Watching films now turns a digital experience

Meher Khanna - Televisionpoint.com | Chennai
As video formats in the film industry follow their audio counterparts in going digital in distribution, they also seem to be becoming more expensive in their theatre formats, and less so in other formats like home video, satellite video on demand and in the internet channels.

Speaking to Televisionpoint.com, Tan Ngaronga, chief operating officer, Sathyam Cinemas, said, "We have definite expansion plans in tier-II cities like Madurai and Trichy; and the pricing of our tickets will not be any different in those places."

All of Sathyam's cinemas are digitised, i.e., they use the digital mode of projection, with facilities in-house to convert the incoming analog reels to digital format. Digitisation equipment for theatres costs anywhere between Rs 12 lakh and Rs 35 lakh, plus annual maintenance of 10-15 per cent of the purchase cost.

"They last for 5-10 years, at an average of 20 films per year showing for two weeks each. The cost of digitisation is borne either by the producer/distributor or the cinema owner." says Senthil Kumar, director, Real Images, which is a digitisation equipment seller as well as service provider for cinemas.

In the industry today, most of the shooting is done in the analog format; it's the post-production work which is done in digital format, that too, only for 35-40 per cent of high budget movies (above Rs 6-7 crore). As only 30 per cent of the cinemas in the country use digital projection, the movies are distributed in analog reels. Hence, the extra cost of digitisation for the end format comes at an extra 20 per cent.

As the very reason cinemas shifted to digital formats was to provide a better quality viewing experience, they also move towards a multiplex format, which is said to be a better entertainment experience on the whole. Those experiences are not coming cheap for viewers.

"In the US , where digitisation is only at the post-production level, like in India, theatrical exhibition contributes to only 35-40 per cent of the producers' revenue, with satellite rights and home videos (DVDs) comprising the rest. I predict the same trend to happen in the Indian market in the next five years," says Kandaswamy Bharathan, executive director of the movie Kavithalaya to Televisionpoint.com.

Says G Dhananjayan, chief operating officer, entertainment business, Moser Baer India, "Internet downloads form about 5 per cent of the US market today; they hold a 25 per cent market potential for India in five years. Even though broadband penetration is not very high here, mobile phones will compensate for it, especially with the 3G rollout in the offing."

However, these distribution models have not picked up in a big way as there's a stipulated interval between the theatrical release of the movie and the release of rights for its satellite broadcast, and home video in most of the states in India.

For instance, in Tamil Nadu, satellite rights of big budget movies cannot be sold till three years after the theatrical release of the movie. This follows the logic of those movies fetching revenue, on reruns at cinemas, especially in tier-II and III centres.

"Those audiences have access to home DVDs and pirated content now, and reruns are fading out of popularity," Dhananjayan said, who also suggests an intellectual property format for movies so that their rights, if released for limited periods of time, can fetch the producer a revenue for a longer duration.

Hindi movie Jab We Met was sold for satellite broadcast over a period of three years to five different channels, with the clause that any of those channels could telecast the movie only thrice per year. It earned Rs 22 crore for the producers in its first year.

Also, home videos recover 10 per cent of the production cost in today's market. "When production costs are going up, it is necessary to restructure our business models," Kandaswamy says.