Entertainment is not a luxury. It is a necessity,” says film exhibitor and distributor Akshaye Rathi, Rathi Group of Cinemas. “After slogging hard for a day or a week, all of us deserve a break. Cinema is the cheapest form of entertainment available in our country. Certain cinema halls in the country have tickets priced as low as Rs 20,” he says. This is, perhaps, one of the reasons why Bollywood, despite being a part of the Indian economy, is defying the slowdown. While most industries are experiencing a considerable fall in their growth, Bollywood is making more movies with each passing year, the budgets on films have been increased and the number of films reaching the Rs 100 crore mark has also risen.
The volume of revenues that comes from cinema is just one per cent compared to the overall Gross Domestic Product of the nation. So while the other sectors -- agricultural and industrial -- form a large section of the GDP, Bollywood, which is a tiny part in the economy, will obviously face a less significant impact. But at the same time, Bollywood impacts Indians emotionally, which is the key in keeping it ahead at all times. Watching movies is almost a ritual, which is second to cricket. “Bollywood is a great unifying factor,” says actor-producer-director Arbaaz Khan, whose films Dabangg (2010) and Dabangg 2 (2012) both earned over Rs 100 crores. “In a country of immense diversity -- of languages, culture, attire, food, religions or castes -- Bollywood brings everyone together and helps them forget all their woes,” says Khan.
Need for speed
India’s Hindi film industry, which completed 100 years this May, now churns out 800 to 1,000 movies every year. The industry was estimated to be worth Rs 122.4 billion (about $ 2.2 billion) in 2012, according to the Federation of Indian Chambers of Commerce and Industry. In 2014, it is expected to reach Rs 12,110 crore. It is growing at a rapid pace between seven and 10 per cent every year, even in times of economic slowdown. “People want to be entertained regardless. In a sense, I’d like to believe that our industry is somewhat recession-proof, though not entirely. While content is supreme, a film’s cost is also what makes or breaks it,” says Tanuj Garg, CEO- Balaji Motion Pictures. Ever since Ghajini (2008) became the first film to cross the R100 crore mark, many Bollywood films in the last three years have reached the magic figure. 3 idiots, Dabangg, Rowdy Rathore, Singham, Barfi! and more recently Yeh Jawaani Hai Deewani, Aashiqui 2 and Chennai Express, have made sure that money is continuously placed in the Bollywood coffers. Post Wanted, which resurrected the masala films genre, got the single screens back in vogue. “While the multiplexes may be adding to the revenues of the industry, the single screens are where majority of Indians still go today,” says Rathi.
The emergence of international studios in the country is another factor why Bollywood has become a more stable industry. There was a time when builders, diamond merchants and other businessmen pumped money into the industry to make films. The money earned from these films was then pumped into other businesses. Today, studios such as Disney UTV, Viacom18, Fox International and many others, solely work on the principle of making movies, releasing them and making more movies. “The money which is earned from films is pumped in back there. There is no wastage of resources,” says Rathi. Ajit Andhare, COO, Viacom18 Motion Pictures, says, “There is a development cycle. The internal business environment is key. As a profitable studio you continue to build a slate of productions and releases for the future, and this, in turn, leads to the progress and growth of the studio, and Bollywood at large,” he says. The growth can also be seen in the manner the studios have increased productions in the last three years. Disney UTV, one of the leading studios of Bollywood, this year alone has produced 11 films as opposed to nine in 2012, six in 2011 and eight in 2010 (approximate figures, since they also produce regional cinema). Similarly other studios such as, Viacom18 Motion Pictures, Fox Studios, Eros and Balaji Motion Pictures have 11, four, nine and three releases this year. Garg states, “I am not sure about the increase, but there has been no decrease either. Leading studios need to maintain a pipeline of products to enjoy trade benefits, economies of scale, and absorb their huge running costs.
Escape from reality
When Sooraj Barjatya’s Hum Aapke Hain Kaun! (1994) released in 500 screens across the country, it was considered to be one of the biggest openers in terms of the screens it had acquired. Dabangg 2 last year and Chennai Express, two weeks back, opened in as many as 3,500 screens, estimating a growth of over 300 per cent in 20 years. Similarly, the number of screens for the medium budget films have also increased from 600 to 1,200 in the last couple of years. Vikram Malhotra, who has recently launched his venture, Abundantia Entertainment, feels it is the content that is driving Bollywood. “Content is now appealing to all segments of society.
Besides the 12 big tent pole releases every year which drive the big money, the other 40 weeks which are pulling in the audience are a parameter of how Bollywood has grown. If the movies weren’t compelling enough, the population wouldn’t keep coming back to the theatres,” he says. Rathi explains that today entertainment does not mean masala films alone. “Any film which tells a story entertainingly is appreciated by the audience. For instance, I recently had Bhaag Milkha Bhaag running to full houses at my cinemas in Nagpur and Raipur,” he adds. The other instances could be Vicky Donor, Kahaani, Special 26 and Raanjhanaa, which were made on a medium budget, and proved to be profitable for its makers. While Bollywood seems to be sitting pretty at the moment, the slowdown in the economic system is eventually going to affect Bollywood in some manner or the other.
Bhushan Kumar, head honcho, T-Series, believes that the initial impact has been seen in the number of foreign shoots that have considerably reduced. “While film business is not affected as such, shooting in foreign locations has become expensive. I am shooting two of my movies abroad and my budgets have increased now,” says Kumar. But looking at the positive side, this also seems to be good news for India, since more Indian locations will now be scouted, and more business would be provided to local hotels, restaurants, and so on. Another reason why Bollywood is defying the slowdown is due to the psychological thinking of the consumer. “It is very difficult to compromise on behaviour-led activities,” says Andhare.
Malhotra states, “The consumption patterns of the people in metros as well as A and B towns are such that they love spending on leisure activities. They love going to malls, where most of these cinema halls are situated. While they may cut down on fuel and eating out, they will not cut down on watching movies because it is the best form of recreation.” Avinash Sethi, a financial consultant and a regular movie-watcher says, “It is easier to cut down on restaurants and clubs, but movies are part of us. You cannot stop going to a multiplex because onions are being sold at R80. It is the best escape from reality.” Small wonder then that Bollywood is even escaping the economic turmoil.
Top 10 Bollywood grossers (in the fastest time)
3 idiots: Rs 202.47 cr -- 9 days
Ek Tha Tiger: Rs 198.78 cr -- 5 days
Yeh Jawaani Hai Deewani: R188.57 cr -- 7 days
Chennai Express: Rs 156.70 cr -- 4 days
Dabangg 2: Rs155.00 cr -- 6 days
Bodyguard: Rs 1s 48.86 cr -- 7 days
Dabangg: Rs 138.88 cr -- 10 days
Rowdy Rathore: Rs 133.25 cr -- 11 days
Jab Tak Hai Jaan: Rs 120.85 cr -- 11 days
Ready: Rs 119.78 cr -- 14 days
849 movies launched in 2013 so far
5 films in Rs 100 crore club
Chennai Express released in 3500 screens
Hindi film industry pegged at Rs 12,000 crore