1. Cinema on way out, the future is the Web; here is why

Cinema on way out, the future is the Web; here is why

Film director Vikram Bhatt is a busy man these days. It’s not cinema, however, that’s keeping Bhatt, who directed box-office hits such as Raaz, Ghulam, Aetbaar, 1920 and Haunted, on his toes.

By: | Published: September 17, 2017 3:11 AM
cinema, movies on websites, cinema on web, live tv “Cinema theatres are on their way out,” he says rather prophetically. “The future is in the Web.”

Film director Vikram Bhatt is a busy man these days. It’s not cinema, however, that’s keeping Bhatt, who directed box-office hits such as Raaz, Ghulam, Aetbaar, 1920 and Haunted, on his toes. Rather, he is busy creating content for the Web. “Cinema theatres are on their way out,” he says rather prophetically. “The future is in the Web.”

Bhatt is ecstatic about his new Web series, Hadh, which premiered on SonyLIV, a video-on-demand service of Multi Screen Media, last month. The gripping boardroom drama featuring revenge, murder and passion is Bhatt’s offering to the youth who are hooked on to American television shows either on their smartphones or laptops. “First, bookstores disappeared, as online portals took over, then sales of music shifted online, and now, it’s entertainment. Cinema theatres are going to face some tough competition, as ‘appointment-viewing’ doesn’t appeal to the young or urban population any more. They want to watch content as per their convenience and in their comfort zone,” he says.

Bhatt isn’t the only one from Bollywood who is testing the online waters. Vikramaditya Motwane, Zoya Akhtar, Saif Ali Khan, Farhan Akhtar, Richa Chadda, Rajkummar Rao, Nawazuddin Siddiqui and Sujoy Ghosh are some popular names who will soon be seen producing, directing or acting in a Web series. A Web series includes videos in an episodic format, which are released online; they can be watched on any device with an Internet connection.

Some of the biggest production houses in the film industry have already created a separate division for creating content for the Web. The competition is, of course, getting intense with the emergence of international players such as Amazon Prime Video and Netflix. “We are all finally competing for the same set of eyeballs, same share of wallet and mindspace. So it’s not just TV or multiplex, but any other form of entertainment—it could be a sports event, a visit to the mall or a stroll on the beach. If you are free, we would rather have you watching stuff we have made,” says Ashish Patil, head, Y-Films, a division of Yash Raj Films.

Streaming revolution

If cable television killed Doordarshan, it won’t be wrong to say the Internet killed cable television and it’s now eyeing cinema houses. Over-the-top content (OTT)—the delivery of audio or video over the Internet without any involvement of a multiple-system operator in control or distribution of content—is wooing audiences. OTT platforms (such as Amazon Prime Video, Netflix and VEQTA), video-on-demand services (such as SonyLIV and Voot) and YouTube channels (such as Y-Films and ‘VB on the Web’, Bhatt’s channel) are giving other mediums of entertainment a run for their money.

Whether stuck in traffic, riding the Metro or lazing at home, the availablity of quality content at the click of a button is what’s driving the online revolution.

In July, Amazon Prime Video announced the launch of Inside Edge, its first original title for the Indian market in collaboration with Farhan Akhtar’s Excel Media & Entertainment. The 10-episode Web series, starring movie actors Richa Chadda and Vivek Oberoi, tells the murky behind-the-scenes happenings of the cricket world. The company has also struck a partnership with director Kabir Khan to develop another original, The Forgotten Army (working title), a series on the Indian National Army. “Localised content helps us remain relevant, relatable and eventually widens audience reach. Innovation in content creation is what we are after. That’s our goal,” says Vijay Subramaniam, director, content, Amazon Prime Video India. It has also announced 17 scripted originals, which are in various stages of development—three shows are still to be scripted, while reality shows such as Jestination Unknown, The Remix and Comic Kaun (working title) will be telecast in 2018. Priced at an inaugural offer of `499, the Amazon Prime Video app is amongst the top entertainment apps across iOS and Android.

Another global player, Netflix, has tied up with telecom operators such as Airtel, Videocon and Vodafone in an effort to capture the market. “These partnerships will help Netflix reach the diverse Indian market more broadly. Together, Airtel Digital TV, Videocon and Vodafone make up millions of users and teaming up with them will make it much easier for Indian consumers to watch Netflix, whether on a set-top box or mobile,” says Jessica Lee, vice-president, communications, Asia, Netflix. It has announced three new original series from India: Sacred Games starring Saif Ali Khan, Selection Day based on Aravind Adiga’s book of the same name, and a detective series titled Again. Netflix has maintained its global pricing with monthly subscriptions ranging from `500-`800, depending on the plan opted for.

As competition intensifies, players are diversifying. VEQTA markets itself as India’s only dedicated sports OTT platform. With VEQTA, sports fans can enjoy exclusive content from marquee standalone events and the biggest sporting events in tennis, basketball, baseball, motorsports, rugby, table tennis, football, etc. “We aim to stay focused on sports for the near future, as it’s one of the most under-penetrated and under-served genres in India in spite of its leadership in driving subscriptions the world over,” says Varun Mathur, director and co-founder,VEQTA.

Why digital sells

As per the 2017 Indian Media and Entertainment Report by KPMG India and the Federation of Indian Chambers of Commerce and Industry (FICCI), there were 400 million Internet users and 300 million smartphones in India at the end of 2016, which ensured that the mobile is fast becoming the medium of choice for media consumption in the country. Video-on-demand (VoD) consumption saw an upsurge, thanks to a 62% increase in average Internet speeds in 2016. The 350 most-viewed YouTube videos saw a 50% increase in average view duration for content uploaded in 2016 compared to three years ago, as per the report.

Clearly, with deeper Internet and smartphone penetration, there’s a colossal market for original content on the Web. Y-Films, which started in 2015 with an original four-part Web show on gender issues called Man’s World, has come a long way in terms of content creation and increasing viewership. Today, it has over 10 lakh subscribers compared to a few hundred when it started. “There are several fresh stories, unique narratives, forms, formats and writing that you don’t get to watch on other platforms. We couldn’t have imagined doing a Ladies Room (a story, about two best friends, set in six different washrooms) as a feature or Sex Chat with Pappu & Papa (a humorous show that discusses sex and sexuality) as a TV series, though I would love to see both,” says Patil of Y-Films. The latter is the only Indian series chosen to be screened at the ongoing 25th Raindance Film Festival in London. Y-Films also launched India’s first transgender band, 6 Pack Band, in January 2016, which won the coveted Cannes Grand Prix Glass Lion at the Cannes Lions Festival in June last year.

The Web is providing content that’s fresh, but the same can’t be said about TV and Bollywood. Viacom 18’s online platform Voot recently launched Stupid Man Smart Phone, which is being touted as India’s first-ever digital survival show, where the mobile phone is the only means of survival. The show is based on a British reality TV show, which traces the tough survival journey of a celebrity in difficult terrain.

The Web is now emerging as a medium that’s keeping the creator happy and the subscribers content. Take, for instance, the case of filmmaker Hemant Gaba. The 37-year-old director of Shuttlecock Boys, an independent film released in 2011, has now shifted his focus towards the Web after directing several documentary films. “This medium is more dialogue-oriented. The attention span of viewers on this medium is low, so one has to captivate them through the dialogues,” says Gaba, who is currently shooting Dilliwood, a Web series for one of Times Internet’s online channels.

Plus, cheaper data costs have become a boon for everyone. As per Mary Meeker’s Internet Trends 2017 analysis, in March 2014, the average cost of 1 GB data in India was $4.4. Just three years down the line, it’s $1.9. The launch of mobile network operator Jio by Reliance Jio Infocomm has also brought the rates further down to $0.17 per 1 GB. Many players such as Netflix offer viewers a ‘download’ option, further ensuring that they remain glued to their smartphones. “We enabled the offline viewing experience when we offered the download feature last year. Users can enjoy their shows seamlessly on-the-go or when they don’t have access to the Internet. Overall, India is one of our heaviest users of this download feature,” says Lee of Netflix.

Assault on theatres

The personal handset has become the primary destination to consume entertainment. And cinema halls are feeling the pinch. Add to it the fact that movie-watching is becoming a luxury for most in India and the scenario becomes bleaker. Increased ticket prices, coupled with the lack of fresh content is turning out to be a dampener for audiences. “Why would I spend money, get stuck in traffic and travel across half the city to watch a movie when I know that a digital platform will release it soon? Unless it’s a cinematic experience with VFX, I think I can avoid going to the theatre,” says filmmaker Gaba.

He isn’t wrong. An outing for a family of four at a multiplex in a metro results in an expenditure of around Rs 2,000—this includes the average ticket price, at Rs 350, and snacks priced between Rs 200-Rs 300. If you compare this with the costliest OTT subscription (Rs 850 for Netflix) for a month along with data prices, it would still come to less than Rs 1,500. Plus, the content can be streamed on four devices at a place and time of your choice.

Though there is yet to be any kind of substantial survey of movie-watching audiences in India, a 2015 assessment by consultancy firm PricewaterhouseCoopers in America found that a lesser number of people are going to theatres in the US. The research found that in spite of advances in technology, improved seating and the ever-growing popularity of 3D films, the increasing cost of movie tickets is discouraging movie-goers. Other reasons cited include lack of original content for the big screen. Also, people preferred watching movies as per their ‘own schedule’.

India typically ranks as the world’s third-largest box-office territory after North America and China.

These reasons stand for Indian audiences as well. “Every person has three or four wallets for entertainment expenses and that includes cinema tickets. The way the audience is getting hooked to online content, soon the movie wallet will shrink and that money may get transferred to paying for data,” says Kabir Sadanand, film director and actor, who is currently showing Virgin Woman Diaries (about a young girl in a live-in relationship) on SonyLIV. He started his production firm three years back. In 2015, he started a separate digital division that plans to release four Web series a year.

Meanwhile Indian cinema is either bereft of fresh ideas, stuck in censorship or shown in few movie halls if it doesn’t have a big star cast. Even the biggest names have failed in recent times, with Shah Rukh Khan’s Jab Harry Met Sejal and Salman Khan’s Tubelight, being duds at the box office. It’s no wonder then that filmmakers are toying with the idea of releasing films exclusively for the Web. “Releasing a film digitally will turn out to be a profitable venture for many small filmmakers like me. One doesn’t have to spend exorbitant amounts on distributors or for the marketing of the film,” says Gaba.

The other side

Not everyone, however, believes that cinema halls are facing the heat. Trade analyst Taran Adarsh is of the view that movie theatres will never go out of fashion. “In India, watching movies is a social event. It can never be taken over by online content,” he says. He has a word of caution though for theatre owners: “Entertainment is getting redefined, so substandard offerings at theatres won’t work any more.”

The largest chunk of movie revenues is generated through box-office collections. But producers can recover up to 30% of the cost of the film by pre-selling it to distributors, 25% of the revenue comes from overseas rights, 20% from satellite rights, 10-15% from the emerging home video market and 10% from music rights. But box office remains king for a film to be successful. “Only a few films are bought before their theatrical release. So for a movie to be picked up by other mediums, it has to pull the audiences to theatres first,” Adarsh says.

As per a report released in 2016 by audit and consulting firm Deloitte, the film industry is poised to grow at a CAGR of 11%, reaching $3.7 billion by 2020—till December 2015, the gross box-office realisation was $2.1 billion. Cable and satellite rights, along with online/digital aggregation revenues, are the fastest-growing segments, and are expected to grow at a CAGR of about 15% by 2020.

Theatre owners, on their part, are innovating vigorously to woo audiences. PVR Cinemas, one of the largest multiplex chains in the country, is offering new-age formats such as the VR Lounge, which allows film buffs to experience virtual reality, a new dimension of entertainment. Then there is PVR Vkaao, a screening-on-demand service that enables viewers to watch any movie of their choice at a theatre of their choice.

Similarly, 1018mb is an on-request theatrical screening start-up, which screens classics, old titles, unreleased movies, as well as latest releases across India. All a user has to do is log on to their site, pick a movie title from their pre-existing library and wait for a certain quota of seats to be filled up in order for the show to be confirmed. “It’s a new-age movie-viewing platform, which puts the power in the hands of consumers, while increasing the monetisation for cinema chains,” says Saurabh Devendra Singh, co-founder, 1018mb. Some screenings are followed by interactive sessions with the director, cast and crew of that movie. “We try to organise a post-movie interaction session with the movie’s star cast. We have had such events for Jaane Bhi Do Yaaro, Qissa, among several others,” Singh says.

Miraj Cinemas, one of the fastest-growing multiplex chains in the country, has chalked out a robust plan to grow to 100 screens from the current 79 across India by this year’s end. “Every single business leads to innovation and that’s what’s happening in the entertainment space currently. But I believe that if people are consuming videos on their tablets, they will come to theatres eventually to enhance the experience. As long as entertainment is consumed, theatres won’t shut down,” says Amit Sharma, managing director, Miraj Cinemas.

Webbed for now

It’s clear that the Web is here to stay. As per the 2017 KPMG FICCI report, ad revenues from the digital space are expected to grow at a CAGR of 31% to reach Rs 295 billion by 2021—from 76.9 billion in 2016—contributing 27.3% to the overall Indian M&E industry ad revenues.

The way online players are acquiring movies right after their release makes one wonder about the longevity of movie theatres. The online players understand that cinema is crucial for their survival. So besides Bollywood, they also offer regional cinema and critically-acclaimed films in Bengali, Marathi, Malayalam, Tamil and other languages. Recently, Amazon Prime Video digitally premiered the Telugu blockbuster, Ninnu Kori, ahead of its TV release. It has also signed a five-year deal with Salman Khan’s production house. With this, Amazon Prime will have the exclusive rights for his upcoming films before their television premiere. Netflix has also signed a deal with actor Shah Rukh Khan’s production company Red Chillies Entertainment for his existing, as well as upcoming titles.

The money pumped in for acquisition of content is nothing short of the budget of a mid-size Bollywood film. The company refused to divulge investment details, but, as per some reports, Amazon has set aside $100-$125 million for original programming and content acquisition for the current financial year. “The total budget of some of the Web series is as good as a feature film’s. Competition isn’t just getting intensified, it’s being overtaken to some extent,” says filmmaker Gaba.

The production and publicity costs of Web series are on a par with films. Take, for instance, Amazon’s Inside Edge, which was reportedly shot at `2 crore per episode, making the 10-episode show stand at a production cost of `20 crore (another `20 crore was spent for publicity). Now, compare this with the latest Akshay Kumar-starrer, Toilet: Ek Prem Katha. The movie—for which Kumar didn’t charge a fee, but took a share of profits—had a budget of `40 crore, the same as Amazon’s Web series.

With content at its heart, the India Film Project (an annual competition for content creators in India), in its seventh year, has announced a first-of-its-kind award for digital videos and content to be announced by the end of this month. Till date, it has received over 5,500 nominations under various award categories for the online segment. “There is no doubt that a millennial prefers online content. And these awards are an acknowledgment to the creators,” says Ritam Bhatnagar, the festival director.

The 70 mm screen might or might not gather dust in the near future, but the battle lines have been drawn. The fight for content isn’t going to die anytime soon.

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