Is the film industry on the brink of closure.. or is it gathering forces to counter the recession? Vajir Singh on the grand debate...
The Hindi film industry that makes more than 200 films a year, is definitely feeling the heat of global recession. Independent producers are blaming the corporate houses and their woeful lack of business acumen for being in the doldrums today. The corporates meanwhile, are busy reworking budgets and strategies.. going slow on green lighting projects and inking deals.
UTV, Reliance Big Pictures, Mukta Arts, Shree Ashtavinayak Cine Vision, Eros International, Percept Picture Company and Studio 18 have either applied the brakes on the production front or are dithering on approved projects.
They deny that it is because of recent losses or the cash crunch. And insist it’s just that they are being extra careful about the films and the actors they support. Contracts are being rewritten.. and film rights relinquished depending on
Interestingly, none of them are ready to accept that business is down. Reliance Big Pictures didn’t want to go on record but a company official rubbished rumours that they had “slowed down”. In fact, he avers that Reliance Big Pictures is looking at expanding its repertoire aggressively and will release four films — 13 B, Sikandar, Kal Kisne Dekha and Do Knot
Disturb — in the coming months. It was also pointed out that the company has acquired the rights to Rakesh Roshan’s Kites for Rs 100 plus crore.
However, UTV has asked the cast and crew of its next film, Hook Or Crook, to cut down on their hereto-agreed-upon signing amounts. Director Madhur Bhandarkar points out that the bubble had to burst, sooner or later.
“This is a panic situation for everyone and stars have to reduce their prices. Till last year, even those actors who had no fan following or box office equity were charging Rs 2 crore. That cannot
continue,” he asserts.
Veteran actor Rishi Kapoor agrees that exorbitant paychecks have to be reduced but doesn’t believe that the industry is going through a slump. “What recession are you talking about? Look at the kind of business our films are doing! Who would have believed that they would cross the Rs 150 crore- Rs 200 crore mark,” he argues.
Superstar Shah Rukh Khan says that while everyone has been affected by the worldwide economic meltdown, the cosmetic and entertainment industries have been the least affected.
He says, “I haven’t heard of any film being shelved. But we will have to make our productions more cost-effective. Actors, directors, writers, musicians and even producers will have to agree to a cut. If the audience can no longer afford to pay Rs 250 for a ticket, everyone involved in filmmaking will have to bring down his price.”
Apart from skyrocketing star fees and lavish budgets, most producers believe that the fall in satellite rights is another reason for concern. There was a time when satellite rights were being sold for more than Rs 10-15 crore depending on the face value.. not anymore.
Subhash Ghai points out that filmmakers will soon have to revert to the strategy of 2005 when instead of selling all rights to a single buyer, the film’s rights were distributed amongst several buyers for better exploitation of the business.
For his three forthcoming movies —Hello Darling, Right Ya Wrong, Paying Guest — Ghai says Mukta Arts plans to distribute the films themselves, all over India, and only sell the overseas theatrical rights.
“Then depending on how they perform, we will put a price on their satellite and DVD rights. From now on, the emphasis will be on performance. If the movie does well at the box office, it will earn big money,” he points out.
Andrey Purushottam, CEO, Mumbai Mantra (part of Mahindra and Mahindra Group) agrees with Ghai that recession has affected ancillary revenues, particularly satellite rights. “But that doesn’t mean we are going on a forced sabbatical. We have five films coming up, including an international project, Buddha, for which pre-production is going on,” informs Purushottam. Now that’s a silver lining amongst the dark clouds.