July 8, 2010

The 100 cr Question?

Bollywood Seems to be going through the “100 cr” Season with many of the movies being mounted on the amount(in the past, the present and surely the future), question is not why are they pegged at that Price(thats almost an boring question now), the main question is how to re-coup the investment.
First things first, is it possible to recover that investment, yes it is possible.
The Revenue Channels,
Indian Theatrical : 50%
Overseas : 20%
Satellite : 20 %
DVD/Music : 10%
Next is how, lets see in little detail.
Indian Theatrical : As with any scenario, performance at the home turf is of the utmost importance.But why?, because all the related “Beyond the Box-office” revenues of a movie are pretty much directly proportional to it.
For the large amount of movies(95%), Indian Theatrical represents almost the bulk of the Overall Theatrical Business(70-75%).
For our movie, it has to at-least do 100 cr Nett domestically, thus giving a theatrical domestic share of around 50-52 cr,given it does Uniform business across the Multiplexes and Single Screens.
Overseas Theatrical : Increasingly in the last few years, Overseas Theatrical run of a movie is playing more and more significant part in the whole situation.In-fact, its almost regular to see them doing at-least 30-35% of what a movie does in India(especially for bigger stars), some rare cases have seen them almost doing comparable business to Indian counterpart but then that’s a rarity only.
For our movie we are expecting around 50 cr Gross overseas, giving us around ~ 22 cr share.
Satellite Rights: With the Advent of Cable TV, Satellite rights of the movies have been increasing by the day too, but as mentioned above the rate here is directly proportional to the Domestic Performance of the movie. If the movie bombs badly at home turf, there have even been outrageous cases of re-negotiations to bring down satellite rights rates.
If a movie is able to crack the 100 cr Nett barrier, it wont be a stretch to expect the movie to get a Satellite Deal as high as 25 cr(given that the movie is not pre-sold).
DVD/Music Rights: Industry standard for big movies is around 9-10 cr for these rights(usually bought together). But definitely even this is only possible/guaranteed if movie performs better at the home box-office.
Adding all revenues of our movie,
Indian Theatrical (50-52 cr) + Overseas Theatrical (22 cr) + Satellite (25 cr) + DVD/Music Rights(9-10 cr) = 106-109 cr
Thus we see that the said amount(100 cr) can be recovered if the movie performs uniformly across the board.