Shares of media and entertainment companies were slighter higher on Friday after the Hollywood directors' union reached a contract deal with the Alliance of Motion Picture and Television Producers (AMPTP).
The studios' three-year labor pact with the Directors Guild of America (DGA) includes provisions to pay union members more for work distributed over the Internet -- a key conflict point in stalled contract talks with striking writers of the Writers Guild of America.
DGA members will also receive annual increases in both wages and residual bases. Guild jurisdiction over programs produced for Internet distribution was also established, as was a residual rate for ad-supported streaming online clips.
AMPTP said the new rate paid to DGA members will be 0.7 percent for television downloads, and 0.65 percent for film downloads.
Of the 307 labor agreements the AMPTP has negotiated since 1982, this new DGA-AMPTP pact surely dealt with some of the most challenging issues we've ever faced, said AMPTP president Nick Counter, in a released statement.
The directors' deal came five days after contract talks began, following weeks of informal discussions with the studios and will lay the groundwork for official negotiations.
The participating executives included Fox chairman and CEO Peter Chernin, CBS Corp. president and CEO Leslie Moonves, NBC Universal president and CEO Jeff Zucker, and Walt Disney Co. president and CEO Bob Iger.
The AMPTP is the same group that the Writers Guild of America (WGA) has been striking against since November 5.
On the news, shares of media companies rose slightly. Viacom Inc., the owner of Paramount Studios, advanced 31 cents to $39.17 while Walt Disney Co., rose 25 cents to $29.02.
News Corp., the parent company of Fox, rose 4 cents to $18.82 while Time Warner Inc. , which owns Warner Bros., was up 11 cents at $15.60.
Shares of General Electric Co., which owns Universal and NBC, rose 3.5 percent to $34.36. GE also reported its fourth-quarter results on Friday, meeting analyst's expectations.