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Domestic and international distribution rights for Bollywood's hottest films under production and slated for release this year, have been pre-sold at record-breaking prices to media and film companies.
As many as seven blockbusters have been sold for over Rs 300 crore, nearly double the amount production houses are spending to make the films.
The buyers are funds-flush entertainment companies like UTV, Balaji Telefilms, Studio 18, and Eros International.
Many more movies -- such as Aamir Khan's Gajani, Love Story starring Priyanka Chopra, and Abhishek Bachchan starrer Dhrona -- are expected to fetch over Rs 140 crore for producers from distribution rights sales.
The entry of the big boys has dramatically reversed a long-standing industry practice of selling distribution rights to small distributers in various territories when the films were complete.
The country was divided into nine territories such as Delhi and UP, east Punjab, Mumbai, Tamil Nadu and Kerala and West Bengal, amongst others.
The new trend is partly a result of the need to maximise profits by managing the release calendar.
"Acquiring films ensures that no two big films are released on the same day or a consecutive week, thereby eating into each other's revenues. It gives the studio enough time to work on the marketing and promotional activities around the film," said Sandeep Bhargava, CEO, Studio18.
The need for year-round content is also prodding distribution companies to make high-cost rights purchases.
"To ensure that an entertainment company churns out films on a regular basis, one has to produce a sufficient slate of films. But, it is not possible to produce all films, so acquiring a movie produced by another company is a workable model," explained Siddharth Roy Kapur, executive vice president (marketing, distribution & syndication), UTV Motion Pictures.
