)
The Indian film industry has much to look forward to with the Confederation of Indian Industries (CII) and PriceWaterhouseCoopers (PWC) predicting a growth rate of 12 per cent compounded annually to reach Rs 21,700 crore by 2018. The sector grew by 12.5 per cent in 2013 over 2012 to finish the year at Rs 12,600 crore.
Domestic box office revenues had the lion's share at 73.8 per cent (Rs 9,300 crore) followed by ancillary revenues (music, cable and satellite rights fees) at 17.4 per cent (Rs 2,200 rore). While Bollywood movies like Chennai Express, English Vinglish, The Lunchbox and Dhoom 3 made an impact abroad, the contribution of foreign collections to revenue stood at 7.93 per cent (Rs 1,000 crore).
Many of these movies were released abroad in phases and continue to be showcased in select countries. Indian film-makers are becoming increasingly conscious of the content they are exporting as they are now targeting movie-goers beyond the diaspora.
The outlook for revenue growth from overseas box office remains at a modest 6.96 per cent a year to reach Rs 1,400 crore by 2018. Domestic box office revenues, on the other hand, are expected to grow at 11 per cent a year to reach Rs 15,800 crore by 2018. Overseas box office revenues will thus continue to be roughly 10 per cent of domestic box office collections. Domestic box office revenue growth will be driven by the emergence of new screens, especially mutliplexes in tier-II and tier-III cities, and from growth in average ticket prices.
The highest growth for a segment of film revenue, according to the CII-PWC report, will be registered by ancillary revenues at 15.39 per cent a year and is expected to reach Rs 4,500 crore by 2018. The past three years have seen broadcasters shell out huge sums of money for big banner movies. Last year, Shah Rukh Khan and Deepika Padukone starrer Chennai Express was sold to Zee Entertainment Enterprises for Rs 48 crore. Similarly, Multi Screen Media (MSM) forked out a handsome Rs 54 crore to snap up the telecast rights of Dhoom 3.
The trend is expected to continue though a slight rationalisation of cost is expected to take place over the next couple of years. Considering the popularity of movies on television and the repeat telecast value that libraries get broadcasters, satellite rights will continue to attract high numbers. Revenue in the home video segment is predicted to decline. Physical home video is a dying market across the world and India is no exception.The segment has some hope of revival with digitisation of home video, but it will take time.
Compared with other parts of the media and entertainment industry, the film industry's contribution to total revenue will fall from 11.25 per cent in 2013 to 9.55 per cent in 2018. The reason being the faster growth in revenue in television (15 per cent), internet access (21 per cent), internet advertising (28 per cent) and radio (17 per cent).
