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AMC and Cinemark, two major international cinema chains, have entered into deals with Hollywood studio Universal for exhibition of films. Under the AMC-Universal deal, AMC will get exclusive theatrical rights to screen Universal films for three weeks, after which the studio can monetise the films by streaming it pay-per-view. In Cinemark’s deal, the exhibition chain will get another two weeks of exclusivity if the film does well at the box-office.
In view of the COVID-19 pandemic, the cinema-going habit of people has changed. Universal went straight to the streaming platform with its Trolls World Tour in April this year as cinemas were shut. The film did extremely well on the OTT platform. Similarly, Disney’s Mulan was also an OTT release. Of course, Warner’s Tenet hit the screens when they reopened and although it did not flop at the ticket windows, its business was not what it deserved to be, given the public reports. For its forthcoming film, Wonder Woman 1984, Warner is not taking chances. It has opted for a dual-platform release for the film — it will open in cinemas on 25th December when it will also be available pay-per-view.
If Hollywood can adapt to the changing scenario, why are the Indian multiplex chains like PVR, Inox, Cinepolis and Carnival taking so long to do the same? It is common knowledge that Bollywood apes Hollywood, and in this case, the writing is on the wall. Till there’s a semblance of normalcy, Bollywood producers, especially of the big-ticket films, are not going to agree to an eight-week window of exclusivity for cinemas. They will fight for the window to be shortened because in case people don’t come to the cinemas for fear of contracting the coronavirus, they (producers) can at least make up for the reduced box-office income by allowing the OTT platform/s to release the film earlier than normal and, therefore, get a higher price for the streaming rights. Thus far, the national multiplex chains (represented by the Multiplex Association of India) have preferred to negotiate with individual producers, which is taking more time as they have to repeat the same spiel over and over again. The sooner the multiplexes realise that the concerns of all the producers are the same, the better it would be for them as negotiations will be faster. What the big multiplexes are currently doing is keeping the production sector divided but they are not likely to succeed for long as producers are all sailing in the same boat.
To summarise, the MAI would do well to realise that it is only harming its own interests by not agreeing to reduce the exclusivity window for cinemas, and by not striking a common deal with all producers. Even in case it wants to negotiate separately with individual producers, what the national multiplex chains need to do is lock the deals fast. The psychological impact such finalised deals will have on the production sector is only going to help the exhibition sector. By delaying the film-release deals, the MAI is putting its members to far greater risk because till such deals or such a universal deal is not finalised, producers are not in a mood to start production activities full throttle. The budgeting of new films depends on what producers can expect to recover from cinemas, and from sale of digital and satellite rights. Till there isn’t complete clarity on this, new film launches will be few and far between. And that will ultimately adversely affect exhibition business after a year because there will then be a shortage fo films to run in multiplexes. Also, the ticking bomb of the exhibition sector being split into two — national multiplex chains on the one hand and the non-national multiplexes and single-screen cinemas on the other — will not augur well for the exhibitors in general. It is common knowledge that the smaller multiplexes and single-screen cinemas are not in synch with the “rigid thinking” of the national multiplex chains simply because while the former do not have the staying and sustaining power, the national chains have far deeper pockets and hence can still survive in the uncertain climate.