Under terms of the tentative agreement with the Alliance of Motion Picture and Television Producers, the union's 11,000 members will get a slight pay raise and more money when their shows or movies are put into syndication or sold overseas. The Fox network, which previously could pay union writers less under the theory that it was still developing, will have to start paying the same amount as the older networks within a few years.

By reaching a preliminary settlement with the writers, the studios have also helped to reduce the chances of an actors' strike. The contract between producers and the Screen Actors Guild expires June 30, and the new deal with the writers will likely be used as a template for the SAG bargaining, negotiators for both sides say.

Analysts had estimated that a strike by the two unions would have cost LA County's economy alone between $1 billion and $2 billion a month. Many said such a loss would almost certainly be enough to push the local economy--already battered by the effects of soaring utility bills and layoffs in the dot-com sector--into a full-blown recession.