The two-month-long standoff between producers and multiplex owners over revenue sharing finally ended today following weeks of close door deliberations between the two parties which continued till the wee hours of this morning.
Producers have decided to commence release of new films from June 12.
Filmmaker Mukesh Bhat who is the convenor of the United Producers and Distributors Forum (UPDF) told PTI that the amicable settlement has been reached and the multiplex owners have agreed to the the producers' demands on revenue sharing, distribution strategy and eradicating accounting discrepancies.
He said a detailed announcement of the agreement to be reached between the two parties will be made on Monday.
Big Cinemas, the multiplex chain promoted by the Anil Dhirubhai Ambani Group, was the first to give in to the terms and conditions of the UPDF.
However, they signed the agreement last midnight even though they had verbally agreed to do so on May 29.
Sources in the UPDF said throughout the week, Big Cinemas was trying to convince other multiplex players to come on board and resolve the stand off.
When Big Cinemas officially announced their agreement with the UPDF, other multiplex chains dismissed it, saying that the agreement was in favour of producers and distributors.
Bhat said the discussions continued from midnight till the wee hours today and the unrelenting multiplex operators finally gave in to the terms of producers.
According to industry sources, the multiplexes other than Big Cinemas have verbally agreed to resolve the stand off.
According to the understanding reached, producers and distributors get complete control of the distribution strategy. They get the right to choose and release films as per the content. Producers and distributors get the right to even mutually agree number of shows and show timings.
All accounting discrepancies have been acknowledged and to be eradicated from now onwards, sources said.
Wherever the entertainment tax is not applicable, it would not be charged. "All films will be treated equally (including all Hollywood films). Producers will get 50 per cent of the revenue from ticket sales in week one, 42.5 per cent in week two, 37.5 per cent in week three and 30 per cent from fourth week onwards till the life of the film.
In addition to this, there will be a bonus on all those films which do exceptionally well at the box office. In case a movie collects more than 17.5 crore at the top six multiplex chains (excluding single screens and independent multiplexes), then the terms will be 52.5 per cent in the first week, 45 in the second, 37.5 in the third and 30 from the fourth week onwards till the life of the film.
Devang Sampat, senior vice-president, Cinemax multiplex, told PTI that the both the producers and multiplexes have arrived at an agreement by mutual consensus.
"It is a win-win situation for both of us.There were many issues and we have arrived at a single tier agreement," he said declining to go into the details.
Earlier, the revenue sharing would be based on the kind of film that is released. Producers used to get 44 to 48 per cent share in ticket sales of the first week, 40 to 37 per cent in the second week.
