Flop after flop is worrying cinema owners and movie producers. Stars are losing their glory, small films aren’t finding takers on the big screen, and Indian filmmakers are still figuring out who their audience is.
The decline in the movie business started with the lockdown that followed the Covid-19 outbreak three years ago, which resulted in huge losses for exhibitors, filmmakers, producers, studios, and talent, among others. Films made a comeback as Covid cases came down, but the recovery was not very strong.
Reason? A change in audience preferences.
It was not just Bollywood – the film business was affected across languages in India and it was mostly due to a change of habit, said Amar Butala, the producer of Bajrangi Bhaijaan and the recent Netflix film Mission Majnu starring Sidharth Malhotra.
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“Two years of Covid caused audiences to change the way they consume content and the first-day-first-show enthusiasm diminished. Audiences are perhaps more comfortable watching movies at home, and unless word of mouth publicity of the film is really good, there is no urgency for them to go to the cinema,” Butala said.
This lack of urgency among the cinema-going public has been blamed for flops such as Aamir Khan’s Laal Singh Chaddha, Ranbir Kapoor’s Shamshera, and Akshay Kumar’s Raksha Bandhan, among others.
Selective viewers
People have become more conscious about spending after the pandemic and this has led to erratic behaviour among the movie-going audience who watch select films, resulting in more box-office failures, said single-screen exhibitor Vishek Chauhan.
While Butala said the movie business across languages has been affected, the impact has been greater for Bollywood. The share of the Hindi films in overall India box-office revenue shrank to 33 percent last year from 44 percent in 2019, according to business estimates.
“The rise of over-the-top (OTT) platforms like Netflix and Amazon Prime have opened up content that was once inaccessible to the loyal Bollywood audience and streaming with subtitles proved a game-changer for regional cinema,” said Kaushik Izardar, CEO of Kaans Production.
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Regional films recorded a 30 percent increase in box office collections to Rs 5,830 crore from Rs 4,489 crore in 2019. The number of regional film releases increased 17 percent to 1,149 last year from 979 in 2019, according to data by PVR.
“India was rock and roll till 2019 and had one of the best years in 2019 when Akshay Kumar delivered Rs 750 crore worth of box office revenue. Then came Covid and the bubble burst,” said Chauhan. “Many actors have now become streaming stars. Medium and small-size films were wiped out and films like Govinda Naam Mera, Monica O My Darling, and Freddy all went to OTT. So, this product is gone for theatres.”
Fewer releases
Chauhan said the films of the new breed of superstars are going to OTT and theatres are losing out on that opportunity.
“These (smaller) films earlier used to at least give Rs 50-60 crore worth of business, but now that revenue is almost lost,” he said.
After average business last year, film distributor Brijesh Tandon is now worried about fewer film releases in January.
“December was bad and the overall box office business was average, that too because of some south films like KGF 2, RRR and some Hollywood films. Hindi had few successes like Drishyam 2, The Kashmir Files, Gangubai Kathiawadi, and Bhool Bhulaiyaa 2. Only 4-5 films did well. Now, January is under pressure due to less number of releases,” said Tandon.
It's not just January or February – there are fewer films expected to be released through this year, said Chauhan.
"There is limited expectations from Q4 due to limited large ticket line ups, said Abhishek Jain, Head of Research, Arihant Capital.
The number of Bollywood films released fell 22 percent to 138 in 2022 from 178 in 2019.
Tandon said only one big Hindi film is set for release in January – Shah Rukh Khan’s Pathaan.
“Can one Pathaan help 4,000 theatres across India survive? My expenses every day are Rs 20,000-25,000. With no big releases until Pathaan, I will incur a loss of Rs 4 to 5 lakh and may earn Rs 5-8 lakh from Pathaan. This will be the story for most cinemas. And god bless those cinemas that don't have 2K (premium format),” Tandon said.
Tandon noted that while Avatar: The Way of Water did well, not every cinema has a 2K projector and they suffered.
“We survived due to Avatar 2 and Drishyam 2. Avatar 2 gave us super profits. But what about those cinemas that depended on Cirkus, which folded at Rs 35 crore?” asked Chauhan. The budget for Cirkus was Rs 150 crore.
“On Valentine’s Day (February 14) there is Kartik Aaryan's Shehzada. After two weeks, there is Akshay Kumar's Selfie. Then there is Tu Jhoothi Main Makkaar starring Ranbir Kapoor and Shraddha Kapoor, and then Ajay Devgn's Bhola. There are only five (big) films from January to March. This period is not very exciting, barring Pathaan," said the exhibitor.
However, INOX Leisure’s chief programming officer, Rajender Singh Jyala, said the line-up of films this year is the same as it was before the pandemic.
No audience connect
More movies are needed but those that connect with the audience.
Chauhan said films that connect with the audience will have longer runs, like Drishyam 2, which ran for seven weeks, or Brahmastra, which had a four-week run.
“One big challenge currently is the disconnect between production houses and makers of traditional cinema with the new generation of audiences,” said GK Tirunavukarasu, the cofounder of Producer Bazaar. “Many producers are still unaware of who their audience are, which demographic prefers to watch a film at home and which would prefer to frequent a theatre.”
He said creators need to come up with engaging stories as viewership patterns have changed because of exposure to diverse genres and ideas, thanks to streaming platforms.
In the Hindi language space, there is lack of good writers, said Sanjay Chabbria, producer and founder of Everest Entertainment.
"Top 10 films of 2022 feature 3 remakes including Drishyam 2, Vikram Vedha and Laal Singh Chaddha. Also, 'leave your brains aside comedies' don’t work anymore. Love stories like Badhai Do, Chandigarh Kare Ashiqui are best suited for OTT release. Writing has become urban and niche. Salim - Javed, Raj Khosla, Vijay Anand are great examples of classic blend of art and commerce which is missing today," he added.
Perspectives of the audience have broadened to a great extent. The creative ecosystem has to adapt to this new change, said Tirunavukarasu. "Investing in writers and fresh stories is the need of the hour,” he added.
High star salaries
He said high star salaries are also affecting the business more than ever before.
“Once upon a time Bollywood films used to have strong collections owing to the strong fan base of superstars. That has changed completely now," said Izardar.
Stars no more guarantee a film’s success, yet their fees remain high. According to reports, some stars doubled their fees during the pandemic based on their digital following and OTT content.
It is estimated that Akshay Kumar, considered the highest-paid actor, increased his fee to Rs 117 crore for Bell Bottom (August 2021) from Rs 70 crore for Sooryavanshi, which was belatedly released in November 2021 after the disruption caused by the pandemic.
Ranbir Kapoor and Ranveer Singh are said to charge about Rs 70 crore and Rs 50 crore, respectively. On the other hand, stars Aamir Khan and Shah Rukh Khan opt for a profit-sharing model with producers at 75 percent and 60 percent, respectively.
“We judge the drawing power of a star by studying the opening of a film, first-day collections, and number of views on streaming platforms. But we must also find out how a star impacts overall collections and digital algorithms. We must find out their influence on advance bookings across India, abroad and on social media trends. The extent to which they draw eyeballs to the small screen and footfalls to theatres must be aggregated as well to evaluate the monetary value of their contribution to a film,” said Tirunavukarasu.
He said there is a need to standardise star fees or the film industry won’t grow and thrive.
“High star fees are the big reason why movie budgets are unsustainable currently,” he said.
Indian box-office receipts crossed the Rs 10,000 crore mark in 2022 for the first time since 2019, according to a GroupM iTV and Ormax Media report.
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