“Life itself has become a movie. We all have become performers and audiences for an ongoing show called life,” said Amitabh Bachhan in an interview. As gargantuan is the glitter and the glamour of the industry so are the profits it reaps. The Indian film industry is not only entertaining millions across the world but it is also a major source of millions are added every year to the domestic revenue. The total revenue that Bollywood earned in 2008 was Rs 10,900 crore with an overseas collection of Rs 977 crore. Bollywood today is one of the biggest money making industries in India which provides employment to over 6 million people.
But like any other business, Bollywood is also suffering under the ordeal of global recession which snipped off 65 percent of the satellite rights. The overseas box office also saw a major drop of 30 per cent with a cut down in the film going audience. For example, a movie like Chandni Chowk to China which had an offer of Rs 11 crore a week before its release crash-landed with a mere Rs 5 crore. Such a huge fall in prices instantly worried the producers, which explains the recent clash between the multiplex owners and producers.
At a juncture like this, it is understandable why the domestic theatrical revenue suddenly seemed significant. The producers wanted a higher share of the multiplex revenue, while the multiplex owners with their own policies of expansion and commitments to their share holders had been planning to extract an increased share from the producers and augmenting the ticket prices.
Both the contrasting demands resulted in a two-month long strike with an estimated loss of Rs 250 crores to the multiplexes and Rs 100 crore to the producers. Professionalism in Bollywood is relatively new and its transactions are often informal and disorganised. This is one of those rare times when producers of Bollywood came together (other than at award functions) to ‘officially’ straighten out things in writing. The United Producers and Distributors Forum and the Multiplex Association of India signed the agreed terms in a memorandum of understanding, as the strike came to an end a few days back. According to these, the producers will get 50 per cent of the collection in the first week, 42.5 per cent, 37.5 per cent and 30 per cent of the collections for the second, third and fourth week, respectively.
Going with the global trends, most of the urban audience today goes to the multiplexes (Big Cinemas, PVR, Fun Republic, Fame, INOX, Cinemax, etc). Movies in multiplexes are major crowd pullers, an incentive to the stores in malls (of which multiplexes are often a part), whose sales have definitely suffered a hitch. The strike also affected the marketing industry with an estimated loss of Rs 35 crores, as the multiplexes are also responsible for the sale of many food items. Thus , it even put many small retailers out of business for the past two months. This goes on show how industries are intricately connected and how the discontent of one puts an impression upon the other.
Though the filmmaking business went on smoothly with a series of high budget movies awaiting release but this slowdown has definitely influenced the fees of actors and the overall market value of movies. Actor Akshay Kumar whose last year’s income was Rs 160 crore and who paid a monthly income tax of Rs 5 crore, is now reported demanding 2 crore less than what he was paid for his previous film. KPMG has estimated that the domestic box office revenue in 2009 will be around Rs 7,880 crore as compared to Rs 8.020 crore in 2008, thus bearing a loss of about a 100 crore.
But as the economy is slowly moving towards stability and seemingly youthful movies like Love Aaj kal, Kambhakt Ishq and New York are lined for a summer release, hope is back in the business. Also future movies like Aamir starrer 3 Idiots and SRK’s My Name is Khan seem to carry the promise of clearing the dark clouds of despair from over Bollywood business. For its only the Indian Film Industry, which makes the second largest number of films in the world, where one can see the drastic rise and fall of both profits and stars. For you never know when Aamir’s moustache may fail to create the charisma or when Shah Rukh’s wink could the magic.
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