If ever one needed an illustration of the phrase ‘winds of change’, the First Day First Show announcement made at the 42nd Annual General Meeting (Post-IPO) of Reliance Industries Limited (RIL) should sit at the very top of the discussion. In one fine swoop, Mukesh Ambani. Chairman & Managing Director, Reliance Industries Limited, woud have sent a collective shiver running down the spines of direct to home (DTH) companies, rival service providers including Airtel and Vodafone as well as the multiplex owners. And there is good reason for all of them to be worried, particularly the cinema hall and multiplex owners.
There are big numbers at stake. According to the FICCI-EY numbers released in March this year, the Indian film segment grew 12.2% in 2018 and the total; Filmed entertainment revenues were clocked Rs 174.5 billion. Domestic film revenues crossed Rs 100 billion with Net Box Office collections for Hindi films registering at Rs 32.5 billion, the highest ever for Hindi theatricals. There are now 9,601 multiplex screen in India.
At the AGM keynote, Ambani announced that the subscribers of the upcoming Jio Fiber home broadband services will be able to enjoy the new movie premieres in the comfort of their homes, on the same day as they release in cinema halls and movie theatres across India. This service will roll out in the middle of next year and will be available to all Jio Fiber users. Now sit back and visualise for a moment, what this may mean to you. And once you come to the conclusion that Reliance Jio Fiber’s First Day First Show offering could completely change the way you approach the typical weekend after a big ticket movie release that you want to watch, multiply that by the millions of other users who may be thinking on the same lines.
“For decades, theatrical release window has been a valuable model for exhibitors and producers alike. In India and globally, producers have respected the release windows and kept a sacrosanct gap between the theatrical release date and the date of release on all other platforms, i.e. DVD, DTH, TV, OTT etc.,” says the company in an official statement shared by Kamal Gianchandani, CEO – PVR Pictures & Chief of Strategy, PVR Ltd.
“We would also like to point out that producers, distributors and multiplex owners in India have mutually agreed to an exclusive theatrical window of 8 weeks, between the theatrical release of a movie, and release on any other platform. This exclusive theatrical window is a model that is followed internationally, in order to ensure the robust financial viability of all the segments of the sector, and has been replicated in India,” says INOX Leisure, in an official statement shared with News18.
Both raise very valid points. The fact is that cinema halls have agreements in place with producers and distributors of movies, which allows for an exclusivity window for cinema halls. How that is going to change to allow Reliance to premiere new movies on the same day as release on their platform, remains to be seen. "The producer of the film is the owner of the creative content and is therefore entitled to choose the platform for distribution and consumption of his content. However, in view of this mutually agreed exclusive theatrical window, he would have to choose between theatrical exhibition or release on any other platform, since release on both simultaneously would breach the mutually agreed exclusive theatrical window," says INOX Leisure.
Then there is the small matter of the costs which customers have to pay. Reliance has said that Jio Fiber broadband plans will be priced upwards of Rs 700 per month with speeds between 100Mbps and 1Gbps. The First Day First Show service is expected to be bundled with certain broadband plans, though those specifics are not available in the public domain as yet. You don’t pay extra for the movie viewing experience.
All right, let us take an example. At the time of writing this, we decided to calculate the costs of going to a cinema hall to watch the movie Mission Mangal purely to illustrate the hit on the cinema-goers wallet. We decided to book 2 tickets at PVR Select City Walk Delhi, for the Hindi – 2D, Atmos option. Chose the 2:30pm show, because that would tie in well with lunch. The Classic Normal seats are Rs 420 each, the Classic Superior seats are Rs 510 each and if you choose the recliners, you pay Rs 1,350 per ticket. Fair enough. We chose Classic Normal to work the calculations with the lowest possible costs, and this takes the bill amount up to Rs 950.52.
How, you may ask? There is something called as Convenience Charge which totals up to Rs 94. Yes, you pay this extra charge for the ‘convenience’ of being able to book tickets from your phone or your PC, and not by queueing up at the box office counter as perhaps in the era gone by. The ticket prices for this attempted booking at PVR Cinemas are Rs 840 in total and there is a GST of Rs 16.62 as well.
In fact, an attempted booking for the same movie around the same time at an INOX Leisure theatre also cost Rs 958.92 for just the tickets plus the convenience charge.
Now that you have booked the tickets and landed up to watch Mission Mangal, it is inevitable that you would probably want to grab something to munch too. A helping of Regular Popcorn will set you back by a cool Rs 260 each plus taxes, a regular Pepsi will cost Rs 230 each plus taxes and heavens forbid you may decide there is an undeniable craving for Nachos Doritos too—these are priced at Rs 270 each plus taxes. So we went ahead and added two Regular Pepsi and two Regular Popcorn, and the final bill amount works out to a cool Rs 1930.92 now.
As it turns out, INOX Leisure also has the same rates for the food and beverage options on the menu for its in-hall sales counter.
This is just one example of a regular multiplex experience (on the wallet at least) for a movie outing, in most Indian cities. Which is why it seems a bit rich when PVR in its official statement in response to Jio’s First Day First Show says, “cinemas continue to bring people together to share a communal experience, this unreplaceable element which is at the core of theatrical experience,” before adding, “theatrical and at-home are two completely different experiences and each has their own places. Both experiences have co-existed and prospered for decades and will continue to so in the future.” And this is before we even talk about the endless stream of commercials before the movie starts.
Yes, these experiences have co-existed all this while perhaps also because there was no real initiative such as the First Day First Show, which Reliance is embarking on. Now thousands of movie buffs, who would have otherwise had to shell out a lot of money to watch a movie at the nearest cinema hall before its eventual release on TV channels and DVD, now have the option of catching the same in the comfort of their homes. Till now there was none. The popcorn and Pepsi will cost a lot less too.
At this point, the Bombay High Court observation in April last year may suddenly become the gospel truth for cinema halls. "The price of food and water bottles sold inside movie theatres are, indeed, exorbitant. We have ourselves experienced it. You (multiplexes) should sell it at the regular price,” Justice S M Kemkar had said while hearing the public interest litigation (PIL) challenging the prohibition on users carrying food inside movie theatres and multiplexes across the state of Maharashtra. Nothing had changed yet, but now it may.
“The theatrical exhibition industry, led primarily by the multiplex industry, has made significant investments in world class cinema theatres, by bringing in state of the art technology, luxurious ambience, bespoke comfort and unmatched service, ultimately curating an experience which can never be matched by watching movies on television screens at home,” says INOX Leisure. There is absolutely no denying the fact that a multiplex spends a lot of money to integrate a better audio visual experience for its users. But there needs to be some control over how much such an experience should cost.
Reliance Jio is going for volumes too. The company intends to connect as many as 20 million homes across India when the rollout starts next month. The first of its kind First Day First Show offering arrives in the middle of next year. The Jio Fiber home broadband services aren’t just an internet line coming into your home, in isolation. The Jio Fiber will bundle a home phone, subscriptions to multiple video streaming OTT platforms, hook you up with a cable TV service and also special tariffs and priority service for Jio mobile subscriptions. If you pay for a Jio Fiber annual subscription plan, there is a free HD/4K TV and a 4K set top box (STB) being bundled as well. And with prices starting Rs 700 per month, a lot of existing and new broadband users in India would find value in this complete ecosystem—the likelihood of the price of your existing 100Mbps broadband, cable and DTH subscriptions and streaming app subscriptions being higher than this, is a very likely scenario. We don’t know yet whether all new movies will be premiered as a part of First Day First Show, and how Reliance Jio will stream it on their platform. But the potential is enough to scare off multiple stakeholders. We may see some big changes in the coming months. Or we may not.
Disclaimer: News18.com is part of Network18 Media & Investment Limited which is owned by Reliance Industries Limited that also owns Reliance Jio.