Hollywood writers and producers broke off contract talks without a new deal, allowing the Writers Guild of America's pact to expire at midnight on Wednesday and making a strike more likely.
A statement issued by the guild Wednesday night did not mention a walkout, although members previously authorized union leaders to call a strike.
No new talks were scheduled yesterday. Writers were to meet last night to plan their next move.
The two sides said they remain far apart on the key issue of raising payment to writers from the sale of DVDs and applying that higher rate to Internet sales. Writers say the current DVD formula is too stingy and have opposed a producer plan to extend that rate to digital sales.
"The companies refused to continue to bargain unless we agree that the hated DVD formula be extended to Internet downloads," the WGA statement said.
Producers have said they would not agree to anything that would restrict their ability to experiment with new Internet and other digital delivery options for films and TV shows.
Calling it "the DVD issue," the producer's chief negotiator said in a statement that the writers were blocking both sides from making further progress in their talks.
"We want to make a deal," said J. Nicholas Counter, president of the Alliance of Motion Picture and Television Producers. "But, as I said, no further movement is possible to close the gap between us so long as your DVD proposal remains on the table."
More than 5,000 guild members recently voted, with 90 percent authorizing negotiators to call the first strike since 1988 if necessary. The union set a meeting of its 12,000 members for last night at the Los Angeles Convention Center.
Jonathan Handel, an entertainment lawyer at the Los Angeles law firm of TroyGould, said it was in the union's interest to delay a walkout, perhaps by five days or more.
"The writers guild has two weapons: One is a strike, the other is the threat of a strike. It has no reason to toss that weapon away without using it for a bit," said Handel, who has served as an associate counsel for the guild.
A strike by writers would not immediately impact film or prime-time TV production. Most studios have stockpiled dozens of movie scripts, and TV shows have enough scripts or completed shows in hand to last until early next year.
After that, networks might turn to reality shows, news programs and reruns to fill the prime-time airwaves. Late-night shows wouldn't fare as well, since they are more dependent on current events to fuel monologues and other entertainment.
The Daily Show with Jon Stewart and The Colbert Report will almost certainly be forced into reruns by a lack of fresh skits and monologues if writers walk off the job.
"If the strike happens, we are very likely looking at repeats for both shows," said Tony Fox, a spokesman for Comedy Central, which airs the shows starring Stewart and Stephen Colbert that lampoon politics.