News & InfoEP StoreAcademySupportCommunityProducts by Country
Blog Home

Residuals and the Streaming Model

How residuals apply to historical content on new media platforms.
May 24, 2022

Anthony De La Rosa

A robust streaming platform is made up of content that appeals to everyone - from widely celebrated new series to quirky independent films. And, of course, feel-good favorites from years gone by. Public forums buzz over the content itself, but we rarely talk about all the work happening behind the scenes to bring beloved content into our living rooms.

To build successful content libraries, unsung heroes of the residual teams must accurately predict what will resonate with viewers and forecast what it will cost to procure desired content for their platform. These teams are also responsible for setting up content, accurately calculating residual payments, and ensuring those payments are ready to be distributed in perpetuity. Long story short, there’s no room for error in this critical role.

How do residuals apply to historical content on different types of new media platforms? Let's dig in.

New media residual basics

'Historical content' refers to any media (movies, television shows, or series) that is not brand new. More specifically, content produced in or after 1971. 'New media' refers to three types of on-demand streaming platforms:

  1. Subscription Video On Demand (SVOD) – A category of new media which require viewers to pay a monthly fee to access their content. Examples include well-known streaming platforms like Netflix, Hulu, Amazon Prime Video, Apple+, and others.
  2. Ad-Supported Streaming Programs (ADSS) – Rather than charging a monthly subscription fee for access, these platforms make money from ads that play before, during, and after streamed content. YouTube is a great example.
  3. Electronic Sell-Through (EST) – A media distribution method where consumers pay a one-time fee to download a digital media file to their device. For example, buyers may purchase a single episode of a TV show or a digital movie from a platform like Amazon or Vudu.

Residual rate calculations for historical content on new media platforms are primarily determined based on two things: 1) which guilds have signatory rights to the content and 2) what type of platform the content is being consumed on. We’ll explore how both parts of this equation impact rate calculations as we go through the setup process.

Setting up historical content residuals

The process for setting up residuals is the same for historical content and new content. The key steps are:

  • Determine which guilds have signatory rights to the content
  • Collect production and payroll paperwork
  • Analyze documents and perform calculations
  • Input talent calculations into the system and generate a residuals report

Residual teams must complete each step listed above in its entirety before moving on to the next step, and must complete all four steps before any payments can be made. We'll focus on steps one through three for the remainder of this post.

Step 1: Determine which guilds are signatory

Three major guilds set residual rules, rates, and regulations for historical content - the Screen Actor’s Guild (SAG-AFTRA), the Director’s Guild of America (DGA), and the Writer’s Guild of America (WGA).

Your residuals team must determine which guilds are entitled to receive payments in order to accurately calculate residual costs. Step one in this process is figuring out which of the three major guilds have signatory rights to the content.

To find a production, you can visit the major guild signatory databases:

If a guild has signatory rights to a piece of content, the title will populate in the search results. A word of caution; if you're not sure about spelling or punctuation, try multiple options or type in a broader search term to make sure you don't miss anything. The responsibility for getting it right falls to each production's residuals team - so it's critical to be thorough.

It's also important to know that one, two, or even all three guilds can have signatory rights on a single piece of content.

Step 2: Collect production and payroll paperwork

When it comes to historical content, locating these important documents can mean hours of sifting through file boxes and binders of paperwork. That being the case, the setup process can take a significant amount of time. At EP, we do everything in our power to digitize and streamline residual setup. Our system utlizes crew rosters, payroll data, and other securely stored digital documents to make the process as quick and painless as possible.

No matter which guilds have signatory rights, production teams need to gather the following documents to set up historical content to receive residual payments:

  • Picture or series title and episode number or title
  • Principal photography date
  • Product length
  • Primary shooting location(s)
  • Made for market (new media, theatrical, etc.)
  • Main title and end credits
  • Guilds applicable for residuals (including all U.S. and foreign guilds, and non-union)
  • Any special agreements related to residuals negotiated between producer and guild(s)

In addition to the items on the list above, residual teams must track down a few other vital documents for each signatory guild:

SAG-AFTRA: Final Cast List – This guild-official form includes specifics on who worked on the project, each person's role type, pay details, and tax identifier information.

DGA: Deal Memos for the Director and Crew – These documents include personal identification data and details on what each cast or crew member worked on.

WGA: Writer Payroll Information and WGA Notice of Tentative Writing Credits – ⁠This guild bases residual split percentages on subtle details, such as whether the credit uses the word “and” or an ampersand. This seemingly minor difference actually changes the amount of money each writer receives, so it's critical to have this document in order to make sure your payments are set up properly. Despite what the name implies, tentative writing credits are an official guild document, and will allow you to ensure accurate payouts.

Here are examples of different ways WGA splits residual allocations:

WGA Allocation Examples.png

Step 3: Analyze documents and perform calculations

New media residual rate calculations are complex, in large part because they vary significantly based on the type of new media platform where the content will be streamed or sold. As mentioned earlier, there are three primary types of platforms. Due to market and project type variables, calculations will depend on fixed payment or percentage of receipts.

What happens if residuals are over or underpaid?

Any time you add a new piece of media content to your library, you must accept the liabilities that come along with it. When it comes to residuals, those liabilities include things like missed payments and inaccurately calculated rates that result in over or underpayments.

Let’s say, for example, your team sets up a residual payment incorrectly, and as a result, an individual is overpaid. When this happens, your team must go through a process called recoupment to try and get that money back. Guilds don’t assist in this process. It falls on production companies to manage issues that arise as the result of a residual payment error - so it’s always best to ensure accurate setup to avoid these issues from the outset.

A better way to manage residuals

With a high level of complexity and constant change, it makes good sense to have a team of experts to help you navigate the world of new media residuals. Especially given that payments are set up in perpetuity! Our team is ready, willing, and able to help, whether you’re setting up new content, adding historical content to your library, dealing with over or underpaid residuals, or just need a better system in place to manage the process.

Our SmartResiduals system takes the headache out of setup, minimizes human error, and eliminates busy work. In tandem, our team of experienced analysts use our collective decades of experience to provide guidance on residual setup, calculations, and payments - and to answer any questions you have along the way. As the entertainment industry’s largest residual payment processor, we’ve seen it all, and you can be confident you’re in good hands with EP.

Topic: Residuals

Related Content

Changes to UK right to work checks

Important Changes to UK Right to Work Checks

On September 30, 2022 the UK rules around right to work checks will change. Here’s what productions need...
Topic: UK
Los Angeles Times logo-sq

Hollywood production in U.K. soars to record levels as crews complain of burnout

Spending on film and high-end television shoots reach record-breaking amounts as production activity...
Streaming platform on tablet device

The Evolution of Residuals: How Streaming Changed the Model

Understanding how residuals payments are calculated for new content on streaming platforms.
Mount Hood, Oregon

Building on Oregon’s Cinema Legacy

How improved tax Incentives, job training, and production infrastructure is expanding the filmmaking...
EP Blog_SQUARE_Wes Hagen

Meet the Location Manager

A conversation with award-winning location manager Wes Hagen ('Ozark,' 'Hidden Figures.')
EP Blog_SQUARE_filmmaking in new mexico

Forging the Future of Filmmaking in New Mexico

As the film industry expands in the Southwest, New Mexico leads the region as top destination thanks to...
Sian Richards and Queen Latifah-square

A Face Kit for Every Skin Tone

Hollywood makeup artist Siân Richards is transforming the makeup industry for actors of every shade.
EP Blog_SQUARE_Fighting Hollywood Stereotypes-TTEI

Fighting Stereotypes and Rethinking Representation

How TTIE is advancing authentic storytelling in Hollywood by empowering historically excluded writers and...
Oklahoma route 66 sign

A New Frontier in Filmmaking

Oklahoma is becoming a production destination, thanks to new incentives and infrastructure programs.

Contracting in a COVID-19 World  

The pandemic has affected how UK production companies contract crew. Here’s how to reduce the impact of...

Terms to Include in UK Crew Contracts

Common terms which studios and production companies include in their UK crew contracts.
Topic: UK
KJ Lamb and Simon Donovan

Empowering the Next Wave of Production Accountants

The EP Production Portal team was delighted to participate in the biannual Netflix Assistant Production...
cell phone with sticky note stating sign here

Six e-Consent Myths (and Why They’re Not True)

Sheridans Associate, Sarmad Saleh, debunks some common e-consent myths.
Topic: Legal
recycling conversation

Sustainability in Production: Q&A with Nikki Saunders

Nikki Saunders on sustainable filming practices, COVID-19, and why carbon offsetting isn’t a...
EP Blog_SQUARE_meet the cinematographer-dan-laustsen

Meet the Cinematographer

A conversation with Dan Laustsen ('John Wick', 'Nightmare Alley').
Bradley Cooper-nightmare alley

Meet the Assistant Director

A conversation with Myron Hoffert ('Nightmare Alley')
EP Blog_SQUARE-Sound Mixer-Lora Hirschberg

Meet the Sound Mixer

A conversation with Oscar-winning re-recording mixer, Lora Hirschberg ('Inception', Skywalker Sound)
Digging Out of a Deficit-featured

Digging Out of a Deficit: What to Expect in the Second Quarter of 2022

Federal and State Unemployment Insurance rates are rising. Learn how these changes will affect 2022 and...

Meet the Set Decorator

A Conversation with Claire Kaufman ('Little Women')
Western Canada

Production Tax Incentives in Western Canada Every Producer Should Know About

Alberta and Manitoba offer film and TV productions competitive tax incentive programs and versatile...
EP Blog_Residuals Penalties

How to Protect Your Production from Residuals Penalties

Find out what triggers residuals late fees and nonpayment penalties and learn about proactive steps you...

Film Industry Booms in Buffalo

Western New York draws top filmmakers with expanded tax incentives, new soundstages, and architectural...
EP Blog_SQUARE_New York

NY Convenience Rule Impacts Remote Production Workers and Film Incentives

How remote employee payroll taxes apply to New York-based productions and if an employee’s physical...
Master Series Square Thumbnail-Film Financing-Crowdfunding

Film Financing Explained: Crowdfunding

Emily Best (Seed&Spark), Stacy Bradford (Indiegogo), and producer Zach Fineblum join us to discuss the ins...
EP Blog_SQUARE_1st AC Matt Sanderson

Meet the First Assistant Camera

A conversation with 1st AC Matt Sanderson ('Everything Everywhere All At Once')
EP Blog_SQUARE_US Expanded Incentives 2022-2

A Record Number of US States Expand Filmmaking Incentives in 2022

Your guide to the latest news in production incentives and film programs to come from the 2022 legislative...
EP Blog_SQUARE_New US Incentives 2022

New US Film Incentives Introduced in Arizona, Indiana, Florida, and West Virginia

As production continues to boom, new tax credits and other programs welcome industry to new locations...
EP Webinar Panelists - US Production Incentives Update

US Production Incentives Update: New and Expanded Programs in 2022

Film commissioners Colleen Bell and Sandy Lighterman, and production executives Jay Roewe and Ashley Rice,...
EP Blog_SQUARE-Atlantic Canada Expands Incentives

Atlantic Canada Expands Film Incentives in 2022

Enhanced production incentive programs attract industry to Newfoundland & Labrador, Nova Scotia, and...
EP Blog_SQUARE_Penka Kouneva-2

Meet the Composer

A conversation with award-winning orchestrator and composer Penka Kouneva (‘Revenge,’ ‘Pirates of the...
Compliant crew contracting panel-square

Compliant Crew Contracting in the UK

Learn how to ensure your crew contracts are compliant with UK regulations and why the Production Portal is...
Topic: UK
dollar signs representing digital crowdfunding

The Beginner’s Guide to Crowdfunding

How filmmakers can leverage the power of social networks and online platforms to build buzz and secure...
5 Master Series panelists discussing Atlantic Canada production incentives-square

Production Incentives Update: Atlantic Canada

Learn how productions can benefit from newly expanded incentives in Nova Scotia, Newfoundland & Labrador,...
Canadian flag flying over Quebec City

5 Reasons to Consider Canada for Your Next Production

Here's why Canada deserves a spot on every producer's shortlist.
Topic: Canada
EP Blog_Jesse Wente

Supporting Indigenous Storytellers of Canada

How the Indigenous Screen Office (ISO) offers advocacy and funding for First Nations, Inuit, and Métis...
Topic: Canada
Jennifer Liscio

Spotlight: Jennifer Liscio, VP of Tax Incentives and Legal Affairs

Meet EP's Canadian legal affairs and tax incentives domain expert, Jennifer Liscio, and learn how she’s...

The UK GDPR and how Productions can Reduce their Exposure - Q&A with Sheridans

Sheridans’ Associate Krishan Neelendra answers key UK GDPR questions from production companies and...
Topic: UK

Six Elements for Enforceable UK Crew Contracts

Although parties to a crew contract can largely enter into whatever terms they choose, certain elements...
Topic: UK

Producing with Purpose

Creative Producer, Kimberly Goodman ('Selling Sunset', 'Project Runway') shares insights on creating...
EP Blog_The Race to Net Zero is On for Big Studios

The Race to Net Zero is On for Big Studios

Film and television studios are embracing the green movement in a big way. Here’s what you can expect to...
Master Series Panel-Solving the crew shortage

Solving the Crew Shortage

Learn how EP Academy, the Georgia Film Academy, Reel Works, the New Mexico Film Office, and others, are...
EP blog-square-tax day

Tips for Tax Day 2022

Your ultimate tax filing checklist - the deadline this year is Monday, April 18th!

Georgia Proposes Capping and Prohibiting Sale of Film Tax Credits

The changes, if signed into law, would cap the amount Georgia hands out in film and TV tax credits at $900...
EP Newsroom-Thumbnail-Portland Business Journal

How Oregon’s updated film incentive law could boost the local economy

A new Oregon film and media incentive law could draw more movie productions to the state.
EP Blog_Marge Dean

Opening Career Doors

How WIA President, Marge Dean, is shaping the future of animation and empowering underrepresented genders
Master Series Women in Animation-thumbnail

Women in Animation: A 3D View

Marge Dean, Mandy Tankenson, and other women leaders from across animation come together to celebrate...
EP Blog-proud to support-square

Proud to Support: Celebrating Client Nominations at the 94th Academy Awards

A look at the evolution of the Oscars and the notable films powered by Entertainment Partners technology.
International Film Financing panel-featured

Film Financing Explained: International Financing

International production experts discuss how producers can utilize financing systems outside of the US,...
Anthony De La Rosa-EVP-Residuals

Spotlight: Anthony De La Rosa, Executive Vice President, Residuals

Meet EP’s resident residual domain expert, Anthony De La Rosa, and learn what inspired him to enhance and...
International Financing-John Hadity-ft

The Beginner’s Guide to International Film Financing

What to know before you begin an international financing plan
Crew contracting in the UK-panel

Quick and Compliant Crew Contracting in the UK

Neisha Glynternick and Sarmad Saleh from UK-based entertainment law firm Sheridans discuss crew...
Topic: Legal

Meet the Executive Producer

A conversation with Mike Drake ('Just Mercy') on the path to becoming and EP, and the role of social...
Los Angeles Times logo-sq

Why the Cherokee Nation is Offering Rebates to Film in Oklahoma

Joseph Chianese speaks to the LA Times on new incentive
EP Blog_SQUARE_Island Incentives

A Ticket to Paradise

Island Incentives Bring Productions Ashore

Payroll & Finances

PayrollResidualsSmartStartNew SmartTimeProduction PortalEP On LocationSmartAccountingEP LiveSmartPOCASHétPayPaymaster Rate GuideEP Residency

Manage Multiple Productions

AssetHubSmartHubSmartHub Vault
Subscribe now

Be an industry insider with EP's
newsletters and alerts

LegalPrivacy NoticeSecurity
© 2022 Entertainment Partners. All rights reserved.