Film industry: Bollywood business model not viable, actors’ fees need course correction: industry

Many Hindi film producers and studio executives believe there is an urgent need to discuss and address rising costs in the post-pandemic world, even though Telugu film industryor Tollywood, is suspending production on all films from August 1st until issues are resolved with various stakeholders.

Producers, studio executives and top executives of Bollywood felt that Bollywood’s business model needed to be adjusted, starting with actors’ fees.

“Major shifts and hurdles for the film business are now taking place not only in the cinema market, but also in the streaming industry. The volume of purchased content and values ​​are greatly affected. This is critical for all stakeholders in our value chain. be right on the course and cost,” said Amrita Pandey, CEO, Photos jungle. “I think talent royalties, among other expenses, definitely need to be brought into line with market realities where there are no more first days off, no streaming fees guaranteed by the name of the actor or the scale of the movie.”

“The business model of the Hindi film industry has failed,” said the lead producer, who has directed more than 50 films and several web series. “The only way this will work is if the stars fall to the ground. We have been talking about the growth in the cost of stars for ten years, but nothing has happened. ”

According to industry estimates, Akshay Kumarwhich has had a string of flops – Bell Bottom, Bahchan Paandey and Samrat Prithviraj – is asking for Rs 117 crore per film and reportedly has no dates until the end of this year.

Price for Shah Rukh and Salman Khanwhich charge some amount upfront and a profit share (backend) also approach Rs 100 crores each, while Aamir Khan is the only actor who does not take an advance payment, but receives 80% of the profits.

Among other actors, Ranbir Kapoor and Ranveer Singh are charging Rs 50-60 crore each, Kartik Aryan has increased his rate to Rs 40 crore, Shahid Kapoor is looking for Rs 35 crore and Varun Dhawan is quoted as Rs 30 crore each. movie.

“What is needed is a genuine course correction, a correction of the economy and a recalibration of priorities,” said Tanuj Garg, managing partner of Ellipsis Entertainment. “This is something that Ellipsis, as a content creator, is very mindful of and it helps us. Content and budgets should be designed in such a way that everyone in the value chain can make money.”

Garg has produced films such as Ragini MMS, Looop Lapeta and Tumhari Sulu.

Many industry experts say that with star prices rising where they are, the Hindi film industry is already in big trouble, without even taking into account the creative part of the business.

“Big producers are isolated for now because they can sell their films to OTT players, but since these players are also looking to cut costs and tighten their belts, soon legitimate producers will not have the money to invest in films,” said the head of a large production house. . “It’s a vicious circle. All the money goes into the actors’ pockets and doesn’t go back into the industry, making filmmaking an unviable business.

Some believe it’s not just the actors’ fees, but the misalignment of the value chain across the creative and distribution industries.

“We need a fair distribution of risk and reward,” said the head of one of the leading film studios. “Ultimately, who in the value chain pays for movies – it used to be satellite, now it’s OTT. The biggest payers right now are DisneyStar, Viacom18, ZEE, Sony, Netflix and Amazon. OTT, satellite, overseas and music rights are being monetized, but what about additional rights? Unlike the West, we haven’t created a single franchise that can outlive movie assets.”

Most experts noted that due to the fact that digital players pay a lot of money for movie rights, satellite and cinema revenues are declining.

“What we have done is shift or replace one revenue stream with another. The overall business must grow, the share of the consumer’s wallet must grow, ”added the head.

The head of the studio, as well as film producers, believe that Bollywood needs compensation tied to performance.

“Big stars are taken away because of their fans and the attraction of the public. An easy way would be to fix their fee in the box office of the first day. But there will always be some spoilers that will come with the lure of glamor and money from the gootka business or the British lottery and pay the actors whatever they ask for,” said the producer quoted above.

The head of the studio added that in the current system, most actors have no skin in the game. “Their fee should be tied to the box office and viewership ratings of the TV premiere.”

As an industry, many believe that the most important thing is to increase the sum of the parts, since it will not do any good if the total volume remains the same.