When Warner Bros announced the simultaneous release of 17 of its upcoming films in 2021 on over the top (OTT) platforms and in theatres, it not only sent shockwaves across the US film industry but also disturbed the Indian film space. The Hollywood studio will simultaneously release the entire slate of films scheduled for 2021 on HBO Max as well as in theatres. And these include films like Matrix 4, Godzilla vs. Kong, Tom & Jerry, among others. The question on everyone's mind is: will such a situation arise in India as well? Will Indian film studios or producers ask for simultaneous release of films in theatres and OTT platforms? According to analyst Karan Taurani, who tracks media and entertainment closely and is Vice-President at Elara Capital, a simultaneous release on OTT and in theatres is not possible in India. "What happened globally is because the exhibition sector does not have the bargaining power. They (US) are mature markets. Pre-COVID, these markets were growing below two to three percent whereas India was growing at a much faster rate. In India, the top cinema chains won't allow simultaneous release and the top three to four cinema chains rule the charts. Around 70 percent of box office collections come from these chains." He added that now with single screens shutting down, the collection share of top cinema chains will be higher. "Plus, these theatre players (top theatre chains) have been raising capital and can raise more money, they can survive for next one year. Hence, these guys (top theatre chains) are in a commanding position and they will not allow simultaneous release of films." OTTs too may not prefer simultaneous release Along with theatres not allowing simultaneous release, Taurani thinks that even OTT players will be hesitant. "OTT players will take a realistic approach as the number of films that have come on OTT directly, which is around 12 to 14, have not done well. While there was high expectation from Akshay Kumar's Laxmii, even that has fallen flat. So, the point is that in these times when the track record for direct to digital releases has not been great, I don't see even OTT players looking at more digital premieres." "Plus, the shoots for web series have started. So, they will focus on them. Also, digital premieres have not led to major gains. So, I don't think OTTs will give more premiums to producers. OTTs wont give a higher premium for same-day release," he added. And movies don't come cheap. OTT platforms like Disney+Hotstar have bought streaming rights for films like Laxmii and Ajay Devgn's Bhuj for as much as Rs 100 crore each. Kavita Shenoy, an ex-Google employee and founder of Voiro, a revenue and data management solutions platform for media houses and digital publishers, pointed out that movies cannot drive user behavior change. Live sports can. "So, If a platform has both sports and movies then it is a good way to push your subscription strategy. But I don't think there has been a change in the way users behave towards subscription only because of digital premieres. Subscription is recurring and movies are one-time events." Sharing similar sentiments, Utkarsh Sinha, MD, Bexley Advisors, a boutique investment bank focused on early stage deals in tech and media, said, "OTT penetration in India and subscription revenues still have room for growth. Therefore, movies might find it difficult to recoup earnings at the same level as a wide theatrical release." But will the OTT window shrink? While simultaneous release can be ruled out in India, shrinking of the window for a film to stream on OTT after its theatrical release may be possible. "Some kind of window-lowering can happen. From eight weeks it can come down to four weeks. This can happen if the box office collections are sub-par even for the larger films," said Taurani. Adding to this, Preetham Daniel, Senior Vice President, Asia, Harkness Screens, said, "Some of the decisions taken by the Hollywood studios to shrink the window also support their own OTT platforms. Warner's decision to go on OTT is to support HBO Max and grow their viewership and subscriptions. HBO Max has 38 million subscribers in the US of which only 8.6 million accounts are activated as compared to Netflix that has 76 million subscribers in the US only." He added, "In India, we don’t have a structure like in the US. Although YRF, Dharma are large studios, they presently do not have an OTT of their own. So, the decision for a film to go on to OTT would be purely because of lack of cinemas opened or shortfall in attendance." Even Sowmya Iyer, Founder & CEO, DViO Digital, a marketing company, said that if simultaneous release happens in India it will be temporary. "Look at Warner’s announcement closely. It says that the 17 films on OTT is a special one-year plan. This shows that in the long term, even they do not believe in migrating to OTT," said Daniel. And just like simultaneous release, there are low chances of window-shrinking in India. "A lot of the production houses I have spoken to, many of them don't want the window to reduce," said Taurani.
