Digitization of Indian Cinema

July 22, 2009

Bollywood is back in multiplexes & so is the news about Indian Cinema Industry. While chatting with a friend on Friday who’s living in a small town up north, came to know that she is taking her kids to the first day first show of Harry Potter’s latest movie “Harry Potter And The Half Blood Prince” in a nearby theater & my immediate reaction was – has it been released there also today itself?

Well, I’m aware that now movies get released on same day in all tier 2 towns as well but this one is a real small town where earlier not even Bollywood films used to get released the same day. But looks like digitization has changed the face of cinema in such smaller towns beyond recognition now.

Bollywood goes Digital (Jai Ho!)

Like many other industries, even Cinema has undergone a sea change over last couple of years with the advent of digital technologies in India. Digitization of Indian cinema has affected movies on all fronts – be it pre production, production or post production, but out of all these, one aspect which has got completely revolutionized with digitization is the distribution and reach of Indian Cinema.

While 2005-2006 saw some initials sign of digital distribution in India, its only 2008-2009 when it has picked up momentum noticeably. The year 2008 saw some prominent films taking the digital distribution route in a big way; for e.g. “Singh is Kingg” which got released in 415* digital theaters or “Ghajini” which released the maximum number of prints in India (1200* digital & analog versions) and made inroads to even some such smaller towns where films never used to get released on the same day as the rest of the world.
Digital solutions in filmed entertainment are now helping the producers to reach relevant audience & increase the number of prints without any additional cost.

Some of the key advantages of digital distribution are:

Cost effective: Digital distribution is quite economic as against physical one. Cost per copy of digital print is INR 3500 – 5000 whereas cost per physical print comes to approx INR 65000 – 70000*.
Larger reach: Digitization streamlines the distribution of cinema through satellite technology to even remote towns, thus increasing the reach to a larger audience on the same day of release. What used to be a gap of 4-5 weeks (sometimes even months) between a big & small city release has now come down to almost zero days.
Reduces scope of piracy: Since the movies get released on same day in all places, so it reduces the scope of piracy & losses due to unauthorized distribution.
Faster recovery of investment: Wider release of films also leads to faster recovery of investments in its initial days itself. New releases always have higher occupancy initially & such higher occupancy in more areas helps in BO collection in a quicker way. Due to digitization & timely release, now revenues from smaller towns are not considered as “non-existent” for producers.
Boon for small budget films: Due to high cost of physical prints, earlier producers of small budget films can only afford to release very limited number of prints to theaters with maximum prints being 50-60 only. Thanks to digitization even such producers can now take their movies to mass in a cost effective way.

Beyond these, digital distribution is also leading to some other interesting benefits to filmmakers; now they are looking towards re-releasing some old classics in theaters as an additional money-making avenue. With all the cost consciousness and focus on reducing piracy, digitization is definitely the way to go for Indian Cinema. Currently out of 12,900 theaters in India, approximately 11% are digital ones. By 2013*, it is estimated that there might be around 7000 digital screens in India. This is expected to result in higher reach of films & higher realization per film, thus increasing the financial viability of movies.

*Figures & statistics taken from FICCI-KPMG Media & Entertainment Industry Report – 2009.

Tags: Digital Distribution of Bollywood Movies, Digitization of Indian Cinema, Technology & Bollywood

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anuj mukherjee on July 22, 2009 at 12:01 pm

Good observations and insights Kanupriya…a win-win situation for consumers and producers/distributors. However the chanllenge is to wake up en-masse from the slumber and aggresively drive the same. Look forward to many such dope from you.

Nidhi on July 22, 2009 at 12:02 pm

Nice article. The author seems to have done a thorough research to come up with accurate numbers. Very informative.

Arun Thomas on July 22, 2009 at 12:06 pm

Recently Film Distributors in Kerala had boycotted digital cinema because of unethical practices by some satellite movie distributors.

Copying from some news sites.

“Three years back when the companies provided release via satellite digital technology promising a free of cost service. But later they demanded Rs. 25 for one screening as royalty. Then they raised the amount to Rs. 20,000 for per week. The distributors had served a notice to the companies two months back when they demanded a hike. But they rejected the request. Further they demanded a hike in royalty, the distributors decided to boycott the companies. The producers association have also joined to boycott the companies. “

Facebook User on July 22, 2009 at 6:43 pm

yes but it does limit capabilities to manage piracy..no?

tanvi on July 23, 2009 at 12:12 pm

congrats for coming up with such a well written and innovative article packed with data at the same time!

Yeshu on July 23, 2009 at 12:22 pm

Informative one, digitization has indeed changed the face of entertainment industry today, not only in cinema but in music as well as television industry too. Though I’m not sure of how much it will be able to prevent piracy, at least in music industry it has not been able to do so till now.