OTT: The Dark Net For A Collapsing Industry?

The Telugu cinema business has become very popular all throughout India. Tollywood has reportedly taken over the Indian film industry from Bollywood. However, this is only the surface. Tollywood has its own problems, and now it has to deal with the problem of really being. The OTT is the primary culprit here. Non-theatrical rights have become more important in modern Telugu films. Those days of relying so much on the theater are long gone. 70% of today's entertainment industry is dependent on non-theatrical, with the remainder on stage productions.

Once again, OTT and Hindi rights dominate the non-theatrical sector. The satellite rights market collapsed with the advent of OTT. Several independent films of moderate scope have yet to attract viewers through satellite.

Producers are factoring in non-theatrical markets in their distribution strategies. The film's financial viability hinges on whether or not there is an audience for the hero outside of theatres.

Heroes are adjusting their compensation to reflect the demands of the video game industry. A YouTuber specialising in short films has just scored a hit with a movie on maternal love. He is asking for compensation in the Rs. 1.25–1.5 crores range. Another hero who starred in a film released only on streaming services during COVID was paid 10 crores. After that, he had three more releases and is now asking for 30 Crore for his next picture.

The non-theatrical market makes sense in both instances.

This means that the non-theatrical market, especially OTT rights, is crucial for both heroes and producers. Is everything rosy on the end of the OTT firms, though?

SunNXT has vanished without a trace. Zee has slowed significantly as it considers a combination with Sony. If SonyLIV's recent purchase habits are any indication, the streaming service's longevity is in doubt.

Amazon Prime Video first sparked the OTT explosion in Tollywood, but the company has now changed course. Netflix is buying up rights like crazy. Tollywood is keeping its fingers crossed that Jio will make some wise purchases.

However, OTT service can only continue for a while to lose money. Consolidation to a single or a small number of companies is inevitable; once that happens, current pricing will be temporary at best.

Money from Hindi rights seems secure as long as Bollywood keeps producing garbage. It will stay that way for a while, however.

Ignoring the theatrical industry in favour of the non-theatrical one is risky.

One young hero creates movies that bring in money outside of theaters. The emphasis on making money at the expense of producing quality material is chipping away at this. Two major studios scored big with package agreements starring this hero, but he ended up with a horrible reputation.

There are two protagonists, one from a powerful family and another whose first picture was an unexpected smash success, but their films have been sitting in cans for months since they have not been interested in their OTT agreements. It's time for the industry, and its heroes and producers, to rethink their approach. The target demographic has to be enticed back to the theatre. Otherwise, you're going down.