Business - India;Has the bollywood bubble burst ?

Tanuj Garg

Has the bubble burst? Is it about to? Or, is it just much ado about nothing? Different schools have different thoughts.

Some time ago when Bollywood became flush with public money, star salaries and acquisition prices shot through the roof creating a financial situation that was untenable and unheard of in all these years. Nevertheless, some companies played along—it was about increasing corporate valuation and raising the topline with little regard to bottomline.

Today, with the global economy being in the situation that it is in, the industry is beginning to slide under a damp blanket for cover. There have been no new mega sign-ups, no flashy announcements of multi-million deals. The more aggressive players have gone tame after a string of colossal turkeys. Sub-distributors are exercising caution in offering fancy prices to distributors.

Incidentally, some big (in terms of their price tag) projects under production are lying un-acquired. The Akshay Kumar-Sanjay Dutt starrer Blue (priced at Rs 150 crore) and the Salman Khan-Ajay Devgan starrer London Dreams (priced at Rs 120 crore) are still to sign sales deals on the dotted line, as buyers have justifiably turned shy to fork out such incredible sums (with no prima facie recovery on table). There are takers available for these projects but not at the asking price.

This, by no stretch, paints a bleak picture of the industry. As cinema is and will remain, the staple source of entertainment for Indians the world over, we are living and working in one of the most robust sectors of the economy. If anything, the situation will only lead to a correction by restoring prices to realistic levels and making cinema more profitable even for those further down on the value chain.

‘Bonding’ with reviews

Yes, so reviews do not matter beyond a point—nothing works like box office success in the movie industry. That said, a bit of critical acclaim has never hurt. Therefore, the news of a Bond film (the upcoming Quantum of Solace) premiering at the London Film Festival this month could easily mean that the director and studio are possibly hoping for accolades from the fourth estate as well.

Following Casino Royale is a tough assignment. Regarded as the best Bond for ages, it came with the unprecedented kudos of a Bafta nomination for Daniel Craig. Directed by Martin Campbell, Casino Royale made nearly $600 million at the box-office, the most financially successful of the series. Casino Royale was loved by the audiences. They now expect more and the director of its sequel, Marc Foster, is a nervous man, who knows he has to deliver in garnering the public sentiment.

It releases in the UK a week before it does in India so it will not be long before the verdict comes out