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V The Indian film industry produces around 1,050 films

and sells around 4 billion movie tickets, each year.

V In 2008, the size of the Indian film industry was


estimated to be USD 2.58 billion.

V While the domestic box office collections


contributed as much as 60%, the home
entertainment contributed a mere 6% to the total
revenues, which is significantly lower as compared
to developed countries.
Source: E&Y, Apr-2009
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ëurrent size of Indian film industry estimated around Rs 109.2 billion in 2008
which is expected to grow at a ëAGR of 12.2% to reach Rs168.6 billion by 2013.

Source: (E&Y, Apr-09)


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V The producer completes the movie.
V Process of Buying Rights:
The producer decides the number of movie of reels that would be
allocated to the distributor.
Rights contain:
£ Purchase of reels
£ Purchase of Publicity material
V Based on previous success record of the producer, the movie post
completion is demanded by distributors.
V The producer estimates the demand for his movie and accordingly
sends the movie to be printed in Adlabs, Mumbai for creation of
movie reels.
V Movie reels are forwarded to distributor at the cost decided by
producer.
Step by Step Analysis

V Movie transfer from distributor to exhibitor begins on


Tuesday/Wednesday evening for a show on Friday in cinemas
halls.

V The reels are transferred by road, air or rail on the basis of


the distance of transfer. For distribution of films to eastern
zone, the reels are sent on Tuesday evening.

V The distributors are not exhibited the film before the sale of
the film, hence his buying is totally based on producerǯs
reputation in the market. E.g. Due to this process, Failure Ȃ
Chandni Chowk to China & Success Ȃ Bheja Fry
Step by Step Analysis
V The distributors that approach the producer are from various
zones of the country classified in to zonal areas, namely
North, east, south & west.

V Post the collection of movie reels by distributor, the


distributor decides the exhibitor through whom movie will
be shown.

V The formats of movie presenting like printing of posters,


advertising, promotion, show timings, no. of shows are
provided by producer. However used by exhibitor &
distributor.
  6 Sheet (big banner), 2 sheet (small banner)
Step by Step Analysis
V Shuttling: This is the method used by distributors in which
distributors rotate the given film roles within cinema halls.
The basic idea behind this concept is that printing of one role
for one cinema is not cost efficient for the distributor.

V The cinema hall owners have a schedule given to them by


distributors stating the upcoming movies in next 6 months.
Hence, an exhibitor can decide and convey the time period
for which he would like to present the movie in his hall.
Information Flow
Producer Distributor Exhibitor

Intermediary
!istribution services provided exclusively to Yash Raj Films & Films coming to
India during International film festival(s)
1. MUMBAI (Bombay circuit Ȃ comprising part of Maharashtra, Gujarat &
Goa) Yash Raj Film Distributors, headed by Mr. Rajesh Malhotra.
2. DELHI (Delhi-U.P. circuit)
Yash Raj P. P. Associates Private Limited
3. JALANDHAR (East Punjab circuit)
Yash Raj Puri & Co. Pvt. Ltd.
4. JAIPUR (Rajasthan circuit)
Yash Raj Jai Pictures Private Limited
5. AMRAVATI (C.P. circuit)
Yash Raj Films Private Limited through Khajanchi Film Exchange
6. INDORE (C.I. circuit)
Yash Raj Films Private Limited
å. BANGALORE (Mysore circuit)
Yash Raj Pal Films Distributors (Bangalore) Pvt. Ltd.
8. SECUNDERABAD (Nizam circuit)
Yash Raj Vandana Films Distributors Private Limited
9. CALCUTTA (Bengal circuit)
Yash Raj Kushagra Arts Private Limited
10. CHENNAI (Tamil Nadu circuit)
Yash Raj Films Private Limited
11. ANDHRA PRADESH (Andhra circuit)
Yash Raj Films Private Limited
12. COCHIN (Kerala circuit)
Yash Raj Films Private Limited
V Step 1
Research potential distributors. Identify the movie's genre
and the audience it appeals to most. Find distributors that
have released similar titles.
V Step 2
Talk with distributors to determine if there is interest on both
sides. Once you have selected the company to distribute the
film, ask them to draft a generic distribution agreement for
you to amend.
V Step 3
Consider the territory that the agreement covers. Use one
distributor for the zones
V Step 4
Discuss whether the distribution agreement covers theatrical
screenings only or include DVD distribution, as well as the
length of the terms. It is to the filmmakers advantage to have a
short term--less than 5 years--with automatic extensions.
V Step 5
Include the amount of publicity and media the distribution
company is obligated to perform on behalf of the film. This
figure includes number of print materials and advertisements
to be created to publicize the film, interviews, articles and
reviews.
V Step 6
Agree upon the distribution fees. Filmmakers can either agree
to a 50/50 split of the profits after the distributor recoups the
costs of distributing and marketing the film.
Source: Ravi Enterprise, Mumbai
V The document begins with following text:
Agreement made and entered into as of AGREEMENT DATE by and
between DISTRIBUTION COMPANY, ("Distributor") at ADDRESS OF
DISTRIBUTION COMPANY, and PRODUCTION COMPANY, ("Producer").
In consideration of their respective covenants, warranties and
representations, together with other good and valuable consideration,
Distributor and Producer hereby agree on following:
A PICTURE - PRODUCTION FORMAT (I.E. 35MM/16MM/DIGITAL)
A RIGHTS GRANTED
A Advertising
A Editing
A Title
A Territories
A Dispute clause
A Warranties
Producer to Distributors:

Producer Distributors

Conventionally, the distributor has been transferring money


on the transfer of the reel. This is like a sale Ȃ purchase. The
distributor purchases the movie at the price decided by the
producer. The revenue generation for producer ends post
sale to distributor.
Înly Weekly collection:
V The exhibitor in this model only presents a percentage of
revenue collections to the distributor. In this case, scaling
model of pricing is used.

V E.g. Mangala Talkies, Deccan, Pune uses a model in which


the 50% of the first week collection goes to the distributor. In
the next week, scaling takes place and 40% of the box office
collection goes to distributor followed by 35% of box office
collection.
The nature of hall, multiplex or single screen also decides the
revenue model.
VTHANKYOU

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