Industry
Financial indiscipline of film producers under the scanner as market crumbles
Summary
- For far too long, film producers have relied on satellite and digital sales, instead of box-office revenue, to recover their investments. A key pillar of their strategy involved paying hefty fees to cast top actors and ride their star power to financial success.
New Delhi: For far too long, film producers have relied on satellite and digital sales, instead of box-office revenue, to recover their investments. A key pillar of their strategy involved paying hefty fees to cast top actors and ride their star power to financial success.
This profligacy proved disastrous, as films bombed at the box office, and makers were unable to sell satellite rights even as streaming platforms turned cautious, trade experts said.
Not too long ago, Vashu Bhagnani, who heads Pooja Entertainment, having to sell off his office space as employee dues running into several crores remained unpaid, made headlines.
“The industry is in a flux right now. OTT has altered traditional revenue models, and the influx of content has increased competition. With the post-pandemic reverberations still being felt on theatre footfalls, the consistent increase in star and entourage fees has indeed strained budgets for independent producers," said Roohi Bhatia, director of strategy and operations, Civic Studios.
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Independent producers
While some independent producers are often the ones pushing the boundaries on important, oft-ignored social themes, these are not seen as commercially viable, which can make producers over-index on big-scale projects with exorbitant marketing budgets, Bhatia added. “Most importantly, the industry is now adapting to evolving audience preferences and demographic shifts in streaming," she pointed out.
To be sure, film industry experts say financial indiscipline and unrealistically high fees to stars without understanding whether the films in question will be able to recoup investments from box office or other rights, have left some producers in the lurch.
The going is particularly tough for producers that are not be backed by large studios or those that did not factor data into the kind of money that films in a similar budget range were managing from OTT and television rights after the pandemic subsided. While theatrical footfall remains uncertain with audiences not turning up even for big star titles, satellite television and OTT right sales have dwindled, with broadcasters and streaming platforms turning cautious.
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“Box office has remained way below par for the past couple of years and all platforms are renegotiating deals. A lot of films were conceptualized during covid and it was presumed OTT services would help recover spends by buying their rights but things have not turned as expected. It is worse for producers who were simply putting projects together based on expected rebates or government subsidies, relying on stars who have failed to find draw," said a producer declining to be named.
The person said that the names impacted have not paid attention to changing audience tastes and demands or attempted to bring anything new to screens.
Box office performance
Over the past few months, big-scale projects like Bade Miyan Chote Miyan (backed by Bhagnani), Maidaan, Yodha, Sarfira, Auron Mein Kahan Dum Tha, and most recently, Khel Khel Mein, have tanked at the box office.
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That said, with the impressive numbers for films like Stree 2, and Kalki 2898 AD earlier, industry experts say well-made films that have upped the game on scale and spectacle along with compelling stories, are finding their audience.
"The kind of films that have clicked are the honest films, well told, well priced and with robust word-of-mouth. It's not about who, as much as it is about what," producer Tanuj Garg of Ellipsis Entertainment said.
