Being an “insider”, I get asked on Twitter all the time whether to a certain rumour being circulated on the net is real. When its about my family, I do respond. At times I dont because its below my level to come and clarify every piece of junk. The more I answer, the more I will be made answerable. Many a time, I even get asked to clarify about celebrities who are not from my family. At this point – I really dont know what to say. I know its untrue, but how can I go about defending other people? I always wished I could do something about it. Sometimes, I see some hardcore fans of actors really getting worked up on these rumours.

While flipping OK!, one of the celebrity mags I bumped into a coulmn which totally caught my eye. Its titled “Real or Rumor?”, and simply states which of the gossip floating is true & which was one is real. I felt it was a good idea and suits our magazine very much. We could also get a quote from the celeb or their PR machinary. Would make it fun & authentic. While some harmless gossip can just float around, the ones that malign a celeb’s image can be dealt with. It would also make an interesting new feature in our magazine. I need your advice on whether we should introduce it.

Despite being the fastest & easiest way to popularity, Southscope kept away from rumour-mongering & attacking celebrities. Stars and our reader love our magazine for the fact that we keep away from yellow journalism. Doing this would would earn me more personal attacks from the “yellow press”, but I am game for it. Think it would be a good idea. Do vote and let me know your opinion.

Our first venture in exhibition is a super-success. “Geetha Apsara” is the number one theater in Rajahmundry, and has the highest ‘average occupany rate’ in South India at 72% (our estimate, even India as attendance levels are much lower up North). We have acquired another theatre Teja in Palakol (our ancestral home town) and going to revamp it soon. On the distribution front – we have a great year with Leader, Avatar (Andhra Pradesh), Magadheera & Mahatma. This year’s line up includes Pawan Kalyan’s Puli, Mahesh Babu & Trivikram’s untitled film. We’re also looking at acquiring another ‘big budget’ film.

In our ‘core business’, film production other than Dad, we have two promising producers on board, B. Madhu (producer of Tagore & Ghajini [Hindi], co-producer Stalin) & Mr. Bunny Vasu who is turning a Producer with our untitled film directed by Sukumar. So Sukumar’s film, Allu Arjun’s Badrinath are our present ‘production’ projects for the year. Add to that, the tamil dubbed version of Magadheera, which will release in the second half of the year. We’ve joined hands with a A-list Tamil producer give it a big release in Tamil Nadu.

Also, I will be joining the Producers list by taking a project some time later, this year. So, we’re going through an exciting phase of making changes in the company, bottom-up. To accommodate these needs, we need more office space. We already have two satellite offices in Jubilee Hills and taking one more. This is excluding the Southscope office, which is a subsidiary of Geetha Arts. In our head quarters in Road 45, Jubilee – we have another floor with a swanky, new Google & Twitter-like office where me, Bunny (Allu Arjun) and my eldest brother Bobby (Allu Venkatesh) will operate out of. I will upload pictures of that office soon here. I am still active in the everyday management in Southscope, but wouldn’t be next year onwards after setting a professional management to run it. Other than these, personally I have floated two small but very exciting businesses. They’re all a part of my “larger plan” and are very exciting. Will update you about them, as they roll out.

I play small, yet significant roles in Geetha Arts – what ever my father Mr. Allu Arvind delegates to me. He still runs the show, calls the shots and is backed by an efficient team who has been with him for over 30 years. Other than seniors, we have also included some new people into the senior management. I will introduce them to you later, on this blog. Amongst the works I do at Geetha Arts is ‘branding’ as I always had the knack for it. But wait, mine is not too glamorous a job! I also do “admin” work like hunting for new offices, upgrading computers & equipment. We’ve designed a enterprise software, for “project management” which is suited to our unique needs. I also got to do some classic CEO-like stuff of hiring the new top-level management & exploring new business opportunities. I am getting trained in all the departments, so that I will be equipped to do bigger stuff in the future. Read the About page of this blog to know more about my ambition.

Soon, we’re going to ramp up our presence on the online medium – which includes a website and an official company blog. My father himself wants to write some stuff! You should read them as we both have totally contradictory opinions on many issues. Also, I want to set up a strong online presence for our stars Allu Arjun & Ram Charan (like a blog & if they’re interested Twitter). Both of them are actually tech-saavy : They use Blackberries, shop & make travel bookings themselves online. For all this I am putting together a small team as support staff. We’re looking for a small, hip webdesign studio to execute this project (Geetha Arts website, Allu Arjun & Ram Charan official website) on BOT (Build-Operate-Transfer) basis.

In the past, we got a brand new logo. A Mumbai-based agency “Ink Inc” had designed it. Following our bold, minimalist logo we have designed some stationary too using the same principles. So, we consciously avoided color and stuck to greyscale. Also, all the employees & stakeholders in the company approved of it. I am just sharing them with you. Hope you liked them!

(Click here to read PART – I) People in the marketing industry estimate that the South Indian celebrity endorsement market is under-tapped. In today’s levels itself the market could be worth around Rs 50 crore. Yet it’s only Rs 20 crore in size. One of the prime reasons, I have found out is that – brands don’t know which celebrity suits their brand and how to sign them. With South India being such a pluralistic market, it’s hard for an outsider to know the big names and their image in each of the four states. Brands have the intention and budget to have a single brand ambassador for the whole of South India, or separate ambassadors for each market. But, most of them don’t know who the big names are – or if the celebrity’s image suits their brand.

Also the endorsement opportunities are not limited to the Suriyas and Trishas of the world, but also to other artistes. Big C is a mobile store chain which is mainly concentrated in AP, with monthly marketing spend in crores. It needs a popular local brand ambassador. They had Charmme, Kajal as brand ambassadors in the past and Ileana at present. Brands like Chandana Bros, RS Brothers, CMR have a strong presence in AP and need a face popular in the state. Pothy’s, Chennai Silks, Kumaran, Nalli, RmKV, GRT Thangamaligai, Prince Jewelers, Vasanth & Co are some of the brands that have a strong presence in Tamil Nadu and marketing spends in crores matching that of national advertisers. They only need faces familiar in Tamil Nadu. Likewise, Malabar Gold is a brand that’s popular only in Kerala and has Mohan Lal as a brand ambassador. Below are some of the ‘regional powerhouses’ which have huge budgets and market though they have limited geographical reach – most times, just to one state.

Some of the brands don’t just use leading heroes and heroines, but also popular character artistes. Comedian Vivek, former hero and artist Prabhu (Sivaji Ganesan’s son), Telugu comedian Dharmavarapu, Prakash Raj, yesteryear heroine Vijayashanti have been featured in many ads as the brand felt they don’t need the ‘glamour’ element in their ad to get their message across. As this business gets more streamlined, there will be more opportunities for artists like Brahmanandam (Telugu), Vadivel (Tamil), Vivek (Tamil), Sunil, Venu Madhav who are ‘stars’ in their own right and can bring great mileage to brands with their endorsement.

Celebrities and Marketers don’t speak each other’s language

Lot of brands have the appetite and budget for a celebrity ambassador, but do not know how to go about it. Many a times, a brand manager calls me or my editorial team at Southscope and asks, “We need a brand ambassador for South/AP. Who is the Shahrukh Khan/Hrithik Roshan of South/AP?” We try to advise them that there are no exact parallels. Instead of asking “Who is the Shahrukh Khan of Andhra Pradesh?” let’s turn the question the other way round. “Who is the Ram Charan Tej of Bollywood?” Abhishek? Both are sons of superstars, but no similarity at all. Hrithik? Close in personality, but Charan belongs to a much younger age bracket. Ranbir? Both are youth icons, but Charan has more mass appeal. Realizing it’s hard to draw parallels, we ask them what is it they seek to achieve through their brand ambassador.Then, they describe their requirements. For example – “We want our brand to be seen as a leader, have aspirational look, appeal to both urban and rural youth.” Considering their requirement, we suggest names on who might fit their needs. It doesn’t end with that – again they come back to me if I can pass on the numbers of their business managers, which we oblige.

A month later, on re-connecting with the brand we realize that the deal didn’t go through. Most of the stars or their managers do not know how the advertising and branding field works and not equipped to handle the legal & creative requirements of brands. The brands do not know the language of the ‘film industry’ and how deal-making is done here. This is one of the reasons why most deals don’t go through. As strange as it might appear, it is true. Only an ‘insider’ in both these industries can close a deal, which is why there is a need for an “entertainment marketing agency”. The star needs an agency that can advise him or her and ‘manage’ all the brands he or she endorses. The brand needs an agency which can manage all the brand ambassadors in its portfolio. Most big brands today have multiple brand ambassadors.

The near future of celebrity endorsements in South India

Unlike earlier, brands don’t prefer to close endorsement deals through ‘mediators’ or middle men but seek marketing agencies with which have sound knowledge of the local industry and the muscle to rope in stars for their endorsements. Some of the leading ‘entertainment marketing’ agencies in India are KWAN, a new floated outfit which is the market leader, followed by others such as Globosport, Cornerstone, Bling and a few other smaller ones. Incidentally, Mahesh Babu is the first and only South Indian star so far to be exclusively represented by an an agency, KWAN. Though others have done endorsements, they’ve done it in their individual capacity. Like how the corporatization of the film industry has brought in more revenues, the entry of marketing & branding agencies would do the same to the local industry. All the big players have their eyes set on the Southern industry as they feel this is the next “growth market” as Bollywood and sport stars are nearing saturation. Also the opportunities are not limited to endorsements alone, ‘Appearance fees’ for showroom openings, press conferences, TV shows and events is another avenue. So is ‘Performance fee’ paid for performing at a certain corporate event or award function. ‘Branded entertainment’ is another segment for opportunity, where a celebrity who need not be the brand ambassador lends himself for a TV show or live event. For ex: A leading electronics brand being the lead sponsor for a concert by a leading music director. There are many other opportunities to be explored. The dialogues between the brands and celebrities have already started. In the near future you would be seeing more of your favorite film stars outside movies. The billboards, TV ads, newspaper ads you consume will be far more interesting, familiar and convincing. Also, I feel Rs 50 crore is still a modest number considering how movie-obsessed South Indians are.

PART – I:

Why celebrities use brands?

Since this is no marketing lecture, let me jump straight to the point. Brands see great value in roping in a celebrity to endorse their brand. If they dint see RoI (return on investment) on celebrities, they would’nt be doing it. Afterall, the celebrity endorsement market in India is pegged at Rs 850 crore. A celebrity endorsement gives the brand many advantanges. It gives a high-recall value to the brand. An average consumer is exposed to hundreds of marketing messages a day, through TV ads, newspapers, hoardings etc., The one that has a celebrity, ‘cuts though the clutter’. It gives instant recognition to the ad.

Also, celebrities endorsing a brand, gives it certain amount of credibility – no what what naysayers say. Most of the times there is a good marriage between the brand’s characteristics and that of the celebrity. Like Pepsi always positions itself as the “youth drink” hence it has Ranbir Kapoor and Ram charan Tej, two youth icons as its brand ambassador. Genelia’s bubbly image goes well with the brand she endorses like Fanta, Virgin Mobile and Perk. These associations make the consumer identify and relate himself to the product better. Marketers call this ‘brand connect’.

A 850 crore market, dominated by Bollywood.

With its wide reach, Bollywood still has the lion’s share amongst the endorsement market. There was a point when crickets and other sports stars started notching deals on par with actors, but again the tides shifted in favour of actors. The celebrity endorsement market in India is Rs 850 crores annually. And movie stars command 70% of this, while the remaining is mostly sports stars. The surprising part is, of this South Indian movie stars only account for a measly Rs 20 crore!

Having a cult like following amongst its movie goers, and having about quarter of the country’s population and GDP,  shouldn’t southern movie actors get a bigger cut of this pie? Ideally, yes – but let’s have a look on why this hasn’t been the case and what the future holds.

The “unified Indian consumer” myth.

Through the post-liberalization era marketers believed that, India will turn into one large unified mass (like China), where people can be easily divided into demographics according to age, income levels and location (urban, rural). They believed if they crack the ‘great Indian middle class’ they have a huge mass of 500-600 million consumers in one go. But, that’s not the case. Though, politically, in spirit we Indians are one, culturally – we’re vastly different from one another. Brands are realizing that to appeal to today’s new-age, well-informed consumers they should make campaigns that talk in their language, reflect their beliefs and be relevant to their culture. The “one size fits all” attitude doesn’t work anymore and brands are quickly adapting this new found insight.

Marketers call India “the most pluralistic” market and rightfully so. There is even a book titled “We are like that only” by Rama Bijapurkar that explains how marketers should respect India’s diversity and not treat them like a single mass. Slowly marketers have realized that to increase ‘brand connect’ they have to localize ads and talk to consumers in a way it appeals to them.

Andhra Pradesh, the 70^th biggest country of this world.

Each state or region is becoming a huge market by itself. Marketers cannot afford to oversee them. With a Rs 2.67 lakh crore economy, AP is India’s third largest economy after Maharashtra and UP. If Andhra Pradesh is a country, it would be the 70th biggest economy in the world ahead of Oman, Lebanon, Bulgaria, Kenya & Jordan amongst others! With nearly 100 million population and a per-capita income of Rs 30,000, Yes, we’re that big! Tamil Nadu has a Rs 2.41 lakh crore economy. Karnataka is a Rs 2.11 lakh crore economy while Kerala’s economy is 1.32 lakh crore in size. Why do you think ThumsUp has a separate brand ambassador for AP? It’s because the state contributes nearly 20% of their national sales. Why does Airtel tie up with a movie for cross promotion every month? Andhra Pradesh is their single largest market for the brand where they hold the No.1 spot. The two biggest liquor consuming states in the country are Andhra Pradesh, Karnataka followed by Punjab. Andhra Pradesh and Tamil Nadu are home to 4.2 crore and 5.1 crore mobile connections respectively. Likewise, for every product or service – be it electronics, housing, food & beverages, financial products – the southern markets are huge.

Limited reach of Bollywood in South India:

To penetrate further into these ‘regional’ markets, brands need to localize the campaigns and make them relevant for the consumer. In most cases, a Bollywood star wouldn’t be enough. A big-budget Bollywood starrer, like My Name is Khan or 3 Idiots would release in about 30 towns in Andhra Pradesh. Where even a small-budget Telugu film would release in more towns than that. If a brand has to do an “in-film placement” and marketing tie up to increase their AP sales, a small-budget Telugu film is a better platform. Though people in Tier-II and Tier-III cities can recognize Bollywood stars, most of them wouldn’t connect to them as they wouldn’t have seen the movies (or very few, if so) of those stars. Even in a mega city like Hyderabad, where over 60% of the people can speak Hindi – the highest grossing Telugu film (Magadheera) sold Rs 22 crore worth tickets, where as the biggest Hindi hit (3 Idiots) sold just Rs 9 crore worth tickets! While neighboring Karnataka is a more Bollywood-friendly market, the reach of Hindi cinema is even lesser in Tamil Nadu and negligible in Kerala. Some of the smarter brands have realized they need a local brand ambassador if they have to improve the ‘connect’ between their consumers and their ads. Some of the smarter brands have a separate brand ambassador for thier ‘national’ campaign and a seperate one that appeals to their regional consumers.

The big bosses of most brands are based out of Delhi or Mumbai and have a limited understanding of South India. A lot of them still see the South as a single mass – with similar attitudes, culture and preferences. They make decision and execute campaigns based on their ‘perceptions’ rather than understanding of the market. How brands and marketers get the whole South Indian market wrong is another topic worthy of an article by itself, which probably I will write later. But this is one of the reason why we see many of dubbed ads more hilarious than engaging, as the people who created it have no idea of their target audience. As brands realize this mistake, they’re looking more towards ‘regionalization’ of their campaigns. Their best bet to help them in this mission – a regional brand ambassador. The endorsement oppurtunities don’t limit to superstars alone, but to the B-list and character artists. Also, ‘national brands’ are not the only ones who need a brand ambassador. To know more, click here to read PART – II of the article.

But, in our good old Telugu film industry, one of the “industry peddalu” (industry biggies) dint approve of this and launched a complaint with the Producer’s Council which had an ‘Emergency Meeting’ to discuss how the producer D.V.V Dhanayya had violated the rules. There are a lot of restrictions in the Telugu film industry, when it comes to marketing. I have written about it in depth here (click to read). Inspite of the Censor process and release tensions, the Producer answered to the committee. Most of the ‘new age’ producers who are regularly making films were empthazing the producer and asked the Council to update its archaic rules. The producer was asked to discontinue the campaign and not to issue further ads. I sincerely wish the Telugu film industry raises above all such petty stuff & becomes a progressive industry. After all, this is place I am going to be working for the next 40 years.

While naming brands or companies, I usually avoid Indian words as very few sound ‘brandable’. Also very few Indian words are ‘universal’ in nature like shastra, sutra, avatar or karma. Also, I felt names Shaadi, Baazee, JeevanSathi, Naukri or Masti doesn’t translate well across cultures in India. I myself dint know what Baazee meant till some one told me. Nor what the much-used ‘Jugaad’ meant for that matter, though I learnt Hindi in school. Also spelling them makes it harder. The brand is spelled as JeevanSathi, but ‘sathi’ is pronounced as ‘saa-thi’. Also if Jugaad or Masti have an H as they’re pronounced ”ju-gaadh” or “mas-thee”. Hence I stick to English words. My magazine’s is name Southscope, a word I came up with. I coined the name “Green Channel Forex” to my aunt who setup a travel & forex agency. Also, suggested my friend Madhu Mantena the name “Cinergy Productions” (cinema – synergy) for his film production company. I came up with another English word for one of the new businesses I am setting up. But, its quite surprising that some body at the other end of the globe actually considered a telugu name for their business. Hop over to Ooyala  (http://www.ooyala.com/about) and have a look at their site. Hope the name works for their brand.

MAGADHEERA ON BLU-RAY. FIRST TIME IN INDIA.

Geetha Arts, one of the leading production houses since 1972, has not only produced mega blockbusters in Indian languages but also pioneered many innovations. This time around, Geetha Arts has joined hands with Balaji Video, the largest home video company, to woo the audiences with a new offering – The all-time blockbuster Magadhereera on Blu-Ray. It includes a bonus disc with additional material. While the DVDs will hit the stands on the 3rd week of March, the Blu-Ray will be available 2 weeks after that. The Blu-Ray discs will be made available outside India for overseas viewers. Incidentally, this is the first time  a Telugu movie’s Blu-Ray disc is being released in the Indian market. Blu-Ray disc is the latest storage format which redefines home-viewing besides giving an experience on par with cinemas in picture quality and sound. A generation ahead of DVDs.

- Master (1997) was the first Telugu film to be released on an audio CD, beside the first Telugu film to be released in DTS.
- Johnny (2003) was the first Telugu film to have movie merchandising. Also the first film in Telugu to have in-film placement and co-branded advertising. It was also the first Telugu film to use sync-sound while filming.
- Jalsa (2008) was the first Telugu film to have a mobile game based on it. Also, the first telugu film using standees in theaters as a publicity tool.
- On its home production Ghajini, starring Aamir Khan Geetha Arts also created India’s first PC game, in association with FX Labs.

With the advent of internet, especially web 2.0 – celebrities don’t need the media to do the gatekeeping anymore. They can directly interact with the end-user using social media platforms like blogs, Facebook fan pages or Twitter accounts. In many controversies, people involved complain of ‘trial by media’ – a  phrase to describe the impact of television and newspaper coverage on a person’s reputation by creating a widespread perception of guilt regardless of any verdict in a court of law. In the times of crisis, social media genuinely gives the celebrity a chance to defend himself and clarify.

Social media presents the opportunity for celebrities to update with fans & moviegoers about their work and personal life, eliminating traditional media as a channel all together. Karan Johar recently hit out Priyadarshan on Twitter for calling the MNIK-Shivsena tussle a publicity stunt. He dint need to invite the media on a press conference specifically to let them know his reaction on this issue. He just posted it on Twitter and the media picked it up. Every time Aamir Khan or Amitabh Bachchan post something on their blog, it becomes national headlines. They cannot be misquoted, as everybody can see what they had to say on their blogs.

Recently, when a reputed business newspaper approached me, enquiring about Magadheera’s Hindi remake – I said we’re considering (not approached) some A-list actors in Bollywood, as only big stars can do justice to it. I don’t know how & why, but the next day – I read a report where I was quoted that Hrithik Roshan is going to play Charan’s role and Aamir Khan in Srihari’s role! I was misquoted, and this article spread far as it was reported by a credible newspaper and created so much confusion in the market about our movie. But thanks to social-media, though I am no celebrity I was able to clarify about the issue using Twitter and my blog to some extent.

Initially I wanted to get my family members and other from the industry on Twitter. It’s the new ‘it-thing’. So many Hollywood and Hindi film celebrities are on it. But after being on Twitter for the last 10 months, I feel it’s not the only & best social-media platform for celebrities to interact with the public. My argument is more-so for South Indian celebrities, whose situation is a little unique from the rest. While I am all in support of social-media, I feel an official website or blog might be a better platform. Here’s my take :

Fan Rivalries & Hate mail : South India has one of the most intense fan rivalries in the world. It’s not unusual to see people come to blows when defending their favorite actor. I myself am guilty of doing it in school. The fact that a certain celebrity is easy accessible will motivate fans of rival actors to post hate messages on Twitter. Irrespective of whether the star reacts to hate mail or not, the poster knows that his message will reach the star. Since real identities can be masked in twitter, it makes it more simple to write offensive tweets. Most people don’t express dislike or hate in real life even if the celebrity is accessible to them.

Also, on Twitter – the celebrity does not have the access/rights to delete defamatory tweets made on him, where as if it’s a blog – that certain comment will not be approved and visible for public to read. Recently, Chetan Bhagat – the author of ‘Five Point Someone’ was annoyed that a cartoonist was poking fun of him on Twitter. He couldn’t do much – where as if it were his blog, he could simply make sure the comment doesn’t show up. Movie buffs like me use movie collections as a metric to show popular or big a star is. A lot of people use the the numbers of ‘followers’ on Twitter as a metric to measure popularity which isn’t the case. Priyanka Chopra has more followers than Shah Rukh Khan where as politician Shashi Tharoor has 500% more followers than SRK! But, it’s undeniable that Shah Rukh is more famous than the other two.

Too much answerability to Gossip : Traditional media like newspapers, TV stations are legal identities that are answerable to the celebrities and law. Recently, Brad Pitt & Angelina Jolie have sued Britain’s News of the World newspaper for triggering off rumors of their alleged divorce.  Preity Zinta sued Mumbai tabloid Mid-day for printing transcripts of a so-called leaked CBI tapes which had unpleasant things said about her. Traditional media can’t say anything about a star and get away with it.

There are a lot of popular websites that exist only virtually, without legal real-life identities. They’re virtually untraceable. The identities of the owners and editors of traditional media have to be made public for them to operate. Blogs or websites can be started by anyone. They don’t require credentials or large capital. Most websites that publish gossip lack real-life legal identities and are virtually untraceable. That gives them courage to write anything, most times creating something out of thin air to get readers excited. The comic below aptly summarizes how gossip travels in today’s social-media era. The amount gossip around a celebrity today is way more than what it was earlier. When it comes to gossip many people have a ‘No fire, no smoke’ attitude, thinking its partly true. But trust me, most times gossip is somebody’s imagination and not even remotely close to reality.

After reading such gossip, the anxious reader would immediately tweet to the star asking him to clarify about gossip/rumors. It’s impractical and unreasonable for an actor to keep defending and clarifying gossip about him all the time. Even if the celebrity choses to be silent its hard, as they’re always pestered to clarify. The celebrity is expected to address by every gossip, everytime it’s asked – which is impractical – and again do it only in 140 characters! For ex : I clarified on Twitter that Geetha Arts never considered remaking 3 Idiots in telugu. But I get kept asking the same question over & again.  If the celeb has an official website or blog, they can just post the clarification, in detail with images or video if required and just once for everyone to see. If he chooses to remain silent, he wouldn’t just blog about it.

Frequent Updation & Limitations : The very way in which Twitter operates is that, it’s expected to be updated frequently. Many celebrities update it multiple times a day. Good for those who are doing it, but the ones who don’t are expected to post something often. Most people who update regularly on Twitter, post trivial stuff about their personal life. Also, they have to post something only in 140 characters. On a blog, they can write more freely, update it less frequently – only when they have something useful to say, insert pictures or video. It is uncensored and as immediate as Twitter. Also it gives the celeb more control over what is being said by them and about them.

Surprisingly, even Twitter is trying to move away from its celebrity culture and offer more value beyond following celebrities. Reach the article on CNN. Popular celebrities on twitter post personal information like what they’re doing at present, where they are currently. And other celebrities too are expected to do the same. A lot of celebs value their privacy hence, have avoided this all together. Some of them like Kanye West, Zac Efron, Beyonce Knowles and Drew Barrymore are vocal on why they are not on Twitter. They either feel its intrusive, limiting in expression or find it too demanding. Most of the top Hollywood names like Will Smith, Tom Cruise, Brad Pitt, Angelina Jolie & Megan Fox are not on Twitter. A lot of celebs have official websites, blogs and Facebook presence, but have decided to give Twitter a miss. Also, due to the sheer volume of communication and time required to maintain it a lot of celebrities don’t handle their twitter account themselves but have PR team in place. Its not ‘personal’ anymore. Most celebs who do this are even open about it. Social media offers various platforms like Orkut, Twitter, Facebook, Flickr, LinkedIn and so on. Last known there are 50 such platforms on which a person or celebrity can be on. A celebrity need not be on all platforms, but choose the right one to be present in. Due to the reasons cited above I feel Twitter is not the best platforms for celebs, especially Southern movie stars to interact with fans and audience. An official website or blog is a better way to communicate.

PS : By the way you can follow my tweets @ http://www.twitter.com/allusirish.

Numbers are very misleading. When a producer announces his movie grosses 100 crores, many people presume “collections – budget = profits”. This is far from it. Like any other business, the film trade has ‘layers’ of middle men between the filmmaker and end consumer, who are all inalienable parts of the business.

One of the most common terms we hear used in the trade is “gross”, “nett” and “share”. If you understand these three terms, you would understand the basics of film trade. Most of the times, what you read in the papers is the “gross collections”. Gross is nothing but number of tickets sold x ticket price. It’s the total amount generated by a movie at ticket counters.

Most states levy an “entertainment tax” on movies. States like Maharashtra, Gujrat, Punjab and others northern states charge in the range of 50%. There is a variation. Uttar Pradesh charges 60%, while West Bengal charges 30%, its 25% at Kerala. Kannada films in Karnataka are tax-free while non-Kannada films pay 70% tax! Tamil films in Tamil Nadu are tax-free while non-Tamil films pay 25%. Andhra Pradesh charges only 12%, one of the least in India. On an average, across India it’s assumed to be 40%.

Nett Collections : After the entertainment tax is deducted, what is left is the “nett”. This is the actual money that’s left in the hands of the theatre owner. He deducts his rent from the nett and forwards the remaining money to the distributor. This is called the “distributor’s share” or “share” in trade parlance. This is really the money from which the movie’s budget is recovered.

Theatre Rentals : There are two types of agreement a distributor can enter with an exhibitor (theatre owner or multiplex chain). For single screens it’s usually, a flat weekly rental. The exhibitor retains the money till his weekly rent is recovered. Anything that is collected afterwards goes to the distributors. Their revenues are not linked to the boxoffice performance of a film. On the other hand, multiplexes charge a percentage of the nett collections. Hence their prosperity is linked to the boxoffice performance of the movies they release. Most multiplex retain 45% in the first week, forwarding the remaining 55% to the distributor. In the second the mutiplex’s share is 50% or 55% (depending on terms) forwarding balance to the distributors. From the third-fourth week onwards, the multiplex retains as much as 60-70% of the collections of a film, as the audience drops. The whole tiff between Hindi film producers and multiplexes were because, producers felt multiplexes charge too much rent and leave very little to themselves. Multiplexes argue their pricing is fair, as customers pay premium price over a single-screen because of their amenities, which cost a lot to maintain.

As a thumb rule, as per present trends in the Bollywood industry, the ‘share’ of a film is 50-55% of its nett. For illustrative purposes, lets take a Bollywood movie which released all over India, with a good mix of multiplex and single screens (like Love Aaj Kal, Ghajini or Rab Be Banadi Jodi) to see how much “share” it collected.

The average ticket price here is Rs 80. This could be lower for a mass movie, as it would release in more single screens where ticket prices are lower. So typically, for a Hindi film a movie that grosses 100 crores only yields Rs 30-35 crores in revenue! So, is “share – budget” the producer’s profit from boxoffice? Not yet. Usually, a movie cannot be released by the producer himself throughout the country. Due to the vast geographical area, he engages distributors. Distributors charge a 10% commission for their services. So in the above case, if we presume the share is Rs 35 crore, we deduct Rs 3.5 crore as distributor’s fee. The balance amount is Rs 31.5 crores. This is the actual amount that goes to a producer.

So, lets take the case of Geetha Arts’ last Hindi film – Ghajini. The movie released in over 1400 screens, had a blockbuster run and grossed Rs 220 crores at the Indian boxoffice. The nett collections of the movie are Rs 115 crores. Which implies that the various state governments of India earned Rs 105 crores as entertainment tax through this film. This is a sum, neither the producers Geetha Arts, distributors Studio 18 nor our lead actor Aamir Khan made from the film! From the Rs 115 crore nett collections, exhibitors (various multiplexes and theatres) retained Rs 65 crores as rentals. Rs 60 crores is the “share” of Ghajini. This is the money that came into Studio 18’s hands by distributing the film.

Incidentally, on the 16th January 2010 the “Hollywood Economist” Edward Jay Epstein whom my blog is partially inspired from wrote an article titled “Why Journalists Dont Understand Hollywood?” which also talks on how news media don’t understand film business yet comment on it.

After reading this article you’d be surprised if most journalists don’t know these themselves. I’ve read umpteen articles where newspapers, including reputed business dailies mix up gross, nett and share for revenues of a film and tries to assess their profitability. One of the reasons behind me writing this article is to educate journalists and movie buffs on how the movie business works. Also to clarify to some irritating friends, who jokingly ask “Where is your 200 crore from Ghajini?” when I refuse to unwisely spend money. Also, I take this as an occassion to remind people that film-producing is not as glamorous as it seems to be. In this business, every rupee earned requires a rupee and half of effort. This is why, most people except seasoned producers dont survive in this industry despite producing hit films.

As most people have been asking me the same questions over and again, I have published those and my answers to them in a seperate post (Click here to read) . Before, you comment – see if your query was answered there.

(Article Revised – 07 Feb 2010) You know what? Though Ghajini is the ‘highest grossing Indian film of all time’,its not the biggest money spinner in India? Rajinikanth’s Sivaji is. The movie’s share from both languages (Tamil and Telugu) is 64 crores. Till 3 Idiots arrived, this movie holds the number one spot in actual revenues. Our very own telugu film Magadheera amassed a share of Rs 58 crores. Wondering how South Indian films are able to generate revenues matching that of Hindi cinema, despite having a far lesser reach? My next article on how Southern cinema (esp Telugu) is a goldmine that needs to be tapped.

Correction : Magadheera’ share was mentioned as Rs 58 crores. This is only for the Andhra Pradesh boxoffice. The telugu version released in Karnataka and collected a share of over 5 crores. The total share of the film’s Telugu version is Rs 63 crore plus, a few lakhs short of Sivaji.

This, though a welcome change to marketing of movies in Telugu Cinema does not comply with the rules of Telugu Film Producer’s Council. The producers of the movie have been served notices by the TFPC and have been asked to come up with an explanation on why the rules of the council were not taken into consideration while running the campaign. While the TFPC cannot ‘ban’ a channel a brand, it remains to see if any action will be taken against the producers for running this campaign. Personally, I welcome this trend and hope to see more such movie-brand associations.

PS 1 : Its a pure co-incidence that I have raised the issue at FICCI, Idlebrain and my blog and around the same time, the commercial went on air. I have no involvement in this. The total credit/blame goes to the 7Up and Arya 2 producers.
PS 2 : A lot of people have made comments on whether they like Arya 2, general comments on creativity in the film industry, or their opinions on PRP. While I respect your opinions/views – we (my moderators or I) would not approve those topics as they’re not related to the topic posted here.