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Latest Bollywood hits the small screen
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In 2009, TV audiences were tired of Jab We Met re-runs on various channels. Once one of the most successful films of 2008 reached the TV circuit, broadcasters had little choice but to air it again and again, because satellite rights were in a slump due to the meltdown, and so were music, home video, overseas and other rights.

No longer. With the market sentiment looking up and a cost rationalistion across the chain, films are again hot property on the TV shelf. Most films released in late 2009 and up to June 2010 have been bought by top broadcasters. So, if STAR has Raajneeti (released June 4) and My Name is Khan, Colors has Raavan (June 18) and Kites (May) and Sony’s MAX 3 Idiots.

Last year, broadcasters refrained from buying because of the ‘high, pre-meltdown prices’ being quoted by producers and as a result there was a lull in film content on television. The TV story was a reflection of what was happening on the big screen. Only a handful of films did well at the box office last year, and the film industry actually de-grew in 2009 from Rs 10,400 crore in 2008 to Rs 8,900 crore in 2009 after a CAGR of 5% between 2006 and 2009. But the release of BIG Pictures’ 3 Idiots last December brought the smiles back, and though the big films of 2010, including My Name is Khan, Kites and Raavan, haven’t really done well on the domestic BO, the satellite and music rights have picked up. Though prices are still not at pre-meltdown levels, there’s a slew of content (films) being bought for television.

The biggest buy of the season is Vidhu Vinod Chopra’s 3 Idiots by MAX. Says Man Jit Singh, CEO, Multi Screen Media, which owns MAX, “Sony acquires blockbusters throughout the year to exhibit on our channels. Clearly the biggest of these movies is 3 Idiots, which we believe is the biggest movie since Sholay, to which we also hold the television rights.” Incidentally, the network acquired the exclusive satellite television rights for the next five years of 3 Idiots, which grossed over $100 million worldwide, in a deal licensed through Eros International.

In early 2009, according to analysts and industry sources, many producers were finding it difficult to pre-sell the rights for a film. But already this year, satellite rights of two mega releases, Raajneeti and Raavan, were pre-sold. “Satellite rights have picked up, there are some channels waiting to launch and films work well as content,” says Siddharth Kapur, CEO, UTV Motion Pictures. UTV pre-sold the satellite and music rights of Raajneeti for Rs 22 crore. According to Gaurav Gandhi, Viacom 18 Group COO & head, international business, besides Kites and Raavan, Colors has also acquired rights of eight-ten big releases between July and March next year. “We acquired the television rights for Kites and then licensed it to DTH pay-per-view (on Tata Sky) before the satellite premiere on Colors,” he adds. He says Kites has done remarkably well on the DTH pay-per-view service.

With the competition intense, broadcasters are being careful of what they pick up. Says Sameer Rao, general manager, STAR Gold, “Star bought the rights of Raajneeti, Housefull and Atithi Tum Kab Jaoge after a detailed story narration with the producer/director and a viewing of key sequences from the film to get an idea of production values and performances. As we have some idea of the kind of movies that our audiences enjoy, we chose to acquire these films because we were confident they would work for us.”

But a lot of deals are happening pre-release. “This is a more risky play unless you are given the opportunity to evaluate the film properly before making a decision,” admits Rao. Says Man Jit Singh, “In certain instances satellite rights are being pre sold but most movies are purchased after their theatrical performance is established.” So, MAX picked up 3 Idiots at least five months after release, though insiders said it was more to do with pricing than anything else.

Another trend the industry is witnessing is the shortening of windows, so TV audiences are getting to see movies sooner after their theatrical release. Broadcasters say it’s easier to monetise a film closer to the film’s release. At multiplexes, a film’s first two weeks are crucial, following which it can go straight to DTH and TV—that’s the overwhelming trend being followed by the industry. According to KPMG, at least 77% of a film’s revenue still comes from theatrical, followed by cable and satellite (7%), overseas (7%), home video (5%) and other revenue streams (4%). Over time, as monetisation from other sources improves, a film’s dependence on theatrical revenues alone is expected to go down.

On airing the films too, a lot of experimentation is going on. While the broadcaster acquiring the rights will primarily air it on its network, syndicating titles selectively at a later stage is not ruled out. Singh says Sony acquired blockbusters to show exclusively on its network and does not syndicate these movies to other channels. “We believe syndication reduces the brand identification of our channels as the place where audiences can find exclusive new blockbusters,” he points out.

Jyoti Deshpande, CEO & MD, Eros International, says Eros would license satellite broadcasting rights for a defined number of years. “We have found it more sensible to deal with one broadcaster at a time for one deal. We allow that broadcaster to then syndicate to other broadcasters rather than operationally run the syndication model ourselves between multiple broadcasters.”

Industry insiders point out that good content gets good ratings and so broadcasters are prepared to pay a premium for good content. Says Deshpande, “The syndication model between four-five broadcasters doesn’t really work unless you have all five broadcasters lined up on Day One, as you run the risk of the window elapsing and losing out on those expected revenues. So while Eros probably started that trend couple of years ago with the syndication of the Om Shanti Om between three broadcasters for limited telecasts, we have again adapted to market dynamics so that we can maximise revenues from our portfolio.” With the market getting fragmented, broadcasters have different target audiences and different genres of movies and different stars rate better on these channels. Players like Eros take all these into account when they split their portfolio of films into different bundles to pitch to various broadcasters.

But isn’t a film’s quick arrival on the DTH/satellite platform killing theatrical revenues? Says Man Jit Singh, “Movies are increasingly being used by Hindi GECs to bolster their ratings. The proliferation of movies on GEC channels is adversely impacting the share of the Hindi movie genre (channels), but we expect this will self correct shortly.”

Insiders pointed out that with the top five broadcasters chasing the top 15 films, prices are still high for the big movies. Says Rao, “As buyers it would be natural for us to say that prices are high. However, there seems to be a robust market, with deals taking place across multiple players.”

Colors’ Gaurav says, “The talent costs for Hindi films have gone up significantly, thus impacting the total cost of production, which, in turn, leads to a higher expectation of the producer when it comes to satellite and other rights sale.”

Source: The Financial Express

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