Once upon a time, actors aimed to get in on network TV residuals as a way to make passive income whenever work dried up. (Just look at the cast of “Friends,” who still make around $20 million a year from their time on the hit series.) But things have changed—and gotten a bit more complicated—thanks to the rise of streaming, an industry-shaking topic that largely led to the 2023 SAG-AFTRA strike.
So, do actors get residuals from streaming? And how much do they make? Here’s what you need to know in the modern age of media.
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Residuals are payments an actor gets in addition to their original compensation (the upfront pay received in full for their performance) when their work is redistributed beyond its original scope. The idea is that because your likeness and work are generating new profits, you’ll get a share of them.
The concept began with acting unions in the 1950s—namely the Screen Actors Guild (SAG) and the American Federation of Television and Radio Artists (AFTRA), now one entity—and evolved in 1960 to include licensing payments from putting films on TV networks.
Who gets residuals?
If you’re a SAG-AFTRA member and play a principal role in a production— any role where you’re acting, singing, or otherwise directly part of the onscreen action (you’re out of luck if you’re playing a background actor, extra, or body double)—you can expect a residual check. Nonunion projects might get you some extra cash with reruns and licensing, but there’s no guarantee. And unless you’re playing a starring role, chances are slim that you’ll get any long-term income.
Residuals have become more comprehensive over the years to include series reruns and broadcast syndications. But these days, the new kids on the block are streaming services like Netflix, Hulu, and Disney+. And they’ve shaken up the media game dramatically.
And if you’re wondering if actors get royalties from Netflix and other platforms, there’s technically a small difference between those and residuals. Royalties are payments that go to the intellectual property’s owner and are then distributed, while residuals are direct payments to the talent.
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For all kinds of distribution, old school and new, residuals come into play when the project you worked on is distributed and exhibited beyond the remit of the original release, which includes the following:
- Worldwide theatrical releases for films
- 10 exhibition days within 1 year on subscription-based TV
- 1 exhibition and a week of advertising-based video on demand (AVOD)
- 90 days of high-budget subscription video on demand (HBSVOD), which include platforms like Hulu, Netflix, Max, etc.
Here are the main kinds of residuals you can expect to encounter:
Fixed residuals
For fixed residuals, you can expect to receive payment after a set amount of time (between 30 days and 4 months) after each rerun. However, this kind of residual was more common in the days before streaming. When it comes to streaming residuals, this kind of payment is rare—after all, there’s no such thing as a “rerun” of a show you can stream anytime.
Revenue residuals
Residuals for streaming work differently than they did for traditional media. Where residuals for shows like “Friends” and “Seinfeld” were affected by popularity and rating, streaming residuals are now based on upfront pay per episode, the streamer’s subscriber count, and a depreciating percentage of the years a project has streamed.
The main kind of residual-based project for streaming specifically is high-budget subscription video on demand (HBSVOD), which are scripted productions that are at least 20 minutes long (or segments that total at least 20 minutes per episode) and have budget requirements determined by tiers.
If you suffer from arithmophobia, brace yourself. Here’s the calculation for deducing residuals from HBSVOD:
Start with your total actual compensation (TAC), which is the money you make including your agent’s commission as well as any extra compensation, such as overtime (which is added as straight time, with the additional payment uncounted). As it applies to streaming residuals, your TAC is also limited by a specific ceiling; any additional compensation is not counted towards your residual pool. The type of project you’re performing in determines these limits. For example, the TAC ceilings for 20-minute shows are lower than those for one-hour shows.
Next, you’ll multiply that number by the streaming platform’s subscriber factor. As per SAG’s tentative 2023 memorandum of agreement, here are the numbers by platform for HBSVOD programs that commence principal photography on or after July 1, 2024:
- Platforms with over 5 million but fewer than 20 million subscribers have a factor of 65%.
- Platforms with 20 million to 45 million subscribers have a factor of 100%.
- Platforms with more than 45 million subscribers have a factor of 150%.
Note that these figures apply to domestic, not worldwide, subscribers.
The more subs a platform has, the more residuals you’ll get. However, you’ll get a platform’s subscriber factor when principal photography begins on your project, not when it’s exhibited.
But wait, there’s more! Your figure will then be multiplied by a percentage determined by the number of years following the initial release, which declines over each year. It starts at 45% for the first year and trickles down to 1.5% by the 13th year and onward.
All of this is slightly different for foreign releases. For worldwide releases on platforms, you’ll use the following subscriber numbers:
- Platforms with fewer than 20 million subscribers have a factor of 47%.
- Platforms with 20 million to 45 million subscribers have a factor of 60%.
- Platforms with 45 million to 75 million subscribers have a factor of 75%.
- Platforms with more than 75 million subscribers have a factor of 90%.
Here’s a quick example to show you:
Let’s say you made a TAC of $2,000 on a project being distributed by Netflix. Since Netflix has more than 45 million subscribers, they have a subscriber factor of 150%. If it’s the first year of exhibition, your figure would then be calculated based on a percentage of 45%. This is what it looks like:
TAC: $2,000 x 150% x 45% = $1,350
Foreign: $1,050 x 90% = $945
If we take the figures from year 13 after the release, here’s what it’ll come out to:
TAC: $2,000 x 150% x 1.5% = $45
Foreign: $40.50
If a project was made for one streaming platform and then shifted to another, the calculation would switch to 3.6% of the license value distribution shared across the cast. This is also the case with low-budget SVOD as opposed to HBSVOD and is subject to change depending on what the guild and producers determine. And just like with revenue residuals, you’d receive these payments quarterly.
Calculating what you’re owed in the case of shared residuals is even more complicated and specific to each project, so you’ll have to check your contracts.
Success-based bonuses: The new SAG agreement also includes success-based bonuses for streaming projects. To be eligible for the bonus, a project needs to garner a level of views within its first 90 days that is equal to 20% of the streaming platform’s domestic subscriber base. These are calculated based on the hours watched relative to the project’s duration, rather than the actual count of distinct accounts engaging with the title—so you are helping out your favorite performers by giving the new season of “True Detective” a rewatch or two. The bonus is equivalent to 100% of the HBSVOD residual payable for the project’s exhibition year.
75/25 distribution model: Seventy-five percent of an approximately $40 million per year fund will go to actors who appear on primetime projects (of half-hour, one-hour, and other show lengths) watched by at least 20% of a streamer’s subscribers within the first 90 days of release; the other 25% goes back into the fund for the union and studios to allocate.
“Seinfeld” Credit: Alamy
Historically, the difference between streaming residuals and traditional residuals was that the latter earned you more money if the series or film you appear in earned more money. For huge shows like “Seinfeld,” “Friends,” or “The Office,” you’d get a bigger cut for reruns and a syndicated broadcast. Until the latest SAG agreement with the Alliance of Motion Picture and Television Producers (AMPTP), streaming was based on ironclad rates rather than on the show’s success. For example, actor Kimiko Glenn posted a video revealing her total residual payout for more than 40 episodes of Netflix’s “Orange Is the New Black” was $27.30.
Under the new contract, however, performers are compensated for success, signifying a sea change in streaming royalties. According to SAG president Fran Drescher: “It was essential that we came out of these talks with a new stream of money from these [streaming] platforms. When it comes to compensation, streaming did not fit the traditional linear residual structure, and we needed to find a solution to that.” For the first time, she emphasized, “there is money for actors that there never was” before.
