Press Release

Star India's movie acquisition strategy

27 February 2014

It's time for Star Gold, the Hindimovie channel from Star India, to reap the rewards of the deals it signed with Bollywood actors Salman Khan and Ajay Devgn last year.The two actors, who have have nearly 11 movies, worth Rs 100 crore between them and Star India snapped up the chance to get exclusive media rights to their films released from 2013 and 2017.

Last year saw Devgn deliver two films – Prakash Jha's political drama Satyagraha and Sajid Khan's retro remake Himmatwala. While the former managed to get some traction at the box office, the latter bombed miserably. Khan on the other hand was missing from the cinema halls last year as both his films Jai Ho! and Kick got delayed. This year however, both of Khan'spending films will hit the theatres and Devgn will be seen in this action hero avatar in Action Jackson and Singham 2.

Through its deals with the actors, Star India will have the rights to all four movies. The channel has spent nearly Rs 900 crore on the two deals according to industry estimates.

On the matter of pricing of films for satellite, Hemal Jhaveri, executive vice-president, Star Gold and Movies OK, says, "The cost of acquiring films these days has become exorbitant. And the price changes from Friday to Friday. We are the last users of the rights after theatrical windows and DVD's and digital consumption, and still end up paying as much as 60% of the cost for some movies."

Jhaveri reveals that he would rather make content bets than box office performance bets while acquiring movies. This is the reason the network also avoids making box office performance related deals.

Last year, Zee Entertainment Enterprises Ltd. acquired Shah Rukh Khan and Deepika Padukone starrer Chennai Express for Rs 40 crore and agreed to pay the producers Rs 2 crore for every Rs 10 crore collected at the box office after the movie's net domestic collections crossed the Rs 100 crore mark, to a maximum of Rs 8 crore surplus.

Since the movies' satellite rights are usually sold before its theatrical release, the box office performance of the movie is no longer a criteria for assessing it's price. The actors' and directors' record at the box office is one of the main considerations, as is a sense of viewer preference based on the research done by the network's in house team.

"We have noticed that comedies and action thrillers usually do very well on TV. A well made romantic film will do well, but a shoddily made romantic film may not appeal to many. Usually, we have noticed that thrillers and political dramas tend to get mixed responses on TV," says Jhaveri.

He however adds that a network does not usually make money through one or two big films, but through its entire portfolio and many films have a repeat viewing value. Having said that, he reiterates that a strong portfolio does not mean that channels and networks should have to pay enormous amounts for new movie acquisitions. Star India's current library of movies stands at around 1100 films including South Indian dubs.

Apart from movies that will come to Star India through the deal with the Khan and Devgn, the network will also get movies from sister concern Fox Star Studios extensive movie slate this year. The studio has a line up of nine Bollywood releases this year and Star India has acquired the rights for Traffic, Hawaa Hawaai, Humshakals, Bang Bang and Bombay Velvet. It has also acquired movies like Yaariyaan, Gang of Ghosts, Sonali Cable, Creature, O Teri, Bhaag Johnny, Roy and Bobby Jasoos. Star India will have the exclusive rights to these movies for a period of ten years and will air them across the network.

Jhaveri adds, “We have consistently received a phenomenal response for the big ticket premieres on our network. Apart from entertaining the audiences, movie premieres also prove to be an extremely successful platform from the advertisers’ standpoint. Hence, it proves to be a win-win situation for all stakeholders. For 2014, we have targeted a diverse content line up acquiring films across different genres.”

He also reveals that the focus will be showcasing Hindi movies and only a select South Indian dubs. The network will continue premiering its big ticket acquisitions at the prime time as it gives maximum opportunity to monetise the film's first airing. Star Gold's Saturday Night Premier property has been very successful and Jhaveri intends to continue with the strategy.

Source: Business-standard.com

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