MEDIA AND VIRTUAL ECONOMICS

Economic Analysis of Independent filmmaking in

India TERM PAPER

Submitted by:

Nikhil Saraf (20130120124)

Paarmi Modi (20130120127

Prem Thomas (20130120132)

Surabhi Anand (20130120152)

Under the guidance of:

Prof. Rasananda Panda

TABLE OF CONTENTS

ACKNOWLEDGEMENTS ................................................................................................................ 4

Requirements of Independent Cinema: ............................................................................................. 5

Film Festivals ................................................................................................................................... 5

Savvy Independent Film Marketers ................................................................................................ 5

Dedicated Film Venues ................................................................................................................... 6

Talent Development Programs ....................................................................................................... 6

Visionaries and Disruptors .............................................................................................................. 6

Audience (Bloore)Building Initiatives .............................................................................................. 6

INDEPENDENT FILM VALUE CHAIN ................................................................................................ 7

Order of Listing Players ....................................................................................................................... 9

Development....................................................................................................................................... 9

Financing and Pre Sales ..................................................................................................................... 10

Production ......................................................................................................................................... 10

International Sales and Licensing ...................................................................................................... 10

International Exhibition and Exploitation/Distribution .................................................................... 10

Consumption/Consumer ................................................................................................................... 10

Library Rights .................................................................................................................................... 10

Integration and Fragmentation ......................................................................................................... 11

Timescale .......................................................................................................................................... 11

Investment and Recovery ................................................................................................................. 12

GOVERNMENT AND INDEPENDENT FILMS: ECONOMIC CONSIDERATIONS ................................... 13

Production spend: the ‘Multiplier Effect’ ......................................................................................... 13

Employment generation ................................................................................................................... 13

Direct investment return .................................................................................................................. 14

Export earnings ................................................................................................................................. 14

National Brand Building .................................................................................................................... 14

Film as a driver of creative economy ................................................................................................ 15

PRODUCTION OF INDEPENDENT FILMS: CROWDSOURCING ......................................................... 16

Lucia .................................................................................................................................................. 17

Crowdsourcing platforms .................................................................................................................. 19

INDEPENDENT FILM DISTRIBUTION IN INDIA............................................................................... 21

Non-viability of Independent Film Distribution ................................................................................ 21

‘Supermen of Malegaon’: Case in view ............................................................................................. 22

Assumptions: ................................................................................................................................. 23

INDEPENDENT FILMS: DOCUMENTARIES ..................................................................................... 26

Government run organisations for documentary making: ............................................................... 26

Monopolization by the Indian Government: .................................................................................... 27

Independent Political Documentaries - Background: ....................................................................... 28

Financing, Production and Distribution of IPDs: ............................................................................... 29

CONCLUSION ............................................................................................................................. 32

BIBLIOGRAPHY ................................................................................... Error! Bookmark not defined.

ACKNOWLEDGEMENTS

We are deeply indebted to our Professor Rasananda Panda for giving this opportunity to write a

comprehensive paper on ‘Economic Analysis of Independent Film Making in India’ along with his

constant guidance, patience and support. We also extend our gratitude to Miss Maitreyi Purohit for

her valuable suggestions and assistance.

We acknowledge the crucial role of Mr. Shailesh Yagnik in guiding us through the data mining

process and perusal of KEIC Library resources. We also thank the other staff members at KEIC Library

for ‘always being at our service’.

We extend a special thank you to Mr. Mrinmoya Majumdar, Research Scholar at MICA and Ravikant

Kisana for their encouragement and expert insights on this topic that helped clarify our doubts.

We also thank our colleagues and peers for their support and exchange of ideas that helped in

facilitating an enjoyable environment for the completion of the term paper.

INTRODUCTION

A lot has been contested about what an ‘Independent Film’ actually is. Some define it as ‘a

film without songs’, others claim it to be an ‘issue based film’. A common consensus that

has emerged is that an Indie film is a low budget film with no stars that may or may not

have songs peppered in its narrative, it is likely that it will be slow-paced, it may deal with a

current affair, and it will surely have a beginning, middle and end. (The Indian Independent

Film Industry: Where Do We Go Now?)

The difference between a Bollywood and an Independent film is that the final product of

Bollywood is ‘commercial’ and something that the audience expects as opposed to an

Independent film that gives the audience something least expected but subconsciously

want.

Requirements of Independent Cinema:

Film Festivals

There is a need for Film Festivals with a open curatorial authority because of the stringent

regulations laid by the Indian Government. (The Indian Independent Film Industry: Where

Do We Go Now?)

Savvy Independent Film Marketers

Financing independent films is becoming more difficult with banks becoming more cautious

about lending money and sales and television licenses both being less lucrative sources for

pre-sales than in the past. Thus it is essential for Independent Film Marketers to work

towards gaining money from funds and other revenue avenues.

Dedicated Film Venues

Very few Independent Films receive a much-valued theatrical release that is able to

monetize a community of film lovers. Initiatives like Sundance Film Forward Program and

PVR Director’s Rare have been undertaken; however there is a growing need for more such

initiatives.

Talent Development Programs

A talent development program, for nurturing savvy producers in navigating co-productions

and alternative funding and distribution models, is required. The arrivals of Sundance in

India via Mahindra, the National Film Developmental Corporation with NFDC – Binger

Screenwriters lab and Film Bazaar have been good initiatives showcasing the talent of Indian

Independent Films. (The Indian Independent Film Industry: Where Do We Go Now?)

Visionaries and Disruptors

These are required to obtain breakthrough innovations in alternate distribution models and

determining methods to obtain economies of scale in this niche category of films.

Audience (Bloore)Building Initiatives

In the Independent Film Ecosystem gathering, collecting and nurturing the audience to

monetize them effectively is imperative.

INDEPENDENT FILM VALUE CHAIN

A value system comprises activities carried out by a series of different businesses working to

the product. A value chain comprises activities carried out within a single company. In a nut-

shell an Industry Value Chain is a series of connected of activities that combine and deliver

product or value to customers. This can be applied to Film Industry. (Bloore, Re-defining the

Independent Film Value Chain)

US Film System often develop, produce, distribute and exploit a film as a single integrated

company. This is also the case with a small number of international studio-style companies.

However the independent feature film industry outside America comprises of an ecosystem

in which a feature film is made and delivered to its final audience by a several companies in

cohesion. (Bloore, Re-defining the Independent Film Value Chain) These companies add

value to the different elements of the production and exploitation process in different ways

along the chain. The money paid by the consumer, in form of a DVD purchase, ticket, or

online download, accounts for revenues earned and commissions through the chain

complicating the flow.

An increase in interest has been observed in the analytical concepts of the film value chain

and value system, due to changes in the economies of financial and distribution aspects.

This calls for alternative business models. (Bloore, Re-defining the Independent Film Value

Chain) Also, understanding the competitive scenario to fully understand the value chain is

vital.

For better understanding, the value chain of the Film Industry and Independent Film

Industry are compared.

Figure 1: The Film Industry Value Chain Chain (Bloore, Re-defining the Independent Film Value Chain)

Complexity in quantity and diversity of its various segments. The production process is

broken down into three separate components; market research occurs at the finance and

development stage and ad and media expenditures and production spend occur at the same

time as. (Bloore, Re-defining the Independent Film Value Chain) Film is treated as a ‘core

intermediate product’ along with merchandising and other secondary products.

Figure 2: Independent Film Value Chain (Bloore, Re-defining the Independent Film Value Chain)

Order of Listing Players

‘Players’ include public organizations, private and freelance individuals. These players are

listed in decreasing order of influence and aesthetic power.

Development

Development includes film ideation, screenplay creation, funding generation, and

production financing initiation.

Financing and Pre Sales

Independent films involve a several businesses, investors and advisors. Pre-sales is the sale

of the film before the final product is made based on the credibility of the perception of the

cast and director.

Production

This includes the shooting, editing and other post production processes.

International Sales and Licensing

Here the film is internationally licensed to distributers in different countries. The

distributors pay for the film and its rights. They can further exploit the rights over a specific

time period. Post which, a share of profits is returned to the producers of the film

International Exhibition and Exploitation/Distribution

The intermediary of the distributor gives each segment along with few rights in each

territory. Due to the changing business models, this element may also undergo few changes

Consumption/Consumer

Customer consumption includes purchasing by the customer to add financial value to the

chain. The Film’s reputation is also built on the opinion of the general audiences including

internet users and critics. The value of the customers is understood through the statement

given below.

Library Rights

The distributer’s duration of license can be further utilized. Once the license expires, the

producer may sell the rights to another distributor for a different duration. Thus this

becomes a bundle of films rather than an individual commodity. The repeated issue of rights

add value to the film by increasing its shelf life. The rights to make prequels/sequels are not

granted to the distributors and are maintained with the producers.

Integration and Fragmentation

The complexity of several numbers of players in the financing, marketing and distribution

process makes the Independent Film Industry a ‘Disintegrated Industry’.

To reduce this disintegration, vertical and horizontal integration is carried out by a company

that controls the players in the value chain

Timescale

Different effort and time is spent in the value chain.

Figure 3: Particular juncture time in relation with the overall time (Bloore, Re-defining the Independent Film Value

Chain)

Investment and Recovery

The income generated by every member of the value chain is different and not consistent.

The Production crew earn through fees paid flat upfront before the product is made and the

Distributors, Sales Agent and Exhibitors earn through revenue from sales of completed

product. As the timing varies, the deals made also vary. Directors, writers and the acting

talent receive both forms of payment and may also receive separate deferral payments.

Sales agents may also receive additional commissions and repayment of incurred expenses.

Though the recoupment and revenue at each value chain level is quite complex, a

diagrammatic simplification is presented.

Figure 4: Sample Independent Film Budget Investment and Recovery (Bloore, Re-defining the Independent Film Value

Chain)

GOVERNMENT AND INDEPENDENT FILMS: ECONOMIC

CONSIDERATIONS

The government is not entirely supportive of the independent film industry as it is outside the scope

of a conventional film industry. However, we will look at some economic considerations vis-à-vis the

independent film industry.

Production spend: the ‘Multiplier Effect’

Multiplier effect is an assessment of the impact that an industry makes on the economy. It is a

measurement of the direct effect into the economy by an activity of an industry as expenditure. It

also looks at the indirect effect on the suppliers to the industry and the effects from the individual

incomes generated. In the film industry the amount spent on different factors of film production like

the equipment, logistics etc. benefits the suppliers of these services and eventually improves the

GDP. In the case of independent film industry too these factors remain and one can see a positive

multiplier effect.

Employment generation

In the film industry, jobs usually involve highly skilled and educated workers who are usually

freelancers in the independent film industry. However, since mainstream and commercial films both

have more or less the same talent pool which is flexible and mobile. So, in terms of employment

generation, both contribute favorably to the economy.

Direct investment return

Independent films are usually financed by private investors, banks and other avenues like

crowdsourcing etc. The nature of the content is non-formulaic, so it is not entirely possible to draw

conclusions about the average returns. Public film funds usually expect 50 percent or lesser returns

on investments. However, from the government’s point of view, it is not financial returns alone they

are looking at. Cultural, economic and social returns are also taken into consideration. Hence, it is

still an uncertain factor for the economy.

Export earnings

A film is also considered as a good which can be and is usually exported to other countries.

Independent films in India do get international recognition and are screened at various foreign

festivals and screens. However, presently they do not have a model to provide a proper source of

earnings from international markets. But there is a growth in markets, especially Mexico, Indonesia,

ASEAN countries and the Middle East. With new modes of delivery improved by technology

(digitization and Internet) and new formats, this can be a favorable aspect for export earnings in the

future.

National Brand Building

Independent Films can go a long way in building the nation as a brand. Due to wisepserad circulation

in film festivals worldwide, good quality films gets noticed. The more visible Indie films are at the

global stage, the more recognition the India film industry will get; this will inturn bring greater

investment to the media industry. This can also help build the export markets for Independent films.

These films can go a long way in terms of geo-political benefits too by enriching the national brand in

terms of skill, innovation and creativity.

Film as a driver of creative economy

Films are by and large one the largest source of drivers in the creative economy. They have been

instrumental in the GDP growth of the country and many nations are now realising that. Moreover,

independent films have the potential to be one of the largest engines of growth for the creative

industry.

PRODUCTION OF INDEPENDENT FILMS: CROWDSOURCING

Crowd sourced funding for producing films has grown as a global phenomenon. Crowd funding

basically derives from the idea of Crowdsourcing wherein the collection of finances takes place from

a large pool of backers or crowd.

In recent times, crowd sourced funding is catalysed by social media and the internet. The most

advantageous part here is that through social media, film makers can address a group of dedicated

followers or their target audience more efficiently. The phenomenon of digitization and

technological convergence has slowly led to the democratization of communication and content

creation. The good news here is that the cost of film making has come down drastically through the

various technological innovations. The Internet also provides any filmmaker with tools not only to

make a movie but to distribute it too. In addition to this, if one considers the emergence of the

Internet as a network, its functionality has ensured that there is now a two way and multi

directional flow between suppliers and consumers of media content. The rise of the digital sphere as

a medium has given rise to two aspects when it comes to the consumer of such films. The audience

has become fragmented and more empowered.

Crowd funding is not an entirely new phenomenon, though in recent times it has gained popularity

as an alternative source of funding for independent film makers. In India crowd based funding is still

in its early stages. There are also arguments that the Indian audience’s tastes are still more biased

towards mainstream commercial cinema.

We will try to analyse some of the Crowd funded releases all over India and try to understand how

they attained their funds and how this can be a model for the future.

Manthan (1976) was one of the earliest instances of crowd sourced funding in the world. Shyam

Benegal , to make the movie Manthan obtained the finances from 5,00,000 members of the Gujarat

Co-operative Milk Federation who gave INR 2/- for the production of the film (Manthan). The film

was a box office success owing to the fact that all those who contributed bought tickets again to

watch the movie made by them.

Here, though not individually named, the movie did give credits to the farmers of Anand as seen in

one of the theatrical posters. This also highlights one of the benefits of crowdsourcing for the donor

wherein the audience who paid for the making of the movie gets a mention as a supporter of the

film.

Though this was one of the earliest examples of crowd based funding in the country, the popular

movies that came out in several languages in recent times were:

1. Lucia by Pawan Kumar

2. I AM by Onir

Lucia

Lucia is a Kannada movie directed by Pawan Kumar who completed the movie at a cost of Rs.51

Lakhs. The cost of this movie was obtained by crowd sourced funding wherein several individuals

contributed through the film makers Facebook page and blog.

Here we can argue that the empowerment provided to the consumer to choose the media due to

the two way nature of the digital media allows the audience to choose what he wants to watch and

could be one of the reasons why a crowd funded project succeeded in India.

Here is how the movie earned money:

By selling 2000 tickets at different denominations namely $25, $50, $100 each coming with its own

set of benefits.

Ticket Price Access to

download the

movie in HD and

unlimited number

of playback.

Exclusive

documentary

about the

making of the

film

Unique affiliate

link that

provided income

to the investor

for every extra

view.

Mention in

Credits as

Supporter

Total

Number

of

Tickets

available

$25 YES NO NO YES 1000

$50 YES YES NO YES 500

$100 YES YES YES YES 500

Table 1: Crowd-funding model for Lucia (Source: http://pawantheactor.com/?page_id=1653)

People who were interested in investing more money became co-producers and based on an

agreement they would get their money back as profits are attained.

The interesting aspect about the model is that the onus of deciding is left to the audience and they

can decide how involved they can be in the process by choosing any one of the amount. This is

enabled through the price differentiation provided to them. The crowd funding discussed here

though was mainly for producing the content; it was later done for distribution and exhibition too.

Crowd based funding opens up a world of opportunities to aspiring film makers in India who want to

make films and show them to the world. However, the audience is fragmented and reaching all of

them at once can be a cumbersome as well as expensive task. The makers here have addressed the

issue by adopting unconventional media networks for distribution, like the internet. The makers of

Lucia provided everyone who paid for the movie with High Quality digital copies of the movie. In

addition to this, the positive buzz that it generated led to PVR picking up the distribution of the

movie under the PVR Director’s rare category. It was exhibited in centres outside Karnataka and did

good business.

Lucia was one of the success stories of crowd based funding, however there are the failures too

especially in a market like India where the audience are still in transition in terms of the content they

consume. There is an apprehension that Indians are more ‘value conscious’ when compared to their

Western counterparts and hence may not be forthcoming to pay.

Crowdsourcing platforms

The infrastructure for crowd sourcing is through platforms such as Kickstarter, Indiegogo and

Wishberry are gaining popularity. These crowdsourcing platforms act as a patronage of several arts

and sciences including cinema and charges a fixed percentage of the funds raised as a fee. Some of

the salient features of these platforms are:

User Empowerment– In this platform the customers are more empowered because they realize

that the project will not happen without their support. Therefore, the sense of involvement will

be much higher and will support the supplier of the content more.

Risk-inversion – The risk in this case is moving towards the customer who will consume the

goods rather than the creator.

Network effects –This can be considered as a Social Network Site (SNS) which has both creators

and supporters. The numbers of both of these can be assumed to be positively correlated as an

increase in supporters will increase the projects that are funded and more the creators better

value will be provided to the supporter.

Multi-homing costs for creators – From the creators perspective there is no possibility of using

more than one site, but they can switch from one platform to another. However, the switching

costs usually discourage them from doing so.

Indian corporates are seeing a business opportunity in this model and have started investing in such

platforms. The investments by Reliance Entertainment Ltd in creative crowdsourcing platform

Talenthouse Inc. as well as the joint venture show that corporates too see the benefits of

crowdsourcing. This is also an encouraging sign for independent film makers and artists as they are

provided with an avenue for their talents. (Sen, 2011)

If well developed, this model can be a cornerstone for Independent film makers as well as the

audience and the end result will be that good content is generated and promoted.

INDEPENDENT FILM DISTRIBUTION IN INDIA

Once the funding has been secured, the film made with all the possible budgetary constraints and

the final product ready; every independent film maker in India or elsewhere is burdened with the

herculean task of getting his film out to the public i.e. distributing the film. At present the options in

India for getting a theatrical release are far and few. However, here we list out ways in which an

independent film maker can get his/her film out:

- Self distribution by renting a cinema

- Self distribution through DVD’s

- Picked up by PVR Director’s Rare [e.g. ‘Supermen of Malegaon’, ‘Shorts’ etc.]

- Picked up by a big production house [E.g. ‘Lunchbox’ by Dharma Productions & UTV Motion

Pictures]

- Download/Stream online [Netflix, Spuul etc.]

- Film Festivals [e.g. ‘Peddlars’ by Vasan Bala]

- Four walled screenings [e.g ‘Lakshmi’ by Nagesh Kukunoor, ‘The World Before Her’ by Nisha

Pahuja]

Most of the options presented above are not viable if the film maker or the producer is either a)

Looking at getting as many eyeballs as possible or b) looking to monetise the movie.

Non-viability of Independent Film Distribution

- The total content cost that the producer has to bare

for releasing a film at the theatres is very high

amounting to around INR 18,000 for per property

Virtual print fee 14,000

12.3% tax 1722

Cloning & Cargo 2000

Total expense on Content 17,722

Table 2: Producers expenditure on content distribution (Source: (The method madness of ticket prices, 2013)

per week. Thus the net box office collections have to be in the margin of INR 40 – 45,000 for

the producer to recover his cost for that property. (The method madness of ticket prices,

2013).]

- Every cinema manager is assigned with certain targets in terms of the average ticket price,

sales per head and the number of admit. These are further categorised by weekly, monthly,

quarterly targets. And statistically, the performance of independent films has been poor on

all three parameters. (The method madness of ticket prices, 2013)

- Most independent films fail garner enough buzz around them due to which it becomes

difficult to promote or monetise them and theatres are reluctant to showcase (The indie

film distributors pvr directors rare, 2012)

- Consumers or movie goers aren’t willing to pay premium prices (Average cost of a ticket at

PVR cinemas is INR 167 and that at Cinemax is INR 156 (Pengonda)) for a independent film

when they can catch a Bollywood blockbuster at the same price. (Onir)

However, the road isn’t all gloomy. The most important thing when it comes to independent films is

the content – it has to be fresh and out of the box. Films with great content have proved that they

can do significant business at the box office with the existing models in place. Let’s take a look at one

such movie – Supermen of Malegaon released by PVR Director’s Rare.

‘Supermen of Malegaon’: Case in view

Release year 2009

Budget1 1,00,000

Distribution Channel PVR Directors Rare

Revenue format 2 50:50 [Between producer and

PVR]

Runtime3 3 weeks [21 days]

Number of tickets sold in Mumbai per theatre4 2000 [6000/3]

Number of screens5 11

Total number of shows 231 [ 11 * 21]

Cost incurred per show in licensing6 ₹1,000.00

Total cost incurred by producer in screening (A) ₹2,31,000.00 [1,000*231]

Approx Expense on content per week per

property7

₹ 18,000.00

Total expense on content (B) ₹5,94,000.00 [18,000*3*11

]

Total expense of producer (C) ₹8,25,000.00 [A + B]

Total tickets sold on average 22000 [2,000*11]

Average price per ticket at PVR8 ₹ 167.00

Approx Revenue Generated (D) ₹ 36,74,000.00 [22000*167]

Share of producer [50% of revenue] ₹ 18,37,000.00 [D/2]

(-) Expense of producer ₹ 8,25,000.00 [C]

(-) Budget of movie ₹ 1,00,000.00

Producers profit ₹ 9,12,000.00

Table 3: Cost-benefit analysis of ‘Supermen of Malegaon’ (Source: 1 (Supermen of Malegaon)2,3,4 (The indie film

distributors pvr directors rare, 2012)5 (The supermen malegaon here go watch show timings included, 2012)6 (Report in

search of the rare indie)7 (The method madness of ticket prices, 2013)8 (Pengonda))

Assumptions:

- Every screen sold exactly 2000 tickets [ Given that 6000 tickets were sold in Mumbai and the

movie played at three screens]

- The movie ran for 3 weeks at all the 11 screens with one show per screen as per initial

schedule

- The producers of the didn’t bear any other expense as PVR Director’s Rare takes care of all

the promotional expense of the movie

Thus ‘Supermen of Malegaon’ provides enough evidence that a small budget independent movie can

earn 9 times the cost of producing the movie. However, there are certain things to be noted here –

- Supermen of Malegaon was made on a shoe string budget of INR 1,00,000 and hence the

profit margins. This might not be the case for other movies as the budget of an independent

movie can vary highly

- The movie was able to attract enough buzz in the festival and critics circuit having around 15

awards to its credit before it was released theatrically (Supermen malegaon winner 15

awards)

- The movie got picked up by PVR Director’s Rare which as a distribution channel doesn’t

charge the film makers (Report in search of the rare indie)

In recent times, there have been other examples of independent films being picked up by big

production houses for distribution and are doing really well. For example, ‘Ship of Theseus’ by

Anand Gandhi made on a budget of INR 12 Lac , presented by Kiran Rao and distributed by UTV

Motion Pictures collected INR 1.1cr in its first two weeks. (Dutta, 2013) On the other hand, ‘The

Lunchbox’ by Ritesh Batra made on a budget of INR 9cr (The Lunchbox), distributed by UTV Motion

Pictures collected INR 25cr with its limited release. Thus, there exists a market if the right movie is

matched with the right distribution channel. (Khanna, 2013)

The scope for revenue generation and fair distribution for Independent film making as an industry in

India is very low as only a handful of the films see the light of day. The industry need to come up

with a new distribution model that gives each and every independent film maker to showcase his

product at the national level at least. As of now such movies are not economically viable as no

matter how efficient the distribution, the revenues don’t outgrow the costs unlike the European

market where they have an Indie film theatres devoted to these movies.

INDEPENDENT FILMS: DOCUMENTARIES

Independent films cannot be categorized as feature films alone. An important part of Independent

films categories are documentaries. Documentary films must be analysed on its own, separate from

that of feature films.

Government run organisations for documentary making:

Under the Indian Ministry of Information and Broadcasting, there are two prime regulatory bodies,

the Films Division and the Central Board of Film Certification (CBFC). These bodies are autonomous

and work in different areas of documentary filmmaking.

The Films Division was established in 1948, it functions as the media unit of the Ministry. Its prime

functions entail facilitation of the production and distribution of short films and documentaries.

These shorts and documentaries are made in order to disseminate nonfiction content which deals

with India’s cultural heritage, traditional folklore and biographical information pertaining to well-

known and respectable Indians. The main aim of the organisation being, boost the national pride

and produce propaganda.

Since its inception, it has produced over 8000 documentaries, short films and animated films.

Combining all of this, it has over 50 million feet of celluloid. In the year 2004, it had almost 15000

theatrical releases and 90 non-theatrical releases. Additionally, it also funded, produced and

distributed 160 films, 58 among these were documentaries and newsreels. With an annual budget of

more than INR 40Cr Rupees, it has a staff of 1500 employees.

Around 700 prints of a documentary and one newsreel are released every week to over 10,000

cinema halls all across the country. In return of showing these films, the exhibitors are required by

law to pay 1% of the gross box office of the week.

The Central Board of Film Certification on the other hand reviews, rates and certifies all films,

television programming, advertisements and promotional material that appear in cinemas and on

televisions in India.

Additionally, film productions are also done at a regional / state level, which are sponsored by the

respective state government run information ministries. They are exhibited at regional cinema halls

or through special screenings in rural areas.

These two bodies collectively have enabled the Indian Government to regulate the documentary film

industry.

Monopolization by the Indian Government:

Through the use of these organisations, the Indian government exudes a strong hold on the

financing, production and distribution of documentaries across the country.

The Films Division being the major producer and distributor of these documentaries, the focus of the

paper will be focussed on its role in this segment.

With a huge number of documentaries being produced by the Films Division, the theatres have been

satiated with state approved and produced propaganda. Being a government run body, the Films

Division not only blocks the distribution of independent documentaries through the mere magnitude

of its clout but holds a legal, contractual monopoly over distribution outlets also, therefore IPDs find

it extremely difficult to find distribution outlets.

For a commercial cinema to open shop, the owners need to enter a deal with the Films Division.

These contracts, block-booking and blind-booking; bind the owner to showcase films approved by

the Films Division. These contracts are on a yearly basis. The theatre owners have no prior

knowledge about the theme of the films. With the mandate issued by the Films Division, the IPDs are

prevented from releasing in these theatres. In reality, any film without the monetary support by the

Films Division is rendered completely unmarketable. The Films Division may decide to buy an IPD at

its price and then distribute it.

The Films Division provides opportunities to independent documentary makers to screen their work

in commercial theatres, although the number is very limited. Each year, the Films Division provides

funding to a select few films that are given to independent producers. These producers are selected

from a list of over 24 such producers who submit competitive bids on film topics which the body

deems suitable for outside production. Alternatively, there is also the option of buying films that

have already been finished. This gives some leeway to independent filmmakers to have their work

distributed in cinemas across India, given the condition that they act as suppliers for the Films

Division.

Independent Political Documentaries - Background:

In spite of the heavy regulation by the government and its apparent monopoly in this segment of

filmmaking, there is a sleuth of documentaries being made without the government’s assistance or

guidance in production and distribution. With no funding received from the government in the

production of these independent documentaries, they are made with a paltry budget using meagre

technical resources. These independently produced and distributed documentaries are referred to

as ‘Independent Political Documentaries’ (IPD).

The theme for these documentaries is usually political in nature with messages that critique the

dominant politico-economic system. The IPD movement began in 1975 during the emergency

period, during which time, under the leadership of Indira Gandhi and President Fakhruddin Ali

Ahmed civil liberties were suspended and commissioned imprisonment of numerous innocent

civilians. It was during this time that documentary was made by Anand Patwardhan about revolving

around the theme of student agitation called ‘Waves of Revolution’.

Financing, Production and Distribution of IPDs:

Approximately only 10% of the Films Division’s theatrical releases comprise of independently

produced films, leaving a dearth of exposure to the other 90%, which never get a chance to be

screened in theatres. (Fischer) The genre of IPDs is such that it typically aims at targeting the present

political and religious supremacy; these messages are extremely unlikely to be funded by the Indian

government. To worsen the already aggrieved situation of IPDs stiff competition within the

community for the limited number of contracts by the Films Division leads to internal animosity,

which is detrimental to the movement’s ability to better organise to compete against the Films

Division projects.

The advent of technology and its benefit of low-cost filmmaking have not much helped the

independent filmmakers who still struggle to raise funds for production of films that are of good

enough production quality in order to compete with state funded projects for viewership.

As there is limited scope of distribution for independent filmmakers, it becomes almost impossible

for them to sustain themselves financially from the proceeds they receive from their work.

Therefore, they fund their films with small donations in cash and kind from friends and kin. They also

beseech patronage from NGOs and corporations that have common focus and would be interested

in financing the film. Anand Patwardhan, in an interview, told The Hindu that after long years of

asking donations from his friends and family to fund his films, he had only recently been able to

sustain through selling off his work, but he still needs to constrict the budget of his films to low.

This approach of raising funds for film production is very time consuming and prohibits the

filmmaker to concentrate on his work. Brahmanand Singh, another filmmaker who is a part of the

IPD community searched for two years for a sponsor for his film, A Burden of Love. The documentary

is based on Alzheimer’s disease set in India, after two years of searching, he found a pharmaceutical

company which agreed to finance his project. Likewise, other IPD filmmakers agree that it takes

upwards of three years to collect money in the form of small donations from individuals to raise

enough capital to produce a film. This can be distressing for many IPD filmmakers both financially

and emotionally, more so through the course of their career.

Although for these filmmakers, to spread their word through their work is more important than

monetary gains but the lack of it thereof has prevented from the number and quality not being

realised to its whole capacity. Further, the non-governmental agencies might not want monetary

returns from the documentaries but only reach to wide audiences to spread awareness on a specific

issue. But, given the inability of IPDs to disseminate to such wide audiences, there may ultimately be

no motivation for these investors to put in their money for these documentaries as neither will they

be profitable nor have a wide audience reach.

With the Indian theatres thronged with the Films Division’s documentaries, international film

festivals have become the best venue for IPDs. This is true for both short and feature length IPDs,

both of these formats have performed well at these festivals.

Anand Patwardhan’s films, War and Peace, A Narmada Diary, Father, Son and Holy War, and In the

Name of God, have collectively won 22 major awards at such international films festivals.

However, these film festivals have not been able to improve the distribution scenario for these

documentaries, the ultimate aim for them being exhibited to a large Indian audience, who can

resonate with the storyline of the film and do not require much background information or context-

establishing exposition. This can be seen with the rejection of Anand Patwardhan’s film, Father, Son,

and Holy War by Films Division staged 2004 Mumbai International Film Festival, after having won six

awards at major international film festivals.

The festivals are also unable to provide monetary benefits to the filmmakers as they offer very little

cash prize which makes it financially infeasible for them to repay for the production cost or use as

capital for future ventures.

There have been rare cases when foreign media channels, such Home Box Office (USA), BBC (United

Kingdom), ZDF (Germany), have bought IPDs after screening at such festivals. These documentaries

are then distributed within their respective countries. For example, Ashim Ahluwalia’s documentary,

John and Jane, was bought by HBO in 2007 for distribution in USA after it was screened at the

Toronto and Berlin Film Festivals.

While the Films Division has monopolized the business of production and distribution of IPDs in

India, therefore silencing the voices of these filmmakers, at the same time even if a film gets

adequate capital to make a film, there is always the question of passing the stringent censorship

which is controlled by the Central Board of Film Certification.

CONCLUSION

With the advent of technology, reduced costs of production and digitization and simplification of the

value-chain where consumers can directly be addresed, the Independent Film Industry is expected

to have sustained growth in the long-term as explained by the Long-Tail Theory. However, the key

concern is the economic impact on the ecosystem with respect to the changing condition of the

industry.

Despite the several impediments that face Independent film making faces, the future holds promise.

The advent of digitisation, technological advances and alternate sources of finances will reduce the

entry barriers for a film to be released and distributed. In addition to this, there is a potential for

tremendous growth simply based on the volumes that can be attained but before doing so, the film

maker must ensure that the film reaches the audiences

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