If you’re not someone who is concerned about writing and/or making movies, you may have missed Amazon’s big announcement this fall that they have formed Amazon Studios. They are getting into the game of creating original programming rather than just distributing other people’s stuff.

I think the initial reaction by many people was HOLY SHIT, COOL! And then people started reading the fine print and the “Development Agreement” and getting disturbed by some of the rules associated with this. Here’s how it works:

Amazon Studios will award $140,000 a month to the “best movies and scripts and a total of $1.1 million to winners of Annual Awards.” So each month they have a contest going for movies and scripts and if yours is chosen that month, you may win cash and then they may further develop it.

They don’t want people to submit a completed film – they want a “test movie. “What is a test movie? “Test movies are inexpensive, full-length movies that tell the whole story of the script in a compelling way. They should have good acting and sound, but polished visuals are not required. Even primitive visuals will help people imagine what a script would be like as a finished film.”

For scripts, you can upload your original screenplay or revise one already on the site. This is important – remember this.

You can also just hang out on the site and review/comment on test movies and scripts to try to impact how they are further developed. You would only do this if you were laid up in bed for weeks at a time and were sick of reading and watching TV. Or if you have no imagination yourself but really like to tell people how to fix things.

So, what’s going on is that Amazon wants to get into the game of original content without paying much to get material – the movie business has all these pesky unions that demand scale wages for different types of jobs, like the WGA. And they want to use crowd sourcing to develop their projects because they’ve heard that people love to crowd source to solve problems; that it makes them feel needed and wanted and that it’s the wave of the future.

They are offering some money because this is a model that has already been used in the world of science for years – there are sites dedicated to posting problems that staff scientists at corporations and other labs haven’t been able to solve, with the idea that someone out there can take a fresh approach and solve it. If they do, they are fairly handsomely rewarded.

But that’s science. If you find a solution to a problem, this solution can be tested in other labs anywhere and other scientists or engineers  should get the same results. “Yep, that’s it, problem solved, it works, give this gal some cash.”

How does that work in movies and scripts? Well, that remains to be seen but I would point out that it has the potential to get fairly muddy since Amazon is not after an objective result. You may be the first person to come up with a solution to a science problem but can you “own” that solution? Someone else could have come up with the same solution given enough time. But because you came up with it first, you get the cash reward.

But what is the right answer when it comes to a creative project like a screenplay and how could it be determined who “owns” that right when a script has been crowd sourced. Some people say it doesn’t matter. But I haven’t met many artists, yet, who truly feel that way.

In its FAQ’s, Amazon says, “You can win awards for your script or test movie or for any revision of your script or movie. Amazon Studios may pick up your work and release it as a major feature film, in which case we would pay you to acquire the rights to your script or movie. And in general you could get attention and feedback for yourself and your work.

The underlining is mine because I want to call attention the words, “in general” and “you could.” Sure, it could happen… and I could give birth to conjoined twins. It could happen! Anything could happen. Because if you then go and read more of the contract fine print, you find this: that by submitting your screenplay or test film your work is automatically subjected to the revision and feedback of other Amazon Studio users. Revision. From Merv in Oklahoma who doesn’t like that sex scene you wrote.

And they state that other users could submit work that is based on your work or that could even contain your work (all of which they saw on the site) and, well, that’s too bad. So that terrific sequence of scenes you wrote could go into some other writer’s screenplay and then what? Amazon Studios says, “you are not entitled to compensation except as we may determine in connection with the awards selection process.” So, if Amazon Studios is feeling benevolent, then you might get a bone thrown your way. And if you don’t like their decision? Well, too bad. Because it says right in the General Contest Rules that you agree that all of the decisions made by their judges and “analysts” are final and binding in all respects and you agree to follow them.

Sell us the cotton you raised at the rate we decide you deserve and spend all your money in the company store and like it!

It gets better. Because if your test movie wins that month’s $100,000 prize you might not even get the full amount. Their judges and “analysts” (I’m beginning to think “analyst” is a euphemism for “lawyer” here) might decide that Susie in Oregon contributed some great feedback and that Damon in New Jersey deserves a big cut for fixing that bank heist scene and, oh, yeah, we really like what Cookie in Grand Rapids did with the character of the smart-talking grandma so, in the end, you might make less than your contributors. Or you might make nothing at all. They also reserve that right for themselves. They might decide you deserve a shit sandwich and your “contributors” deserve to divide up the $100,000.

Now, lots of people are going to say, “Bullshit, that might be possible but it’s highly improbable. They wouldn’t dick someone over like that.” But why wouldn’t they? They want content. They now need to feed the beast. And if they pay out to more people, those people are going to keep coming back. They aren’t going to get much attention for themselves, they might only get one payout in several years, but they are going to hold out hope… So who is Hollywood now, Amazon Studios?

There is a page on the Amazon Studios site called “Understanding the Development Agreement.” On that page they take a tone that is jocular and understanding, saying that basically they only want you to do this if it would be a good thing for you. You should know that if you upload your script to Amazon Studios, they have an option on it for 18 months. This means they have an exclusive right to buy it for $200,000 and release it as a movie. If they want, they can then pay you $10,000 to extend this option for another 18 months. Now, I think a lot of people reading the site may think, “I upload my movie, they love it, they pay me $200,000.” Nah… this means they might but more than likely they will sit on it for 18 or 36 months and you can’t shop it around. You can’t enter a contest and win. You can’t do your own legwork and try to get it read or sign with an agent to shop it for you.

And remember – it has to be released as a theatrical feature film first before you get your money. That means developed, produced,  marketed and it appears in theaters. Before you would ever see a dime… And anyone who knows the studio system or has read about it or has seen movies like Swimming With Sharks knows that projects often die.

But, OK, maybe you don’t all of this sounds like such a bad deal. It would be awesomeness to get paid $200,000… that’s assuming they are still recognizing you as the sole author of your screenplay. But what about any contributors who team wrote your movie after it was uploaded and got an awards payout along with you? Wouldn’t they want a piece of the final pie?

Amazon wants to make money. So they are paying you $200,000… what are they making on the deal? They’re a corporation, not a foundation. They are going to cover their expenses, of which you would be one, and then make money on top of that. I’m not saying this is necessarily wrong or evil but it’s worth thinking about. You make $200,000 whether Amazon makes $400,000 or $4 million. Except for the bonus.

The bonus?

“If we pay you the $200,000 option payment, then we have purchased your original script or movie from you. If a movie based on your original script or movie earns $60 million at the US box office in its initial release, you get a further bonus of $400,000. The normal approach in option agreements is to give the writer a small “net profit” participation in the movie, which guarantees nothing. The bonus in our agreement is large and clear. If you pick up Variety one day and it says that the movie we released based on your original script or movie made $60 million at the US box office, then you will get $400,000.”

But they own the movie now and you aren’t represented by a union or a lawyer here. So, uh, when are they gonna pay you? And why would you have to pick up Variety to find out your movie made $60 million? Are they trying to hide this from you or is the onus on you to keep track of the profit it makes in its US box office initial release or then chase them down?

Plus, that’s $60 million in U.S. only -  no European, South American or Asian profits, etc. Only theatrical, so no streaming or DVD revenue.

The chances of you making that bonus are about the same as me giving birth to conjoined twins.

This all being said, maybe this will be a fun project for Larry in Oklahoma or Stan in Michigan who is bitter that he’s been writing screenplays for 15 years but has made no headway in the “industry.” So go to it! But I wonder if truly talented writers and filmmakers with fresh ideas and incredible vision are really going to sign up for this or if… they would just make money somewhere else, with representation, because… they actually have talent that someone can instantly recognize.