John August

John

FTC proposes new merger guidelines

Film Industry, News, WGA

The Federal Trade Commission and Department of Justice have drafted new merger guidelines outlining how the agencies should approach corporate consolidations.

Here are the key points:

  1. Mergers should not significantly increase concentration in highly concentrated markets.
  2. Mergers should not eliminate substantial competition between firms.
  3. Mergers should not increase the risk of coordination.
  4. Mergers should not eliminate a potential entrant in a concentrated market.
  5. Mergers should not substantially lessen competition by creating a firm that controls products or services that its rivals may use to compete.
  6. Vertical mergers should not create market structures that foreclose competition.
  7. Mergers should not entrench or extend a dominant position.
  8. Mergers should not further a trend toward concentration.
  9. When a merger is part of a series of multiple acquisitions, the agencies may examine the whole series.
  10. When a merger involves a multi-sided platform, the agencies examine competition between platforms, on a platform, or to displace a platform.
  11. When a merger involves competing buyers, the agencies examine whether it may substantially lessen competition for workers or other sellers.
  12. When an acquisition involves partial ownership or minority interests, the agencies examine its impact on competition.
  13. Mergers should not otherwise substantially lessen competition or tend to create a monopoly.

These are good principles! Notably, they’re not obsessed with whether a merger is likely to raise prices for consumers. Rather, they look more broadly at how consolidation impacts all the components of an industry.

The FTC has invited public comment on these draft guidelines. As of today, there are over 1,000 comments. The WGA has encouraged its members to share their experiences. Citizens working in every industry should write in as well. Mergers affect all of us, and these policies could shape the next few decades.

I submitted my comment today. Here’s what I wrote.

I’m a screenwriter and novelist who has seen firsthand the impact of mergers and consolidation in the film and publishing industries. That’s why I’m writing in support of the FTC and DOJ’s Draft Merger Guidelines. We need to revive and rethink antitrust enforcement in this country so that it recognizes consolidation’s impact on workers, sellers, consumers and citizens.

My work as a screenwriter has found me working for both Disney (including 2019’s Aladdin) and what remains of Fox (where I currently have a series in development). I believe Disney should never have been allowed to buy 21st Century Fox in 2019. Not only did it increase concentration and reduce competition for consumers, it did the same for writers. This issue is addressed in Point 11 of your draft guidelines: “When a merger involves competing buyers, the agencies examine whether it may substantially lessen competition for workers or other sellers.”

When Disney bought Fox, it came at the immediate cost of redundant employees’ jobs. It then created downward pressure on the wages throughout the industry, with one less buyer for the services of writers, directors, actors and crew.

I can offer a specific example from my own experience. In 2018, Fox brought me in to meet on a high-profile book adaption for their Fox Family division. By the time it came to make my writing deal, the proposed Disney merger was announced and the division wasn’t allowed to pursue any project that might compete with Disney’s own. All of the executives on the project were let go.

In the process of Hollywood development, projects disappear and executives get fired all the time. What was unique is how this merger broke so many pieces simultaneously, from studio feature films to indies to cable to broadcast television. We should consider not just the immediate negative impact, but also the after effects. Tom Rothman, who used to run Fox’s film division, noted that “Consolidation under giant corporate mandates rarely promotes creative risk-taking. And in the long run, it is always a challenge to compete against horizontal monopolistic power.”

I also work as an author, with three books published by Macmillan and an upcoming book published by Crown (Penguin Random House). Consolidation in the industry means that 60% of books published in English come from just five publishers, and we nearly dropped to four. They have unprecedented control over the market, limiting options for retailers, authors and readers.

I’m a proud member of the Writers Guild of America, West, and have served on both its board and negotiating committee. The entertainment industry’s history of unchecked consolidation is a major factor in the strike of 11,500 writers including myself on May 2 against our employers, who collectively negotiate our three year contract as the Alliance of Motion Picture and Television Producers (AMPTP). SAG-AFTRA has joined us on strike, their 170,000 members seeking a contract that fairly compensates us for the value we create.

It is essential that antitrust agencies consider how any future proposed mergers in this industry — such as the long-rumored Apple/Disney deal — would impact writers and other industry workers. It’s not enough to wait and see; antitrust agencies should proactively investigate and announce decisions, so CEOs don’t propose deals that paralyze the industry.

These Draft Merger Guidelines are the solid principles we need to maintain a vibrant, competitive environment that serves all Americans.

Thank you for the consideration of my comments.

You can submit your own comment on the FTC’s public comment page.

My history with AI

Software, WGA

As part of the WGA’s negotiating committee, I’ve done a lot of work (and press) on behalf of the Guild’s proposal regarding AI, which seeks to regulate the use of AI on MBA-covered projects.

Specifically, the proposal would ensure that AI-generated material is not considered “literary material” or “source material” — two terms with specific and important meaning in our contract. Getting this language in our contract protects writers from having AI write or rewrite us, and ensures that the things we write isn’t fed into the algorithm to generate “new” versions of our work. ((We sometimes call this the “Nora Ephron Problem,” the idea that you could feed Nora Ephron’s screenplays into a system and generate a “new” script in her voice.))

Amid the list of other urgent concerns about compensation and working conditions, the Guild’s AI proposal might seem like an outlier. Indeed, when it was first proposed as an addition to our pattern of demands back in November, some members of the committee wondered if it was too early. ChatGPT had only just been announced, and very few people had experimented with it.

But I’d had an early preview of similar technologies, and a sense that we needed to be thinking about AI issues now.

In addition to my day job writing movies, I run a tiny software company. We make Weekend Read and Highland, which is maybe the third most popular screenwriting app. One cool thing about working in software is that you meet other people in tech. In August 2021, a friend introduced me to Amit Gupta, who was starting a company called Sudowrite. He described as “Photoshop for text.” That’s a cool pitch.

A tool or a weapon?

I met with Amit and saw a demo. The app was just a web page with a text box. You could click buttons and have it rewrite the text you provided, or expand upon it. It was primitive, but it felt like magic. This was more than a year before ChatGPT, but it provided the similar level of “wait, is this actually possible?” intrigue. And right after that, a corollary feeling of “wait, this could be really bad if used for evil.”

How do you make sure this is a tool used by writers, like spellcheck and Wikipedia, and not a tool used to replace writers?

I wasn’t ensorcelled; I recognized that if Sudowrite could do this, other companies could as well, including companies with no qualms about replacing writers. (Indeed, most of the early competitors focused on writing ad copy and SEO-optimized websites.)

My company made a small investment in Amit’s company and started talking about ways actual writers might use this technology. They were focused on prose fiction, which made sense. Screenwriting is weird. As a person who sells an app that formats it, it’s a small and specialized market. The world is full of folks who write fiction, especially fan fiction. They would be a better fit for the tool as it stood.

I’m listed as an advisor to Sudowrite, but that overstates my involvement. I haven’t hyped it up or used it beyond those initial few weeks. As far as I know, none of my books or scripts have been used in any of its training. Neither I nor my company ever made a cent from our investment in Sudowrite, and never incorporated any of their stuff into the apps we sell.

My interactions with Sudowrite gave me an early preview of what was compelling and troubling about the intersection of AI and writing, which helped put it on the Guild’s radar.

GPT-2-point-something

I wasn’t the only person who was intrigued by these AI writing tools. Stephen Follows, a data scientist I’d worked with on figuring out the truth behind the “one page per minute” rule and other screenwriting esoterica, reached out in June 2022 to say that he and a friend were working on a project to write a screenplay using AI.

He invited me to come on their podcast to discuss it. They shared their screen to show how they were using an early version of OpenAI’s GPT tool to generate screenplay scenes. Bad scenes, it must be noted. Like, not even first year of film school scenes. But it was the first time I saw people using this kind of tool to do the kind of work we are hired to do in film and TV. And when they said they were working with a guild-signatory producer, that set off alarm bells.

How do you determine credit? Who is the writer of record? Would a script created this way even be copyrightable?

I raised these concerns in the podcast, but then reached out to the Guild to put this on their radar. In early July, I had my first phone calls and conversations with Guild staff about how situation like this could handled under existing rules and definitions.

This was all before ChatGPT, which debuted in November 2022.

The WGA West assembled a board committee to study the issue, ultimately recommending the proposal which was included in our pattern of demands. It was quirk of the calendar that our three-year contract was coming up before the use of these AI system had become widespread. As ChatGPT 3 evolved to the much more capable ChatGPT 4, it became clear that waiting another three years to address the issue was not an option.

Studio silence

As noted on the two-page summary of where our issues stand as the WGA went out on strike, the studios rejected our proposal and refused to make a counter. In the room, they said that the technology is new and they are not inclined to limit their ability to use this new technology in the future.

That’s ominous and unacceptable. I believe we have to address this issue in our contract now. We can’t spend three years stalling with committees.

Along with our other urgent needs for compensation and working conditions, I believe we’ll ultimately win these necessary gains in regulating AI. As evidenced by the 2007 strike over the internet, our members understand how important it is to grapple with new technology before it becomes entrenched.

But even when we win this battle, the issues surrounding material generated by AI won’t be over.

As writers and a society, we have to grapple with the implications of this technology. How do we ensure the material used to train these models is provided with consent, credit and compensation? How do we deal with the bias? How do we treat the material output by these systems in terms of copyright? There are myriad concerns that go well beyond our contract, and will require developing both ethical and legal frameworks. I discussed some of those at this week’s listening session with the U.S. Copyright Office.

My early look at Sudowrite and related systems gave me a brief preview of a few of these issues, but none of the answers. We’re going to be grappling with the implications of these technologies for years.

AI and Copyright

News, WGA

On Wednesday, I participated in a listening session on AI and copyright hosted by the U.S. Copyright Office.

I was representing the WGA West. Other speakers included reps from the DGA, Public Knowledge, the Motion Picture Association and the National Association of Broadcasters.

Video will be up from the event in a few weeks.

Update: Video is now available! You can also read the transcript, and check out all the other sessions.

In the meantime, I wanted to share my opening remarks, which were a group effort with the team at the Guild.

My name is John August. I am a screenwriter and member of the negotiating committee of the Writers Guild of America West, a union that represents thousands of writers who create the content audiences watch every day in theaters, on television and on streaming services.

This is a unique moment for me to be speaking to this issue, because the subject of AI and its role in our industry is a major point of contention in the Guild’s ongoing nationwide strike against the major motion picture and television studios.

While writers who work under the Guild’s collective bargaining agreement are not copyright owners—we create works for hire—the Guild has negotiated an assortment of contractual rights in the works we create, including the right to residual payments for the reuse of our work across media platforms.

In the current negotiations, the Guild has made a proposal to regulate AI for the first time in our contract. The broad purpose of the proposal is to prevent our employers from using AI to devalue the work that writers do—to lower our pay, to deprive us of credit or attribution rights, or, in the most extreme case, to eliminate the need to hire writers altogether.
The proposal would also prohibit the companies from using material written under the Guild’s agreement to train AI programs for the purpose of creating other derivative (and potentially infringing) works.

The companies’ response has been telling: not only did they reject our proposal, they refused to engage on the issue at all. The most they have said is that the technology is new and they are not inclined to limit their ability to use this new technology in the future. This is an ominous response in the eyes of our members and one of many reasons that 11,500 writers have been on strike since May 2.

We often speak of copyright as a means of protecting works of authorship. But copyright was created with the intention of protecting authors from appropriation and theft. As we discuss the impact of AI, we need to remember the human authors and not just the corporations who employ them.

Following our opening remarks, panelists had the opportunity to answer questions about what rules and policies the Copyright Office should consider.

Speaking on behalf of the Guild, and its 11,500 members currently on strike, I focused on the need to protect the human creators of work.

You can read the opening statement of John Bergmayer at Public Knowledge, which specifically mentions the WGA strike. I’ll post other statements as I find them.

Which of these answers was written by AI?

Tools, Words on the page, Writing Process

GPTZero is a new service created by Edward Tian designed to sniff out AI-generated text.

I’m dubious, in part because I’m not sure I could reliably spot the differences between sentences assembled by humans versus machines. But maybe that’s just my human bias.

As an experiment, I decided to run a quick, not-at-all-scientific test. I asked ChatGPT to “write three paragraphs explaining what a manager does for screenwriters.” I also looked up the answer for “What does a manager do?” on screenwriting.io.

Here are the two responses, one written by a human ((Stuart Friedel wrote most of the early screenwriting.io answers.)), the other by an AI. See if you can spot which is which.

SAMPLE A

In brief, a manager manages your career.

This includes tangible acts, like setting up meetings, giving notes and feedback, and assisting with deal negotiation, as well as the more abstract, like helping steer your career’s direction.

Managers, unlike agents, are not required to be licensed by the state. They usually have fewer clients than agents, and often take more personal and less business-focused roles in their clients’ careers. Managers, are allowed to take producer credits on their clients movies, which agents are not.

Like agents, a manager typically receives 10% of a client’s earnings. A manager should never ask for an upfront or flat fee.

SAMPLE B

A manager for a screenwriter plays a vital role in helping the writer navigate the film and television industry. They can assist with finding and developing new ideas, as well as helping the writer shape their existing ideas into marketable concepts. This often involves providing feedback and suggestions to help improve the story and make it more appealing to potential buyers.

Managers also help screenwriters with the business side of things, such as identifying potential buyers and pitching the writer’s work to them. They can also help negotiate deals and contracts, as well as manage any legal issues that may arise. In addition, they can help the writer navigate the many different players in the industry, such as agents, producers, and studio executives.

Finally, a manager can also help screenwriters with their long-term career goals by helping them identify opportunities for growth and advancement. This might include working on larger projects, transitioning to other forms of media, or developing a personal brand to increase their visibility and credibility in the industry. Overall, a manager plays a critical role in helping a screenwriter achieve success in the competitive film and television industry.

For each answer, GPTZero measured the text’s Perplexity — the randomness of the text — across several ranges.

Total Average Highest
Sample A 41 136 219
Sample B 11 36 49

That 219 is an example of “Burstiness,” which GPTZero defines as “spikes in perplexity.” For Sample A, the opening sentence has a perplexity of 219, whereas highest perplexity in Sample B is just 49.

That’s the tell, apparently.

Some human written sentences can have low perplexities, but there is bound to be spikes in perplexity as the human continues writing. Contrastingly, perplexity is uniformly distributed and constantly low for machine generated texts.

After crunching the numbers, GPTZero renders its verdict.

SAMPLE A (score 66.44):
Your text is likely human generated!

SAMPLE B (score 9.93):
Your text is most likely to be AI generated!

On both counts, GPTZero got it correct.

But how hard would it be to fool the system? I spent two minutes editing the AI-generated version into the following:

Sample C

Managers can play a vital role for screenwriters. Basically, they help the writer navigate the film and television industry. They can assist with finding and developing new ideas, or shaping their existing ideas. They provide feedback and suggestions.

Managers also help screenwriters with the business side of things: who the buyers are and how to pitch to them. They can help negotiate deals and contracts, as well as manage any legal issues that may arise. They help the writer navigate the many different players in the industry, including as agents, producers, and studio executives.

Good managers think about screenwriters’ long-term career goals. This might include working on bigger (or smaller!) projects, transitioning to other forms of media, or developing a personal brand. Overall, a manager can play an important role in helping a screenwriter achieve success in the competitive film and television industry.

Total Average Highest
Sample A 41 136 219
Sample B 11 36 49
Sample C 19 106 439

The verdict:

SAMPLE C (score 118.77):
Your text is likely human generated!

Some takeaways

  • The ChatGPT answer was well-written and potentially helpful for someone who didn’t know anything about managers.
  • GPTZero is looking for patterns a human likely wouldn’t notice, which makes sense. But an AI model trained to provide responses with high perplexity and burstiness would likely evade detection. It’s interesting to see this arms race play out, because adversarial networks are already a fundamental tool in AI.
  • It’s currently very easy to fool GPTZero with just minimal rewriting. If this tool meant to detect AI-generated term papers, students will quickly learn how to evade it.