No one saw it coming but when it came, it created a storm which was devastating both mentally and economically for Bollywood films. Not only the releases but even the shooting of Bollywood films have been stalled as the virus is taking a different angle now. Let us check the before and after affects of COVID-19 in Bollywood in terms of daily wages, production budgets, promotions and theater release.
2019 was a fantastic year with Bollywood industry giving monstrous hits which left the audience urge for more entertainment and were looking forward to a big 2020. Bollywood films have started shining not just at the domestic market but also at the Overseas market as it is reaching out to the wider audience who are appreciating the diverse films. With more screen counts, more awareness from social media, quality produced films are doing good business at the box office. This year, the star of the show was definitely the Ajay Devgn, Saif Ali Khan and Kajol starrer Tanhaji-The Unsung Warrior, which not only crossed the milestone in India but also became the highest grossing film of Ajay Devgn in the Overseas market.
While 2020 started with a bang as January, February month saw some decent performers like Malang and Shubh Mangal Zyada Saavdhaan. However, the Corona Virus scare engulfed more than 50% of the profit for Bollywood films in March. Except for Baaghi 3 and Thappad which could reach close to its budget, the highly anticipated and the last film of Irrfan Khan, Angrezi Medium, suffered the most as the cinema halls started the shutting down across the country on the first weekend of its release.
Let us understand how the finance works in Bollywood. Bollywood films goes through various stages until it is released in theaters :-
1. Pre-production – When a script works, the production house is ready to invest in it. Thus, team building including writer, director, cast and crew initiates.
2. Production – Once everything is finalized, the executive producer will give green signal to begin the shooting on the locked dates as proposed by the director in liaison with movie stars. This will include arranging for the logistics for the shooting locations in advance so that schedule is not delayed as this is where producer’s money will be pitched in. Further delay means more money need to be spent on operation cost of the film shooting.
3.Post-Production – Probably the most important phase where the film maker will decide on how to present his/her film to the audience. This phase requires attention to details as lot of work is involved in final processing of the film.
4. Marketing & Promotions – Once the trailer is out, the producers fund the stars to travel across the country and promote their films. The event management team will organize the event which will include the media, photographers, paparazzi which helps in creating buzz around the buzz before it sees the light of the day. The promotion also involves the advertisement across TV and digital platforms.
5. Final release – The d-day has arrived and the film will finally be screened at various theaters, multiplexes and events across the country. This is where feedback of the film is very important especially now days when social media is the critical to success.
If you consider the above phases, so many workers are involved right from the beginning of the film once the movie hits the theaters. The money is rotated from Indian banks and financial institutions who lend it to film studios who in turn invest in a film which is then sold to distributors (Distributors purchase a film from a Producer – based on Star Cast, Director, Producer, Lyricist and Music Director – and pay the Producer the amount of the budget plus some profit. The bigger the actor the more the Producer can earn) and sell it to exhibitors based on the profit sharing model. An Exhibitor is the multiplex chain or single screen theaters where the film will be shown. The Distributor makes arrangements with Exhibitors to showcase a film in as many of their screens as possible. This was a usual process before the pandemic hit us. How will this change post COVID-19 ? Given the uncertainty surrounding the pandemic, trade experts estimate that Bollywood will lose somewhere between $1 billion and $1.3 billion in just 4-5 months.
New trend to start in Bollywood ?
Since the entertainment industry has been widely impacted by the COVID-19 situation, there will be a pay cut across the board. This will result to downsizing from top to bottom to minimize further losses. In order to deal with the situation , the producers needs to re-consider the budget of the film, understand the money constraint (both inflow and outflow), re-work on the remuneration paid to the stars (few actors hike their prices after giving couple of hits). The remuneration model will not only be applicable for small stars in TV industries but even the A-list actors as major chunk of a film budget goes in paying to the popular actors. It is also the duty of actors, who charges exorbitant price for their work, to understand the difficult situation the entertainment industry is going through.
Producers also need to re-think on how to reduce the daily crew members count, especially 10 people required to assist an A-List star and only require smaller crew who should have a fixed monthly salary for a particular production unit as there will be a job security for these hard-working people. There have been cases where producers have arranged private jets for the stars to fly across different cities in India on a single day to promote a big-budget film. The movie promotion will not be done on a large scale basis and stars can be step when it is required.
The real-estate prices in Mumbai is sky-rocketing for which a production houses have to be pay eye-popping monthly rents. The production houses will need to re-think on their business model on how to reduce the operation cost and encourage employees to work from home, is possible. This may also help then in paying monthly salaries. India is a beautiful country and we do have a jaw-dropping and exotic locations which can be used for shooting rather than spending big bucks on foreign shoots. Ayushmann Khurrana’s film have been majorly shot in India and still have raked in good moolah at the ticket window considering the economy of the film
There have been cases where small budget films like Tumbbad, Tashkent Files, Bheja Fry or Kahaani have worked wonders at the ticket windows thanks to solid content which have driven the audience to the theaters for multiple viewings. Result, producers have gained 10 times the profit based on their investment.
Exhibitors also need to re-consider their decision on keeping a check on the prices on the tickets and food items, including the popcorns, soft drinks etc which is sold at insane price especially at the multiplexes. As Gulabo Sitabo became the first big budget Bollywood film to screen on OTT platform this week. This will be followed by Laxmmi Bomb, Bhuj-The Pride Of India, Sadak 2, Khuda Haafiz, Big Bull, Lootcase, Dil Bechara, Shakuntala Devi and Gunjan Saxena which has been a big blow to the exhibitors. They need to ensure to how come up with a good idea to keep the viewers happy economically. Situations something like Corona Virus nobody would have witnessed before. In order to keep the safety of your employees, the productions house can keep aside an emergency fund which will be used in the time of despair.
The pandemic situation is the lesson learnt for the entertainment industry. The only thing which can be done is learn from the grave situation and use the strategy to survive the next disaster before it hits back again.