Ever wondered why popular movies like Garam Masala or Apharan are released in cities like Panipat, Rajkot or Pathankot a week later than they are screened in Delhi and other metros? The reason is money -- or rather, the lack of it.
Currently, producers of a medium budget movie in India (between Rs 8-10 crore) release around 200 prints while a higher budget movie (Rs 15 crore plus) is released with 500 prints. Each celluloid prints' average cost is Rs 60,000 and this translates into a minimum cost of Rs 1.2-3 crore on print distribution alone.
While medium budget films are distributed in celluloid prints to merely 70-90 theatres within the first week of their release, higher budget filmmakers like Yash Chopra and Karan Johar release their films in 600 theatres.
"With a total of 13,000 theatres in the country", says Sanjay Gaikwad, CEO and executive director, UFO Moviez, "there's still a loss of revenue from 700 theatres, which in turn leads to rampant piracy. It is to check this glaring loophole that digital cinema is now being touted as the next big thing."
Gaikwad seems to know what he's talking about. After all, UFO Moviez, a division of Valuable
Media (a subsidiary of the Rs 3,500 crore strong Apollo International) along with Digital Projection International, a projection systems' manufacturer, have ambitious plans to convert the traditional analog movie theatres into digital format.
"By mid-2006, the group will set up 500 digital movie halls after which Rs 80 crore will be invested. With a total investment of Rs 300 crore, we will create 2,000 digital cinema halls across the country by 2007," says Gaikwad.
Can digital distribution of films revolutionise the Rs 4,500 crore strong Indian film industry? Not everyone seems to agree. Sanjeev Bijli of PVR feels, "The technology may have potential, but to say that it will make an outstanding difference is a little too early to predict."
UFO Moviez has installed 110 cinemas in states like West Bengal, Maharashtra, Chattisgarh, Gujarat, Tamil Nadu,
Kerala and Rajasthan. "We've received queries from nearly 500 theatre owners who want a digital cinema experience," says Gaikwad. "Theatres with our digital format have registered a whopping 96 per cent increase in revenue collections."
Fayaz, director, UFO Moviez says, "Andhra Pradesh, Tamil Nadu, Kerala and Karnataka have 59 per cent of the cinema halls in India. We expect 50 per cent of our conversions to come from south India."
While the cost of converting analog theatres to a digital format -- approximately Rs 15 lakh -- is borne by UFO, a basic fee is charged from theatre owners and movie producers in lieu of the services offered to them.
It also hopes to retrieve 30 per cent of its revenue from advertising from FMCG majors, telecom and also automotive players. Not just that, UFO Moviez will also consider an IPO in its second phase. "Our company is hopeful of creating the largest chain of digital cinema houses in India by 2007," says Gaikwad.
1 lakh = 100,000, 1 crore = 100 lakh, 100 crore = 1 billion