Movies

E&Y pegs South Indian film industry at Rs 17.3 billion

CHENNAI: The South Indian cinema industry, which is heavily dependent on domestic theatrical revenues, is pegged at Rs 17.3 billion.


Telugu and Tamil movies contribute around Rs 7.7 billion each (45 per cent each), according to an Ernst & Young-Ficci report.


Malayalam movies make Rs 1.4 billion, or eight per cent share of the South Indian film market, while Kannada films earn Rs 0.5 billion (two per cent).


Almost 65 per cent of the revenues in the South Indian Film industry come from films exceeding budgets of Rs 70 million, the report, which looked at the fiscal ended 31 March 2009, said.


Forty per cent of the films made during FY‘09 didn’t get released. There is a need for better marketing of films which could start right from the inception of the film, especially in the international territories.


The domestic theatrical revenue stream is the most dominant, accounting for nearly three-fourth (around Rs 12.6 billion) of the total kitty. Efforts must be made to increase non-theatrical revenues, the report suggested.


"The four states have 50 per cent of the theatres in India. Almost 25 per cent (1,200 theatres) of the 5,000 theaters in the south are digital, a figure that is far higher than that of the rest of the country," the report said.


Revenue from cable and satellite (C&S) television rights come next in the list, accounting for 17 per cent, or around Rs 3 billion, of the total revenue pie.


Also, there is a large untapped international market which is made up of the large global diaspora of people from South India who have to sometimes resort to viewing pirated copies because of unavailability of original copies. Thus revenues from international theatrical rights are confined to Rs 0.9 billion, or five per cent, of the total revenue pie.


Other revenue streams, which include music rights, domestic home video rights, Internet and mobile rights account for Rs 0.8 billion (5 per cent of the total revenue).


Among the top markets, Tamil Nadu is much dependent on the domestic theatrical releases as Rs 6.2 billion comes from this stream. The C&S TV rights in Tamil Nadu contribute just Rs 0.8 billion as the market has not seen new channel launches and is greatly dominated by Sun TV network.


Telugu movies earn more from the sale of TV telecast rights, perhaps led by the fact that the market has seen more channel launches. About Rs 1.8 billion comes from the sale of TV rights, according to the report.


The industry has immensely talented actors, artistes, technicians and crew members and adopts a disciplined approach, preplanning processes and adheres to schedules right from script to screen which leads to high productivity levels and overall lower costs of film making. "Spiralling production costs, however, need to be brought down," the report said.

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