Cinema’s new AI act

While Hollywood is taking a cautious approach towards AI, Indian film studios are increasingly adopting the technology, attempting to balance innovation with creative accountability. Across the industry, say experts, AI is helping lower production costs, improve accessibility, and reshape how stories are created and consumed.

At the same time, the rise of AI in cinema has sparked growing debates around artistic integrity, consent, and the urgent need for regulatory safeguards.

The controversy intensified last year when Eros Media World re-released the 2013 film Raanjhanaa with an AI-modified ending. The updated version replaced the film’s original tragic climax with a happier conclusion, prompting criticism from audiences as well as the movie’s lead actor, Dhanush.

In a strongly worded social media post, Dhanush said that the altered ending had “stripped the film of its very soul” and claimed the changes were made despite his objections. He argued that using AI to alter completed films creates a “deeply concerning precedent” that could weaken storytelling and erode cinema’s artistic legacy, while urging authorities to introduce stricter regulations.

Despite the criticism, the re-release performed strongly at the box office. Reports indicated that the Tamil-language version recorded ticket sales of 35% in August, far above the usual 12% average, reflecting strong audience curiosity about AI-driven reinterpretations of films.

Now showing

Film industry leaders maintain that AI’s role is evolving. Pradeep Dwivedi, group CEO of Eros Media World, describes AI in Indian cinema as being in its “formative innings”. “India’s unique economics, multilingual market, and vast content appetite make it particularly fertile ground for AI-assisted production, localisation, dubbing, VFX, and restoration of legacy content. Raanjhanaa demonstrated how technology can be used to reinterpret legacy IP for regional audiences while preserving the original work and opening new monetisation avenues,” he adds.

AI is already proving to be a meaningful shift in filmmaking in India rather than just a trend. “What’s changed is access and scale rather than just the cost or speed. Filmmakers can now build worlds, test ideas, and execute ambitious narratives without being constrained by traditional production limits,” says Vijay Subramaniam, founder and group CEO of Collective Artists Network.

Through its AI-powered content and influencer marketing platform Galleri5, the talent management and creator ecosystem company has been working on building AI-native production systems rather than using AI as a plug-in. Projects like Mahabharat: Ek Dharmayudh, Hanuman: The Eternal, and Krishna, which are part of the company’s Historyverse slate, have been built with this approach.

Mahabharat: Ek Dharmayudh, a 100-episode AI-powered mythological series, has already crossed 26.5 million views, with a record-breaking 6.5 million views on its opening day—2.1 x higher than the platform’s average. The series—a collaboration between Mukesh Ambani’s Reliance Industries and The Walt Disney Company—premiered on October 25 last year on streaming platform JioHotstar.

Meanwhile, in April, Jio Studios and Collective Studios’ Historyverse unveiled the global teaser of Krishna, an upcoming feature film directed by Manu Anand, at the National Association of Broadcasters (NAB) Show 2026 in Las Vegas, US.
Krishna not only embraced cutting-edge AI-led filmmaking but also advanced commitment to future-forward storytelling powered by world-class technology being built in India, as per Jyoti Deshpande, president, Jio Studios (Media & Content Business, Reliance Industries). “We see this as an opportunity to democratise powerful tools making them more accessible, intuitive, and cost-effective for storytellers,” she adds.

Experts also say AI is already transforming production workflows. Rajesh Sethi, partner and leader, media, sports and entertainment, PwC India, says, “Tools such as auto-rotoscoping, generative backgrounds, facial de-ageing and real-time pre-visualisation are significantly reducing both time and cost in special and visual effects. AI is also helping democratise filmmaking by enabling smaller studios to produce high-quality content without prohibitive budgets.”

“We can generate multiple visual directions, tones and sequences within hours. That fundamentally changes creative decision-making. In SFX and VFX, AI is a multiplier. It helps in background extensions, crowd generation, face clean-ups, de-ageing, environment creation, and even shot correction,” says Danish Devgn, founder and CEO of Lens Vault Studios, a technology-driven media production company focused on creating content through AI, AR/VR and immersive formats.
Lens Vault Studios is producing Bal Tanhaji, an upcoming AI-powered animated film presented by Ajay Devgn. The project, featuring intense, stylised action, marks a shift toward AI-driven filmmaking aimed at younger audiences.

Similarly, Ridhima Lulla, co-founder and co-president of Eros Innovation, highlights AI’s potential in upgrading legacy content. She cites the 2014 motion-capture film Kochadaiiyaan as an example. It was India’s first photorealistic motion capture film—actors were represented as fully animated characters. “But the technology back then had its limitations. Today, with AI, we can revisit something like Kochadaiiyaan and reimagine it with far more realism, better facial detailing, smoother rendering, and overall richer visual storytelling. In fact, we are working towards remaking it using AI, which is incredibly exciting.”

Eros Media World has invested in its own AI ecosystem, including Eros GenAI and Large Cultural Models trained on Indian cinematic data. The company is enhancing its film catalogue to 4K and 8K resolution and developing platforms like Eros Universe to enable creators to work with licensed intellectual property at lower costs.

Opportunity & resistance

While India is still in the early stages of developing AI capabilities for cinema, the momentum is building. Industry voices suggest that the real breakthroughs are not yet in fully AI-generated films, but in hybrid workflows where AI integrates with traditional filmmaking processes. “That’s where the real value is currently being unlocked,” says Danish Devgn, adding that AI is helping lower entry barriers for storytelling, scale up content output for platforms like YouTube and OTT, and create high-quality visuals without Hollywood-level budgets.

“Traditional studios are now trying to retrofit AI into legacy pipelines, which is much harder. Our teams operate at the intersection of filmmaking, design, and AI tooling,” adds Devgn, pointing to the structural advantage of newer studios.
Meanwhile, industry leaders agree that while opportunities are substantial, challenges, especially around ethics and governance, are pressing.

Dwivedi of Eros Media World, says, “While the opportunity is substantial, the AI-in-film segment faces meaningful creative, ethical and regulatory challenges. Audience acceptance remains uneven, particularly when AI is perceived as compromising artistic authenticity or being deployed without sufficient transparency.”

In 2024, while Hollywood writers went on strike to protect their livelihoods from generative AI, Bollywood embraced it, but with a pinch of salt. “We witnessed this firsthand during our AI-assisted reinterpretation of Raanjhanaa, which sparked debate despite being clearly labelled as an alternate version. Similar concerns are being voiced globally by filmmakers, unions, and artists. That debate is healthy. Every transformative technology in cinema, from sound to CGI, faces scepticism initially. The key is ensuring AI augments creativity rather than erodes trust,” says Dwivedi.

Amid all this, trust remains central. Apurv Modi, MD and co-founder of Abhay Group, a conglomerate focused on technology, consumer electronics and B2B channel engagement,  underscores this challenge: “The biggest challenge is trust—from the creative community and audiences alike. Actors worry about their likeness being used without consent, filmmakers worry about losing authorship and audiences are still forming opinions.”

At the studio level, transparency and rights management remain key concerns. Lulla of Eros Innovation highlights the risks around unauthorised use of content. “We’ve all seen cases where AI-generated content is used without permission, which creates legal and reputational risks. At Eros, everything we use is rights-cleared and permissioned,” she adds.

Meanwhile, experts and filmmakers experimenting with AI echo the sentiment that the technology complements rather than replaces human creativity. Sethi of PwC India cautions that challenges related to intellectual property, data ownership, and workforce upskilling must be addressed as adoption scales. “While AI is reducing post-production costs and shortening release timelines, its long-term impact on revenue models is evolving. Indian studios are approaching AI adoption thoughtfully, positioning it as an enabler rather than replacement,” he adds.

Subramaniam of Collective Artists Network, too, doesn’t see AI as a replacement for VFX or SFX but rather as an evolution of how those processes work. “Traditionally, VFX comes in later in the pipeline. In our case, AI is integrated from the beginning. Through Galleri5, we’re building systems where world-building, character consistency, and visual environments are developed as part of the core pipeline, not added on later. This allows for far greater continuity and control across scenes,” he adds.

New revenue playbook

If AI hype focuses on futuristic possibilities, the immediate impact is practical: cutting costs, speeding up workflows, and opening up new revenue streams.

While studios and producers do not state any exact figure due to contractual limitations, industry experts estimate the cost of a film anywhere between Rs 100 crore and Rs 300 crore. But AI-integration can slash the cost, up to 40% of the budget vis-a-vis traditional special effects films, say experts.

Speaking at a session in WAVES Film Bazaar at the International Film Festival of India in Goa last year, filmmaker Shekhar Kapur also said that AI lowers entry barriers to filmmaking. “AI is the most democratic technology. There is a $300 million film that can now be made for $300,000. If it’s India, it can be made in $30,000… if you want to tell stories and you can’t get to a theatre, an AI film could do very quickly. I can make an Avatar for YouTube of the same quality with AI,” Kapur cited after viewing entries from 181 teams who participated in an AI filmmaking hackathon.

As per Modi, productions using AI strategically are reporting 20-40% reduction in post-production costs, significant in an industry with thin margins.

“Globally, investors are pouring capital into AI film-tech, and India is beginning to attract that attention too. AI unlocks multiple revenue windows, faster content repurposing across OTT, regional edits, and international markets. Studios that build AI into their pipeline today will hold a structural cost and speed advantage within the next three to five years,” says Modi.

Meanwhile, the AI-film convergence is no longer limited to studios; it now includes global tech giants as well. Google has partnered with filmmaker Shakun Batra for Imagine with Shakun Batra X Google Gemini, a five-part experimental series exploring AI-assisted storytelling across genres. Using tools like Veo 3 and Gemini, the project aims to test how AI can function as a creative collaborator. Major production houses are reviewing their libraries for AI re-releases, and tech companies like Google, Microsoft and Nvidia are partnering with local filmmakers. Reports indicate that India’s film industry is reorganising around AI, driven by economic factors.

Similarly, platforms like Utopai Studios are building end-to-end AI filmmaking systems. Its platform PAI allows creators to turn story ideas into production-ready outputs, manage continuity across scenes, and even generate multi-shot 4K videos, highlighting how quickly the ecosystem is evolving. As Jie Yang of Utopai puts it: “The next phase of AI in media will not be defined by isolated tools, but by systems that can carry story, continuity, and collaboration across the full creative process.” Revenue is also diversifying. Beyond traditional box office returns, studios are increasingly relying on platform monetisation (YouTube, OTT), brand integrations and collaborations, IP ownership and licensing powered by AI workflows.

Coming next

Going ahead, experts feel AI will power pre-visualisation, VFX, dubbing, localisation, restoration, personalised edits, synthetic environments and eventually native AI-assisted content creation across select formats. Subramaniam says, “AI will become a standard part of the filmmaking toolkit, much like digital cameras or CGI once did. The conversation will move away from ‘AI vs traditional filmmaking’ to ‘how well the technology is being used’.”

Devgn adds: “We’re heading towards AI-assisted filmmaking becoming standard; personalised content at scale; faster production cycles; new storytelling formats that didn’t exist. You’ll see AI-native films, where the entire pipeline from script to screen is designed with AI in mind.”

Dwivedi sees a similar trajectory, where AI becomes embedded across the filmmaking process. He says, “Fully AI-made films will likely emerge as a viable category, particularly in animation, fantasy, short-form, and experimental storytelling, but premium mainstream cinema will remain fundamentally human-led for the foreseeable future.”

On the ground, AI is already transforming how films are made—especially in visual effects. Producer Anand Pandit, known for movies like Section 375, Bazaar, Sarkar 3, Thank God, Total Dhamaal, Big Bull, and Chehre, among others, cites a few examples where AI-driven advan-cements in SFX and VFX are transforming filmmaking and democratising high-end production by lowering costs and enabling independent filmmakers to produce complex visuals within limited budgets. 

For instance, in Flow, a Latvian, French, and Belgian co-production, animation was done using the free and open-source software Blender, which achieved an unprecedented victory at the 97th Academy Awards. Similarly, Top Gun: Maverick prioritised immersive physical action over digital effects, using real aircraft as well as sharp camera work.

“Even an untrained eye can identify AI assisted imagery and the moment technology starts feeling excessive or emotionally hollow, viewers disconnect immediately. I see many makers reverting to traditional tools for the sake of authenticity. A blend of warm tactility and technical smarts make for a good combination,” Pandit tells FE, whose upcoming film Haunted 3D: Echoes of the Past uses available technologies to their fullest potential, without disturbing the narrative’s natural flow or emotional texture.

FUTURE FORWARD

$29.4 bn
Overall market size of the Indian media and entertainment sector in 2024

$17 bn
Overall market size of India’s AI sector by 2027

2,000
No. of AI startups driving India’s next digital transformation as of early 2026

200,000
Hours of content created by 2.8 mn media professionals annually in India

3,900
No. of Indian studios involved in animation, VFX and post-production, including 2,900 registered companies and over 1,000 proprietorships

• Emerging epicentres of creative and technical excellence: Mumbai, Chennai, Kolkata, Hyderabad, Bengaluru
• Smaller cities where new studios are opening: Vadodara, Indore, Pune and Bhopal

Sources: BCG; EY report titled ‘A studio called India’; FICCI-EY report titled ‘Shape the future: Indian media and entertainment’