Zee Telefilms to restructure distribution business

MUMBAI: Zee Telefilms Ltd is reviewing its entire film distribution business plan, following a hit of around Rs 50 million and a need to change the traditional model.

The film production activity will also slow down as a consequence and a definite scheduling plan will be in place only after finalising a restructured distribution model. The alliance with Rajshri Pictures for the exclusive theatrical distribution of all Hindi pictures has been called off after the eight movies that were channelised through the pipeline did not turn out profitable.

Zee is weighing various options including getting into the film distribution business on its own. "We incurred a loss of around Rs 50 million for the eight movies we distributed. We feel that the distribution model needs to change," says Zee Telefilms chief executive officer of film production and exhibition Nitin Keni.

One of the options could be setting up a distribution network in selected territories on its own. Taking over old distribution networks and modernising them could be another model.

A new plan on film production and distribution will be ready and into play only in the next financial year. Zee Telefilms will stop procuring movies for distribution till then. The company had spent about Rs 100 million to acquire the eight Hindi movies for distribution through the Rajshri network. "We will not push any new product into the pipeline unless we understand the distribution," says Keni.

Zee had decided to partner with Rajshri Pictures for distribution of Hindi movies after box office hit Gadar (its own production) failed to recover about Rs 500 million from the system. Under the commercial agreement in December 2003, Zee was to procure the rights for the theatrical distribution of Hindi movies. Rajshri, which has 20 distribution offices covering more than 13,000 screens across India, would provide its network for exploitation.

"We lost money in each of the movies that we distributed," says Keni. Among the movies that were distributed through this chain were Who Tera Naam Tha, Lakshya, Yuva and Kyon Ho Gaya Na.

Zee, however, has fared better in overseas distribution. The company is using its existing offices in the US, UK and South Africa to go for a direct distribution model. So far, it has distributed just one movie - Mujhse Shaadi Karogi. "We will continue with our overseas distribution," says Keni.

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