Actor Salman Khan has realised the worth of Brand Salman Khan. In a move that’s set to change the rules of the game when it comes to profit sharing in Bollywood, the king of the Rs 100 crore film club has come up with a new business model.
Traditionally, if a film made money at the box office, the producers, exhibitors and distributors got the profits and the actors, a fixed remuneration. But according to Khan’s new model, he shall pay a fixed amount of Rs 15-20 crore —over and above the production and distribution cost— to the producer and will keep the rest of the profits, that could well go upto Rs 200 crore for a hit film.
The industry, surprisingly, has given a thumbs up to Sallu’s idea. “After giving mega blockbusters such as Dabangg, Ek Tha Tiger, Bodyguard and Ready, Salman is today in a position to command whatever he wants. This model is great for him to encash his brand. If he will get the biggest chunk of the profits, one needs to also keep in mind that he is ready to take the risk that if the film fails, he will still pay the committed amount of Rs 15-20 crore to the producer,” says trade analyst Atul Mohan. Explaining that top stars such as Shah Rukh Khan, Akshay Kumar and Salman himself have anyway had a profit sharing arrangement for their films for a while now, trade expert Taran Adarsh adds, “We now follow the Hollywood model where the lead actor becomes a partner in one way or the other. All the top actors have realised that a film works because of them and what their worth is, so they don’t want to share the profits with anyone.”
Not everyone, however, agrees with Salman’s blatant diktat. “Yes, Salman is in demand and that’s why this rule. His mantra is, ‘main kisi aur ko kyun kamaane doon?’ But this way it’ll be very difficult for producers outside of his family to work with him. He will have to produce all his films himself,” says trade analyst Vikas Mohan.
A Bollywood film’s profit break-up
As of now, after incurring production costs, if a film earns Rs 100 crore at the box office
Rs20 crore goes to the government as entertainment tax
Rs48 crore (60% of the remaining Rs 80 cr) goes to exhibitors
Rs2 crore (5% of the remaining R32 cr) goes to the distributors
Rs30 crore (the remaining profit) goes to the producer of the film
As per Salman’s new model, the producer gets a fixed amount of Rs15 crore and the rest (after deducting entertainment tax and the exhibitor-distributor share), goes in Salman’s pocket.
* Approx estimates by industry sources