Candice Kersh, a partner at the firm, pointed out that in today's advertising industry, you have to make a distinction between creative properties, and value is becoming very important in the creative.

"Creators of content—either that goes within a different industry in which the norms are different, or that creates additional value for the client in other ways than that which would have been reasonably expected in the past, such as simply brand awareness—are trying to figure out a way to get paid for that value," Kersh said. "The two ways we're discussing doing it is through the ownership of the creative, which allows you to license it and control it, or by being compensated more if you create more value."

Kersh was joined on the panel by Josh Rabinowitz, senior vice president and music director, Grey Worldwide; Katarina Skoberne, co-founder and group managing director, OpenAd; Emily Liu, director marketing/PR, Sixty USA; and Jonathan Weinstein, executive producer/partner, GO Film.

"The question we are all faced with is should we follow the compensation model that exists where a client pays an ad agency for an idea for a flat fee or should they really be paying for the sales results that they get for the idea," Weinstein told the audience. "Is it fair to pay creative a fee for creative based on reuse or future use or possible revenue generated or is it fair to stick with the old model of you came up with a great idea, I pay you a nice living for that idea, and now if that's successful I reap the benefits?"

Weinstein said that people call him all the time and say they want to shoot a viral ad. "That's like me calling you and saying, 'I want to shoot a Gold Lion.' I don't know if its going to win a Gold Lion when I shoot it and I don't know if its going to be viral when I shoot it. If it gets seen and people like it and they e-mail it to each other and it gets on YouTube and it has 20 million hits the first week its on there, it's viral. But to contract me to shoot something that is going to be viral—I can't promise you that it's going to be viral.

"In terms of the media we are producing now, it's a lot a projection of what will be successful. And I think that's where the world of advertising and client relationships is broken in terms of compensation. Because we are trying to compensate in the hopes that something will be hugely successful. Everybody wants their piece. That's why the writers have been picketing the last couple weeks because they want their piece. They wrote something and there are more screens to see it on than there were three, five, 10 years ago."

Weinstein explained that GO Film started GOON Media (SHOOT, 4/13) because the company was constantly being approached to do work for the Internet only. "Given that we are a union company, as a production company we couldn't do what was necessary to achieve that through our existing company. So we started this creative consortium," he said.

MRM Worldwide and McCann Erickson approached GOON Media about crafting two Web-based mock music videos for Intel. GO Film's director Christopher Guest wrote the tracks for the videos with CJ Vanston. "We share that ownership with the client and agency," related Weinstein. "The interesting thing is as large an agency as McCann is, it sent us through a commercial production contract. And we said, 'But it's not a commercial. It's going on the Internet. We can't sign a commercial production contract.'

"We had to revise and rewrite a new contract because the ad agency didn't have one that existed for this type of media. If they reuse that as a commercial, on the radio or anywhere other than its original specific intent, we will be paid again for that because the fees we charged for that were far different than what we would have charged had they been producing two :60 commercials.

"In our world," continued Weinstein, "it's a very interesting landscape right now...I am working directly for clients and I am working directly for ad agencies. Three years ago if I told people I was working for clients, they would say I was out of my mind, that an agency will never hire you again if you are working for their client. Well there are certain things agencies don't provide clients and they are looking for it elsewhere and it's okay now."

Overall, there seemed to be a positive outlook about the future amongst the panelists. Kersh is optimistic that advertisers, production companies and agencies will be able to arrive at fair relationships in the future as advertising and entertainment continue to merge.

"I think there is a long way off to where the world should be but I think we are getting closer. In my practice I am doing a lot more deals where you are getting to a value-based compensation structure and there is a recognition that different creative has different value. There are some clients who can be somewhat intransigent in their views and as a result as an industry as a whole we are a long way off, but that doesn't mean I am not optimistic that we are getting there," Kersh said.

Her advice to parties involved is to focus first on their own culture . "You have to believe in this. You have to embrace this. Because in order to convince another of the merits of this, it has to be permeating the entire culture. Once you do, it's being creative in terms of how you discuss it with the client and understand that not one size fits all. You have to look at all the various things you do. It may be that this type of compensation structure is an overlay if you are doing a lot of services. It may be appropriate for incremental revenue. It doesn't mean that it's an all or nothing situation. You have to address compensation and ownership based on situational factors."

By Nicole Rivard - Reported in SHOOT on November 30, 2007