After almost two months into demonetisation, apart from ecommerce, retail, auto, real estate sectors and a host of other sectors, the Indian film industry aka Bollywood is wrestling to come to terms with demonetisation.
When it comes to Bollywood, which releases over 300 plus films annually, a significant part of the revenue is from the single screen theatres. It is estimated that India has over 13,000 screens of which 10,000 are single screens and most of them are in tier-i and tier ii cities and the chief mode of transaction is cash based.
Ever since the demonetisation move was announced, entertainment has become a casualty as people flock outside ATM’s for limited withdrawal. Though the urban multiplexes have a tradition of digital transactions, it is the cinema goer in the tier-I and tier-II cities who has to rejig his priorities when it comes to spending cash on entertainment.
Amid this scenario, Bollywood is gradually coming to terms with the demonetisation move. Says Munnish Puri Founder, Indian Film Advisors & Indian Financial Advisors, “Demonetisation may have resulted in impacting Indian Box Office proceeds in the week of the announcement and the week thereafter. This is only natural. However, the demonetisation move is a far-sighted move and the Indian Film Industry welcomed it. Furthermore, good content always attracts viewers. Dangal is a great example. The film opened across India at INR 30 crore and it did over INR 34 crore on day two. This in itself illustrates that the viewers will go to any extent to watch good content and its collections have not been impacted by demonetisation. And Dangal is actually a rare gem. Even the collections from overseas are stupendous.”
Bollywood Trade Analyst and Film Critic Taran Adarsh states that though demonetisation was a big worry for filmmakers in the initial few weeks, but the effect is getting subsidised gradually. According to him, “Demonetisation is bound to show its effect on films. However, the situation now is far better that what it was in the first few weeks. I’m sure as the time goes by, filmmakers will be able to tide over the situation.”
When asked about the impact of demonetisation on marketing spends in Bollywood, Adarsh said, “There has been no visible impact as the marketing budgets allotted were fixed before the demonetisation move was announced. I believe the marketing spends will not be impacted in the coming time too.”
While Bollywood has a reputation for absorbing black money, Kamlesh Pandey, Bollywood veteran and writer of the much acclaimed movie Rang De Basanti said, “I would say black money was used to fund many films earlier, however, the things have changed now. The industry has become very transparent largely, again actors can be exceptions. Having said this, demonetisation has definitely impacted a number of producers who have incurred losses. Moreover, there is a culture of cash payments for junior artists and associated staff and they have been facing the demonetisation blues as producers are not able to arrange enough cash to pay them on a daily basis. But, thankfully, the industry has been able to handle itself well.”
Terming the demonetisation drive as a great move that will bring more transparency in Bollywood despite the challenges that it poses to filmmakers, actor Rahul Dev added, “While demonetisation has been a tough decision, it is the way forward as it will bring in more transparency in the film industry. There might be immediate challenges that it poses for the film fraternity but I am sure they are just temporary.”