From the Los Angeles Times:

Dozens of striking film and TV writers are negotiating with venture capitalists to set up companies that would bypass the Hollywood studio system and reach consumers with video entertainment on the Web.

At least seven groups, composed of members of the striking Writers Guild of America, are planning to form Internet-based businesses that, if successful, could create an alternative economic model to the one at the heart of the walkout, now in its seventh week.

Three of the groups are working on ventures that would function much like United Artists, the production company created 80 years ago by Charlie Chaplin and other top stars who wanted to break free from the studios…

Silicon Valley investors historically have been averse to backing entertainment start-ups, believing that such efforts were less likely to generate huge paydays than technology companies. But they began considering a broader range of entertainment investments after observing the enormous sums paid for popular Web video companies, including the $1.65 billion that Google Inc. plunked down last year for YouTube, a site where users post their own clips.

They also have been emboldened by major advertisers, which prefer supporting professionally created Web entertainment to backing user-generated content on sites such as MySpace that can be in poor taste.

“I’m 100% confident that you will see some companies get formed,” said Todd Dagres, a Boston-based venture capitalist who has been flying to L.A. and meeting with top writers for weeks. “People have made up their minds.”…

Already this year, a handful of sites have received venture backing, including, co-founded by comedic actor Will Ferrell, and, launched by former MTV executive Rob Barnett…

Most writers who have been talking with venture capitalists declined to discuss their plans on the record, saying it was too early to provide details. Yet an array of strategies have emerged from interviews with writers, investors and others involved in the process.

The groups modeled after United Artists (which eventually was bought by Metro-Goldwyn-Mayer Inc. and recently was revived with the help of Tom Cruise) envision creating and distributing programming for the Web and recouping their investments by selling rights to the most successful properties to TV networks or movie companies…

Some high-profile writers and technologists are trying to create a collaborative studio they hope would be officially sanctioned by the Writers Guild. They want to build on the popularity of strike-related videos on the guild-inspired blog UnitedHollywood, YouTube and elsewhere.

“We are uniquely positioned to take our case and new business model directly to consumers,” said a leader of that effort, the primary writer on a TV show that was a blockbuster a decade ago. “This will be the officially sanctioned Hollywood union portal.”

Others seek to create a privately owned studio that would develop episodic series for the Web. The studio could turn a profit even without cutting movie or TV deals if it developed an audience coveted by advertisers…

At least two additional groups plan to create companies that would distribute material on Facebook or other online gathering places where they might quickly become popular.

Facebook director Jim Breyer, a partner at Silicon Valley venture firm Accel Partners, said he was weighing deals that would rely on Facebook’s platform. “It is likely we will make investments in Los Angeles screenwriter/content-oriented companies in 2008,” he said.

Accel and Dagres’ Spark Capital are among four venture firms that have been meeting with writers since the strike began. Hedge funds are also interested in investing, writers who have met with them said…

Some of the writers who are drafting business plans said that if the strike had lasted only a week, they would have just gone back to work. But now they’ve had time to plot strategy — and to realize that a prolonged strike with reruns and reality shows filling the airwaves might allow them to grab a wandering audience.

“The companies are pushing us into the embrace of people that are going to cut them out of the loop,” marveled one show runner who is tracking the start-up trend but not participating.

“We are one Connecticut hedge-fund checkbook, one Silicon Valley server farm and two creators away from having channels on YouTube, where the studios don’t own anything.”