GST, Theatres & OTT

It seems like yesterday and Ajith Kumar has already completed 25 years in Tamil Cinema which is a remarkable feat, given that he never had/continues to have a blood relation who produces movies. He has almost come up on his own strength all through and he dissolved all his fan clubs many years back. He continues to maintain a dignified silence in most public issues and is neither active on social media either.


So when Vivegam was announced, his fans rejoiced for it was a defining year in his career. the film opened to a thunderous box office opening although the reviews were mixed, with critics rating the film high for its finesse and sharp editing cum direction. The film did well in the theatres and continue to run a few shows sparingly.


So when I noticed last week that the film was up for viewing on SunNxt app, I was quite surprised. It's abnormal that a top-hit film of one of India's highly rated Actors shows up on an OTT platform on the 50th day of its theatrical release. While Kamal Hassan toyed on this idea about 3 years back ahead of his Vishwaroopam release, a section of theatre owners protested that they would lose audience. But in the case of Vivegam, things have spanned quite the opposite.

The film was produced on a budget of about Rs. 120 Crores and the Producer Sathyajyothi Films seems to have made a Gross Profit of over Rs. 50 Crores while the Trade seems to have lost out at least Rs. 20 crores. There are several reasons to this and has already been much debated. Sun Tv has purchased the Satellite Rights and it was widely expected to telecast the film on the day of Pongal Festival in 2018.

My column here is to focus more on why would Sun Tv prefer to throw open the film on SunNxt, the Over The Table App (OTT) in such a hurry. Or as always, are they setting a trend? The film goes online officially on the 50th day of Vivegam's release which is quite surprising although it has been well received by the online users.

SunNxt launched about 4 months back amidst much fanfare, perhaps the first OTT App to showcase all four regional languages in the South although Star Network's hotter has been around for over 2 years now while Amazon Prime launched about six months back and Netflix has been around for over a year now. Amazon bagged the satellite rights of Rajnikanth starrer Kabali and has climbed up the charts in terms of downloads and subscriptions in the past 2 months, especially among the not-so keen on technology audience.


SunNxt app requires a small subscription fee of Rs. 120 per month or Rs. 450 per annum after the first 15 days of Free subscription. It had gained over a million downloads within 2 weeks of its launch and already hosts over 500 movies across 4 southern languages including recent top hits.

Almost every Ajith Fan would have downloaded the App and would have also subscribed at least for one month to watch the film repeatedly. The films, apart from songs and other movie clips can also be downloaded on the devices for future views offline. So, this is an add-on to the users while the App also provided live and delayed access to all programs that appear in the 30+ channels that the network hosts.

With Inox and PVR Cinemas shut in Tamil Nadu over the local tax hike, the audience bearing the brunt of GST and sudden increased prices, almost twice of what the ticket prices were on Aug. 31 has only deterred the regular movie goers to visit theatres.

Given this scenario, it would be interesting to see which Producer and Hero/Heroine releases his/her film on both platforms in parallel. Much has been discussed about how this would dissuade illegal exhibition of films online and downloads thereafter although the Producers and Exhibitors haven't come to a sensible consensus till date on this issue. 


My summary opinion is that releasing on OTT platforms is perhaps the best things to happen for the Producer, with the audience getting more than one opportunity to watch the film. To draw an example, Vijay starrer Mersal which released on the Deepavali day of 2017 has been running housefull almost all over Tamil Nadu with ticket prices averaging Rs. 300-500 in the black market, although it doesn't benefit the Producer or Exhibitor directly. By releasing the film in parallel, the audience get a chance to watch the film online at a place and time of their convenience and if the content is good, there is a high chance they will flock theatres to watch it on the big screen.

2018 is going to be a big year for Tamil Cinema with Rajnikanth, Kamal Hassan, Surya, Vikram, Vijay and Ajith all of them having at least one release. Let's see who will take this giant leap.

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