Mumbai: A breakthrough in talks between multiplexes and production houses to resolve a dispute over revenue sharing terms that has held back all new releases for nearly two months appeared imminent Friday night amid reports that Reliance BIG Cinemas and PVR Ltd have broken away from its peers and agreed a deal in principle.
According to people close to events, the multiplex chains have agreed to producers demands for control over the distribution strategy of films, as well as equal terms for all new releases.
In addition, it is understood that the multiplex chains have accepted revenue sharing terms of 50:50 for the first week, 42.5:57.5 for the second, 37.5:62.5 for the third, with revenue being split 30:70 in the fourth week, with the lion’s share going to the multiplexes.
Tushar Dhingra, chief operating officer for BIG Cinemas, Friday night said he would be unable to comment, adding that the news of a breakthrough came as “a shock” to him. Amitabh Vardhan, chief executive of PVR Cinemas, also declined to comment. Meanwhile, Mukesh Bhatt, the film maker and official spokesperson for the Producers Distributors Forum, said that reports of a deal were premature, and that he would have more factual information in 24 hours.
Pressure to resolve the deadlock, that has seen all films being placed on hold since 4 April, is mounting with analysts putting the collective losses so far to the industry at Rs350 crores. Multiplexes have also approached the competition watchdog CCI to lodge a complaint about movie makers colluding through a cartel to exploit cinema owners, according to ‘PTI’.
Talks between the parties were ongoing Friday night, amid reports of various issues in the contract that still needed to be hammered out. “The contract is about 17 pages long and they are still on page one,” said a source, who declined to be named. “It is a very technical contract and they are struggling with it. But they have reached a verbal agreement.”