Understanding Residuals For Writers:

"Just four cents per DVD -- that's the writer's home video residual, we're told. More specifically, the hated DVD formula is 1.5% (or 1.8%) of 20% of the studio's gross on DVD sales. That odd looking set of percentages is equivalent to 0.3% or 0.36% of the studio's gross. The 1.5% or 0.3% applies when the studio's gross on a title is less than or equal to $5 million; the 1.8% or 0.36% applies thereafter. If the studio gets about $11 on an average $22 DVD, the writer(s) get a total of three to four cents."

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