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Is the big screen enough?

sudhish kamath
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issue As Kamal Haasan sticks to a conventional theatrical premiere of “Vishwaroopam” instead of DTH, industry insiders open up on why the market is not ready for change. sudhish kamath

A still from “Vishwaroopam”
A still from “Vishwaroopam”

When Kamal Haasan’s “Vishwaroopam” releases in theatres on January 25, it begins a journey in recovering its budget of Rs. 95 crore. One of those rare cases where hitting 100 crore is only halfway to recovery. Yes, the film needs to collect Rs. 180 crore to break even, with only satellite and international rights for a cushion, now that the DTH release date of the film and the pricing is still undecided.

Thanks to the entertainment tax of 30 per cent in the cities, out of Rs.120 per ticket, the producers will make Rs. 40 in the city after the distributor/exhibitor share. The makers would make a little more in towns and villages since the entertainment tax is lower (20 per cent) and their share is higher (60-70 per cent).

To break down the math, “Vishwaroopam” needs to sell over 3 crore movie tickets if the film were to depend on theatrical revenue alone, thanks to government regulation of ticket prices, cap on number of shows and the high entertainment tax.

“You want to hit full capacity during the first four days and also price the ticket according to demand but you don’t have that option,” says a distributor.

Also, with “Vishwaroopam” getting a U/A certificate, the producers are not eligible for exemption provided only to U-rated films that protect and preserve Tamil culture. (See box for more on the government policy).

“An exclusive theatrical window remains the most viable option for filmmakers around the world to recover costs,” the distributor observes.

“Just because technology gives you an option does not mean it’s necessarily good for business. DTH has existed for years in the U.S. and if it made business sense, it would have eventually happened.”

Admitting it may be a good thing for the customer who is provided with the choice to watch it at the theatre or at home, the DTH premiere may not make business sense for the producer, he says. “The sum of the parts will be less than doing it in a staggered manner. The industry has settled on a model that’s tried and tested... Theatrical release is a great launch platform for revenue to be earned from other avenues. When you go straight to TV, the excitement of a release is not there. But this case has made the industry see that there is an opportunity to monetise the film through DTH which was earlier sold along with satellite rights,” the insider believes.

“The truth is not black or white. The exhibitors and distributors also have some valid points,” says Shakthi Girish, editor of “Galatta”. “I laud Mr. Kamal Haasan’s efforts to revolutionise the business but his team of advisors should have given him a clearer picture about the potential of DTH in the current scenario.

Perhaps, another release and pricing strategy that was acceptable to all parties involved could have avoided the controversy. That said, it’s imperative that we explore and adapt to changing distribution models for further profitability of the industry and reduce piracy.”

Despite the possibility of tracking the fingerprint on DTH to the address of the pirate, many theatre owners are not convinced.

“This is an immature market where piracy thrives and people expect everything for free, especially if it’s on TV. We are not ready to deal with DTH,” opines a trade analyst.


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