The Hindu Business Line : Corporates yet to taste big success in movie biz

THEY are big names in the corporate world. But when it comes to making an impact on the box office — corporate groups such as the Tatas, Raymonds and Oswals — have registered a string of flop shows.

Barring the AV Birla Group-promoted Applause Entertainment that had its first big success in the Amitabh Bachchan-Rani Mukherji starrer, Black, most of the others have now gone slow on their venture in tinsel town. The Tata Group have exited the business after the poor showing of the movie Aitbaar, also featuring the Big B and Bipasha Basu.

Even producer-director Subhash Ghai's Mukta Arts, Pritish Nandy Communications and K Sera Sera are yet to taste big success.

According to analysts, the reason why these business groups failed to make an impact in the film business is because they were unable to segregate the creative and operational management.

"The film industry has registered revenues of Rs 5,900 crore last year and has the potential to touch Rs 14,300 crore by 2010. However, to grow at a faster pace it would have to unlock the hidden values," said Mr Anindya Roychowdhury, Associate Director, KPMG.

For instance, the industry lost about Rs 900 crore last year due to piracy and leakages in theatre collections. These need to be plugged.

Similarly, films can increase realisation from overseas revenues. "These revenues can be enhanced through increased penetration of Indian films, focused marketing and expanding into new markets with common languages especially of regional films. Also falling prices of DVD/VCDs will drive growth. In addition, with the gradual penetration of addressable digital platforms like direct-to-home (DTH), the demand for filmed content will increase as one can access made-for-TV films and new films premiering on pay-per-view television," he added.

The soothsayers of the industry are very optimistic about its future. According to KPMG report on entertainment, the film industry is entering the second wave of growth.

"Over the last few months, there has been a far greater intent on the part of the industry to move towards corporatisation with the filmmaking process becoming more efficient, investments in a larger portfolio of films of different budgets and genres, segregation of creative and operational management, vertical integration of processes and value chains," it said.

Also, "institutionalised film financing efforts till now are laudable — but the sector needs to deepen with the entry of more players and the advent of sophisticated financing akin to project financing," the report said.

Ms Kacon Sethi, CEO, K Sera Sera, said that the film business inherently is a more risky business than television content as the market dynamics and audience preferences change every Friday. "Companies that have been able to de-risk their models are able to give higher returns to the investors," she said.

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Corporates yet to taste big success in movie biz