Television's filmy woes

TELEVISION: Viewers and producers may be happy with the proliferation of Hindi film content on TV, but channel bosses are chaffing at the soaring costs of satellite rights.

The impending launch of Hindi general entertainment and film channels from broadcast networks such as INX, BAG Films, UTV, NDTV and Network 18, among others, is raising the cost of satellite television rights of Hindi films.

Television networks are forking out 50 to 100 per cent more to buy Hindi films for their channels.

"The mid-level films which could earlier be acquired for Rs 50 lakh or so now command between Rs 1 crore to Rs 2 crore," says Kunal Dasgupta, CEO, Sony Entertainment Television.

Blockbuster films' prices have also gone up from between Rs 5 crore and Rs 7 crore to between Rs 10 crore and Rs 12 crore, depending on the star cast and success of the film, he adds.

Rates are shooting up as new channels are starting to build their own film libraries. The launch of Sahara's Hindi film channel Filmy has added to the competition, says a Star India executive, adding that even Zoom, the Times Group's lifestyle channel, has started airing Hindi films.

According to Sandeep Bhargava, head of Studio 18, the film production arm of TV 18, even a general entertainment channel shows at least two films a week.

"This means that it would need at least 100 films in its library. The cost of new titles and older libraries will grow as the demand for content will surge," he points out.

High-priced satellite TV rights of films will benefit film producers, but some of them like Pritish Nandy say that the duration of the rights given to a channel should be reduced from the current five to seven years.

Producers sound pleased but broadcasting networks are worried about their return on investment. On film channels, a regular film fetches an ad rate of between Rs 3,000 to Rs 4,000 per 10 seconds.

"However, a blockbuster film shown on a general entertainment channel such as Star Plus or Sony could fetch Rs 1.2 lakh to Rs 1.5 lakh for 10 seconds. But the fact is that the price channels pay for such films is exorbitant," observes a media industry expert.

The satellite TV rights of films like Don and Krrish, for instance, were sold for between Rs 12 crore and Rs 14 crore. Back of the envelope calculations show that even if 60 minutes of advertising in the film is sold for Rs 1.25 lakh per 10 seconds, you recover only about Rs 4.30 crore.

Add another Rs 80 lakh worth of sponsorship deals and a channel could make about Rs 5 crore. "That's not even half the cost of what they have paid for the film," says the expert.

Now the remaining Rs 6 crore has to be recovered from repeat telecast over a period of time. On an average, the rights are acquired for a period of five years.

However, experts say that while another Rs 1 crore can be earned from its telecast on the network's regular film channel, its ability to attract advertisers diminishes later.

"The window of recovery is short. Once the film is available to be legally shown on cable TV, its saleability on the satellite channel reduces," points out the expert.

However, a senior executive at media agency Starcom says that broadcasters make enough money from associate sponsors of the film on general entertainment channels.

"They are complaining as they want to build a case to increase ad rates," he says.

Adds Mohan Gopinath, head of Zee Cinema: "The cost may be going up but it is for the channel to take a call on whether it wants to pay so much money. The success of a channel does not depend on how much it spends on programming but on the right programming strategy."