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A breakthrough has been reached in contract talks between Hollywood studios and striking writers and could lead to a tentative deal as early as next week.

The two sides breached the gap Friday on the thorniest issues, those concerning compensation for projects distributed via the Internet, said the person, who requested anonymity because he was not authorized to speak publicly.

A second person familiar with the talks, also speaking on condition of anonymity because he was not authorized to comment publicly, said on Saturday that significant progress had been made and a deal might be announced within a week.

The people did not provide specific details on the possible agreement. Major points of contention include how much and when writers are paid for projects delivered online after they have been broadcast on TV.

The studios have been insisting programmes be streamed online for a certain period, deemed promotional, during which writers would forgo residuals. When payment kicked in, the companies sought to limit it to a flat USD1,200 fee, while the guild wanted a percentage of a distributor's revenue.

Although work remains to be done on elements of the agreement, prospects for a deal appeared solid, said those close to the situation. The tentative agreement would have to be approved by a majority of guild members.