Selling TV rights a challenge even for box-office hits as viewership dwindles
Summary
Broadcast industry executives say even theatrical successes are failing to grab eyeballs on TV on premieres or subsequent runs. This has led to a decline in advertising rates, which don't justify the steep price that producers ask for while selling satellite rights for their films.Producers are struggling to sell satellite rights even for box-office hits, as television viewership has dwindled, hurt by the popularity of streaming platforms.
Broadcast industry executives say even theatrical successes are failing to grab eyeballs on TV on premieres or subsequent runs. This has led to a decline in advertising rates, which don't justify the steep price that producers ask for while selling satellite rights for their films. Box-office successes such as Kalki 2898 AD and Stree 2 have yet to strike satellite TV deals.
TV has been relegated to the third medium of content consumption, after the advent of video streaming platforms such as Netflix, Amazon Prime Video, and ZEE5.
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“The fact is that broadcasters are unable to recover prices paid for these acquisitions on premieres of movies or runs post that. The film is anyway screening post OTT so all the interest has dried out and there is a real need to relook at pricing," said a senior executive at a broadcast network, declining to be named. This executive added that the kind of rates that producers ask for, in excess of ₹10-15 crore for a film, are not viable and channels find it challenging to recover even 30-40% of what is often paid for big hits from advertising. “There just isn’t enough money in the market to monetize," the executive added.
Satellite rights were huge revenue source in the past
To be sure, satellite rights were a huge source of revenue for both actors and filmmakers in the past. Till about eight years ago, television networks were signing deals directly with big stars such as Salman Khan, Ajay Devgn and Hrithik Roshan, for upwards of ₹300 crore for a specific number of their forthcoming movies for a certain period. The reason the deal could be struck with actors instead of the producers, who would be expected to hold the copyright of the film, was that the actor agreed to coordinate the supply of movies to the channel by reducing his remuneration for the film with the producer, who would otherwise sell the satellite rights himself. However, with the drop in movie channel ratings on TV, the price of film rights for satellite TV itself has fallen 30-40% in the past few years as broadcasters that also have streaming platforms, such as Star and Zee, like to release new films on OTT first. Foreign platforms like Netflix and Amazon Prime Video, too, shell out big bucks for digital premieres.
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Mukesh Mehta, founder of Malayalam film production and distribution company E4 Entertainment, agreed that the sale of satellite rights is a huge issue since a large portion of the viewership has moved to digital, denting the prospects of any film on TV. “Advertising is determined on the basis of ratings, which is why satellite rights are a challenge at the moment," Mehta said.
As far as Hindi movies go, broadcasters say mid-budget, experimental and slice-of-life films that are made more often in Bollywood are not finding favour with family audiences over the past few years. While some of these titles like Badhaai Ho and Queen struck big at the box office, especially in big cities and multiplexes, they are hardly a saviour for broadcasters when it comes to single TV households across India.
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“The overall sentiment in the market is really low. Advertisers, who have limited budgets themselves, are not paying huge sums for movie premieres and prefer spending on tentpole reality shows or other content instead. It’s a whole cycle," film producer, trade and exhibition expert Girish Johar said.