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DELHI : Movie producers and distributors are locked in a standoff with theatre owners over charges on digital movie releases, holding up the release of new movies even after theatres have reopened.

Producers and distributors want theatres to reduce the virtual print fees (VPF) levied for screening digital movies, but theatres that saw nil revenues for months have rejected the demand, prompting the former to suspend new releases.

“The big miracle that we thought would take place 10 years ago with digital (technology) where we would be able to make and release small films has actually dried out because of the massive VPF charges that are put on them," Siddharth Roy Kapur, president of the Producers Guild of India, said on 25 June, at a panel discussion on movie portal Film Companion. He was referring to the benefits of digital technology such as reduced piracy and the ability to reach multiple locations simultaneously.

Until 2010, when physical film prints were in use, producers and distributors bore the cost of developing prints, while exhibitors bore the projector cost. With the emergence of digital technologies, digital service providers (DSPs)—such as UFO Moviez—have entered the picture and install costly digital film projectors at theatres at their own cost and provide technical assistance.

Theatres collect a VPF of 12,000-15,000 per show per screen from producers and distributors and pass it on to DSPs. Producers now want this to be reduced to a nominal fee, but theatres, driven to losses by the extended closure, are dead set against it.

The Association of Active Tamil Film Producers tweeted on 21 October that no new film release is scheduled by its members till the issue is sorted out. Producers in the Hindi film industry and executives of Hollywood studios looking to bring foreign offerings are also following suit, agreeing that commercial terms will have to be renegotiated with cinemas post the pandemic. Producer-director Vipul Shah told Mint in an earlier interview that a post-covid world will be different and filmmakers will have to re-think plans for the release of their films. As a result, several films like Christopher Nolan’s Tenet will not be in theatres in time for Diwali.

“There has been a lot of speculation on the release of Tenet. We are committed to a theatrical release and are in conversation with our exhibition partners and hope to arrive at mutually agreeable terms soon," Denzil Dias, vice-president and managing director at Warner Bros Pictures (India) Pvt, Ltd, producers of Tenet, had tweeted.

Meanwhile, finding it hard to pay VPF after the blow from covid, producers of small-budget films are releasing films on streaming sites, depriving theatre audiences of fresh content.

“We agree the charges are high for small films, but our theatre occupancies and revenues will also be extremely low for some time," P.V. Sunil, managing director at Carnival Cinemas, said. “It is time to keep our differences aside and see how quickly we can recover."

Theatre owners argue their business has already been wiped out. Moreover, at least 7,000 of India’s 9,000-plus cinemas cannot afford to buy their own digital projectors and technology costing 55 lakh- 2 crore.

“This is derailing the process of recovery and is equally bad for exhibitors and producers who are hurting chances of their own films. The longer it lasts, the more we mess with the prospects of resurrection," independent exhibitor and distributor Akshaye Rathi said.

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