(Technically called "Program Usage Commercials.") If you're lucky, here's the down payment on that Porsche. A list of cities in which the commercial airs is made and the units for all those cities are added together. Then, how much you should be paid for a network commercial with that amount of units is looked up. And that's what you're paid. And, when it airs again, the process is repeated. (It's possible on the next airing that Pittsburgh was dropped and Cleveland was picked up.) This happens over and over and over again, because you're paid every time this kind of commercial airs. We can't give you dollar amounts, because we don't know what cities your commercial will air in, or how often it will air. But we can tell you it can mean big bucks.
Wild spots
Remember watching Witch Women of Azuza on your local late show and, in between evil spells, you kept seeing the same commercial (an evil spell itself)?
That's probably a wild spot. This kind of commercial cannot air on a network show (unless they cut to a local station). You're paid a flat fee, based on the city or cities in which it will be shown (the "unit" system). For that fee, the advertiser can show the commercial as many times as he likes, without paying you anything more. He does, however, have to pay that fee every 13 weeks. There's a bit of controversy over these commercials, specifically because the advertiser can air them time and time again without additional compensation to you.
Dealer commercials
A local Toyota dealer, say, wants to run a national Toyota commercial, at his own expense. In this case you'll get a flat fee (again based on the unit system) and he'll get unlimited use of the commercial for six months. Don't get too distressed, since few dealers can afford to run a commercial over and over again.
Seasonal commercials
Santa Claus selling "Ralph's Reindeer Vitamin Supplements" is a "seasonal." Again, you'll be paid a flat fee based on the unit system, but the advertiser can use the commercial for only 23 to 25 weeks. (Santa Claus in May wouldn't work anyway.) The advertiser can, however, bring back that commercial for another run a year later.
Tesr commercials
Sometimes an advertiser wants to see if a given commercial will work, so he airs it only in a limited market in order to see what reaction it gets. That's a "test." Since by definition the commercial will run only in a few cities at most, thus earning you only a few units, there's obviously very little money in test commercials - unless the advertiser gets great response and decides to go national with it. Then the commercial is converted to "program usage." (This is called a "roll-out," perhaps because, as far as you're concerned, it means "roll out the money.") Nice - if it ever happens.
AGENTS' COMMISSIONS
Your agent gets ten percent of every dime you make, regardless of the kind of commercial you do, what use fees you are paid, and including your session and holding fees, for the first 21 months. After that, he'll have to re-negotiate for at least scale-plus-ten if he wants to make any more money on that commercial.
EXCLUSIVITY REVISITED
First, don't confuse "use fees" with "holding fees." Use fees are separate sums paid to you when the commercial airs; holding fees are paid to keep you exclusive whether or not a commercial is aired. It is indeed possible that you'll get 21 months' worth of holding fees and never see a use fee because the commercial-maker never airs the commercial.
Second, the advertiser will deduct what holding fees he's paid you from what he owes you in use fees if the commercial does air.
Third, the initial session fee he paid you (that also serves as your first holding fee) also "pays for" the first time he airs the commercial - only the first time. Your use fees start when he airs the commercial the second time.
Fourth, as long as the producer sends you your holding fee every 13 weeks, you are held exclusive to him for all of the above kinds of commercials, with the exception only of a seasonal. You are not exclusive when you do a seasonal. You may do a commercial for a competing product, but you'll need to notify the second advertiser that you've got a seasonal either running or on hold for next year.
Fifth, and most important, you should look at commercials not only as income producers, but as possible blocks to future income. Do a test, for example, and you're cut off from auditioning for all other competing products for as long as you remain exclusive. Maybe no national commercials with competing products will come along during that time for which you would be "right," but maybe one (or many) will - especially if you're a good commercial type. Decisions, decisions.
KEEPING TRACK
How does anyone know if your commercial runs at 4:30 p.m. in Padooka? Do the unions hire little gnomes to sit in front of TV sets all over the country to be sure you get all your units? Who keeps track of all this?
Believe it or not, the very people who pay you. Specifically, the advertising agency, on a more or less "honor system." And it works. Almost all the time. (Since the agency gets a commission from the advertiser every time his commercial is run, it's to the agency's benefit to keep accurate records.)
Still, foul-ups do occur. It wouldn't hurt to contact your friends around the country and ask them to keep a watchful eye out. (It's not all that much of an imposition; people love to spot friends when they appear on the tube. It's exciting to know somebody who's actually "making it" in Hollywood.)
You might even keep a "commercial notification file" of your friends around the USA and, whenever you do a commercial, send them self-addressed postcards asking them to fill in:
"I saw you on a PRODUCT commercial on DAY , DATE , at the approximate time of TIME ."
If you find you haven't been paid for those units you or your agent can contact the advertiser or the union. Once you've got a starting point - that is, a date and city - it can be checked. Every station, by federal law, must keep a log book of everything they show on that station from sign-on to sign-off.
The cost of the stamps and postcards could ultimately net you some very decent "found" units, and therefore, use payments you didn't even know were owed you. It's happened before.
If it does, you owe your buddy a dozen roses or a six-pack of liquid "units."
