Corporate Studios & Bollywood - Is the Courtship Over?

by Ravi Singhal

 Posted on 17-Sep-2016 09:31 PM

2007 was the year when the first Bollywood film made by a Hollywood Studio was released. Sony Pictures India backed Saawariya which bombed. That, however, did not curb the studios’ enthusiasm and the trend gathered momentum. It became a force to reckon with around 2013. Hollywood giants like Fox and Disney had forayed in the Indian market, mostly with local collaboration. But come 2016…the honeymoon with Bollywood seems to be over! A number of big international and Indian studios like Sony Pictures India, Fox Star Studio, Studio18, Walt Disney Company, Reliance Big Pictures and PVR Pictures are either shutting shop in India or incurring huge losses on many productions. While corporate studios are bailing the market, the family-run production houses like Yash Raj Films, Dharma Productions, Rajshri Productions and Vishesh Films are doing exceedingly well. What is the reason for this dichotomy? Let’s take a look.

Unheard of Fees

One of the key reasons the individual production houses have survived is because they are fanatical about keeping the costs down. They have a better judgement of returns from a film than the studio bosses who literally disrupted actors’ and directors’ remuneration. Stars and directors were being signed for sums unheard of even though they may not have had a recent hit. Films that wouldn’t have even fetched Rs. 50 crores in the market were picked up by studios for almost double the amount.


Overestimating the Indian Market

India is a huge market but highly fragmented. All states of South India enjoy their own sturdy regional market. Other regions, despite Bollywood dominance, still produce films in the local dialect for certain sections. Gujarati, Bhojpuri, Punjabi or Marathi films are preferred over Hindi. The Studios were wrong in their projections - buying films so expensive does not make business sense.


                                                                         mohenjo daro 

Neglecting the Script  

In the race to sign up ace directors and A-list actors, the script took a back seat. Glossy films with weak script failed to generate enthusiasm and bombed miserably.


Failing to feel the pulse of the people

Studio executives extrapolated their learning from Hollywood to Bollywood. Despite the Hindi film industry’s name being a knock-off of its American counterpart, Bollywood is a radically different game. Sensibilities of Indian audience are completely different from the West. While script is king in Hollywood, in India a film that tugs the heart’s strings and brings tears to the eyes has always ensured mass appeal. I am sure Rajshris will concur. They have made a formula of delivering hits after hits, often using similar stories steeped in an imagined and utopic cultural milieu. We love Hollywood films but want our films to be rooted, not a Hindi Film masquerading a Hollywood offering.



Bollywood has competition. Its target audience has many options other than Bollywood. They can literally watch hundreds of shows and films from all over the world, most of them for free. The business of re-runs is almost over, most old films and shows are either available for free on YouTube or can be readily obtained for cheap. Piracy, too, is rampant thereby impacting the business.



One of the rumors doing the rounds is that the acquisition price is high because there is an element of kickback by the selling party. Irrespective of a film’s business, the top studio executives gain personally with some moolah making way into their individual pockets.


So what is the future of the studios? They need to re-calibrate themselves. In my opinion here are some suggestions that might get them humming again.

Get Real

The A-lister (stars and directors) fee has to get realistic. The market cannot sustain such sky-rocketing investments. Certainly a paradigm shift in the industry but those who don’t adapt will perish! Some of the biggest successes like Neerja and Dum Laga Ke Haisha did it without a ‘superstar’.


                                                                                        dum laga ke haisha 

Keep costs under check

An instrumental contributor in the success of “Dum Laga Ke Haisha” was its realistic budget. Its 30 crore earning naturally topped its 10 crore investment. On the other hand, massive productions like Mohenjo Daro and Fitoor caused colossal losses to Disney. Bombay Velvet dented Fox Star Studio’s balance sheet. Warner Brothers lost heavily on Chandni Chowk to China. A way to hedge risks could be to make future films on a moderate budget.



Have a person from the creative side at the helm 

The business of Cinema cannot be divorced from the creative side. Cinema is not a product in the traditional sense where the quants and makers exist in separate silos. Spreadsheets don’t make a money spinner. Filmmakers who understand the viewers’ pulse, do. The individual production houses are successful because they have lived cinema for years and understand the audience intuitively.


Get creative with distribution

Making viewers shell out many hundreds of rupees in multiplexes is only driving them to other alternatives. Just hoping that the initial multiplex mania will work its magic again is unrealistic. Filmmakers have to adapt. Think various forms of media for entertainment. Leverage multiple platforms to drive revenue. Internet can give you the required volume if the price is right.


Explore other streams of revenue

 Merchandizing can be a good source of revenue. Bollywood has not seriously exploited these money-earning propositions. Most Bollywood films would fail their ‘marketing savvy’ test, were such a test conducted. 

It seems the individual production houses are successfully riding the new wave. It is the big studios with their glib –filled execs who are floundering in the sea. If they don’t learn to swim with the tide, they will soon drown.

TAGS : fox disney warner brothers pvr sony pictures Yash Raj Films Dharma Productions bollywood nee

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