Los Angeles breathed a collective sigh of relief at the quick resolution of the discussions. Had negotiations stalled, the writers would have gone on strike against both film studios and television production companies, effectively shutting down the entertainment industry and, with it, the city which depends on it. "A cloud has been lifted from the Los Angeles economy," said LA Mayor Richard Riordan, who had worked quietly but tirelessly behind the scenes to get the adversaries to reach an agreement. Riordan had commissioned a study on the potential effects of a prolonged strike against the entertainment industry, which predicted a loss of as many as 81,900 jobs and as much as $6.9 billion in income for the LA region if strikes continued through October. A strike would cost Southern California as much as $500 million per week, the study concluded.

The apparently quick resolution of the issues wasn't easy, negotiators said. "I just want to say this is one of the most difficult negotiations we've had in many years because of the complexity of the issues facing the industry today, both for writers and for producers and our member companies," chief industry negotiator J. Nicholas Counter told the Los Angeles Times. His counterpart from the WGA, Michael Mahern, expressed similar sentiments.

The WGA's new contract, which must still be ratified by union vote, gets writers $5000 additional pay for features released on DVD—a format that was not yet a market force during the last contract renewal. They will also get residual fees for features and programs shown on foreign television and re-run on domestic networks. Other concessions include the right to visit sets of films in production and to participate in promotional efforts such as press junkets for new releases. Despite the industry's emphasis on directors and stars, without writers there are no movies, and they want to receive the recognition they feel they deserve. WGA negotiators failed to win a concession on a related issue, the "film by" credit, which typically goes to a film's director. The new contract has been estimated at a value of approximately $100 million to the entire industry over an unspecified period of time, according to the Times.

One widespread hope is that an impending strike by members of the Screen Actors Guild and the American Federation of Television and Radio Artists can be avoided, too. SAG and AFTRA spokesmen said they "look forward to analyzing the new WGA deal in detail to see if will be helpful in finding a way to address the specific needs of actors in our upcoming negotiations." Actors' contracts expire June 30.