Film industry: Bollywood’s business model is unsustainable, actors’ fees need to be fixed : industry

Several Hindi film producers and studio heads feel that there is an urgent need to discuss and address the issue of rising costs in a post-pandemic world, even though Telugu movie industryor Tollywood, is halting production of all films from August 1 until issues are resolved with various stakeholders.

Bollywood producers, studio heads and senior executives felt that Bollywood’s business model needed a fix, starting with actor fees.

“Massive changes and headwinds for the film industry are no longer just in the theater market, but also in the streaming space. The volume of content acquired and values ​​are profoundly impacted. This is essential for all parties stakeholders in our value chain to be course and cost correct,” said Amrita Pandey, CEO, Pictures of Junglee. “I think the talent fee, among other costs, absolutely needs to be brought into line with the realities of the marketplace where there’s no longer an opening weekend or guaranteed streaming fee with an actor’s name or the scale of the movie.”

“The Hindi film industry’s business model has been turned upside down,” said a prominent producer, who has produced more than 50 films and a few web series. “The only way it will work is if the stars come down to earth. We’ve been talking about the rising cost of stars for a decade now, but nothing has happened.”

According to industry estimates, Akshay Kumarwhich had a series of flops – “Bell Bottom”, “Bachchhan Paandey” and “Samrat Prithviraj” – is asking Rs 117 crore per film, and would not have dates until the end of this year.

Shahrukh’s price and Salman Khanwhich charge an upfront amount and a profit share (backend), also come close to Rs 100 crore each, while Aamir Khan is the only player that does not charge any amount in advance but takes an 80% share of the profits.

Among other actors, Ranbir Kapoor and Ranveer Singh are charging around Rs 50-60 crore each, Kartik Aryan has hiked his rate up to Rs 40 crore, Shahid Kapoor is looking for Rs 35 crore, while Varun Dhawan is quoting Rs 30 crore for movie

“What is needed is a real course correction, a correction in the economy and a recalibration of priorities,” said Tanuj Garg, managing partner of Ellipsis Entertainment. “This is something that Ellipsis, as a content creator, is extremely aware of, and it puts us in good stead. Content and budgets must be designed in a way that allows everyone in the value chain to earn money.”

Garg is the producer of movies like “Ragini MMS”, “Looop Lapeta” and “Tumhari Sulu”.

Many industry experts say that with star awards going where they are, the Hindi film industry is already in deep trouble, not even considering the creative side of the business.

“The bigger producers have been isolated so far because they can sell their movies to OTT players, but with those players also looking to cut costs and tighten their belts, soon legitimate producers will have no more ‘money to invest in movies,’ said the head of a major production house. “It’s a vicious cycle. All the money goes into the pockets of the actors and doesn’t come back to the industry, making film an unsustainable business.

Some think it’s not just about actor fees, but also about the mismatch in the value chain across the entire creative and distribution industry.

“We need a fair distribution of risks and rewards,” said an official from one of the biggest movie studios. “At the end of the day, who in the value chain is paying for movies – before it was satellite, now it’s OTT. The biggest payers now are DisneyStar, Viacom18, ZEE, Sony, Netflix and Amazon. haven’t created enough avenues. Although theatrical, OTT, satellite, overseas and music rights are monetized, what about ancillary rights? Unlike the West, we haven’t created any franchises that can survive the film assets.

Most pundits have pointed out that with digital players paying top dollar for film rights, satellite and theater revenues are shrinking.

“What we’ve done is move or replace one revenue stream with another. The business as a whole needs to grow, the consumer’s share of wallet needs to grow,” the executive added.

The studio manager, as well as film producers, believe that Bollywood needs performance-related pay.

“Big stars are taken because of their fans and attract audiences. An easy way might be to set their fees on day one box office pickup. But there will always be spoilers that come with the allure. glamor and money from the gutka affair or the British lottery and pay the actors whatever they ask,” the producer said as quoted above.

The studio head added that under the current system, most actors don’t have skin in the game. “Their fees should be tied to box office performance and TV premiere ratings.”

As an industry, many believe that the most important thing is to grow the sum of the parts, because it won’t do any good if the overall pot stays the same.