With theaters opening up, there's an increasing conversation around safety and viability of film screening and emergence of OTT platforms. In a conversation with Baradwaj Rangan organised by CII, producer Suresh Babu speaks about the co-existence of theatres and OTT, post-COVID-19 releases, the film business and more. Excerpts.
What is the scenario like in the Telugu States? Did theaters open on October 15?
Single-screen theater owners are a bit reluctant, but they're looking forward to opening it by Deepavali. Initially, the multiplexes had hopes on Hollywood films, but that didn't work out well. Also, the huge fear of OTT releases exists among theatre owners, but I think we'll surely get back to theatrical releases. However, now that film shootings are in progress, people are looking forward to good collections from Sankranti releases.
The Government has permitted opening theaters with 50% capacity extensive sanitisation and rules and regulations. Will non-multiplex theaters be able to invest so much in maintaining the prescribed SOP?
It's a heavy operational cost, clearly not viable in today's date. With not many big films available for release, following the SOP is going to be very expensive. Moreover, starting theaters after months of shutdown will require investment in renovation too. There's going to be a lot of fear and skepticism towards the staff and audience.
The guilt factor of COVID-19 transmission is daunting. They aren't sure if the audience will strictly follow all rules, which might lead to stress while watching the film. It's going to be extremely challenging.
What is your perspective on enhancing the reach of Southern films on OTT Platforms?
OTT is a boon that has opened up the market for a large number of players. At a financial level, less than 20 per cent of films breakeven every year. Now, more films are commercially successful because they gain Return on Investment (RoI) not only from regular theatrical releases but also with OTT releases, dubbed versions and digital rights sold in different languages.
This has allowed producers to spread their risk and has enhanced the footprint of Southern films. Despite the mixed reviews, they still manage to generate revenue because of such OTT platforms, and that's what keeps the industry going. As it is done internationally, bestowing equal importance to theatrical releases followed by OTT releases and satellite releases will be the way forward.
Secondly, OTT platforms don't buy the rights for all films. It'd be great to have an option of a 'Pay for Performance' model for certain films that are not bought by any players, to independently monetise themselves on OTT platforms. The courage to make films will be higher, as producers get to bet on their product directly.
The straight-to-OTT release is somehow viewed as a taboo. Do you think it's necessary to always take the theatrical route and only then come to OTT?
I am completely for direct release, because, as a producer, I'd always look out for as much revenue and critical acclaim as possible for the content being produced. If OTT releases are more commercially viable than theatrical ones, it'd be a wise decision to go with what benefits the film.
One such example is Krishna And His Leela that released on Netflix. The challenge is that one needs to be flexible enough to accept those routes. Some Gen X directors and actors love the theatrical experience, and succumb to the nostalgic glamour of big screens. To forgo that and directly have an OTT release it a bit of a task.
In your opinion, what is the future for the theatre business in the coming years?
The theatre business has become very unviable nowadays. For instance, 1,300 screens in Andhra Pradesh have shut down in the last 20 years, giving us a sign of reducing theatrical business. The box office gross has higher collections today because of the increase in ticket value, but the total number of people going to theaters to watch films has drastically come down.
Prior to the COVID-19 lockdown, there was a prediction that by 2030 there would be very little cinematic experience available for big films. If theatrical business doesn't redeem itself in a post-pandemic scenario, that will happen much faster. Maybe, theaters will only be used for publicity. It's difficult to publicise OTT releases, because word-of-mouth strategy works differently. For OTT, we get reviews. The box office collections and number of viewers are unknown, which reduces the competitive nature of a theatrical release.
What is the downside to an OTT release?
There's clear upside for theatrical releases. I know that my profits can be of any amount; as in I make a film for Rs 10 crore, with a gross collection of Rs 100 crore. There is a 90 per cent upside if I make the right film. This aspect is missing in OTT. Also the fame and glory one receives from theatrical releases is unmatchable. It might become more difficult to create stars on OTT, because the heroic moments in the film pay off well only in a collective cinematic experience. This is the reason why tentpole films do massive numbers in theatres while Indie films don't. The same Indie films, when released on OTT, do really well. So, everything has its own pros and cons.
What do you think will be the percentage of screen viewing vs OTT in five years from now?
We're really not sure how long the pandemic will last, or when we will get a vaccine. If COVID-19 is controlled, the audience will be more comfortable visiting theaters. The exhibition sector will become more organised. We're trying to build an e-platform where producers, distributors and exhibitors will be under a single umbrella. Box office collections will be updated and producers can bid with the distributors, irrespective of the geographical location. It's an integrated approach to make the film business more accountable and transparent.
Screening patterns need to change for a more systematic distribution of films. This will give some hope to the theatre business. If this happens, there will be a good extension of single screens, directly proportioning to more theatrical releases.