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Kannada Film Industry Challenges & the Way

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Kannada Film Industry Challenges & the Way T A PAI MANAGEMENT INSTITUTE (TAPMI) MANIPAL KANNADA FILM INDUSTRY CHALLENGES & THE WAY FORWARD A Report prepared for Karnataka Chalanachitra Academy August 2015 By : Dr. Gururaj Kidiyoor Dr. Prashant Yatgiri Prof. Sham Ranjan Shetty ACKNOWLEDGEMENTS First of all We would like to thank Shri. S V Rajendra Singh Babu, a renowned producer/director and Chairman of Karnataka Chalanachitra Academy, Bengaluru for urging us to take up a study on the regional cinema which is rather unusual for a b-school faculty. Once it was decided to go ahead, he gave us all the support required in terms of data and contacts for primary information. We shall remain indebted to him. We thank Mr. Thomas D’Souza, President, Karnataka Film Chamber of Commerce, Mr.B M Harish, Hon. Secretary, Karnataka Film Chamber of Commerce, Mr. K C N Chandru, Film Producer and Distributor and Mr. N M Kumar, Film Producer and Exhibitor for sharing their views on the Kannada movie industry through interviews. We are also grateful to Mr.Shivaram of Karnataka Chalanachitra Academy for his useful insights on subsidies on movies. The project lead came from Mr.Pramod Fernandes and Sagar Mukhopadhyaya of Manipal Technologies, Manipal. They made it sound exciting and enabled contact with S V Rajendra Singh. Our sincere thanks to them as well. We also take this opportunity to thank our Director, Dr. R C Natarajan for his encouragement and support. Our 2nd year students did all the hard work of data collection from the field. We thank you Shruty D, Ravikeerthi Somayaji, Gourish Bellad, Niharika G, Joel Vas, Mahalasa Kini, Vinayaditya, Mahesh Deshpande, Jayanth Bellur, Sunil Prasad, Pramukh Desai, Arun Bhat, Anup Munavalli and Sagar Manjunath. This project would not have been possible without you people. Pramukh Desai merits special thanks for the content he provided on marketing of movies. Special thanks to Prof. Gurudutt Nayak, Assistant Professor, TAPMI for proof reading the document. We would be failing in our duty if we did not thank Mr. P Johnson, Assistant Administrative Officer, TAPMI and Rebecca Mendonca & Shuba Amin, Academic Assistants, for their immense help in data entry and consolidation. We are also grateful to Kiran Kumar, IT Administrator at TAPMI was instrumental in preparing the questionnaire on Google Docs. Dr. Gururaj Kidiyoor Dr. Prashant Yatgiri Prof. Sham Ranjan Shetty i DISCLAIMER This report is based on an independent project conducted by T A Pai Management Institute (TAPMI), Manipal purely for academic purposes. The project was basically an initiative of TAPMI towards contributing to the development of art and culture of Karnataka, of which cinema is an integral part. The conclusions drawn in this report and the recommendations made are based on three sources namely, analysis of survey data collected from a sample of movie goers, in-depth interviews conduced with five persons associated closely with Kannada movie industry, and secondary sources mainly from the internet and print. T A Pai Management Institute (TAPMI) will have the exclusive copyright of this work for all puposes. The study is purely exploratory in nature and the report is not prepared to highlight either proper or improper handling of a business / administrative situation by any individual or an institution. August 29, 2015 ii CONTENTS Acknowledgments i Disclaimer ii Part 1: Overview of Indian Film Industry 1-12 Part 2: Kannada Cinema – A Brief History 13-34 Part 3: Kannada Cinema – Issues and Concerns 35-60 Part 4: Consumer Study 61-85 Part 5: Recommendations 86-112 Annexure 1 Annexure 2 Part 1: Overview of Indian Film Industry PART 1 OVERVIEW INDIAN FILM INDUSTRY One hundred years after its conception, the cinema remains a popular art form and in the developed countries, appears to be the most widely practised cultural activity especially with rapid advances in technology. Like any other trade, the trade of cinema too runs on supply and demand philosophy. Where there is a demand for certain products and services, there will be a host of suppliers willing to supply them for profit. The Indian film industry produces more movies than any other and is seen to be on the threshold of emerging as a big market internationally. In 2001, the film industry was granted “industry” status, which has helped to move it to more professionally approach financing, production and other allied activities. In recent years, the Indian film industry has witnessed marked improvements on all fronts, viz., technology, themes, exhibitions, finances, marketing and business environment. Indian film industry is also getting corporatized. Foreign direct investments (FDI) in all film related activities such as film production, distribution, exhibition, marketing etc. is permitted up to 100% for all companies under the automatic route. Until the end of the 1990s, the Indian film industry received a lot of its finances from shady and unknown sources. An investment into a film was and still is risky. In 1999, only 11% of the films released made good business; and the number is not above 25% even now. Lately, the granting of industry status has made financing much more accessible to producers. The Mumbai film industry (Bollywood) is star-centric and actors like Amitabh Bachchan are worshiped like half-gods by their numerous fans. This is why, although they are the largest stakeholders in film production, 1 Part 1: Overview of Indian Film Industry producers do not dictate terms. Also, the cost structure of Indian movies is hard to estimate, since the majority of the commercial dealings are cash transactions. Stars also often work on several sets during the same period of time, which can cause delays. Disciplinary efforts by the producers come to naught, and because of the absence of insurance models, completion guarantors and gap financing systems, they have to bear all the financial risks1. India is the largest producer of films in the world. In 2009 India produced a total of 2,961 films on celluloid that includes a staggering figure of 1,288 feature films. Indian film industry is multilingual and the largest in the world in terms of ticket sales and number of films produced and 7th largest in terms of revenue. It is also perhaps the oldest film industry in Asia after Japan. The industry is supported mainly by a vast film-going Indian public, and Indian films have been gaining increasing popularity in the rest of the world—notably in countries with large numbers of expatriate Indians. The largest film industry in India is the Hindi film industry mostly concentrated in Mumbai, and is commonly referred to as "Bollywood", an amalgamation of Bombay and Hollywood, which produces around 20% of films in India. The other largest film industries are Telugu cinema, Tamil cinema, Malayalam cinema, Bangla cinema, and Kannada cinema, which are located in Hyderabad, Chennai, Kochi, Kolkatta and Bangalore are commonly referred to as "Tollywood"(Telugu), "Kollywood"(Tamil), "Mollywood"(Malayalam), "Tollywood"(Bangla) and "Sandalwood"(Kannada). The remaining majority portion is spread across northern, western, and southern India (with 1 Competition concerns in the film industry by Dr.K D Singh and Tulika Singh 2 Part 1: Overview of Indian Film Industry Gujarati, Punjabi, Marathi, Oriya, Assamese Cinema). Indian films are made filled with musicals, action, romance, comedy, and an increasing number of special effects. "Bollywood" picks up a larger portion of films produced in India and is viewed all over the Indian Subcontinent, and is increasingly popular in UK, USA, Australia, New Zealand, Southeast Asia, Africa, the Gulf countries and European countries having large Indian population. Enhanced technology paved the way for upgrading from established cinematic norms of delivering product, altering the manner in which content reached the target audience. Visual effects based, super hero science fiction, and epic films like Baahubali. Enthiran, Ra.One, Eega, and Krrish 3 emerged as blockbusters. Eminent directors such as Satyajit Ray, Ritwik Ghatak, Mrinal Sen, Adoor Gopalakrishnan, Buddhadeb Dasgupta, G. Aravindan, Aparna Sen,Shaji N. Karun, and Girish Kasaravalli have made significant contributions to Parallel Cinema and won global acclaim. Other filmmakers such as Shekhar Kapur, Mira Nair and Deepa Mehta have found success overseas. The Indian government extended film delegations to foreign countries such as the United States of America and Japan while the country's Film Producers Guild sent similar missions through Europe. The provision of 100% foreign direct investment has made the Indian film market attractive for foreign enterprises such as 20th Century Fox, Sony Pictures, Walt Disney Pictures and Warner Bros. Indian enterprises such as AVM Productions, Prasad's Group, Sun Pictures, PVP Cinemas, Zee, UTV, Suresh Productions, Eros Films, Ayngaran International, Pyramid Saimira, Aascar Films and Adlabs also participated in producing and distributing films. Tax incentives to multiplexes have aided the multiplex boom in India. By 2003 as many 3 Part 1: Overview of Indian Film Industry as 30 film production companies had been listed in the National Stock Exchange of India, making the commercial presence of the medium felt. The South Indian film industry defines the four film cultures of South India as a single entity. They are the Kannada, the Malayalam, the Tamil and the Telugu industries. Although developed independently for a long period of time, gross exchange of film performers and technicians as well as globalisation helped to shape this new identity. The Indian diaspora consists of millions of Indians overseas for which films are made available both through mediums such as DVDs and by screening of films in their country of residence wherever commercially feasible. These earnings, accounting for some 12% of the revenue generated by a mainstream film, contribute substantially to the overall revenue of Indian cinema, the net worth of which was found to be US$1.3 billion in 2000.
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