Pay or Play
A contract guaranteeing payment to talent even if the project doesn't proceed.
Definition
Pay or play provisions guarantee that attached talent receives compensation regardless of whether a project actually gets made. Once a deal goes pay or play, the studio is committed to paying the agreed fee even if the film is canceled or the talent is replaced.
This protection gives talent security when committing to projects that may not proceed, compensating for opportunity cost of holding availability.
Why It Matters
Pay or play commitments represent significant financial risk for studios and significant security for talent. Understanding when deals go pay or play helps professionals navigate the commitment levels in Hollywood negotiations.
These provisions protect talent from development uncertainty while binding studios to serious commitments.
Examples in Practice
A director attached pay or play to a $200 million production would receive their full directing fee even if the studio canceled the project. Major stars often won't commit without pay or play protection given the opportunity cost of holding availability.
Studios carefully manage pay or play commitments, often waiting until financing is secured before triggering binding obligations.