Product Integration

Screen Actors Guild (SAG) has pushed for new rules on product integration, one of the dozen or so outstanding issues between the union and producers in their long-stalled negotiations on a new television and film contract.

According to research by PQ Media, advertisers spent $2.9 billion in 2007 on product placement in movies and TV shows, a 33.7 percent increase from the year before. For 2008, PQ Media projects the number to hit $3.6 billion, a 24 percent increase.

It is likely that product placement and integration will continue to rise at double-digit rates, because the number of homes with digital video recorders, which allow viewers to zoom past commercials, is growing at triple-digit rates.

Leichtman Research Group found that 2 percent of U.S. households had a DVR in 2003; by 2007 the figure had increased to 20 percent, and by 2011 Leichtman projects it will be about 50 percent. That's an average yearly increase of 300 percent. Video-on-demand services have also curtailed the effectiveness of the traditional 30-second spot.

Many of the product placement and integration deals come in the reality genre, where SAG has no jurisdiction. According to the Nielsen Co., the top 10 programs in product placement in 2007 were all reality shows.

According to interviews, SAG has no significant objections to product placement, which simply involves placing products on set. The union does, however, have issues with product integration, in which actors are told to speak lines of dialogue that mention or extol a particular brand. "Actors feel it compromises the integrity of the performance when they're asked to integrate dialogue into a story line about a product that otherwise wouldn't be mentioned."

According to its contract proposals, the guild wants actors to be notified of product integration deals in advance of production, to have the right to consent or refuse to speak dialogue in support of a product, and to be paid extra if they do.

In what it has termed its final offer to the guild, AMPTP rejected SAG’s demands. "SAG's proposal on product integration is completely unworkable because it would allow an actor to hold up production and demand to be paid twice for the same work."