The Future of Content Distribution
The Chennai Angels and TiE Chennai had organized a very interesting fireside chat session today on the future of content distribution – which was about the business of movie distribution in India and Indian films. The two industry veterans on the stage Mr Senthil Kumar of Qube Cinema and Mr Sanjay Wadhwa of AP International were awesome. They had so much to share on how things work behind the scene in making and distributing a film from a business and commercial perspective. The moderator extraordinaire Mr Chandu Nair had done so much homework on the topic, that he kept the pace to resemble that of drinking from a firehose.
Senthil Kumar of Qube Cinema is acknowledged world leader in the technology of electronic distribution of film content. They have a significant share of screens running on Qube hardware in India and abroad.
Sanjay Wadhwa of AP International is steeped in Film Production and Distribution and has in more recent times taken to streaming his content in overseas markets.
Below are some points from the talk:
(Disclaimer: These were from what I remember listening to the panellists, they are not meant to be comprehensive or definitive)
- The reason so many people enter the film making business is that there is no entry barrier – you don’t need any certification, no qualification required, just the ability to raise money (or have money). It is best to attain glamour and publicity. Often heard in the industry circles, that people who are not capable of anything else come to movie making (producing).
Typical estimates on the money involved in a Tamil film (meant for illustration):
- If a big-budget movie is made at a cost of Rs.210 Crores, then the Hero takes the significant portion of it – Rs. 108 Crores.
- If it is made at Rs.110 Crores, then the Hero takes Rs.60 Crores, well over 50%. The villain gets a maximum of Rs.5 Crores.
- A successful Vijay movie’s Hindu dubbed rights sell for Rs.25 Crores for auction in Bihar. A Dhanush’s movie sells for Rs.6 Crores. There is a growing market in Hindi heartland for popular films (Hindi dubbed) from South, due to the family-oriented subjects.
- Well over 90% movies made in South India (and India) fail. They don’t earn back the money invested or make any profit.
- There are very few corporate houses in movie making in India, even less so in South India. Anil Ambani’s Reliance Entertainment tried to do, but they failed for their own reasons.
Continuing on, the panellists mentioned:
- OTT platforms and Streaming companies (Read as Netflix, Amazon Prime & Others) are becoming big-time producers with huge investments in original content. And being global platforms, subscribers worldwide get to see content created for various national markets.
- Netflix India mostly buys movies that have earned audience acceptance and praise, and, they don’t go for unproven movies or just for big names. Whereas, Amazon Prime looks at buying earlier at lower price movie rights, before the theatrical release. Each of them seems to have carved their niches.
- Reliance Jio is expected to be the trojan horse in the OTT space with their deep pockets and the availability of patient capital.
- E & Y Report on “India Media & Entertainment Industry” published in March 2019 had many interesting data points.
- YouTube is a significant player in India, with 93.5% of digital video viewers in the country, which is about 271.9 million in 2019, expected to grow to 342.3 million viewers by 2021.
- Figures show that the number of digital video viewers in India continues to grow as cheap data plans flood the market of 1.3 billion people. There will be 290.8 million digital video viewers in 2019, an increase of 18.6% from the previous year. By 2021, the number expected to reach 368.8 million viewers.