Kollywood producers vs distributors: Will Rajini’s request change the way business is done?

Rajinikanth suggested distributors not fall prey to producers’ hype when purchasing films.
Kollywood producers vs distributors: Will Rajini’s request change the way business is done?
Kollywood producers vs distributors: Will Rajini’s request change the way business is done?
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Superstar Rajinikanth may have ruffled a few feathers when he suggested that distributors show due diligence while purchasing the rights of a film and not fall prey to the tall promises of producers or star value.

Speaking at the audio launch of Neruppu Da, Rajinikanth said, “Producers tend to create hype to promote their product. A distributor or an exhibitor shouldn't get carried away by the business tactics of a producer. They should consult veterans in the field before purchasing a film — they should ensure that the numbers for which they buy a film is affordable for them. They should be in a safe zone. It is unfair to cry foul when the figures do not meet your expectations after purchasing a film for a heavy price."

The actor also requested producers to think of all stakeholders in the film rather than profits alone.

Rajinikanth’s comments are not surprising, considering the star has found himself in the eye of the storm when his otherwise bankable films have flopped. When Baba bombed at the box office in 2002, Rajinikanth compensated distributors for their losses. The same happened in 2008 with Kuselan. When his 2014 film Lingaa failed to live up to its pre-release hype, distributors began knocking at Rajini’s door once again. Following several rounds of negotiations, the superstar coughed up Rs 10 crore on “humanitarian basis”.

In a meeting on Tueday, the Tamil Nadu Film Distributors Association reportedly came to the conclusion that the Minimum Guarantee system, that has become the norm in Kollywood, be scrapped.

Based on Minimum Guarantee or MG, the distributor buys the rights for a film prior to the film’s release for a fixed amount of money. If the producer makes a windfall after the film’s release, the profits will be split with the distributor. However, if the film ends up tanking in the box-office, the burden of loss is on the distributor.

Earlier this year, Tirupur Subramaniam stirred a hornet’s nest when he observed that star films such as Rajinikanth’s Kabali, Vijay’s Bairavaa, Suriya’s Singam 3 among others caused distributors like him a loss to the tune of 25 to 50%.

Burdened by their losses following a string of flop films, the Association have reportedly decided that henceforth it would only adopt two systems. One, the normal distribution of films, where the earnings are split between the producer, the distributor and theatre owners. The other option before distributors in Tamil Nadu is outright purchase, where a big distributor or cinema house buys the rights outright for a region. However, it is a high stakes alternative reserved for larger players, with profit or loss being entirely on the outright buyer. 

(Content provided by Digital Native)

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