Is Boycotting Big Movies a Viable Strategy for Theatre Owners?

Introduction

Despite the rising popularity of Over-The-Top (OTT) platforms, traditional theatre owners find themselves in a precarious position. The recent trend of theatres boycotting big heroes’ movies due to the ongoing OTT problem raises crucial questions about the future of theatrical experiences. This article delves into the potential impact of such strategies, weighing the short-term challenges against long-term opportunities.

Revenue Impact

Boycotting a big movie star like Vijay, Ajith, or Suriya can have severe repercussions for theatre owners. A Vijay movie typically generates around Rs. 35–40 crores in theatrical revenue, which is approximately Rs. 6 lakhs per theatre. This substantial income is crucial for the basic operations, including staff salaries and regular running expenses. Furthermore, these big stars significantly boost auxiliary business such as snack sales and parking, contributing an additional 33% of a theatre’s income.

Average performing stars, like Vijay Sethupathi, might not achieve the same box office success. However, their films still tend to outperform the so-called “money-losing” films of big stars. For instance, Suriya's recent films, 24 and others, have been financial duds, consistently losing exhibitors between 35-40 crores. Now, theatres are demanding repayment of approximately Rs. 19 crores in lost revenues from 2014 onwards.

Strategic Analysis

On the other hand, the absence of big stars does not guarantee better performances from lesser-known actors. Unless they consistently deliver excellent films throughout the year, theatres may struggle to maintain their financial stability. By focusing on 20 mid-budget films instead of a few big-ticket productions, theatres might be able to sustain revenue levels.

In the short term, a boycott would cause a significant financial hit. However, in the long run, this strategy could potentially reshape the industry by increasing the number of mid-budget movies shown in theatres. Malayali exhibitors, for example, have successfully managed to control the movie flow, reducing their dependency on famous actors.

OTT and Theatrical Operations

The rise of OTT platforms is another crucial factor to consider. Many theatre owners, especially in smaller towns, do not collect the actual ticket fare. Instead, they rely heavily on the auxiliary business, with the canteen generating significant revenue during the first two weeks of big movie releases. For instance, in cities like Madurai, a theatre with 3 screens might collect only Rs. 250 for 192 tickets, but the canteen can earn up to Rs. 90 to 220 per person for snacks and beverages.

Thus, even when big stars release their films, theatres are compelled to attract family audiences and generate additional revenue from the snack bar and parking fees. This dependency on big stars’ films for sustenance is likely to continue despite the growing presence of OTT platforms.

Conclusion

In conclusion, while boycotting big movies may provide a short-term relief for theatre owners, it is not a sustainable strategy in the long run. The theatrical experience is deeply intertwined with the revenue generated from auxiliary business, and the rapid growth of OTT platforms is unlikely to diminish in the near future. A balanced approach, focusing on both big and mid-budget stars, might be the key to navigating this challenging era.

Keywords

OTT, Theatre Revenue, Big Movie Stars, Theatre Operations