By Jacqueline Trescott
Washington Post Staff Writer
Friday, May 26, 2006
The Smithsonian Institution is locked into its semi-exclusive television contract with Showtime Networks Inc. for 30 years, Smithsonian Secretary Lawrence M. Small told a House oversight committee yesterday.
Filmmakers, historians and members of Congress have criticized the contract, which has never been made public.
Small disclosed several other details about the deal:
· The Smithsonian is guaranteed $500,000 a year, and can earn additional money if Smithsonian on Demand, Showtime programming based on Smithsonian holdings, is popular with cable subscribers.
· Showtime invested "tens of millions of dollars upfront" to start Smithsonian on Demand.
· The Smithsonian can do six television programs a year with other filmmakers outside the Showtime contract.
Summoned by the House Administration Committee, chaired by Rep. Vernon J. Ehlers (R-Mich.), Smithsonian officials explained how the deal originated and what the new partnership means to scholars and historians seeking access to the Smithsonian's voluminous collections and its experts.
The committee was given a copy of the 170-page contract, Ehlers announced as he opened the hearing, but he said he would keep it confidential. He added that the first copy he had received was incomplete. "Large portions of the contract were redacted in the version that was submitted, making it difficult to gain a complete picture of its substance," he said. He thanked Small for providing a full text, but some committee members said they hadn't had time to read the entire document.
Some members of Congress have strenuously objected to the secrecy around the contract. They also complained that it wasn't shared with them before it was announced in March. As a sign of its displeasure the House Appropriations Committee reduced the proposed Smithsonian budget by $20 million.
Yesterday's hearing was the first time Small and Gary M. Beer, chief executive of Smithsonian Business Ventures, the brokers of the Showtime contract, have spoken publicly about the contract. Rep. Juanita Millender-McDonald (D-Calif.) said the unusual aspects of the contract should have prompted the Smithsonian officials to consult Congress.
"We apologize for the hullabaloo this has caused for Congress," Small said.
With the deal, the Smithsonian said, researchers and scholars would continue to have access to the archives and other Smithsonian resources. But commercial filmmakers could make only "incidental" use of the materials unless they were working with Showtime or got special approval. Smithsonian officials have said only a very small number of filmmakers would be affected. Small said that of the 900 media contracts signed between 2000 and 2005, only 17 had more than an incidental use of Smithsonian resources.
The objections were loud and were repeated yesterday at the hearing.
"What we do know is that the resources of the Smithsonian should not be made exclusive to anyone," said Margaret Drain, vice president for national programming at Boston station WGBH, one of public television's leading producers.
Several committee members said they were deeply troubled over the length of the contract, especially if access continues to be an issue. "I'm worried about stifling people for 30 years, and Showtime doesn't want the competition," said Rep. Robert A. Brady (D-Pa.). Small said it took time to build a cable company, and establish a brand.
Small explained that the Showtime project was one way that Smithsonian was trying to bring in extra revenue. It receives 75 percent of its money from Congress. Its other funds come from a private account that includes an $800 million endowment. Small said yesterday the Smithsonian had raised $1 billion from private sources since 2000. But he also reminded the panel that the Smithsonian has a backlog of repairs that would cost billions of dollars.
The contract also gives the Smithsonian a 10 percent ownership in the Smithsonian on Demand venture. "Since the Smithsonian is not investing any money, the percentage is unusually good," Small said.
The Showtime agreement, Beer said, was reached after discussions with 10 other media companies. The conversations with Showtime started in March 2005 and were announced a year later.
Besides Drain, the committee heard from two other critics of the deal. Emily Sheketoff, executive director of the American Library Association's Washington office, suggested that the Showtime contract be annulled and that the terms of another deal with HarperCollins Publishers be disclosed. Carl Malamud, a senior fellow at the Center for American Progress, a Washington think tank, said in a rapidly changing media age, a 30-year contract was impractical. "In this Internet era, even three-year distribution contracts can be considered long," Malamud said.
Whatever the future of Smithsonian businesses, the panel emphasized that Congress needs to be keep informed.
"If we have even an idea we will come to you," Beer said.