MUMBAI: The week on week disagreement between distributors and exhibitors over revenue share terms of movies seems to have reached its peak now.
The Film and TV Producers’ Guild of India has intervened in this matter and has called for a joint meeting between producers, distributors and mutliplex exhibitors in order to rationalize and streamline the revenue share terms of movies to avoid confrontation between content creators, distributors and exhibitors.
Speaking to Businessofcinema.com movie producer and Producers core committee chairperson Mukesh Bhatt says, "There are differences in the way of functioning. There are not one, but various issues. On Saturday, there is a meeting between producers, distributors and exhibitors, but I would not like to comment on it now. We would want it to be confidential."
The meeting on Saturday will be attended by Film and TV Producers’ Guild of India president Manmohan Shetty, Mukesh Bhatt, officials from Yash Raj Films, UTV Motion Pictures, Eros International, Studio 18 and Reliance BIG Pictures who will represent the producers and distributors and from the exhibitors front officials from Fame Cinemas, Cinemax, Inox Leisure, PVR Cinemas and BIG Cinemas will be present.
The tension between distributors and exhibitors over revenue share terms has been brewing for long now, as has been reported by Businessofcinema.com time and again. The turning point for this is said to have come with UTV Motion Pictures’ Dev D. The terms for Dev D was verbally decided in the year 2008 for 45:55 and 35:65 share between distributors and exhibitors respectively for the first and second week.
However, at the start of this year, the exhibitors jointly proposed to revise the terms to lower than before due to the economic meltdown, dipping profits and an array of flop films dished out by various distributors last year.
This revision of terms has irked distributors of UTV, who are now not willing to release Dev D in multiplexes on 6 February. If terms are not resolved with exhibitors, the movie will release only in single screens in the country. Also Bhatt’s movie Raaz – The Mystery Continues, which released on 23 January underwent tensions until last minute over the same issue.
In 2008, the revenue share terms for big and medium film for all circuits outside of Bombay was more than Bombay, but this year onwards multiplexes are not only proposing to reduce the terms, but also to make standard all across India.
An exhibitor of a leading multiplex chain on condition of anonymity says, "A movie should strictly get its fair share on the basis of its performance, which can be measured as per its gross revenue, footfalls or occupancy of theatres. Non performing movies shouldn’t deserve to get terms as high as blockbuster films. We have faced enough brunt last year when various unsuccessful movies got undeserved and high terms."
Another exhibitor adds, "Due to the ongoing financial crunch, multiplexes are renegotiating with vendors, housekeeping and landlords of properties. Hence they are also renegotiating with distributors this year."
A national distributor of hit films of 2008 says, "Movies have never got same terms all over India, how can they expect it now? And if they want our movies to be classified, then we want their properties to be classified. Why should we give our movies in multiplexes where we do not even recover our print costs?"
Another distributor adds, "The greed of exhibitors in trying to lower terms by holding distributors ransom until the last moment, has led to a tussle and created tension. A permanent resolve needs to be in place, so that the industry can function amicably and we can all work together for the better of the industry and not fight with each other."
Distributors are now calling the whole act of multiplexes as the multiplex mafia and cartelization. Going back to Chandni Chowk To China, the movie released on 16 January and is already out of multiplexes, but the terms for the movie still remain undecided with no contract signed till date, due to the confusions and uncertainty.
Now it remains to be seen what the outcome of Saturday’s meeting will be and how it will decide the course of revenue share terms for this year’s movies going ahead.