On Nigeria’s $11bn box office cinema industry

The industry is estimated to gross between $10 billion to $11 billion in box office

THANK YOU FOR THE OPPORTUNITY and the question. The cinema and theatre industry of the current era in Nigeria can be traced back to 2004. After 20 years of military sanctions, when we had no access to films, there was decaying infrastructure which posed a challenge to the sector. Also, there were only 60 cinemas in...

IN A PERIOD WHEN THE CORONAVIRUS PANDEMIC is wreaking havoc on global businesses, the Nigerian cinema industry, which is estimated to be worth over $10 billion by industry experts, has found ways to thrive, despite the adverse impacts brought by the global pandemic. Over the years, the industry’s growth has been largely driven by the quality film productions, as well as the transparency and accountability of the Nigerian box office, valued at over $6.4 billion as of 2018 by industry analysts. Despite the hit on the industry, which saw key players experience a dip in their revenues, loss of stocks, as well as the laying off of staff, industry practitioners have expressed strong optimism as they hope to see the sector bounce back to its feet in the shortest time. Business A.M’S CHARLES ABUEDE spoke, in this exclusive interview, with MOSES OLUMUYIWA BABATOPE, Group Executive Director, Filmhouse Cinemas and FilmOne Distribution and Production, Nigeria, who has over 18 years of managerial experience in cinema operations, management and film distribution, on the realities in the cinema and theatre industry in the face of the coronavirus. He expresses optimism about a bounce-back and a more resilient industry with higher revenues, post-COVID. Excerpts:

Thank you for agreeing to this interview with Business A.M. Kindly give us an overview of the cinema and theatre industry in Nigeria. How can we trace the evolution of the industry?

THANK YOU FOR THE OPPORTUNITY and the question. The cinema and theatre industry of the current era in Nigeria can be traced back to 2004. After 20 years of military sanctions, when we had no access to films, there was decaying infrastructure which posed a challenge to the sector. Also, there were only 60 cinemas in Nigeria as at then and we deserved more cinema funding, more cinema locations. With the evolution of the industry over the years, we have seen over $6.4 billion in box office receipt as of 2018, and when we add other things such as currency devaluations, several adversities faced by the industry over the years, coupled with a pandemic that has severely hampered on the efficiency and operability of the industry, we can see an industry estimated to gross between $10 billion to $11 billion in box office.

Let’s talk about the economics of the industry. What can you say has been the source of funding in the industry considering the low level of capital importation into the entertainment sector in Nigeria and the government’s little or no investments into the private sector? Also, what has been the major growth driver of the industry in Nigeria in recent years?

The industry’s growth is largely driven by previous films successes and the quality of films produced within the industry. Also, the marketing of our films locally and internationally; the level of transparency and accountability of the box office has majorly been the driver in the cinema business in Nigeria. However, the support received by the industry from the Development Bank of Nigeria (DBN), the Bank of Industry (BOI) in terms of funding for the growth and expansion of all sectors within the industry, as well as grants, from international investors and other multilateral lending financial institutions. This, however, has led to an increase in the number of film locations tremendously over the years till now.

Briefly analyse the Nigerian cinema industry on how it has evolved over the years with major filmmakers adapting their scripts and movies for the big screen, what are the earning potentials of the industry?

On the industry’s earnings potentials, over the years, we have done productions that appeal to the sub-Saharan Africa film market as well as the diaspora. We have seen our stories speak to the dramatic and rich cultures of Nigeria, the intricacies of treachery, betrayals, combining all aspects of our everyday lives and showcasing them as the world wants to see our films imbibe the rich and relatable ideologies in our storytelling. Taking more time to ensure that stories are well developed; we have seen more demand for our movie and people are willing to pay for it. We see more and better depictions of our cultures and traditions on screen. With the appeal in the eyes of viewers, we have Netflix and other major streaming giants signing deals with Nigerian filmmakers to produce what comes out as blockbusters and box office hits. All these have contributed hugely to the enormous earning power of the industry.

Lets us look at the relationship between regulators and industry players. What has the relationship been among the filmmakers, distributors and the industry regulators? What have the challenges been like?

The relationship between the filmmakers, distributors and the industry regulators has been cordial and still evolving in a positive direction. As a result, we have discovered several guilds and associations that are active and seeing to members’ welfare. We have an industry regulator under the leadership of Adedayo Thomas, who runs a sector that listens. In the present time, our films are appealing; they are rated and classified as they should be. Every player and operator within the industry is happy. We have set the industry in the theatrical sector. Currently, we are speaking with stakeholders in the industry. Consequently, there is an exchange of ideas between stakeholders, directors, producers and actors within the industry on how we can find ways to progress and move the sector forward.

Still on the challenges faced by the industry; in the face of the pandemic, which led to the closure of cinemas worldwide. In what ways do you think the industry can

We need to win back our audiences in their large turnout to the cinema and also see a surge in revenues in the next 12 to 18 months

thrive on the back of the pandemic when reopened?

The challenges have been really one of the pain points. We have had to lay off staff due to the loss of revenue for six and half months on the backdrop of the COVID-19 pandemic; stock losses and the wearing out effects of the pieces of machinery. There has been an upward trajectory of slow growth within the industry since the start of the crisis. The negative impacts of the coronavirus pandemic, as well as the government’s directives on the lockdown of cinemas across Nigeria have seriously reared its ugly head. Nevertheless, we have been allowed to reopen, though, there is a limit to the carrying capacity from between 33 per cent and 50 per cent of the actual hall capacity. This directive might directly or indirectly hamper on the revenues of the cinema business considering the cost of operations.

In your view, as an expert and the helmsman of one of the leading cinema houses and film distribution companies in Nigeria and Africa, in what way do you think the industry can influence and/ or shape the economy of Nigeria?

The film is a powerful tool to project the human experiences and our traditional system. We need to work with government and other relevant stakeholders to project the power of film. In a similar vein, we have seen the United States’ Hollywood adopt best features such as the police force, the military, the health, banking, prison, legal and other areas in their movies. We need Nigerian-owned Nollywood films to depict the best of our culture and corporate features such as the military and paramilitary forces, banking, prison and legal features. To achieve this, we need access to capital.

However, the industry will have a tremendous impact on the Nigerian economy because Nigerian films are watched globally. If we are supported to tell more of our story, imagine the level of employment for the youth, when you consider Nigeria’s unemployment figures; also imagine how many more stories that will be told. Basically, films can play a transformative and tremendous role in the development of the Nigerian economy.

Give us a brief outlook for the industry. Do we hope to see more entrants, expansions of the currently existing ones or consolidations as a result of the pandemic? What do you look forward to seeing happen in the industry in the nearest term?

You can’t take away the human interactions from what we gain from the released emotions in a movie. Nigerians need to share their experiences as shown in the movies. We oftentimes see the connection in the halls where the suspense, emotions, drama and every humane projection from a movie changes the atmosphere and movie lovers will like to experience such once again. We look forward to seeing that again with full capacity.

On the other hand, what we must do is to continue telling our stories in the best possible and professional manner that we could. On the outlook for the industry, we need to win back our audiences in their large turnout to the cinema and also see a surge in revenues in the next 12 to 18 months. However, we hope the infection rate slows down and also the discovery of a vaccine for the global pandemic which would, in turn, afford us the opportunity of coming back to our normal lives. We also hope to see some forms of consolidations and expansions in the number of cinema outlets in Nigeria and more funding supports from the government and international investors.