The film industry in India is facing a challenging time, with many big-budget films failing to perform at the box office. This trend has raised some questions about the financial practices of film producers and whether it's time for the industry to rethink its approach to profitability.

Overreliance on Star Power

For years, film producers have banked heavily on star power to drive their films to success. The idea was simple: cast a top actor, pay them a hefty fee, and rely on their fame to pull in audiences. This strategy worked for a while, but the landscape has changed. With the rise of streaming platforms and the decline in box-office revenues, this approach is proving risky.

Recent big-budget films such as Kalki 2898 and Bade Miyan Chote Miyan have shown how high production costs don't guarantee success. Kalki 2898, with a budget of ₹620 crore, managed to earn ₹620.8 crore at the box office, just scraping through as a hit. In contrast, Bade Miyan Chote Miyan, with a budget of ₹360 crore, earned only ₹60.6 crore, resulting in a disastrous loss.

Similarly, Auron Mein Kahan Dum Tha, made with ₹100 crore, earned only ₹11.15 crore, making it another disaster. These examples highlight the risk involved in betting on star power and massive budgets without considering audience preferences and market dynamics.

The Shift to Digital and Satellite Sales

Traditionally, box office revenues were the primary source of income for films. However, in recent years, producers have turned to satellite and digital rights sales to recover their investments. The thought process was that even if a film didn’t do well in theatres, selling the rights to television channels and streaming platforms would still bring in money.

But this strategy has its flaws. As the market becomes saturated with content, streaming platforms and broadcasters are becoming more selective about the films they buy. They are no longer willing to pay exorbitant fees for movies that may not perform well. This cautious approach has left many producers struggling to recoup their investments.

The Impact of Financial Indiscipline

One of the major issues plaguing the film industry is financial indiscipline. Producers often set unrealistic budgets, fuelled by the high fees demanded by stars and their entourages. They invest large sums of money without considering whether the film will be able to make that money back from ticket sales or other rights.

This problem has been exacerbated by the COVID-19 pandemic. Many films were planned during the pandemic, with the expectation that OTT platforms would buy their rights and cover the costs. However, as the situation normalised, these platforms started renegotiating deals, and the expected revenues didn’t materialise. As a result, several producers found themselves in financial trouble.

Adapting to Changing Audience Preferences

Another reason for the financial difficulties in the film industry is the failure to adapt to changing audience tastes. Today’s viewers are more discerning, and they have a wider range of content available at their fingertips. Simply putting a big star in a film is no longer enough to guarantee success.

Films that have done well in recent times, like Stree 2 (box office collections over ₹425 crores) and Kalki 2898 AD, have succeeded because they offer something fresh. They are well-crafted, with compelling stories and strong word-of-mouth. This shows that audiences are looking for quality content rather than just star-studded spectacles.

The Way Forward

The film industry needs to rethink its approach to profitability. Producers should focus on creating films that resonate with audiences, rather than relying solely on star power. Budgets should be set realistically, considering the current market conditions and the changing dynamics of revenue streams.

It’s also important for producers to be more disciplined with their finances. Understanding the potential returns from different revenue sources—whether it’s the box office, digital, or satellite rights—will help them make better financial decisions.

The Indian film industry is at a crossroads. To ensure long-term success, producers must adapt to the changing market and focus on profitability through quality content and prudent financial management. By doing so, they can tackle these challenging times and continue to entertain audiences while remaining financially stable.