Friday, June 10, 2011
Tuesday, November 3, 2009
How digital cinema is unscrambled ( Article from Business Standard)
November 03, 2009 12:51 IST
It has turned the whole logic of digital cinema in India upside down. Scrabble Entertainment, a start-up funded by Manmohan Shetty, is digitising theatres (largely multiplexes) across metros and big cities in India. Old and new multiplexes from PVR or Inox , among half a dozen chains, are quickly signing on.
In just over a year, Scrabble has digitised 100 screens across 23 theatres with equipment approved by the Hollywood-endorsed DCI (digital cinema initiative) standards. That means a Scrabble theatre can play any Hollywood release in digital form. By December 2009, CEO Ranjit Thakur expects to wrap up 200 screens across 50 theatres in large Indian cities.
You could argue that in a market dominated almost completely by domestic cinema, why bother with DCI standards. They are meant for markets where Hollywood is big business. That is precisely why it is surprising that Scrabble is managing to get theatres or that it expects to break even in three years.
Why digital?The whole point about digital cinema so far, has been digitising single (usually not very profitable) screens in small-town India and bringing them back into the market. That is because digital prints usually involve a one-time conversion cost of Rs 1,75,000-Rs 200,000 while each regular 35 mm print costs Rs 50,000-60,000.
A film usually releases with anywhere between 600-1,500 prints. The bigger the print runs the better the chances of making money in the first week.
However, since costs limited the number of 35 mm prints they would slowly wind their way into small-town markets, by which time piracy killed all potential.
E-cinema solved that problem by making same day release possible in large parts of India. It is now normal for large films to release with 1,600-2,000 prints, almost half of them digital.
The first rollout, almost five years earlier, happened when Shetty's Adlabs (now part of Reliance) tied up with Mukta Arts to form Mukta-Adlabs. Though the Mukta-Adlabs roll-out fizzled out after a few years, it showed the promise of digital cinema.
Later others such as UFO Moviez or Real Images used different business models to great effect. UFO for instance charges a per play fee. Their efforts have meant 2,000 digital screens in India. In a 9,000 (active)-screen fragmented Indian market, these are helping to get in a nice slice of revenues back into the industry kitty.
However, most multiplexes and metro theatres never saw the point of digitising. One, because unlike small-town theatres they have top-of-line equipment which is better than e-cinema, so there is no significant change in picture quality. Even if they wanted to the costs were prohibitive -- Rs 40 lakh (Rs 4 million) for DCI approved equipment against Rs 10 lakh (Rs 1 million) for e-cinema.
Why Scrabble?Thakur, a consumer electronics man was, however, clear that he wanted to get into the business of digitising theatres in large cities. "Eighty per cent of the box-office revenues come from 1,000 big city screens. That is my market." In 2007 he approached Shetty with the idea. The latter's firm, Walkwater Media, is now the majority owner of Scrabble.
Scrabble offers the equipment at a subsidised cost (Rs 30 lakh or Rs 3 million instead Rs 40 lakh or Rs 4 million) payable over several years. The reason multiplexes signed on is because they can push the not-so-old equipment into the smaller town properties.
Then they can digitise using top-of-the-line equipment from Christie's and Doremi at a bargain price. Also, as Hollywood goes completely digital it will become difficult to access foreign films for critical metro markets. So, Scrabble's timing is good.
The theatre chain has to take digital prints of any film played on Scrabble's equipment only from Scrabble. On the content side, it has a deal with all major producers and the Hollywood studios that wherever there is Scrabble equipment, the company gets the digital print.
The company makes its money from the prints. After the conversion and digitisation is done by labs such as Prasad or Adlabs, Scrabble transports the print.
For being a secure 'FedEx' kind of service, as Thakur puts it, Scrabble gets a virtual print fee of Rs 20,000 per theatre, irrespective of the screens it has.
This is because the print can be played only on Scrabble's equipment and only for the shows and screens it is authorised for. Thakur reckons that piracy is almost impossible on this system.
Its subsidy of 10 lakh per theatre notwithstanding, Scrabble expects break even in three years, assuming it has digitised 150-200 theatres. That is when it is hoping advertising, too, will kick in as a revenue stream.
The chinks in the Scrabble armour? Well, technology could change and there could be better projectors than the 2K machines that Scrabble is rolling out. That is an evolutionary risk.
The bigger risk is what happens after the difference between digital and non-digital screens disappears, when everything is digitised. Then, Scrabble will need to have really iron-clad contracts with content producers to continue being the 'FedEx' for DCI approved prints or it will have deal with lower revenue per print.
Till then, it is headed for a good time.
( Vanita Kohli-Khandekar in New Delhi )
November 03, 2009 12:51 IST
It has turned the whole logic of digital cinema in India upside down. Scrabble Entertainment, a start-up funded by Manmohan Shetty, is digitising theatres (largely multiplexes) across metros and big cities in India. Old and new multiplexes from PVR or Inox , among half a dozen chains, are quickly signing on.
In just over a year, Scrabble has digitised 100 screens across 23 theatres with equipment approved by the Hollywood-endorsed DCI (digital cinema initiative) standards. That means a Scrabble theatre can play any Hollywood release in digital form. By December 2009, CEO Ranjit Thakur expects to wrap up 200 screens across 50 theatres in large Indian cities.
You could argue that in a market dominated almost completely by domestic cinema, why bother with DCI standards. They are meant for markets where Hollywood is big business. That is precisely why it is surprising that Scrabble is managing to get theatres or that it expects to break even in three years.
Why digital?The whole point about digital cinema so far, has been digitising single (usually not very profitable) screens in small-town India and bringing them back into the market. That is because digital prints usually involve a one-time conversion cost of Rs 1,75,000-Rs 200,000 while each regular 35 mm print costs Rs 50,000-60,000.
A film usually releases with anywhere between 600-1,500 prints. The bigger the print runs the better the chances of making money in the first week.
However, since costs limited the number of 35 mm prints they would slowly wind their way into small-town markets, by which time piracy killed all potential.
E-cinema solved that problem by making same day release possible in large parts of India. It is now normal for large films to release with 1,600-2,000 prints, almost half of them digital.
The first rollout, almost five years earlier, happened when Shetty's Adlabs (now part of Reliance) tied up with Mukta Arts to form Mukta-Adlabs. Though the Mukta-Adlabs roll-out fizzled out after a few years, it showed the promise of digital cinema.
Later others such as UFO Moviez or Real Images used different business models to great effect. UFO for instance charges a per play fee. Their efforts have meant 2,000 digital screens in India. In a 9,000 (active)-screen fragmented Indian market, these are helping to get in a nice slice of revenues back into the industry kitty.
However, most multiplexes and metro theatres never saw the point of digitising. One, because unlike small-town theatres they have top-of-line equipment which is better than e-cinema, so there is no significant change in picture quality. Even if they wanted to the costs were prohibitive -- Rs 40 lakh (Rs 4 million) for DCI approved equipment against Rs 10 lakh (Rs 1 million) for e-cinema.
Why Scrabble?Thakur, a consumer electronics man was, however, clear that he wanted to get into the business of digitising theatres in large cities. "Eighty per cent of the box-office revenues come from 1,000 big city screens. That is my market." In 2007 he approached Shetty with the idea. The latter's firm, Walkwater Media, is now the majority owner of Scrabble.
Scrabble offers the equipment at a subsidised cost (Rs 30 lakh or Rs 3 million instead Rs 40 lakh or Rs 4 million) payable over several years. The reason multiplexes signed on is because they can push the not-so-old equipment into the smaller town properties.
Then they can digitise using top-of-the-line equipment from Christie's and Doremi at a bargain price. Also, as Hollywood goes completely digital it will become difficult to access foreign films for critical metro markets. So, Scrabble's timing is good.
The theatre chain has to take digital prints of any film played on Scrabble's equipment only from Scrabble. On the content side, it has a deal with all major producers and the Hollywood studios that wherever there is Scrabble equipment, the company gets the digital print.
The company makes its money from the prints. After the conversion and digitisation is done by labs such as Prasad or Adlabs, Scrabble transports the print.
For being a secure 'FedEx' kind of service, as Thakur puts it, Scrabble gets a virtual print fee of Rs 20,000 per theatre, irrespective of the screens it has.
This is because the print can be played only on Scrabble's equipment and only for the shows and screens it is authorised for. Thakur reckons that piracy is almost impossible on this system.
Its subsidy of 10 lakh per theatre notwithstanding, Scrabble expects break even in three years, assuming it has digitised 150-200 theatres. That is when it is hoping advertising, too, will kick in as a revenue stream.
The chinks in the Scrabble armour? Well, technology could change and there could be better projectors than the 2K machines that Scrabble is rolling out. That is an evolutionary risk.
The bigger risk is what happens after the difference between digital and non-digital screens disappears, when everything is digitised. Then, Scrabble will need to have really iron-clad contracts with content producers to continue being the 'FedEx' for DCI approved prints or it will have deal with lower revenue per print.
Till then, it is headed for a good time.
( Vanita Kohli-Khandekar in New Delhi )
Friday, June 26, 2009
Business facts of 'Small Budget Films' (published post)
Studios zoom in on small-budget films for profits
Aminah Sheikh / Mumbai September 11, 2008, 0:41 IST
Small-budget films seem to be raking in the moolah for production houses. Little wonder that filmmakers like Ghai, Mahesh and Mukesh Bhatt and Pritish Nandy have over the years stuck to making small-budget films in the range of Rs 10-15 crore.
In the first week after its release, Farhan Akhtar's musical flick, Rock On, with a small budget of Rs 8-9 crore, has recovered its cost of production. Industry estimates the film to have earned over Rs 9 crore from box-office collections in the first week, with just 210 prints.
The renowned Bhatts' (Mukesh and Mahesh) recent offering, Jannat, featuring Emraan Hashmi earned them almost three times the cost of the film (Rs 10 crore). Here's how: According to Mahesh Bhatt, Jannat recovered its production cost by selling the satellite rights for Rs 10 crore and music rights for Rs 4 crore. Therefore, the theatrical earnings from the 150 prints released were a bonus (nearly Rs 24 crore).
Even a Bollywood flick like Ugly Aur Pagli with Mallika Sherawat and Ranvir Shorey, which has faced the heat from film critics, has earned its producer Pritish Nandy a handsome return on investment
When small-budget film-makers slate their movies, they sell them as a package to distributors, which cover their risk. A lion's share of earnings for such films comes from satellite and home video, while the remaining is contributed by theatres. In case of big-budget movies, nearly 70 per cent of the income comes from box-office collections.
For instance, the much-acclaimed movie Iqbal, with actor Shreyas Talpade (Rs 2.75-crore budget) earned Rs 1.3 crore from the box office, while satellite rights fetched Rs 2.25 crore and home video rights Rs 50 lakh.( Iqbal was released with 50 prints)
Sunday, May 31, 2009
Sunday, September 28, 2008
Judge yourself - business of subject oriented films
They work with passion and planning. Even though they are not offered lavish funds for films but their dedication to face challenges make them a fighter. To share their vision all they need - a trust within their self to give a best possible creative work . They are the new age film makers.
As I have discussed earlier too, Films with subject & treatment (no big stars) are doing great . A few recent films can be mentioned in this regard - 'AAMIR', 'WEDNESDAY', 'ROCK ON', 'JAANE TU..." etc. to name a few.
Publicity and promotions make a difference to reach out to the public but a film can not sail through on that only. Good films always find it's way to the hearts of people. A point to be noticed is that- new age film makers are giving more hits ( business wise ) than big shot. Why so?
Today's audience is mature enough to welcome different new subjects apart from those age old ones. They wish to see new aspect of film making, new visions. But all good things does not appear on it own. They expect encouragements but are we really thinking in that line?
Go...gather & join hands with these new age people.....you will feel the part of revolution.
As I have discussed earlier too, Films with subject & treatment (no big stars) are doing great . A few recent films can be mentioned in this regard - 'AAMIR', 'WEDNESDAY', 'ROCK ON', 'JAANE TU..." etc. to name a few.
Publicity and promotions make a difference to reach out to the public but a film can not sail through on that only. Good films always find it's way to the hearts of people. A point to be noticed is that- new age film makers are giving more hits ( business wise ) than big shot. Why so?
Today's audience is mature enough to welcome different new subjects apart from those age old ones. They wish to see new aspect of film making, new visions. But all good things does not appear on it own. They expect encouragements but are we really thinking in that line?
Go...gather & join hands with these new age people.....you will feel the part of revolution.
Saturday, September 13, 2008
Bollywood's trend but foresight.......??
Glamour is integral to film world and mostly people are prone to conceive their thoughts referring to glossy magazines and articles.Some crash land here while chasing their dreams and some stands tall or survive to sudden jolts. It's a rough terrain and survival demands - patience, endurance, humanity, opportunities, luck & lot more.
It's also a smart example for co-ordination theory of commerce where finance merges with creative intellect to market a business on large scale. And it's really having huge potential for it's expansion in the near future.
Changing Indian film trend is encouraging lot more new pool of talents to tap the potential and it seems going great. Nowadays a lot more films are welcomed because of their subject and treatment and they are doing great business. So called small films ( Budgeting 2-3 crore approx.) are doing better business against their investment while the big budgeted films are more prone to losses ( keep aside a few exceptions). but still there is a rush for star system style of making which have been followed always.
Corporate houses jumping into this market with their full strength is an indication that there is lot to happen in this changing scenario of film market where multiplexes and digitization of theaters could lead us towards a new beginning, where film with fresh ideas and beautiful treatment would be breeze amid a mad rush.
Hope we shall see a lot more new ideas shaping up in films rather than those age old mad rush
A few questions:
It's also a smart example for co-ordination theory of commerce where finance merges with creative intellect to market a business on large scale. And it's really having huge potential for it's expansion in the near future.
Changing Indian film trend is encouraging lot more new pool of talents to tap the potential and it seems going great. Nowadays a lot more films are welcomed because of their subject and treatment and they are doing great business. So called small films ( Budgeting 2-3 crore approx.) are doing better business against their investment while the big budgeted films are more prone to losses ( keep aside a few exceptions). but still there is a rush for star system style of making which have been followed always.
Corporate houses jumping into this market with their full strength is an indication that there is lot to happen in this changing scenario of film market where multiplexes and digitization of theaters could lead us towards a new beginning, where film with fresh ideas and beautiful treatment would be breeze amid a mad rush.
Hope we shall see a lot more new ideas shaping up in films rather than those age old mad rush
A few questions:
- Film world is an industry now and it works well (business wise) in a planned way, then why people hesitate to plunge into it to tap it's potential when it's in a phase of transition?
- Don't they have a fore-sight or rather they only go for 'follow the leader' type of vision?
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