Actors, producers approaching deadline on contract.

For nearly 18 years, Hollywood's actors and producers have lived in peace. Perhaps no more.

Within the next three weeks, a labor battle could erupt that would not only affect the fall TV season but the production of many motion pictures.

June 30 is when the contract expires between the actors, represented by the Screen Actors Guild and the American Federation of Television and Radio Artists, and the producers, represented by the Alliance of Motion Picture and Television Producers.

Both sides have set April 2 as the deadline for a settlement.

"April 2 is critical," said one talent agent. "It is when everyone will be looking for some movement. The networks start looking at their fall schedules around this time. You have films getting ready for summer shoots. Nobody wants to go right down to the deadline on June 30."

If there is a strike, network programmers who normally announce their new schedules by mid-May could wind up delaying the start of the fall season.

"We have a very serious situation," said one studio executive who asked for anonymity. "We have a lot of big issues and both sides are far apart."

Such fears come at a time when Hollywood is booming. "Titanic" has become the first $1 billion movie. TV shows like "ER" are being renewed for staggering multimillion-dollar fees.

"The business is rolling along right now," said one producer of films and TV. "I hope nobody wants to be the one that drives us off the cliff. Nobody wins in a strike."

Arthur Rockwell, president of Rockwell Capital Management, downplayed the likelihood that a strike would occur.

"They always play up these things as serious," said Rockwell. "But the industry has been enjoying an unprecedented period of prosperity. It will be a close call, but there is too much to lose if there is a strike."

SAG and AFTRA represent 138,000 actors who would be covered by a new contract. The AMPTP represents about 450 producers. who range from small production houses to the major studios and TV networks.

The last time actors and producers squared off was July 1980. The resulting strike delayed the start of the fall TV season until October.

The last strike to hit Hollywood was the bitter 1988 battle between the producers and the Writers Guild of America Inc. It lasted 22 weeks and caused an estimated $500 million in lost revenues for Hollywood.

Last week, the AMPTP and SAG/AFTRA issued a joint statement saying they would have no comment on the negotiations. The union also issued a statement to its members saying that "any rumors you may have heard about a strike are just that - rumors."

The statement was prompted by published reports listing the key issues in the negotiations. A SAG/AFTRA letter to its membership subsequently listed several highlights for a new deal, including an increase in residual payments for cable programming and foreign telecasts.

Among the actors' other demands are rules protecting against the digital alteration of an artist's performance without the actor's prior written consent, the establishment of residuals for stunt coordinators, and making Martin Luther King Jr.'s birthday a holiday.

The producers have countered with demands that include reducing residual payments for domestic reruns and changing salary structures for TV movies and low-budget theatrical films. The producers also want to cut payments to pension and health funds.

One thorny demand by the producers is a proposal for holding back residual payments until after a producer recoups costs for negatives, prints and advertising.

"The main issues are overseas bucks and cable," said one producer. "The actors want to double the current residual minimums from overseas."

This demand, another producer said, has hardened his colleagues.

"We have to draw a line in the sand," the producer said. "This demand is excessive. They have to be more reasonable. Right now there is a lot of saber rattling going on."

Most TV shows start production in late July and early August. A delay in the start of the season could escalate the continued decline of the network share of the audience. Viewers might then drift to the burgeoning alternatives to network television.

"A strike would have a much greater negative impact on ratings performance than 10 years ago when you didn't have the Internet or dozens of cable channels," said Bill Croasdale, president of network broadcast at Los Angeles-based media buyer Western International Media Inc.

Movie producers also consider April to be important because it's the time when films are being readied for summer and Christmas release.

"The production stream is already slowing down," said one producer who just completed a film. "A lot of producers don't want to be caught in the middle and have to shut down. There won't be a lot of green-lighting going on."