Bollywood studios eye profits at last as India goes smartphone mad

Wed Apr 6, 2016 3:15pm EDT
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By Himank Sharma

MUMBAI (Reuters) - India's all-singing, all-dancing movie hits capture the attention of hundreds of millions of fans - but they generate precious little in box office profits for the world's largest cinema industry.

Now, with smartphone sales booming and India preparing for nationwide 4G Internet access, India's film and TV industry hopes the ease of tapping your phone for the latest release will generate profits at last, overcoming the problems of woefully few cinemas and rampant piracy.

India has about 10,000 cinema screens across a country of 1.3 billion - 8 for every million people, compared with 120 in the United States and 30 in China, according to digital film distribution network UFO Moviez.

That low density means that for most Indians, pirated content is the only way to see movies, costing the industry some 30 percent of potential annual gross collections.

"Even if we can manage to get a small fraction of the people to pay on their phones, you are looking at a market that can potentially become bigger than the box office," said Girish Johar, head of revenue at Essel Vision Production, part of Zee Entertainment Enterprises, one of India's largest media groups.

The profit boost for studios will in large part be driven by the rush for local-language content from platforms like Netflix Inc, which launched in India this year and is aggressively adding to its Hindi-language catalog.

Homegrown rivals, though keen to forge partnerships with online streaming companies, are introducing their own platforms, a new revenue stream for production firms that earn little from either cinemas or DVD sales.

And the numbers add up.   Continued...

Commuters watch videos on their mobile phones as they travel in a suburban train in Mumbai, India, April 2, 2016. REUTERS/Shailesh Andrade