Instead of lamenting the diminishing box-office returns, it’s time we took the bull by the horns and looked at the real roadblocks to profitability
Shibasish Sarkar,Coo, Reliance Entertainment
Like any other industry, the film industry is also dependent on quality, resources, infrastructure, technology evolution and a combination of other underlying factors. At the same time, unlike many other industries, the creative involvement and people participation in this industry is paramount for quality. Yet, films are largely not a profitable proposition as a business. Let us look at the reasons:
1.We are not telling compelling or engrossing stories. Period. I feel the first step to identifying the issues starts with us. We should make compelling stories for the ‘audience’, not necessarily for ‘us’. There is a large audience in this country which wants to appreciate a good story. India is a varied and diverse country and there is scope and an audience for every genre and stories as long it touches
a chord. Films are a hit or a failure, the day the story is green-lit. Everything else after that is about just going through the cycle of execution. So we need to cultivate writers, look for good stories, which is not easy, but we need to harness the best creative minds to work in that space.
2.Movies become hits or flops on cost. We suffer in making cost-rational films. Films even with compelling stories become flops on cost. Talent costs in today’s times are completely irrational / unviable. There is no easy solution to this as the prices of actors and other talent are a market-driven phenomenon. One solution is to use a profit-sharing formula largely, which some actors have already started doing. If it is not working out, producers should resist making films. It’s better not to do films than to do risky projects.
3.Less screens and 52 weeks to showcase. In India, the number of screens is pathetically low compared to the number of films that release every year. The other side of the story is that cinema halls / multiplexes are able to recover only on F&B. Estate costs are exorbitant in India and that is killing the exhibition sector, which in turn affects the film industry. The government needs to take the initiative. Take a look at China, whose box office is likely to exceed that of Hollywood by 2020. The Chinese government has taken the initiative to drastically increase cinema chains, which has paved the way for growth in the industry. Secondly, we need to increase cinemas in Tier II and Tier III cities. The box office can grow dramatically, if we can make low-cost option of cinema halls in Tier II and Tier III cities.
4.Time of partnership / Acquisition model is not viable. The film industry needs to evolve in its mindset. Independent producers, talents and all sections of industry have grown over the last 15 to 20 years with public funding, corporate funding, bank and FI funding etc. The overall industry has benefitted substantially and grown disproportionately over the last 15 years. But somewhere the spirit of partnership is missing and investors bear a lopsided risk, compared to all other segments of the ecosystem. As producers, we need to ensure that stakeholders and investors get their value. We need to work on more partnerships to make sure that all segments of the ecosystem get their returns and that risks and rewards are borne equally. Otherwise, we will very soon go back to the ‘60s and ‘70s in terms of financing structure….and the industry will shrink.