Which Indian Movies Will Release on Digital Platform? All Possibilities.
With Theaters in a Lock down and small producers trying to get their money freed up, there's a lot more than what meets the eye.
Which Indian Movies Will Release on Digital Platform? Before We get into the answer, Let’s understand the Reasons Why this Paradigm Shift is happening.
In our last Report on OTT sector in India we covered the reasons why there was a tiff between theatre owners and Bollywood Producers. Today, We will dig down more into the problems of Indian Producers.
Reasons Why Indian Movies are Going for a Digital Release:
1. Yes We all Know Theatres are closed but Producers are not confident that even if they open, Will the audience come out to watch movies in large numbers? This uncertainty is the primary reason and every other reason is just a catalyst.
2. Most of the Indian Producers don’t have to capacity to hold for a long period of time and this is the primary reason why even a big film like Laxmmi Bomb is desperate to go Digital and get a decent price for their movie. Because of their monthly interest on the huge investment is huge.
3. The genre of the film plays a vital role here. A film like Gulabo Sitabo might not work at theatres when the audience has to push a little harder to come out and watch the movie which brings one more uncertainty in the minds of producers. Combine that with Reason 1 and 2, it ends up in countless sleepless nights for Indian producers.
4. India and the World are going through a transition phase. Where OTT is trying to attain a bigger pie in developing countries like India.
What is the Limit that OTTs can pay for a movie?
There are many limitations to this particular aspect. For Example, Hot Star Claims that they have 8 Million Paid Subscribers in India. Although the plan which most sells for them is VIP which is at Rs. 399 and Premium at Rs. 1499 for a year.
As said earlier that their moving plan is VIP and not premium but let’s give a 50% subscriber weightage to both the plans and the average customer revenue will be Rs. 949 which will give them a yearly revenue of Rs. 760 Crores Approximately.
The holding company of Hotstar i.e. Star India had reported a loss of Rs. 1,216 Crores in FY19 and in the same period Hotstar reported losses of Rs. 554.38 Crores. and overall revenues surged to Rs. 1,112.74 Crores. The Total Expenses however for FY19 were at Rs. 1,677.51 Crores. If We compare this to revenue of Netlfix in India it was at just Rs. 450 crores in FY19 and that’s an increase of 700% from the previous year. Netflix also reported a Profit of Rs. 5.1 Crores from Its Indian Operations which was around Rs. 20 Lakhs in the previous year.
Before the arrival of COVID-2019 it was estimated that the Indian OTT market will grow to 550 Million subscribers by 2023.
After looking at these numbers and when we deduct the operating expenses of each company like Salaries, Office Cost, Server Cost, Electricity Cost, Media Expenses and much more. It’s not possible for the leader in India in this space to go above the cost of Rs. 40 crores for having the premier rights. While most of their buyouts will be limited to Less than Rs. 20 Crores.
But they have scope for experiment and if they can acquire a big film starring a Superstar and that can drive new subscribers in Numbers then that becomes a successful business model.
The Biggest Indian Film on OTT:
The biggest film that will release on OTT this year will be Laxmmi Bomb. Although it stars a Superstar Like Akshay Kumar it’s a joint production and Shabana Entertainment is not in an easy position right now. The Production budget of the film is around 130 Crores if they have to release it in theatres then it goes to about Rs. 150 Crores.
Let’s say the situation at theatres does not stabilize even after 4 months. So producers are on a notional loss of Rs. 1.5 crores every month just on the interest of the investment. They are of course looking at ways to recover their investments with decent profits.
So they start approaching Online Streaming Platforms, Netflix has strict guidelines to acquire content in India when it comes to commercials and so does Amazon Prime. Because India is not the most important market for them unless their Indian Management sticks there neck out on this experiment.
But a Hotstar is more convinced and has room to even occur some losses in this process as it will not only give them an edge in the Indian market but they will be the first Ones to actually Premiere a big movie on OTT.
If this movie was backed by Say Yash Raj Productions or Dharma Productions then they would have waited for the theatres to open normally.
Even if Hotstar is successful with this experiment it will be false learning during the lockdown as the audience will react differently when a COVID 19 medicine or Vaccination actually comes out.
Which Indian Movies Will Release on Digital Platform?
- Biggest One can be Laxmmi Bomb and in all probabilities, it will go on Hotstar, the current offer made to the producers is around Rs. 80 crores and producers are looking at a further revenue of 75 Crores from other territories like Satellite, Music, Other Territories etc. What’s interesting is the amount that will be offered to these types of big movies which are directly going digital by Television Channels?
- Gulabo Sitabo on Prime Videos on 12th June 2020 again, in this case, the entire budget of the movie is not covered by the OTT money, they have to depend on Music and Satellite right for all recoveries.
- Release Date for Shakuntla Devi is not accounted but it should be in July on Prime Videos to keep the viewers engaged.
- Then you have a legal drama Ponmagal Vandhal from South starring Jyothika which will release on May 29, 2020 on Prime Videos.
- Then You have another Film called Penguin from Southern film Industry which is all slated to release on 19th June 2020.
- Then There is LAW a Kannada film starring Ragini Chandran and Siri Prahlad releasing on 26th June 2020.
- Franch Biryani another Kannada film starring Danish Sait, Sal Yusuf and Pitobash to release on 24th July 2020.
- Sufiyum Sujatayum starring Aditi Rao Hyadri and Jayasurya. The release date is not fixed yet but it will release on Amazon Prime.
- Indoo Ki Jawani which also stars Kiara Advani should soon make an announcement of going ahead with Netflix.
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