No new releases: Bollywood boycott over multiplex fee dispute enters 2nd month

Bollywood boycott dulls Indian screens

MUMBAI, India — The dispute between Bollywood producers and Indian multiplexes over revenue sharing hardened this week, with no end in sight to the monthlong boycott of new releases.

Indian movie fans — who spend an estimated 63 billion rupees ($1.27 billion) each year at theaters — were again presented with a tepid array of aging Hollywood blockbusters and regional films Friday, the night usually reserved for new releases.

Richa Bose, a 23-year-old software engineer, stood out front of Inox cinema in south Mumbai, looking unhappily at his ticket for “Fast and Furious 4.”

“We don’t want to see it, but we don’t have a choice,” he said.

The dispute comes at a challenging time for India’s $1.8 billion film industry, which is struggling to deal with a dearth of blockbusters, tight funding, falling ticket sales and rising competition from television — especially during cricket season in April and May.

The standoff, which began April 4, has so far delayed the release of at least six major Bollywood films and two Hollywood movies, “Angels & Demons” and “X-Men Origins,” producers say.

Analysts estimate the boycott has already cost multiplexes 300 million rupees ($6 million).

Talks between producers, who want a larger share of box office revenues, and multiplex owners collapsed Tuesday, prompting Mumbai’s largest movie studios to vow to release new movies at single screen and non-chain theaters, beginning at the end of this month.

Multiplexes quickly shot back. Six chains — Fame India Ltd., Adlabs Films Ltd., Inox Leisure Ltd., PVR Ltd, Cinemax India Ltd., and Fun Multiplex Pvt. Ltd. — promised to gather a 400 million rupee ($8 million) war chest, and on Friday began hunting for films they could buy and distribute on their own.

Movie producers complain that India’s national multiplex chains — which control 5.2 percent of the nation’s 12,500 movie screens but account for 60 to 65 percent of ticket revenues because they charge more for tickets — have acted as a “cartel,” negotiating revenue sharing agreements on a per-film basis which puts individual producers at a disadvantage.

“We were not getting our fair share,” UTV Motion Pictures chief executive Siddharth Roy Kapur said in an interview Friday.

Producers asked for more timely and transparent payments and demanded a standard 50:50 after-tax revenue sharing agreement. During Tuesday’s talks, they retreated, saying they’d accept 45 percent in the second week, and 40 percent thereafter, Kapur said.

Shravan Shroff, managing director of Fame India, said multiplexes, with after-tax profit margins of 3 to 5 percent, can’t afford those ratios.

Multiplexes had wanted performance-based fees, but agreed to a standard revenue sharing agreement of 50:50 in the first week. In the second week after the release, the multiplexes wanted 60 percent of revenue, 70 percent in the third and 75 percent thereafter, said Shroff.

There has been no date set to resume negotiations.

In the meantime, movie theaters are emptying out. In April, average occupancy at multiplexes was less than 15 percent, down from 25 percent last April, executives and analysts say.

The Indian Premier League cricket season, which runs from April to May, has kept many people glued to their televisions at home. Normally, occupancy rates are about 35 percent.

(This version CORRECTS day in grafs 8 and 12 to Tuesday, sted Monday.)