The dummy's guide to the Hobbit dispute

What was that about? Denis Welch explains what really happened in Hobbitgate
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illustration by tane williams

What was that about? Sir Peter says it’s an Aussie plot, Robyn Malcolm has the cheek to disagree, John Key changes the law and Warner Brothers gets an even sweeter tax break. Denis Welch explains what really happened in Hobbitgate

Before we start, just tell me: could the whole ugly dispute have been avoided in the first place?

Only in a world where hobbits lived happily in holes and there were no orcs or dark riders or rings of power. Think of it as two guys glaring at each other over a girl they both want, making threats and muscling up. What started out as a standoff escalated into a stoush, and from then on, it was Mordor on the dancefloor.

Okay. Now take me back in time to the origins of this thing.

Once upon a time there was an actors’ union called NZ Actors Equity—a feeble thing, with little bargaining power. Seeking more leverage, they linked up in 2006 with the Australian union Media, Entertainment & Artists Alliance (MEAA), which represents not just actors but broadcasters, journalists and other circus acts. MEAA in its turn is part of the worldwide International Federation of Actors (FIA). NZ Actors Equity stresses that it’s an independent branch of MEAA, though how a branch can be independent of the tree to which it’s attached is an interesting question. In any case it didn’t show much independence earlier this year when FIA advised actors not to work on the Hobbit films until the producers sat down and discussed contractual terms and conditions with them. Our local thesps were happy to go along with this strategy.

And the producers agreed to such a meeting?

No. It never took place. The producers declined on legal advice that collective bargaining amounted to price-fixing and was illegal.


That’s what we said too. But you’ve got to put that in the context of the film and television industries, where actors are rarely salaried employees; they come and go from productions on an individual contract basis. From the producers’ point of view, a bunch of individuals on separate contracts can’t bargain collectively. That would be, you know, oxymoronic.

Still, it sounds reasonable that workers would want to improve their pay and conditions, especially on a big-budget project.

It does, doesn’t it? But for years New Zealand Actors Equity has been refusing offers from Spada (the Screen Production and Development Association, which represents local production houses) to revise the Pink Book—the guidelines for acting contracts in New Zealand. So they had problems agreeing to meetings too. Also, there’s a sense in which they were being used as pawns in a global game aimed at getting parity of pay and conditions everywhere. A noble ideal, but it would prevent New Zealand producers from undercutting Hollywood with cheaper wages— the very reason we got to make the Lord of the Rings trilogy here in the first place. This is why Kiwi cast and crew are known in Hollywood as “Mexicans with cellphones”.

Was there ever a blacklisting or a boycott?

Yes. The unions never called it that, but that’s what the ‘Don’t work on The Hobbit’ order amounted to. By the same token, it was clearly never intended to be anything more than a negotiating gambit, a way of trying to get the other side to come to the table. But on September 26, Sir Peter Jackson went sensationally public with a cry of distress about the “ugly spectre of an Australian bully boy” (he seemed to have in mind MEAA’s Simon Whipp) and raised the prospect that the films would have to be made elsewhere. It’s hard to see how he could really believe that, because by this stage the American producers, headed by Warner Brothers, had already invested $100 million in making the films here and relocation would have been a colossal act of time-wasting lunacy, given that they want the first of the two Hobbit films shot by December 2011 and in cinemas by December 2012.

Suddenly the acting fraternity were depicted as servants of the Dark Lord, traitors to their country and, worse, completely unlike like the characters they play on TV

You mean all that talk of the production being shifted to Ireland or Croatia was pretty farfetched?

It was never going to happen. If you take one message away from the whole saga, let it be this: the Hobbit films were always going to be made in New Zealand. Warners are not stupid. As commentator Gordon Campbell wrote, “Sitting in Los Angeles and reading Jackson’s press releases, the Warners top brass were probably more worried about the effect the union dispute was having on the temperament of their director, than about any direct threat that unions posed to the production.”

So what was Sir Peter frightened of?

Hm. Sir Peter’s role in all this is as difficult to pierce as the mists that gather over the Vale of Rohan when the Rohirrim ride as if pursued by the wind that blows through the Paths of the Dead from Minas Tirith. Or something like that. The unions’ stance seemed to really get under his skin, and the usually mildmannered Wizard of Miramar rose up in wrath. If he hadn’t become so publicly alarmist, it’s arguable that this whole thing wouldn’t have got so out of hand.

Is Simon Whipp the devil’s spawn?

Well, he is Australian. Apart from that, he was just doing his job. He reckons, correctly, that New Zealand actors don’t have the same rights as their counterparts in Australia, the UK, the US and Canada and deserve better. But FIA and MEAA chose the wrong project to test their sense of injustice on. No one in the acting fraternity foresaw what one unionist later called a “perfect storm” of controversy. Suddenly they were being depicted in the media as servants of the Dark Lord, traitors to their country and, worse, completely unlike like the characters they play on TV. It was, you might say, an outrageous misfortune.

Warners saw an opportunity and took it. you don’t have to be an economist to work out that they figured they could ratchet a better deal out of the Government

So they backed down?

They did. They removed the boycott.


The world first heard about it on October 22, though Actors Equity says it happened the weekend before. The producers were given an unconditional guarantee that, in Whipp’s words, there would be “no industrial issue with the actors on this movie”.

Whew. Glad that got sorted.

You’d think so, wouldn’t you. But by then the controversy had a momentum all its own and couldn’t be stopped. Sir Peter went even more public, giving rare TV interviews and carrying on as if nothing had changed and the project was still poised on the brink of Mount Doom. The Government got involved and Warner executives flew to New Zealand for talks with the Prime Minister.

But why, if the blacklist threat had been removed? And didn’t they have better things to do with their time?

One question at a time, please. Essentially, like Simon Whipp, they were just doing their job. They saw an opportunity to get better terms and conditions for their production, and took it. ’Twould be nice if they told us that in their own words, but to this day we hardly even know their names. For the record, the key ones who came here were Warner’s Home Entertainment Group president Kevin Tsujihara and New Line Cinema president Toby Emmerich. They didn’t say a word publicly. But you don’t have to be an economist to work out that they figured they could ratchet a better deal out of the Government.

And the Government rolled over on its back and waved its paws in the air?

You might think that, but I couldn’t possibly comment. The facts are that the Government gave Warners $20 million more in tax rebates on the two films (they had already qualified for about ($65 million) and $13 million to market a short film advertising New Zealand, and undertook to pass a law guaranteeing that no actors on contracts will ever, ever, ever be allowed to negotiate collective agreements or claim the rights of an employee.

Did the law have to be changed?

A popular question. It’s also the question known in some circles as “Would Warners have pulled out of New Zealand if the law hadn’t changed?” Answer: highly unlikely (see above).

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What, if any, ramifications does the law change have?

Sunday Star-Times business editor Rob O’Neill says it’s extraordinary, because for the first time a class of workers is defined in law as contractors. So it sets a precedent that other business sectors may well be keen to adopt.

Is everybody happy now?

The only players in this drama to clearly profit from it are Warners, who get $20 million they weren’t going to get before. And that should help nicely to compensate for losses incurred by the 20c rise in the Kiwi dollar against the US dollar since the Hobbit project was first mooted two years ago. Apart from that, nobody else has gained a thing: we’re just back to the status quo that prevailed before the dispute blew up.

The last word on this?

Let it be with New Zealand Herald columnist Brian Rudman, who wrote: “The Hobbit is about a bunch of peasants living simple feudal lives. The way we’re behaving, where else but New Zealand could it be filmed?”

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