Gap between theatrical release and TV premiere is shrinking

Star India Pvt. Ltd has picked up the television broadcast rights for Shah Rukh Khan super-hero movie Ra.One, which is currently set for an October release. The company didn’t say how much it paid for the movie rights to one of the year’s most highly anticipated films, but it reflects the aggression with which TV is pursuing Bollywood. With brand new films guaranteed to attract viewers, broadcasters are spending as much as 300 crore rupees a year to purchase TV rights of films, according to some media buyers.

Star also bought the rights for films currently running in theatres – Stanley ka Dabba and Dum Maaro Dum – ensuring that those who didn’t watch these movies in the theatre can catch the movies on TV soon. The gap between the theatrical release and TV premiere is shrinking and with it the window of opportunity for the cinema halls to make money from a film. The whole dynamics of the fastest FMCG (cinema) is changing very fast.
In villages of rural AP, it is not so common to see theatres shutting down as the villagers prefer to watch TV at home than in the theatres. With the increasing penetration of DTH in rural India and with better infrastructure (electricity) the local theatres are facing tough competition from the TV channels. Most people in the villages too get glued to these new movie premieres on TV.

Some of the latest blockbusters shown on the DTH platform attracted as many as 100,000 people on a pay-per-view basis, many of them from smaller towns and cities. Instead of spending money in the theatres, multiple people can watch the movie for 50 rupees at home.

From the film production houses point of view, theatrical releases are still the biggest source of revenues which is the reason why producers should time the release of their films in the theatres and on TV very carefully. The FICCI-KPMG 2011 Entertainment and Media Report points out that with income from other platforms going up, the share of theatres is declining. Currently the share has declined from 79% in 2008 to 76% in 2009 and the report says that it is set to decline to 70% by 2015.

It is to be seen how these dynamics play out in the future which has key implications for marketers and businesses.