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In win-win deals, TV channels pick up tabs of films, get satellite rights - Sathish - 11-15-2010

Always strapped for cash, film producers have found new and willing financiers in television broadcasters. TV channels, according to people in the broadcast and films business, are striking innovative deals with producers which include not only pre-release buys but also underwriting up to 40 per cent of the cost of the film even before it begins production.

And it isn’t just the small producers who are entering such deals, which also imply a new film airing on TV within 40-50 days of its release, but also the big guys.

According to industry sources, Tees Maar Khan, directed by Farah Khan and produced by her husband Shirish Kunder; Guzaarish, directed by Sanjay Leela Bhansali and produced by UTV Motion Pictures; and Break Ke Baad, directed by Danish Aslam and produced by Kunal Kohli, have been underwritten by Viacom18, the broadcast company that owns Hindi general entertainment channel Colors.

“Quite a few films releasing over the next six months have been underwritten by some leading TV channels,” said a senior executive of a Mumbai-based production company. Underwriting essentially means the TV channels pay a certain fee upfront in return for exclusive cable and satellite rights of the film immediately after it has had its theatrical run, thereby taking a significant financial burden off the producers’ shoulders even before the film goes on the floor.

“It’s a win-win for broadcasters and film producers. Bollywood films bring in massive viewership and hence, advertisers. Whereas the mechanism helps the producers recover a significant chunk of their investments,” says Rajesh Kamat, CEO, Colors.

Buying a film before the production begins, however, involves a great amount of risk. Hence, some broadcasters opt for pre-release satellite rights. “It is safer to take a bet on a film which is half done or is nearing completion. One can then take a calculated risk,” says Sameer Rao, head, Star Gold, the Hindi movie channel of Rupert Murdoch-owned Star India.

Star Gold bought the pre-release rights of big-ticket films such as Wanted, My Name is Khan, House Full, and De Dana Dan this year.

Even the pre-release rights get the producers handsome returns, almost 30-40 per cent of the total cost of the film. “It is an attractive revenue proposition. These kind of deals help de-risk the production cost to a good extent,” said Amrita Pandey, senior vice-president, international distribution & syndication, UTV Motion Pictures.

Since the exclusive satellite rights are for five to seven years, the channel also gains as it can air the film any number of times, she noted. Also TV channels, keen to recover the money they have put in, help promote the film.

According to broadcasters, films are a sure-shot way of getting eyeballs, especially during weekends, when most general entertainment channels do not air much of their original content. Hence, there is a rush among all leading Hindi general entertainment channels to lap up the rights of a film before a rival does.

Source: Indian Express