Both sides in the Hollywood writers strike expressed optimism that progress was being made in contract negotiations aimed at ending a five-week walkout.
The Writers Guild of America said Wednesday that talks with studios over the past two days were "substantive," but cautioned it had yet to get a response on proposals including residuals for movies and TV shows streamed online. Negotiations were to resume Thursday.
"For the last two days, we have had substantive discussions of the issues important to writers, the first time this has occurred in this negotiation," the guild said in a statement. Among the issues: union jurisdiction over the Internet and reality TV.
The Alliance of Motion Picture and Television Producers said in a statement it believed the sides could find common ground that would allow the industry to "survive and prosper" in a changing global marketplace.
The guild said it was calling for a different formula for the thorny issue of online compensation than the one producers put on the table last week.
It accepted the idea of a fixed residual for TV shows in the first year of online use, but the payment should be adjusted upward for each 100,000 streams per quarter, the guild said.
"This is a readily ascertainable number," the guild said. "In fact, companies are already keeping records of streams for their advertisers."
After the first year, the union wants 2.5 percent of a distributor's gross for TV shows and movies streamed over the Internet.
Studios had proposed a flat $250 payment for a year's use of an hourlong TV show on the Web. That contrasts with the $20,000-plus that writers now earn for a single network rerun of a TV episode.
The strike has shut down production on dozens of prime-time and late-night shows, sending a number of programs into reruns.
Meanwhile, laid-off staff members from NBC's "The Tonight Show" received holiday cheer from host Jay Leno.
In a meeting Wednesday with the non-writing staffers, Leno said he'd continue covering their lost pay at least through Christmas, according to a network executive.
The comedian had agreed to pay about 80 workers' salaries through this week after NBC laid them off last Friday. The network had kept the staff on for a month after the strike started and production on the show stopped as Leno honored the guild's picket line.
Leno will reassess the situation week by week, depending on what happens with the contract talks, the executive said, speaking on condition of anonymity because the person was not authorized to comment publicly. The "Tonight Show" host also gave out early holiday bonuses.
Other late-night hosts, including Conan O'Brien, David Letterman and Jimmy Kimmel, are paying laid-off workers on their shows.
A writers strike in 1988 that lasted 22 weeks was said to have cost the industry $500 million. Estimates for damage from the current walkout, if it lasts as long, have hit $1 billion.
But the quarterly Anderson Forecast by the University of California, Los Angeles, said a close examination of this year's strike suggests a more "modest and transitory impact" on the Los Angeles economy that would be a third or less than the billion-dollar predictions.