Netflix, Prime revive ailing Bollywood production firms
NEW DELHI: Online platforms like Netflix and Amazon Prime have opened up new revenue streams for Bollywood’s less active or defunct production houses that are grappling with declining sales from satellite TV rights.
The platforms are acquiring rights to stream older classics as well as new titles, said Atul Mohan, editor of trade magazine Complete Cinema. Companies such as RK Films, Venus Worldwide Entertainment, Tips Industries Ltd, Mukta Arts and the families of filmmakers like Manmohan Desai and Prakash Mehra, who own rights to a host of titles, are likely to benefit the most from the growth in Internet streaming.
“Old classics that one may not get to see in theatres or even on DVDs anymore have found a new lease of life on OTT (over the top) platforms,” confirmed Rajiv Vaidya, CEO of Spuul, an online video streaming service, which streams Hindi film blockbusters from the 90s such as Hum Aapke Hain Koun and Dilwale Dulhania Le Jayenge. “They, however, contribute a small percentage to overall consumption.”
Older Bollywood production houses today generate revenue from video on demand, IPTV (Internet protocol television), Internet, mobile rights and direct-to-home (DTH) platforms.
“Apart from organised corporates, there are independent producers who, in times of crisis, sold the rights to their films to financiers, some of whom today are holding on to nearly 100 titles per person,” said Utpal Acharya, founder of film production, distribution and marketing company Indian Film Studios. In this case, it is the financier holding the rights who stands to benefit and not the original filmmaker.
Any old movie isn’t sold in isolation to these platforms, but as part of a package comprising a big tent-pole (blockbuster) and a couple of smaller films. It works exactly like television where satellite rights of a bouquet of films is typically sold for a period of 10 years and the price depends on how much the channel can afford to pay. Prices for satellite TV rights fell 40% last year.
Every television network today has one online streaming platforms — Star India has Hot- star, Sony Entertainment Television has Sony LIV and Zee Entertainment Enterprises owns DittoTV. Independent video streaming platforms include Spuul, Wynk and BoxTV.
Digital platforms in India are looking to invest over a billion dollars per year for a mix of exclusive and non-exclusive content, Acharya added.
The opportunity is not just limited to video content. Music companies have found their calling by owning their own YouTube channels besides selling their albums to digital platforms like iTunes, Gaana and Saavn.
These streaming apps pay music right owners a revenue share that comes from a combination of advertising and minimum stream rate depending on the individual song. The ₹1,000-crore Indian music industry owes its earnings to three big revenue streams — ₹400 crore comes from audio and video streaming services, ₹250-300 crore from broadcast license income contributed by music played on radio, television and public venues, and the remaining from caller tunes and ringtones. Revenue sharing with these digital platforms ensures a daily income of ₹10-15 lakh for music labels.
“I’m definitely happy (with the new digital opportunities), any new platform or technology coming in means additional revenue for the film industry,” said veteran producer Pahlaj Nihalani who has sold the satellite and digital rights of his films separately.