PROLOGUE

The entertainment industry has been evolved because of the human need for entertainment. This industry has been immensely expanded over the years. All businesses can go down but entertainment industry is ever expanding as a rich or a poor person requires entertainment from some or the other source. The players in this industry are radio, television, live entertainment, films etc. There has been immense growth and improvement in technology, which brought up better forms of entertainment from black and white films to colored, digital films, to an old traditional theatre to a multiplex. Entertainment the very name con ures images of performers, of color, of sagas, of pleasure and of relaxation. Each and every one of us has been touched by the various facets of the entertainment industry, vi!, films, television, radio, music, live entertainment to name a few. These together comprise the popular, evergreen, ever expanding "Entertainment #ndustry$. This industry has always been successful in drawing, the masses from the days of %oman gladiators to &hakespeare to &holay to Taal. 'erformers and entertainers since time immemorial have immense themselves in entertainment masses. (iven the inevitable convergence between entertainment and telecommunication, the potential of this sector is unrivalled. )hile technology drives this revolution, there is no disputing the fact that * content+ is what will fuel the fire of convergence. The various segments of the #ndian entertainment industry, though an integral part of our lives and social fabric, has always been treated like children of a lesser (od, when it comes to (overnment support and encouragement, particularly in comparison with certain newer industries. The nebulousness of this industry is probably why the (overnment has not been able to fully appreciate the si!e and latent potential of this industry. #f properly nurtured, this industry can be one of the largest contributors to exchequer and a dominant player in the new economy. This industry is unique compared to any other #ndian industry, let

alone foreign, considering the diverse tastes and cultures the industry caters to. The demand from expatriate #ndians, the rekindling of global interest in #ndian culture and art forms, and the promise of convergence, are the key factors influencing the potential of this industry

OVERV"E# F"L$S
PROJECTED REVENUES FOR THE GOVT
2005 200 2003 2002 2001 2000 1!!! 250 500 2000 1600 1200 3 00 500

The current si!e of the films segment, in terms of costs, is estimated at %s. ,- bn, with the industry budget increasing at about ,./ per annum over the last 0 years. The future growth of the segment will be driven by expansion in exhibition infrastructure and development of multiplexes, availability of

%upees in crore

finance from institutional sources, exports of film and animation software and emerging revenue sources such as web1casting, etc. 2n account of the above factors, the segment is estimated to grow at 30/ per annum to a si!e of about %s. 4. bn by 563..0. The industry7 (overnment should take the following measures for the segment to achieve its growth potential8 Di%e&'i(i)*ti+,8 5ilm companies should diversify into other segments of the entertainment industry like their global peers. This will not only mitigate risk associated with films but also enable the companies to cross promote their offerings across several delivery platforms in the era of convergence. Exp*,'i+, i, ex-i.iti+, i,(&*'t&u)tu&e8 At ,3.0 mn screens per mn people, film exhibition infrastructure in #ndia is much lower than in developed countries and woefully inadequate for the large population. #n order to boost revenues, there is a compelling need to expand and spruce up exhibition infrastructure. Re/u)ti+, *,/ &*ti+,*li0*ti+, +( e,te&t*i,me,t t*x 8 The entertainment tax in #ndia is much higher than in other Asian countries. 9esides, the level and nature of taxation varies from state to state. The (overnment should reduce and standardi!e entertainment tax to encourage fresh investment in theatre infrastructure.

Ceili,1' +, ti)2et &*te'8 This regulation, present in some states, has rendered operations of numerous theatres unprofitable. The &tate (overnments should consider doing away with this regulation.

E:E%(#;( T%E;<& A;< ;E) <E=E>2':E;T&

&ome of the ma or fast growing segments in the domestic industry include the music, cable and satellite advertising, infrastructure, exports, animation and 5:. The domestic music industry was estimated at around %s ,?,... million in the year ,@@@ and is pro ected to grow to around %s -.,... million by the end of the current year. The export segment is also expected to increase from around %s 4,... million to around %s ,.,... million during the same period. %evenues from the animation segment are also forecasted to increase from %s 3,3.. million to nearly %s 4,4.. million by the end of the current year. #n order to capitali!e on this fast growth ahead, companies are making large1scale investments in terms of infrastructure. 5or instance, the :ode 5amily has invested around %s ,,0.. million towards the construction of multiplexes that can screen around ,A films simultaneously. At the same time, ma ors such as Bee Telefilms and Eenadu T= are expanding their hori!ons to other markets as well.

OVERV"E# OF THE "ND"3N F"L$ "NDUSTR4

#ndian cinema has come a long way from the shaky flickering images and grating noises and sounds to a very sophisticated state1of1the1art technology for creation and pro ection of image and sound track. The film industry has grown multi1dimensionally commerce, art, with craft, unique star blend of glamour, social

communication, literary ad uncts, artistic expression, performing arts, folk forms and above all a wide1ranging and abiding appeal to the heart, the mind and the conscience. %amo i 5ilm City, outside Dyderabad EA'F is the biggest film single center in the world for making films, outside of the G&. The most important trend for the #ndian entertainment industry is that the number of #ndians scattered around the world are numbering close to the affluent population back in #ndia. And as entertainment becomes a strong ethnic bond for #ndians in alien lands, theatre owners, T=7cable channel operators, event managers are all hankering for #ndian entertainment products

#ndian film business is set for a period of sustained growth. Among the impressive forecasts in this report8 production investment will rise ?./ by 3..A, the #ndian film industryHs export revenues will climb ,3./ over the same period, foreign filmsH theatrical rentals in #ndia will also rise steeply. #ndia has not one film industry but several. The 9ollywood industryHs output of over 34. films in 3... made it the largest of #ndiaHs film industries, the Tamil, Telegu, :alayalam, Iannada and 9engali language industries are also significant, between them producing over 0.. films in 3.... #ndian government is moving to encourage corporatisation of the industry, improving access to bank finance and reforming taxation laws to encourage exports. 9ehind these measures lies 5

a perception that the film industry, like telecommunications and information technology, is one that can leverage the countryHs highly skilled workforce and low costs to create an internationally competitive economy. =aluable export markets have already been developed in countries like the GI, G&A, the (ulf &tates, &outh Africa J Ienya. The #ndian government is convinced of the link between a healthy theatrical exhibition industry and film industry success. #n order to encourage moderni!ation of the countryHs @,... hardtops Eto which can be added another -,... mobile cinemasF, entertainment taxes are being massaged downwards, especially for new cinemas, and import duties on cinema equipment have been cut. After a number of false starts involving foreign investors like )arner 9ros, Gnited Cinemas #nternational, Iodak and <ecatron, it now seems #ndia will at long last get its multiplex boom, though in practice this will mostly mean multiscreening of existing large halls by their #ndian owners, together with construction of relatively small new multiplex cinemas. Cinema equipment suppliers, however, are already en oying good business as local operators seek to upgrade their venues.

TDE CDA;(#;( >A;<&CA'E 25 TDE #;<#A; 5#>: #;<G&T%6 A;< TDE IE6 E:E%(#;( T%E;<&
E,F. The introduction of institutional financing across the film value chain of production, exhibition and distribution will transform the #ndian film industry. E3F. The #ndustrial <evelopment 9ank of #ndia E#<9#F, which has adopted a scheme for financing films, has started this process. #t invested ,.. crores in 3.., and has set aside the same sum for 3..3. #t is forming a consortium with commercial banks and institutions to extend film financing. This marks the break with funding from private sources which charge interest at a rate of up to -A14K/ compared to #bis+s ,A/. E-F. The #ndian film industry is showing signs of transformation at the operating level as it begins to embrace corporatisation and organi!ed business structures. :ukta Arts was the first to raise equity finance through an initial public offering in 3.... #t was also the first to take out film insurance, offer legally enforceable contracts and a completion bond. 2ther producers such as Aamir Ihan and 6ash %a 5ilms are following the trend, which is growing as many producers can see the advantages of moving from a family business to a corporate entity. E4F. #ndia is studying various funding models including those of Australia, Canada, the G& and (ermany, to develop a film financing structure for its own film industry which addresses the needs of both the large players as well as independent film producers. E0F. :any producers are adopting a more structured approach to film production. ;ew practices include continuous shooting schedules and the use of better technology, as evidenced by the 2scar1nominated film >agaan, and a greater focus on marketing and packaging as seen by Iabhi Ihushi Iabhi (am. EAF. There is an increase in the production of niche films with smaller budgets as established television companies like 'ritish ;andy Communications, 'ad :alaya

Telefilms, Bee Telefilms, 9ala i Telefilms, Tips #ndustries and <evgan Entertainment move into film production. Cable and satellite television is also becoming an important driver of content and financier of film production. E?F. 5ilm insurance is becoming an established concept. Taal was the first film to get insured and Gnited #ndia #nsurance the first company to introduce a policy for film production along with producer :ukta Arts. #ncreasing numbers of films are now seeking insurance against loss and damages including time and cost of over1runs. EKF. 2ver ,,... multiplexes with between ,0.14.. seats are expected to be built in the next few years. The impetus for the multiplex boom has been provided by entertainment tax incentives introduced by state governments. The central government has also announced that operators setting up multiplexes in non1metropolitan areas will be eligible for a deduction of 0./ of their taxable profits for five years. 2rgani!ed corporate players are now investing in this market while single screen owners are able to access bank and financial institution loans to upgrade to multiplexes. E@F. #ndian cinema is beginning to adopt digital technology. #n :arch 3..3 the government reduced the basic duty on certain elements of studio equipment and digital pro ection is expected to be a new area of growth.

TDE :A#; #&&GE& 5ACE< 96 TDE 5#>: #;<G&T%6

516 3 l*)2 +( t&*,'p*&e,)78 u,+&1*,i0e/ (i,*,)i,1 *,/ pi&*)79 : have been the ma or barriers to attracting investment from venture capital, private equity, public, bank and institutional financing into the sector. The challenge facing the ma or production houses is to become corporate entities 1 to implement sound accounting practices and adopt corporate governance as a code of conduct. The industry also needs to adopt security mechanisms such as legal contracts with artists and other agencies, film insurance and film completion bonds. 526 L*)2 +( ')&ee,i,1 (*)ilitie'9 : #ndia has around ,3@.. cinema screens Ea G; &tudyF. This leads to a serious shortage of screening facilities in #ndia. Even the existing screens aren+t technically up to the standards required. :ost of them are also closing down or being converted to a multiplex or shopping malls. The economics for a multiplex works better. The success rate for movies has gone down drastically since the last year. &tates like %a asthan, :aharashtra Daryana, Gttar 'radesh and :adhya 'radesh have given tax breaks for multiplexes. Dalls with smaller capacities also are better for niche films. 536 L*)2 +( ex-i.iti+, *,/ /i't&i.uti+, i,(&*'t&u)tu&e9 : The average seating capacity of a theatre in #ndia is between ?..1K... (eneral attendances are only -0/ of capacity. The high level of taxation has led to under investment in the exhibition infrastructure resulting in decrepit cinema halls. Digh taxation has also led to exhibitors under1reporting the levels of ticket sales to avoid paying taxes and sharing the box office profits with the producers7directors and distributors. The film industry needs to explore other revenue streams such as home video, <=< sales and rentals, cable television rights, pay per view, video on demand and merchandising.

5 6 T&*i,i,1 *,/ e/u)*ti+,9 : There is a dearth of technical and creative talent in #ndia. )ith the exception of the 5ilm #nstitute in 'une, there is no credible organi!ation in #ndia providing professional training in acting, directing, and scriptwriting or cinematography skills. There are however, a significant number of private organi!ations delivering such training. The industry is facing an acute shortage of trained personnel and there is an urgent need to establish institutions providing the latest technical training. 556 Up 1&*/*ti+, +( exi'ti,1 m+%ie t-e*t&e' 1The existing halls need to be renovated so that more viewers are attracted to cinema house. As per the current market trend most hall owners don+t earn enough to be able to upgrade the existing theatres. The answer could be flexible ticket pricing. 9lack marketing of tickets is common feature whose advantage is taken by unsocial elements. A system could perhaps be introduced whereby the film industry or the theatre owners to whom it rightfully belongs derive this advantage. This can possibly be achieved by introducing the concept of flexible pricing of tickets. Theatres should be allowed to collect higher revenues for more popular movies by temporarily increasing Eor decreasing in the case of a non hit movieF the ticket prices. This would generate higher revenues for the industry, which in turn would encourage them to spend more to upgrade the standards. 566 L*)2 +( */e;u*te i,(&*'t&u)tu&e (+& m+%ie p&+/u)ti+, 8 1 There is a serious dearth of movie production facilities in #ndia. :ost of the movies are produced at shoestring budget. Though there are adequate creative ideas, implementation is poor. The primary cause is lack of facilities. Examples like %amo i %ao City &tudio in Dyderabad, )histling )oods from the house of :ukta Arts are recent examples of where the country is headed. 5<6 Fi,*,)i,18 1 #n terms of volume, #ndia produces the largest number of movies in the world, K.. on an average annually. 9ut the 5ilm industry structure has been highly non1corporati!ed till date. #t has generally been family run companies

10

with no access to institutional finance. 5inance is tapped from family friends and other sources with high rate f interest Eup to 4./F being charged. )ith the 5ilm industry being granted the official *industry status+, it has propelled companies like :ukta Arts to go in for institutional sources. &till not many 5ilm companies have availed finance from these sources. This is because corporate structure in place is a pre requisite for such a venture. This means that the company has to clearly define the following8 A. <ocumented scripts in place 9. >egally enforceable contracts with the artists and technicians C. The entire time schedule documented <. The producer has to make sure the filming activity is completed in time and there are no time and cost overruns. Companies like Dindu a T:T, which has earmarked %s 3. crores for 5ilm financing this year, and GT= which made 5i!a, are entering this arena while the emerging finance sources encourage corporate to invest8 These sources of finance are available only to companies and not to individuals, thus the need for corporatisation. C## J C%#&#> are also working at developing a financing model that would enable the banks to weigh the risks in this industry. 5=6 Pi&*)79 : #ndian film industry loses about %s.-.. crores annually to piracy. The industry is worried that while the avenues of piracy are increasing at an alarming rate and the laws are either inadequate and where they aren+t, the problem is enforcement. The fines paid when caught are inadequate and so is the punishment. They also cite the non1cooperation of cable operators as a ma or handicap in their efforts to curb piracy. The cable industry on the other hand finds it difficult to check it on its own. The nature of piracy in the Entertainment industry is such that since the consumer demands the pirated product, the administration finds it difficult to check it. The cable operators cite this reason among others as to why it is difficult for them to control it. #f one operator does not showcase a pirated movie, the consumer switches to the other. And since there isn+t strict enforcement of the

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laws, there is not disincentive for anyone to stop showing such movies. The operators claim that even the film industry is not clear as to which rights are to be given to the cable operators and how to distinguish them from satellite rights of movies. >ast year alone it is estimated that unlawful copying and distribution cost the industry LAA million in revenues. To combat the problem the government has set up a task group to identify anti1piracy measures. The Confederation of #ndian #ndustryHs Enter media group, 5#CC# and finance house %abo #ndia have made recommendations to the task group on the issue which include the need to educate the public on the menace of piracy, the launch of a campaign of wide1 spread raiding operations, the promotion of organi!ed retailing and the introduction of Hsource identificationH codes on each unit. 'erhaps the most significant obstacle relating to piracy is the lack of a centrali!ed government body to regulate all matters concerning the film industry. Current responsibility is divided across multiple government and regulatory bodies such as the :inistry of #nformation and 9roadcasting for film censorship, the :inistry of 5inance for taxation issues and the :inistry for D%< Ewhich controls Education, 6outh and &portF for intellectual property rights protection and copyright violation issues.

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T3> "NFERENCE
To recapitulate, the #ndian Entertainment #ndustry comprises films, television broadcasting, cable television, television software, music, radio, and live entertainment and event management. The budgetary support of the :inistry of #nformation and 9roadcasting is being increased by 33 / to %s 4,0 crore for the year 3..3 3..-. &ome other benefits announced for the entertainment sector include8 reduction of custom duty on certain earth equipment and studio equipment from -0 / to 30 / and allowing for the next five years a deduction of 0. / of the profits earned by units constructing and operating multiplex theatres in non metropolitan towns if such multiplex theatre is constructed between April ,, 3..3 and :arch -,, 3..0. ;o excise duty is levied on C< %2:s but there is a levy on audio C<s and video C<s although the manufacturing process, requirement of raw material and plant requirement for three types is the same. A 4 / excise duty has been imposed on :%' with regard to audiocassettes. This will result into an outgo of about %s A. crores from the music industry alone. The service tax on broadcast service, which leads to multiple taxation on production of programme and broadcasting content, is leading to a cascading effect. ;o abatement has been offered with respect to this service tax on broadcast services. The sector is reeling under a heavy tax burden of entertainment tax, which goes up to even ,.. / and beyond. Gnlike other categories, service tax for film production sector cannot be passed on to the final consumer. The film sector has been given industry status by the (overnment. Estimates show that the Entertainment #ndustry is currently generating revenue of %s ,.. billion and this will increase to %s -,0 billion by the year 3..0.

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Apart from giving the industry status to film segmentM the (overnment has announced several measures that can give the critical push to the overall growth of the entertainment sector. These measures including allowing listing of a company with ,. / public ownership akin to the information technology industry television broadcasting has been privati!ed. &imultaneously the (overnment intends to bring the convergence bill, which ensures growth in several sectors, and renders the regulatory mechanism more effective. 2ne of the ma or sectors of the industry is the film segment. The current si!e of this particular segment is worth 33 billion. The average growth of budget for films has been increasing by ,0 / p.a. The growth of the film industry depends not only on the basic activities like film production and distribution, but the intensification of and expansion of exhibition infrastructure and development of multiplexes. The availability of finance through institutional sources is imperative for this expansion and diversification. &tream lining is also called for in the areas of corporatisation of film companies, reduction and rationali!ation of entertainment tax, ceilings on ticket rates and expansion of exhibition infrastructure.

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The present size of the television segment is estimated to be Rs 35 billion The !T" s#stem $ill give a ne$ dimension to the television broad%asting in the %oming da#s The s&bs%ription reven&es of the television %hannels are estimated to be aro&nd Rs 25 billion %&rrentl# There are 35 million ho&seholds having a%%ess to abo&t several %hannels thro&gh %able net$or's The penetration of %able T() parti%&larl# in the r&ral segment is e*pe%ted to gro$ b# 12 + in the %oming #ears The gro$th of m&si% ind&str# has been asto&nding in re%ent #ears ,n the #ear 2000) the ind&str# sold an estimated 250 million m&si% %assettes and 15 million %ompa%t dis%s This is a gro$th of 15 + %ompared $ith the previo&s levels of sales The m&si% ind&str# is dominated b# -. sales rather than .!s The m&si% ind&str# in ,ndia is e*pe%ted to gro$ at a rate of 18 / 20 + in the %oming #ears

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?RO3CH"NG $ULT"PLE>ES "N "ND"3

"NTRODUCT"ON TO $ULT"PLE>
$ultiplexe' *&e ,+t * ,e@ )+,)ept i, ",/i* . Chennai Ethen :adrasF had the <evi complex and <iamond7&apphire7Emerald complex over three decades ago, while :umbai had &hivam7&atyam7&undaram complex for the same period of time. 9ut the G& had set up movie complexes in the suburbs about twenty years back and this concept is now spreading all over the world. :a or movie production houses and media companies, including 3.th Century 5ox, 'aramount, Gnited Artists, Columbia1 Tristar7&ony and )arner 9rothers, operate multiplexes all over the world. 5rom the release :arch of ,4, #mperial ,@-, to 5ilm the

CompanyHs

screening of Armaan in :ay 3..-, from the first #ndian song to Chamma Chamma in :oulin %ougeM from the success of >agaan in &hanghai to Taal in the GI, the #ndian film industry or our 9ollywood has traversed a victorious ourney surpassing criticism, language and physical barriers. #n this ourney even the facet of the cinemas has immensely changed. The magical word in cinemas today is 1 multiplex. #t emerged out of the necessity faced by the cinema owner to cater to the busy, fast moving and variety1loving consumer who wants more than ust one film under a single roof :ultiplexes have become ust a rage that most of the old cine 16

complexes are converting to multiplexes. 5irst of all, what is a multiplex and how is it different from a cinema hallN #t is a large cinema or a movie theatre with several separate movie screens, says the 2xford <ictionary. Today it is not ust several screensM it is an ultra1sophisticated complex with a variety of retail activities revolving around it.

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TDE :G>T#'>EO 'DE;2:E;2;8

The growing share of entertainment expenditure in the disposable income pie is driving a revolution around #ndiaHs favorite entertainment option today 1 :ovies. The combination of cinema with other services and facilities has led to the burgeoning growth of multiplexes around the country. (lobally, multiplexes are operated primarily by ma or movie production houses and media conglomerates including the likes of 3.th Century, 'aramount, Gnited Artists, Columbia1Tristar7&ony, and )arner 9ros. The primary reason for the popularity of this business model has been the escalating cost of movie distribution as well as a hedging opportunity to run multiple revenue streams around self owned content. #n #ndia, the movie industry is not quite as developed and organi!ed as the industry in G&A. :ultiplexes arrived in #ndia in Pune ,@@? when 'riya =illage %oadshow was the first to pioneer the concept with its initial establishment '=% Anupam, a multiplex with 4 theatres and a host of other entertainment options including restaurants, music centers, gaming centers etc. The multiplex model is based on the concept of umbrella entertainment built around a primary anchor 1 movies. The revenue streams, however, do not necessarily center around a single anchor. Typically, the possible income generating channels in a multiplex can include8 The box office collections %ent from display systems 5ood J beverage 'roduct launch rentals 'romotions by companies seeking to promote consumer goods 18

:ore often than not, multiplexes earn lot more from other revenue sources as compared to box office collections. #t is unlikely that #ndia+s experience with the multiplex form of cinematic exhibition can be comprehended without understanding the mechanisms of the liberali!ed economy in which it emanated. 9ut to locate its persona and impact as being solely the affections stemming thereof would in some ways amount to a limited and inadequately informed view. &ince its inauguration in ,@@?, the #ndian multiplex experience has been smattered with instances that stand in opposition to its immediate environs. #ncoherent, inconsistent, possibly transitional yet aggressively attentive, these lend to it markings of an indigenous, self1derived and developed nature. Though patterned along the *shopping mall+ model of the multiplex as developed and prevalent in the )est, and sustained by the retail boom unleashed by the economic liberali!ation policy of ,@@,, the #ndian multiplex site sports all the features of an up1market turf. #t has aligned with and extended the transformation of #ndia+s urban milieus being re1visioned within the framework of consumerism. The multiplex+s steady proliferation in the metropolis+s and simultaneous penetration into some smaller cities and towns testifies to its increasing popularity, coinciding with the rise of disposable incomes in the hands of the urban #ndian family. 9ut in terms of its exhibit, i.e. the films on its screens, it makes for a space that mirrors a complex cinematic multiplicity. The increasingly curious mix of parallel, regional and art cinema along with the mainstream, both domestic and foreign, is what distinguishes most multiplexes in #ndia, such that the #ndian multiplex has come to position itself, not so much by identifying with particular kinds of films, as by being a theatre for accessing the *latest+ from a wide spread of cinematic fare mainstream or fringe in comfortable, colourful and inviting surroundings.

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)hile the former, mostly 9ollywood films which, given their steadily improving production quality and contact with newer territories, especially overseas markets, aligned quickly with the multiplex+s swanky appearance, the latter too, mostly low budget, non1narrative films, easily if not as promptly, penetrated into the multiplex without bearing any proximity with the site or its vicinity which is enlivened with an array of branded local and global products and services. The multiplex intervention, as of the moment, can be termed as appropriating varying audience segments to stabili!e and secure its own position, establish its distinction and engage the audiences in a varying film viewing exercise. #t has emerged as comprising a mix of seemingly contradictory strains wherein central and peripheral tendencies coexist. Taking cues from each other, multiplexes all over the country are making for variables that don+t ust originate in, or correspond with, the existing common needs of their audiences, but have also identified and accommodated overlapping tastes and preferences by readying access to fare, which may have previously been considered as lacking numerical encouragement vital for profitability. :ost art films and much of parallel cinema have usually faced reluctance from distributors and exhibitors alike. (iven the limited response they face, bodies like the ;ational 5ilm <evelopment Corporation E;5<CF have regularly stepped in to support them financially alongside promoting them at foras like film festivals and national network television. Their penetration into the multiplex can first be located in simple mathematics the proliferation of screens, enhancing access to films. :ore important than simply the number of screens is the fact that even though more cinemas are getting converted and new multiplexes are being set up, the number of seats has not increased in equal proportion. #t is only when new multiplexes are constructed that seating capacity has recorded an increase. )hile the capacity at a single screen cinema is usually in the region of K0. to ,... seats, or sometimes a little over that, a single screen in a multiplex seats a far smaller audience,

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9ecause when a cinema is converted from one to multiple screens the seats get divided among them, though not equally. Anupam '=%, #ndia+s first multiplex situated in <elhi, was converted to four screens, two with a capacity of over -.. seats and the others with ,0. seats. The pattern continued, shaping into a trend, with the result that even when a new multiplex is constructed the seating capacity per screen rarely parallels that of a single screen hall. Consequently, the number of admissions per screen stands far reduced at the multiplex. Dowever, though non1mainstream films are unlikely to attract audiences of the si!e as a conventional 9ollywood film would, their showings are still lucrative because the numbers they command constitute a greater, more competitive marginal value. 5urther, the multiplex has not followed the conventional ,31-1A1@ time schedule as prevalent in most cinemas. This created opportunity to schedule and programme films on the different screens. The ability to manipulate schedules allowed for films of varying lengths to be accommodated. &ince non1mainstream films are of varying lengths and usually shorter than an average feature, they could easily be integrated in the multiplex+s film menu. :ultiplexes have charted cautiously in relation to industry films. #n relation to 9ollywood, multiplexes have not depended entirely on conventional films as they are in any case competing with the single screen cinemas which draw larger audiences. This is not only because they have a greater seating capacity, but because they are more accessible. They usually outnumber multiplexes, are located within easy reach and, more importantly, offer the same product at a lower price. 9esides, a thriving video piracy industry coupled with a deep penetration of cable television meant that the multiplex settled for exhibiting selected films usually the awaited, big budget, publici!ed, mostly familial films. These films coincide with the multiplex+s redefinition of cinema as a family outing comprising

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other amenities like food and games. &ince it needs only a section that would guarantee a sell out of its limited seats being offered at a higher rate, it tends to exclude the average 9ollywood film. 9ut in so doing it has managed to elicit viewership from upper class segments, which previously may have held reservations towards cinema going, given the lack of facilities like air1 conditioning, upscale interiors and so on. #n relation to Dollywood films too, multiplexes find themselves playing on limited ground as releases in non1western territories are usually a couple of months after the film+s release in home territories. And the access to films through <=<s before a theatrical release Eat least in metropolis+sF has implied a replication of the approach as adopted towards 9ollywood films. #nitially, multiplexes were pro ected primarily as theatres for English films. That changed soon, because despite their popularity English films are rarely accessed by non1English speaking, illiterate and non1affluent audiences. These films seldom transcend metropolis+s and large cities and, on the screens, they compete for space with films from a flourishing native industry that appeal to a wider audience. The apprehension towards foreign films is not determined by the urban or linguistic divide only. )ithin the different income regions of say a metropolis itself, one finds multiplexes located in posh localities exhibiting foreign films along with substantial numbers of non1mainstream films. Dowever, when located in the lower income group areas, multiplexes get smaller, being composed of fewer screens and English films Emostly well advertised onesF constitute a smaller portion of the assortment. As one moves away from the Dindi heartland, the film menu tilts correspondingly in favour of native languages and no longer reads bilingually Ei.e. comprising only Dindi and English filmsF. ;either is it always trilingual, say in cities like :umbai and <elhi, or regions such as &outh #ndia. Dere films in the immediate native language get complemented with those from other regions, in differing dialects.

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)ith the multiple screens accommodating a spillover of linguistic access that may be rooted in a host of factors education, migration, employment and training or ust proximity this gets converted into overlapping cinematic preferences. The variation is not simply of language, but extends to genre as well, including treatment in relation to content and construction in terms of form. %esponses at the multiplex to the non1mainstream films have not been completely negative. #n fact, a few low1budget, non1mainstream films, despite a cast comprising prominent film stars, could only secure screening at multiplexes in some territories. &uch a trend coupled with the entry of vernacular films into non1native regional territories, and an active #ndo1western intersection has also facilitated the entry of non1mainstream English and non1English foreign films into some multiplexes. The multiplex also constitutes the primary site for the increasing territory of films directed by overseas #ndians, whose representations span both the #ndian diaspora and the home1land. &ociological in their orientations while dealing with the diaspora, these present traditions and lifestyles as altered by being away from the homelandM and in terms of the homeland, they highlight native habits and attitudes as seen from a *foreign+ eye. Explicated mostly in humorous, familial scenarios that involve the play of customs and rituals along with the essential element of entertainment materiali!ing in song and dance, these films are developed along non1native patterns of construction, aesthetic and language. Their duration too is a variable, almost always under three hours. <espite being located within the native community and thus being readily decipherable, they too like other foreign films have en oyed limited appeal not extending beyond the largely educated audience that+s bilingual and en oys familiarity with diaspora experiences and attitudes. Though films surrounded with more publicity are played at a few single screen halls as well, the multiplex is more promptly identified with non1native cinema. Add to that the fate of films like Fire E,@@?F,

23

and the polari!ation between the single screen and multiplex cinemas stands further sharpened. (iven the fast pace of its spread, its acumen towards cinema of diverse kinds and a long gestation period, central and state governments are encouraging ma or investment and offering sops to investors and developers who comprise real estate entities, film exhibitors and distributors, film processing companies and media conglomerates. 9ut the concessions are accompanied with conditionalities aimed to prevent concentration of multiplexes in select regions and in some cases to promote regional cinema. A microcosm of retail culture including significant portions of global brand names, the multiplex site makes for the kind of up1beat location that coincides with government attempts to alter conventional images and all that compliments the bandwagon. #t also enables foreign tourists to access cinema. )hile multiplexes may be emerging as local macrocosms of native and foreign cinema, they constitute a kind of exception when compared with their western counterparts, most of who pressured by their functional mechanisms and operating in advanced, more developed markets characteri!ed by deeply entrenched segmentation which extends into film exhibition as well, have ended up institutionali!ing and populari!ing the blockbuster syndrome. #t is thus necessary to recollect a few trends that may not bear directly on the sub ect but do not bypass it either, having operated upon audiences as much as the multiplex itself has. Fi&'t, the multiplex is preceded by and concurrent with a tradition in parallel cinema that reached a peak in the ,@?.s. :ore recently a trend in rethinking, innovative cinema has gained prominence for confronting pressing social and political issues like feudalism, sexuality, terrorism and separatist movements within the scale of mainstream films. These films occupy the space between the mainstream and art film, reaching audiences without the essential melodrama typical of 9ollywood films in which characters are foregrounded, on occasions

24

distanced, from their milieu. These films situate sharply defined characters as the site where the opposing pulls of an irreconcilable crisis operate. They have gained critical acclaim at home and abroad alongside box office endorsement. )hile the attraction of some can be located in the dynamics of stardom and a heady mix of song and dance, all interpellate the audience through commonplace situations, traumas and experiences. <espite the difficulties it faces, the fringe comprising art and off1beat films has been sustained both independently and in collaboration with firmly positioned industry players. &imilarly, it is important to remember that non1Dollywood cinema too has commanded an audience promoted by international film festivals, film study circles, national network television and cross1cultural exchange programmes with other nations. The preponderance of single screen cinemas has not come in the way of screening critically acclaimed foreign films from time to time. Se)+,/, in the backdrop of a film industry steeped in financial crisis, the small budget and independent films have received considerable approval and encouragement when compared with the industry product. )ith off1beat content and newer forms, their slice of the cinema is expanding. 5or them too, the multiplex constitutes a crucial exhibition space, given that they target specific rather than mass audiences. T-i&/, and to further unpack the possibilities at the multiplex, a brief recap of the functional impulse7s for it is vital. Gpon introduction of liberali!ation, retail chains emerged and expanded as the momentum of consumerism slowly rose. Consequently, retail spaces steadily gained premium over commercial ones. &trategies to cover costs had to be revised. )hile rethinking products, prices and efficiency, retailers linked promotions, fun and entertainment to penetrate bigger chunks of the market and secure customer loyalty through customi!ation.

25

#n a climate of alliances and add1ons like food oints, the concept of holistic family entertainment experiences gained patronage. #n such a scenario, the immensely popular leisure activity far older than television in #ndia cinema suffering from inadequate exhibition facilities intersected with aggressive retailing and helped prompt the multiplex. This served to revive the diminishing cinema going habit by enticing audiences away from their television sets, with their clutter of imagery from all over the world drawing upon the cable and satellite boom. The desire for the image now combined with other leisure activities and occupations. 2nce in place, the multiplex developed a counter to the unitary propensity of the single screen hall, founded on exclusion, perpetuating homogeneity and cultivating committed audience segments. )hile single screen cinemas identify themselves with films of particular kinds, say the Dindi masala and blockbuster, the English, or the porn movie, the multiplex has capitali!ed on an inclusive tendency to motivate and assemble diverse audiences. 2n the one hand it has contained the influence of embourgeoising forces within its edifice, allowing on its screens the interplay of alternative and mainstream or conventional strains. 5urther it has limited contact with the )est to no more than the fashioning of its site, preventing the hegemony of either Dollywood blockbusters as the result of a partial global encounter, or conventional 9ollywood films that en oy a pan1linguistic and cultural appeal cutting across regional, religious, class and other variants. 2n the other hand, it has remained an urban, largely middle and upper middle class leisure pursuit, with its highly priced tickets excluding the masses crowded in the lower regions of the income graph. )hile the masses take to cinema readily, given their financial capacity and lack of identification with the plush appearance, products and services at the multiplex in any case targeted at the socially and economically mobile sections this numerically significant chunk of audience has remained confined to the outer edges of the multiplex experience. And it is unlikely that the dynamics of the

26

multiplex in its present avatar will manage to secure their participation. &patially too, multiplexes can mostly be spotted in affluent neighbourhoods, within the easy reach and concentration of young audiences. &o far a nascent experience, the number of multiplexes is soon slated to rise sharply. The full impact of its rapid spread, particularly over the last two years, is yet to be determined given the long gestation periods and concentration in and around selected pockets. As a result, it is too early to draw any conclusions about its impact or chart any definite course for its future. (oing by the variables that are emerging in response to the needs of immediate audiences, and the fact that in its present form it has acknowledged cinema as composed of diverse possibilities, the multiplex may in the future enhance segmentation and result in branded theatres exhibiting particular fare, say the art, mainstream, or foreign films, maybe even documentaries. The mechanisms of competition would then come into operation and influence aspects such as ticket pricing. As a space commanding flexibility and an ease with maneuverability, the multiplex, concurrent as it is with the digital revolution, could even aid in the promotion of the format. ;ot simply by providing accompanying exhibition facilities like digital pro ection or digital sound, but by making available alternative display spaces for digital films that bear potential as a distinct genre. )ith the conveniences of its apparatuses, film form is already witnessing alteration in some parts of the world, and filmmakers without access to elaborate film equipment have received a fillip from this technology. ;ew territories in relation to content are being explored by a breed of filmmakers who are exploiting the ease of accessibility accompanying the medium. %edefining film form and content, digital films could prompt and occupy viewing spaces as differing from conventional films and embody forms like the *walk

27

through+ film that may require simultaneous pro ection on more than one screen, not necessarily of conventional theatre si!e. 5rom its present shape, there only emerge more queries than any concrete predictions. )ill the rapid spread of the multiplex and its concentration in particular !ones with audiences constituting existing and potential markets for the retail entities supporting the multiplex, emerge as the dominant trend, and push doors for further segregation and institutionali!ation of segmented audiences, leading to branded multiplexesN 2r will encouragement from the various governments drive away the multiplex, aiding its penetration into other urban and semi urban, non1affluent territoriesN )ill the multiplex alter existing film form so as to align with its own plush and colourful appearanceN 2r will it encourage alternative filmsN #ts dispersal away from well1heeled spaces is crucial if the intention is for it to emerge as at least a pan1urban, if not a pan1#ndian experience. )ell meaning as government policies may be, without their committed implementation and in the absence of the shopping mall culture in other locales, the possibilities of the multiplex there remain suspect. 9ut in the meanwhile cinema stands redefined for the #ndian viewer as composed of fare other than the regular three1hour film. 5rom the present assortment at least, sporadic and transitional as it may be, there are definitely more films to choose from. And the choices aren+t merely linguistic. #n :umbai a multiplex is one with a minimum of four screens and ,30. cinema seats. #n other parts of :aharashtra the specification is for three screens and minimum capacity of ,... seats. Typically, film exhibition centers particularly in the metros have to compete with various other avenues of entertainment available to the public at large8 1 3. They can choose to watch the movie on satellite film channels, cable television, and home video

28

?. They can choose to spend the time and money on other sources of entertainment such as video games, amusement parks etc. The only way to pull people back to theatres is to make theatres attractive, comfortable and equipped with the latest amenities, thereby offering the audience more than what they expect out of a theatre. The mantra of renovation and up gradation has given a fresh lease of life to theatres in cities like :umbai, which were reeling under a severe financial crunch and succumbing to commercial pressures. &ince more than one movie is screened in a multiplex at any given time, a potential viewer rarely goes home without seeing a movie though it may not be the one he first came to view. :ultiplexes, the hot new concept in movie exhibition, have the potential to radically alter the entertainment business in time to come. :ultiplex embodies the luxurious amenities of the modern day theatre, multiple screen choices, state of art technology, ergonomic seating, eye catching architecture and top of the line cafes and food courts. The first #ndian multiplex set up in <elhi, 'riya =illage %oadshow Ea oint venture between 'riya exhibitors of the 9i li (roup of Companies and =illage %oadshow >imited of AustraliaF has been pulling in crowds with the provision of wholesome one stop entertainment. ;ow with various state governments announcing Tax Dolidays for Cineplex Emultiple movie theatreF pro ects, more multinationals are preparing a foray into #ndia. The (u arat (overnment had announced a seven1year entertainment tax holiday for such pro ects. These announcements has been have given a definite boost to those planning to build multiplexes. Among the ma or foreign players interested in multiplexes are Columbia Tri1&tar, Eastman Iodak and Pohn 9uck and Company. According to the industry sources, theatre admissions in England, (ermany and Australia tripled with the multiplex and theatre boom and a similar growth could be expected in #ndia with development of multiplexes7 theatres. At the same time, multiplexes should not be viewed as a threat to the one screen theatre. )ith the growth in the theatre going population, the single screen theatre will also benefit from the growth in multiplexes. Typically, the multiplex model is built around a primary anchor 1 movies. The &e%e,ue 1e,e&*ti,1 )-*,,el' in a multiplex includes box1office collections, rent from display

29

systems, restaurant rentals, food and beverage collections, product launch rentals and promotions by companies. The other &e%e,ue 't&e*m' are often larger than box1office collections, but movies are the main pull of such complexes. &everal of these multiplexes are being located in shopping complexes and average an investment of around %s. 0 crore for a four1screen theatre. Daving a multiplex ensures about ,,3.. footfalls daily, which is great for a shopping mall. There are about ,... screens planned over the next five years all over the country, oining the existing ,3,... screens. The screens per one million population for #ndia are only ,, as compared to ,,? in the G& and ?? in 5rance. Though this scheme has not boosted the existing single screen cinema theatres, several theatres are planning to upgrade to the multiplex concept and hence provide a boost to the big screen cinema. There is healthy competition among the multiplexes and the initial high1ticket rates will definitely come down to more acceptable levels. #n fact, these may actually spur the declining cinema market in #ndia. The smaller cinema halls provide the owner flexibility to rotate the movies economically. The cinema going concept has changed drastically, becoming part of the "broad spectrum$ family entertainment. This is good for consumers and film buffs. The threat of over1capacity of cinema seats has not dampened the multiplex mania currently prevailing all over #ndia.

30

NEED FOR $ULT"PLE>

Though the #ndian entertainment industry had been growing Q -- / for the last few years, the number of screens had gone down, attendance had decreased and box office collections had reduced in real terms. #n comparison, during the @.Hs 1 directly due to the growth of :ultiplexes 1 the number of screens had increased by ,.. /, attendance levels by ,0. /, and box office collections by 3.. /.

#ndia in terms of its theater capacity around 118!62 5*pp&+x6 t-e*te&' is not meeting its consumer demands. And moreover out of this there are about =8 00 pe&m*,e,t theaters which are not good in terms of its consumer base which makes viable only 11')&ee,' pe& milli+, people. This creates a need for more and more screens and much developed exhibition centers for movie and movie goers.

31

3DV3NT3GE
:ore often than not, multiplexes earn lot more from other revenue sources as compared to box office collections. Dowever, due to the role of RpullR creator that the movies play in this scenario, overall returns are highly correlated to box office contribution. :ost multiplex pro ects break even at an occupancy rate of 4.140/. This figure may vary as per the maintenance standards of various theaters and the revenue streams running parallel to it. %eal estate is the ma or cost component and a strategic resource for the multiplex business. Typical built up area required per seat is around -. sq. ft. and average no. of seats per screen is around 30. 1 4... Although much smaller than traditional theatres in a screen to screen analysis, multiplexes often command higher collections and space efficiencies due to the following reasons8 The element of choice of movies available to the consumer 'remium pricing possible due to the total entertainment platform :ultiple revenue streams hedge the risks associated with movie performance :ost of the initial multiplex pro ects started in the ma or metros due to the availability of larger catchment areas. Dowever, a recent trend in multiplex operations has witnessed the proliferation of multiplexes into non metro urban centers of the country. The driver for this phenomenon is a combination of lack of quality entertainment options in non metro cities together with a growing consumer base and disposable income available for entertainment. The primary targets in this list include 'une, 9aroda, #ndore, Ahmedabad and Paipur. :aharashtra, with its attractive tax sops for multiplex development and operation is likely to get a lionHs share of these pro ects. :ultiplexes in :umbai :etropolitan %egion E::%F will get a ,.. percent exemption for four years while in the rest of :aharashtra the exemption 32

period will be five years. These pro ects will be entitled to a number of facilities including stamp duty relief Eif located outside the municipal limitsF, power at the industrial rate for five years etc.

33

THE $3H3R3SHTR3 ST3TE L3#

TDE &TATE:E;T
T-e '*lie,t -i1-li1-t' +( t-e St*teme,t *&e9 EaF <ue to the onslaught of cable television and advancement in the

field of information technology, the average occupancy in cinema theatre has fallen considerably and hardly any new theatres started in recent past. 'ublic at large, these days, prefers seeing movies at home. Ieeping in view this scenario, a concept of complete family Entertainment Center more popularly know as *:ultiplex Theatre Complex+ has emerged. These :ultiplex Theatre Complexes offer various entertainment facilities for the entire family under single roof. Dowever, these complexes are highly capital intensive, their gestation period is also quite longer, and therefore need EbF (overnment support and incentive in entertainment duty.

The (overnment of :aharashtra therefore considers it necessary

to encourage, by giving incentives for the construction of new cinema theatres and to ensure the healthy cultural development in the &tate of :aharashtra. EcF (overnment has, therefore, with a view to commemorate birth duty of to :ultiplex Theatre Complexes in to promote the &tate.

centenary of Chitrapati late =. &hantaram decided to grant concession in entertainment construction new cinema houses

34

EdF

To preserve and promote :arathi cinema, it is obligatory for such

complexes to reserve one screen for one month in one year, exclusively for :arathi movies.

EeF

'ower is taken to specify by notification, the facilities and conditions

including multi entertainment activities such as providing one theatre for &tage 'erformance, 5amily Entertainment Center, Art (allery, etc., which are to be provided by the 'roprietor in a Complex and the 'roprietor is not to discontinue any of such facilities without the prior permission of (overnment. EfF 'ower is also taken to withdraw the concession in case of violation the concession is granted.

of the conditions sub ect to which EgF

'rovision is also made for the existing theatres to convert into

:ultiplex Theatre Complex and to avail of the concessions, sub ect to compliance with the specified conditions and requirement for setting up of a Complex.

35

TDE '2>#C6
The extracts are from the English translation of the 9ombay Entertainments <uty EAmendmentF 2rdinance, 3.., E:aharashtra 2rdinance OO#= of 3..,F, published under the authority of the (overnor of :aharashtra. #t is an 2rdinance to further amend the 9ombay Entertainments <uty Act ,@3- and was notified on August ,K, 3.., #t applies to any person partnership firm, body corporate or a company registered under the Companies Act ,@0A, responsible for or for the time being charge of, the management of any :ultiplex Theatre Complex. :ultiplex Theatre Complex means an entertainment1cum1cultural center which provides, EiF within the limits of :unicipal Corporation of (reater :umbai not less that

four theatres in a complex with minimum total seating capacity of ,30. and EiiF anywhere else in the &tate, not less that three theatres in a complex with minimum total seating capacity of ,... and such other incidental and connected matters, facilities, multi1entertainment activities and other facilities as specified by (overnment by notification in the 2fficial (a!ette.

36

There shall be levied and collected by the &tate (overnment from the proprietor of a :ultiplex Theatre Complex the duty in respect of any such complex as follows namely 5or the first three years from the date of commencement of the :ultiplex Theatre Complex, no duty. 5or the subsequent two years, at the rate of twenty five percent of the rate of duty. 5rom the sixth year full amount of duty leviable at the rate specified.

37

52% TDE 'G%'2&E 25 TDE A92=E

EiF the date on which the :ultiplex Theatre Complex is opened to the public for admission shall be deemed to be the date of commencement of the :ultiplex Theatre Complex. EiiF the change in the management of :ultiplex Theatre Complex or the change in the name of the complex shall not be constructed as a fresh commencement of the :ultiplex Theatre Complex. The concession in duty shall be available to the proprietor of the :ultiplex Theatre Complex sub ect to following terms and conditions, EiF the proprietor shall not charge less payment for admission than the prevailing highest rate for admission than the prevailing highest rate for admission at any given time, in any of the cinema theatres in the <istricts in which the Complex is situated, till the period of concession is over. EiiF one theatre in the complex shall be reserved for a total period of not less that one month, in a year, exclusively for :arathi movies

EiiiF the proprietor of a complex shall not levy the service charge Epresently rupee one per admission ticketF till the period of concession is over. After the concession period is over, the proprietor may levy service charges as specified EivF the :ultiplex Theatre Complex shall be operating continuously for ten years EvF no facilities provided in the complex as specified in the notification shall be discontinued or curtailed, without prior permission of the (overnment

38

#n case of violation of the above conditions, the concession shall be liable to be withdrawn and the duty shall be levied and collected form the date of commencement of the :ultiplex Theatre Complex, at the rate specified along with the interest leviable at the rate specified.

#f an existing Cinema Theatre is converted into a :ultiplex Theatre Complex by not reducing its original seating capacity and by complying with the above provisions, the converted theatres shall be also entitled to concession in the duty as specified.

39

TDE ;2T#5#CAT#2;
Extracts from ;otification no. E;T7,.@@7C.%.?A7T1,. The (overnment of :aharashtra specifies the following conditions which shall be complied with and other facilities including multi1entertainments activities which shall be provide by, the proprietor of a :ultiplex Theatre Complex, in such a complex8 T-e )+mplex '-*ll -*%e9 EaF state1of1the1art sound system like <olby1<T&7<olby1<igital, pro ection system like xenon light and illumination system EbF be centrally air1conditioned EcF comfortable seating arrangement with minimum width of every seat from center to center twenty1one inches. EdF one of the theatres compatible for stage performances EeF an art gallery with a minimum area of 0.. square feet with facilities such as display panels, stands, counters etc. EfF an exhibition center with a minimum area of 0.. square feet with facilities for exhibition of works of arts, traditional garments, handicrafts etc. EgF a family entertainment center such as video game parlour having electronic games, slot machines, pri!e redeeming machines Enot amounting to gamblingF virtual reality games, computer games or any other gadgets which can be

40

installed for entertainment etc. with a minimum area of 0.. square feet, bowling alley, pool parlour Econtaining minimum 3 tablesF, cyber cafS The art gallery, exhibition center can be a designated part of the foyer or waiting lounge and the family entertainment center can be designated part of the foyer area or such other centers which may be prescribed by general or special order issued in this behalf by (overnment EhF a restaurant EiF adequate parking facilityM and E F such other facilities, as may be specified by general or special order by (overnment The complex may also provide any of the following facilities. EaF Commercial complex EbF health center7health club EcF small apartment hotel

The state has over 3-. applications for exemption of entertainment taxes. :aharashtra has the most attractive policy for multiplexes, followed by )est 9engal, (u arat and %a asthan. The requirements are at least three theatres with a minimum of ,... seats, which must be completed within two years of the application being approved. DG<C2 too has plans to use prime areas in ma or cities belonging to the <epartment of 'ost E<o'F for multiplexes.

41

NECESS"T"ES FOR THE 3PPELL3T"ON OF $ULT"PLE>

,F &et Gp :ultiplex &hould 9e )ith >atest &ound &ystem >ike <olbydts7<olby <igital >atest Exhibition :achinery, >ike Oenon >ight And >atest >ight Arrangement Etc 3F #t &hould 9e Centrally Air1Conditioned -F There &hould 9e Comfortable &eating Arrangement 4F 2ne 2f The Theatre &hould 9e &uitable 5or <rama &tage 'erformances. 0F Art (allery &hould 9e :inimum 0.. &q 5t Area )ith Amenities >ike Exhibition 9oard, >ight Arrangement, &tand, )indows Etc. AF Exhibition Center &hould 9e )ith 0.. &q 5t )herein Entertainment 'rogramme 2r 5amily Entertainment Center E)herein Electronics (ames, &lot :achinery, 'rice <isplaying :achine ;ot (ambling :achine, %ealistic (ame, Computer (ame :inimum - :achinesF or ?F 'lay house having minimum area of 0.. sq ft for entertainment having video playroom bowling alley, pool parlors Eminimum 3 tables, cyber cafS etcF

KF Art gallery, exhibition center or rest room for relaxing should be specifically treated as part of the same. @F Also the foyer of entertainment center for family or resting shall be specifically treated as part of the same. There should be other such centers as prescribed video ournals or special orders from time to time by govt.

42

$3JOR D"S3DV3NT3GE OF 3 $ULT"PLE>

:a or problem faced by multiplexe' is ticket pricing. (oing to a movie in a multiplex is nice whether in terms of sophisticated facilities, crowd or comfort but it is expensive. A ticket cost is anywhere between %s.,,. %s.,0.. :ovie for a family of four could cost around %s.A.. and with food it becomes %s.,....A person who goes to a multiplex pays around two to three times more money that what he gives in a normal cinema shall be it the ticket or food. The rates are still steep even after the reduction in the entertainment tax from A. per cent to -. per cent.

43

UPCO$"NG $ULT"PLE>ES "N THE COUNTR4

F3$E H7/e&*.*/
#t is located in the epicentre of DyderabadT At Dimayatnagar, one of the busiest shopping district of the city. Dimayatnagar is the hub of commercial and retail activity on this side of Tank 9und. A multiplex consisting of three screens, with a total seating capacity of @.. seats. 5ame is all set to redefine the pleasure of watching movies at Dyderabad.

Fu, Ci,em* i, J*ipu&

5or offering something different to the cinegoers of 'ink City cinegoers, Bee T= (roup has planned for a new multiplex at Time &quare complex located in =idhyadhar ;agar colony of Paipur. 5un Cinemas comprises two cinemas with ,@. seats each, catering to the entertainment needs of residents of =idhyadhar ;agar, :urlipura and &hastri ;agar colonies. Tele1booking, home delivery of cinema tickets, etc. will be the special features of the new cine complex, scheduled to start by end of Puly.

",+x +pe,' multiplex i, N*1pu&

#ndia+s leading chain of multiplex operators, #nox >eisure has opened central #ndia+s first multi1theatre complex in the city over the weekend. The three1screen multiplex will also host 9ig 9a!aar+s second outlet in the city, in one of its wings. :ano 9hatia, chief executive officer ECE2F, #nox, said that movie watching would

44

never be the same in the city. The three theatres have a combined seating capacity of ,,.AK people and will have world1class acoustics. The complex has ultra1modern fixtures. The multiplex will be #nox+s twelfth one. The theatre complex will be managed by #nox. 5or the first time in the city, a concept of dynamic pricing of tickets is proposed to be introduced. <epending on the day of the week and the movie being screened, the price of tickets will range between %s 0@ and %s ,4.. 9hatia said the subsidiary of (u arat 5luorochemicals, which had entered the cinema exhibition business in ,@@@, has already made a mark in the entertainment industry with its customer1centric approach and international standard services. 2n future plans of the company, he said that within the next two years, it intended to widen its presence from the current ,, cities to in ,K more. "9y the end of 3..K, we plan to have a total of 3A multiplexes, with a total of ,.K screens and a seating capacity of -.,...,$ he said. The company+s turnover for the quarter1ended Pune 3..A, stood at %s -0 crore. #nox has an alliance with the 'antaloons (roup on a national level and has preferential access to all real estate developments taken up by the group. At the local level, the firm has tied1up with #ndo1'acific &oftware Entertainment.

3/l*.' t+ +pe, (+u& multiplexe' t-i' 7e*&

:G:9A#8 Adlabs films, the Anil Ambani1owned entertainment firm, has finalised the roll1out plan for its ambitious multiplex business. &ays :anmohan &hetty, managing director, Adlabs, ")e are all set with the roll1 out plan. >ater this month, a multiplex is being opened in 9angalore. )e will follow it up by opening multiplexes in #ndore and (a!iabad near <elhi in :arch

45

3..A.$ :etro, the :umbai theatre, will reopen as a multiplex later this summer. Adlab+s multiplex roll1out will see it getting access to A. screens nationwide. The movie distribution scene in #ndia is changing rapidly from single1screen to the multiplex space. Currently, out of an average -.. prints for a big budget Dindi movie, only about A. prints are for multiplexes. Analysts believe that within a decade, the share of multiplex screen prints could overtake that of the single screen complexes. Adlabs has also decided to aggressively move on to 5: business. After bagging ,A licences in a recent bidding round, Adlabs controls 43 stations. "The 5: business is all about content. )e plan to bring diversity. Dowever, the final content will depend on market acceptance.$ And how is life at Ad labs, post1Anil AmbaniN "Ambani doesn+t have time for Adlabs. )e decide strategy and Adlabs goes ahead with its roll1out. 9eing with the Ambani allows for critical mass and # think that entertainment is a big1ticket business of the future.$

46

$ULT"PLE> A PVR 3 C3SE STUD4

There are ?- multiplexes operating in #ndia with 3?A screens. '=% Cinemas is one of the biggest and a ma or player in this market

CO$P3N4 ?3CBGROUND

'=% Cinemas is #ndiaHs largest multiplex Cinema operator by number of screens. They established the first :ultiplex Cinema in #ndia, '=% Anupam, in <elhi in ,@@? and the largest :ultiplex Cinema in #ndia, '=% 9angalore in 3..4. As on date, it has ,, cinemas with a total of 4? screens in five A1class centres. 2f these, '=% operates nine :ultiplex Cinemas and two single1screen cinemas and managed one :ultiplex Cinema with three screens. '=% was incorporated in April ,@@0 pursuant to a oint venture agreement between 'riya Exhibitors 'rivate and =illage %oadshow, one of the largest non1G& cinema exhibition companies in the world with more than ,,... screens under operation. The latterHs international experience enabled the company to begin its film exhibition business operations. '=% also operates a small film distribution business through its wholly owned subsidiary, '=% 'ictures, which acquires and distributes #ndian and international films.

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9y introducing the multiplex concept in the country '=% Cinemas brought in a whole new paradigm shift to cinema viewing experience, high class seating, state of the art screens and audio visual systems. This catapulted the company to command a significant presence in ;ew <elhi, ;C% J 9angalore, making it the larget cinema exhibition chain in the country.

GRO#TH DR"VERS
Di%e&'i(7i,1 it' &e*)-9 Earlier '=% Cinemas was largely concentrated in the ;orthern parts of #ndia, with <elhi and Daryana accounting for ?K/ of its total cinema seating capacity followed by 9anglore E33/F. 9ut now the scenario seems to be changing. #n 56.A, <elhi and Daryana+s contribution to total seating capacity fell to A./ of its total cinema seating capacity and :umbai and other states emerged as new markets. The company is planning to establish further new cinemas and new screens across the country. Esee charts belowF.

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C Ot-e&' i,)lu/e $DP8 UDP *,/ H7/e&*.*/D R+.u't ti)2et '*le'9 The Company+s film exhibition business earns revenues from five primary sources, which includes box office revenue, food and beverages, advertisement, royalty income and management fees. Total revenues for 56.A were higher by 0./ over the corresponding twelve months of 56.0. The highest contribution to revenues was from the ticket sales, which at %s ?.0 m, accounted for AK/ of the company+s revenues. 5ood E%s 3,- mF and advertisement revenues E%s @,mF were the next highest contributors accounting for 3,/ and @/ of the total income respectively. The 0./ growth in total income was primarily driven by ticket sales, which increased by 0K/ 6o6, mainly due to the robust increase in revenues of existing cinemas and from the new multiplexes, which commenced operations during the year.

PVR F"RSTS
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At '=%, we are driven by a simple belief 1 H:ovies 5irstH. 'recisely why everything we do is to deliver cinema buffs an unparalleled movie1viewing experience. Dere is our *Dall of 5irstsH.

5irst to launch a multiplex in #ndia 1 '=% Anupam &aket, <elhi 5irst to launch #ndiaHs biggest ,, screen multiplex 1 '=%, 9angalore 5irst to bring premier movie viewing to #ndia with the exclusive Europa Cinema And >ounge at '=% (urgaon 5irst to introduce (old Class Cinemas in #ndia at '=%, 9angalore 5irst to form a foreign oint venture with =illage %oadshow, Australia 5irst to receive institutional funding in the cinema industry 1 from #C#C# =enture 5irst to offer computerised J online ticketing 5irst to accept credit cards in cinemas 5irst to introduce mobile based information J ticketing service 5irst to launch a loyalty program for movie1goers in #ndia 5irst to launch H:ovies 5irstH 1 a monthly maga!ine that updates the movie lovers on the latest happenings in 9ollywood and Dollywood.

PVR P"CTURES
'=% has also ventured into the business of film distribution and set up '=% 'ictures, a fully1owned subsidiary of '=% >td. '=% 'ictures specialises in acquisition and local distribution of films. This is a strategic business unit aimed at solidifying '=%Hs exhibition growth and strength. To date, '=% 'ictures has successfully released films produced by G&1based production house :iramax such as Chicago . '=% 'ictures has also signed a 0.80. oint venture with %am (opal =ermaHs =erma Corporation >imited7 I &era &eraHs production company *5actoryH. The new venture, titled *'=%75actoryH operates under the '=% 'ictures entity and has exclusive distribution rights in <elhi, Gttar 'radesh and Gttranchal.

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3CCOL3DES
'=% Cinemas proudly boasts of its hard earned achievements and accolades. #n recognition of the successes and pioneering efforts of '=% >imited, A ay 9i li, :anaging <irector, '=% >imited, was conferred *The Theatre )orld ;ewsmaker of the 6ear Award for 3..-H. #t is his vision and outstanding contribution to the cinema exhibition industry that has made '=% the largest cinema exhibition company in the country today. #t has been '=% CinemasH constant endeavour to provide its patrons a luxurious cinema viewing experience. ;ot only does '=% give importance to the choice of movies that are screened but it also focuses on providing a safe and comfortable ambience. Ieeping with this, '=% (urgaon was nominated for an award in the "9est %etail Environment$ category at the prestigious "Annual <esign )eek$ awards. #n yet another achievement for '=% Cinemas, A ay 9i li1 a significant contribution to the multiplex industry of #ndia, was honoured with a special award at CineAsia 3..4. 5or the first time, CineAsia honoured an #ndian exhibitor. De has also been chosen as &ignature 6outh #con for the year 3..0.

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UPCO$"NG $ULT"PLE>ES OF PVR Ci,em*' S)&ee,' Se*t' Expe)te/ ",

'=% C#;E:A& &elect City :all, &aket, ;ew A &creens <elhi '=% C#;E:A& 'hoenix :ills, >ower 'arel, ? &creens :umbai '=% C#;E:A& 2beroi :all, (oregaon, :umbai K &creens '=% C#;E:A& &hiva i 'ark, %a ouri (arden, A &creens ;ew <elhi '=% C#;E:A& Ampa :all, Chennai '=% C#;E:A& 2deon, (hatkopar, :umbai '=% C#;E:A& 5lame! :all, >udhiana 'rashant =ihar, <elhi >atur Aurangabad &ilver Arc, >udhiana TOT3L ? &creens 4 &creens 4 &creens - &creens - &creens - &creens - &creens ,A.. ,30. ,... K.. ,.0. ,,.. ,... 5iscal 3..? 5iscal 3..? 5iscal 3..? 5iscal 3..A 5iscal 3..A 5iscal 3..A 5iscal 3..K 33.. ,0.. 5iscal 3..? 5iscal 3..K 3.0. 5iscal 3..? ,3A@ 5iscal 3..?

<1 S)&ee,' 1!310 Se*t'

PRESENT PVR C"NE$3S

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,F '=% 9angalore 3F '=% 'riya -F '=% &aket 4F '=% =ikaspuri 0F '=% ;araina AF '=% :(5 ?F '=% &ahara :all KF '=% E<: @F '=% 5aridabad ,.F'=% &pice ,,F'=% Dyderabad ,3F'=% %ivoli ,-F'=% >ucknow ,4F'=% #ndore ,0F'=% Puhu ,AF'=% :ulund

"N THE NE#S9

3/l*.'8 Di',e7 l*u,)- $+%ie $*1i)
:G:9A#8 The )alt <isney Company E#ndiaF and Adlabs 5ilms >imited on &aturday announced the launch of <isneyHs :ovie :agic at a special charity screening here at :etro Adlabs theatre.

Commenting on the association, )alt <isney Company E#ndiaF :anaging <irector %a at Pain said <isneyHs :ovie magic as a new weekend entertainment option will be available through leading multiplex chains across #ndia.

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These <isney movies will be screened in Adlabs theatres in :umbai, 'une, ;ashik, #ndore, Dyderabad and :eerut. The exciting line1up of movies will include <isneyHs feature animation and popular live1action hits such as The #ncredibles, Cars, 5inding ;emo, The >ion Iing, Aladdin, Tar!an, Chicken >ittle, The 'rincess <iaries and ,.3 <almatians. The weekend shows are scheduled from @ am to ,. am and tickets are priced at %s @., which include goodies for kids, said Tushar <hingra, Chief 2perating 2fficer, Adlabs 5ilms >imited.

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#+&l/:)l*'' multiplex +pe,' i, N+i/*

;orth #ndia+s largest multiplex with K screens, &pice '=% Cinemas for a unique 341carat cinematic experience, was launched in &ector130 A, ;oida, yesterday. #t has -A plush fully reclining seats and offers personali!ed service that includes a wide selection of light meals and beverages. <r <.I. :odi, chairman, :corp (lobal said that in creating the world1class exhibition infrastructure for the #ndian audience, they plan to launch more lifestyle entertainment centres in the near future. "# strongly feel riding on the merging digital infotainment wave #ndia can do with this sector what its human resources have managed to do for the #T services industry. :corp (lobal is committed to the progress, corporati!ation and globali!ation of the #ndian film and entertainment industry,$ said <r :odi. The digital age presents #ndia with a wonderful opportunity in the international entertainment sector. #ndia can emerge as a global hub for digital entertainment and :corp (lobal will do everything to make this a reality "#n the years to come, the #ndian entertainment industry will be larger than the #T services attracting international capital to this sector. #t+s now time to shift gears and look at the challenges that lie before us for placing the #ndian entertainment industry on the global map,$ he said. The state1of1the1art digital and advanced pro ection system make this a truly memorable experience, unlike anything presented before in #ndia. &pice )orld is the first truly world1class mega mall and multiplex in ;oida. )ith #ndia+s first 4 < theatre, it is all set to redefine entertainment in #ndia.

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D Sm*&t C-*i&' 4< &mart Chairs are theater seats designed to produce various combined sensation effects and enhance the cinematic experience. 9y creating a uniquely combined and synchroni!ed Rvisual1sensationR experience, regular theaters can be easily transformed into exciting multi1sensory theaters. Each unit includes a bench of chairs Ecomprising four or three seatsF which are then placed on a multi1leveled floor. Controlled by a central synchroni!ing system, the effects created by the 4< &mart Chairs become an integral and coordinated part of the pro ected film

<esigned by world1renowned architects Dolford Associates from <ubai, &pice )orld lives up to the highest international standards in ambience and offers a wide range of innovative entertainment ideas. :r 'riyaran an <as :unshi, Gnion :inister of #nformation and 9roadcasting, who was slated to be the chief guest at the opening of &pice '=% Cinemas, could not make it.

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Dollywood film producer, Ashok Amritra , Chairman of Dyde 'ark Entertainment, who had flown in from California as the guest of honor at this event, said he would take a hard look at the #ndian film industry scenario for possible investments here.

PVR Ci,em*' l*u,)-e' it' <0t- ')&ee,D

2pens 3 screens multiplex at &ahara :all to beda!!le (urgaon with unmatched '=% Experience

C"NE$3> $*1*0i,e lu,)-e/

The day was all about celebrating films as C#;E:AO Cinemas, :umbaiHs most popular movie exhibition company today launched its very own film encyclopedia titled HC#;E:AO :aga!ineH. The maga!ine was launched by the charismatic, gorgeous and stunning 5ormer :iss #ndia (ul 'anag at C#;E:AO =ersova. C#;E:AO :aga!ine is a complete insight to the world of 9ollywood. 'ublished monthly, the maga!ine would feature all activities and events taking place at all C#;E:AO multiplexes. #n addition, the maga!ine would also feature information, gossip and film reviews taking place in the entertainment industry. :r. <evang &ampat, (eneral :anager 1 :arketing and &ales, C#;E:AO said, R#t was a great moment for C#;E:AO as this is the very first time in the history of cinema entertainment that has introduced their very own film encyclopedia. The maga!ine is a dream come true for all at Cinemax and would be edited by our very own Diral Ianakia. The maga!ine aims to provide information to our valuable patrons on C#;E:AO expansion plan, its activities and events and will also endeavor to take a note of the fellow achievers.

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C#;E:AO brand has put the magic back into going to the movies. C#;E:AO is amongst the numerous successful ventures premeditated by the house of IanakiaHs. An established and trustworthy name in construction and education, this group has forayed into entertainment industry with its revolutionary initiatives. C#;E:AO is the largest ownership model multiplex in country. )ith -- screens across ,. locations, C#;E:AO is the third largest exhibition company in #ndia.

N+@8 )*t)- #+&l/ Cup *)ti+, i, multiplexe'

:G:9A#8 5ootball lovers can re oice. They will be able to watch the )orld Cup semi1final and final matches live at city multiplexes. Exhibitors have reached an agreement with E&';1&TA% &ports, official broadcaster of the Cup. Tickets will be priced between %s-.. and %s0.., and there will be value1added services such as well1stocked bars, unlimited beer, and gifts. ")e have tied up with a liquor brand and obtained the mandatory permissions,$ said <evang &ampat, general manager, marketing and sales, Cinemax cinemas. Tushar <hingra, chief operating officer, Adlabs cinemas, said the multiplexes would pay a hefty royalty but "will not pass on the additional costs to the audience.$ The additional cost is for upgrading equipment. 9ut multiplexes believe it+s worth it. "To be associated with the Cup is a great brand building exercise,$ said %ahul :erchant, head of sales and marketing, 5ame cinemas.

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PVR 1et' li)e,)e (+& 6:')&ee, multiplex i, $ulu,/

:G:9A#8 >eading multiplex cinema operator '=% >td on )ednesday said it has been granted licences for a new six1screen multiplex in :umbai.

The company informed the 9ombay &tock Exchange that the multiplex, ;irmal >ifestyle at :ulund, would begin its commercial operations from Pune @. The multiplex would also be eligible for a ,.. per cent exemption from entertainment tax for a period of five years in accordance with the Entertainment Tax policy applicable in the state of :aharashtra, '=% said. )ith the opening of these screens at the multiplex, the total number of screens in operation would go upto AK, it added. Earlier in :arch, '=% had been granted licences for five screens at #ndore and four at >ucknow. >ast year, the multiplex operator had announced plans to launch K3 screens in ,K multiplexes by 3..K. 2ut of these, five multiplexes had been planned for :umbai and two low1priced ticket multiplexes for Aurangabad and >atur.

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CONCLUS"ON
)ith :umbai already boasting seven multiplexes and several more being planned, the message is clear, the era of single theatres is drawing to a close. Even as the ,4.1odd single theatres in :umbai resumed work after the end of a ,.1day long strike demanding a reduction in entertainment tax, the message was clear. The era of the single theatres was drawing to a closeM the future belonged to the multiplexes. )hile the (overnment had reduced the entertainment tax EETF for the single theatres from 00 per cent to 40 per cent, the multiplexes need not pay any ET for three years and then only 30 per cent for the next five. 2f course, the multiplexes had to provide extra facilities such as video games, a theatre to stage plays, adequate parking, a crUche, gardens and so on. The :aharashtra (overnment views the multiplexes as a prestige issue and a definite plus point for the city. Also people are accepting multiplexes. There is a change in the lifestyle of the people. They are ready to spend. Their aspirational levels have gone up dramatically. They don+t ust spend on basic goods and services, but always something more, something extra. They want to indulge themselves by spending more on lifestyle products. This is because of the disposable income is rising. &trong economic growth and increased globali!ation has resulted in higher household income. The rise of the #ndian middle class with greater earning power and a higher disposable income is the drive for the growth of the multiplex segment. Digher the income earned, greater percentage of income will be spend on discretionary items such as movies J entertainment.

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