Fascinating Industrial News! Karan and Shahrukh Heading for a Battle Over Streaming?

The big headline news being reported everywhere is “Shahrukh movies come to Netflix“.  But here’s the big thing to notice in the stories, they are coming to INDIAN Netflix.  So unless you do that thing where you use a mirror site and trick your computer into thinking it lives in India, or unless you yourself live in India and have Netflix and a good internet source, this does you no good.

Variety Asia specifically says in their report:

Apart from a few mainstream blockbusters like “Prem Ratan Dhan Payo”, “Kabali”, “Theri” and “1-Nenokkadine”, Netflix has largely concentrated on acquiring films from the festival circuit.

Theri and 1-Nenokkadine are not available on American Netflix (I’ve looked!) and I don’t think Kabali is either.  PRDP is though.

Also, American Netflix has a surprisingly large number of “mainstream blockbusters” available from India.  If you want to see them all, this earlier post gives a shortcut to view everything labeled as “Indian” in their system.  They have some art films too, but if we are talking about “largely concentrated on acquiring”, then right now the tilt is definitely mainstream Indian films for American Netflix.

This trend wasn’t until recently, like just about 4-5 years ago, and it was driven by competition.  Hulu actually is the first service I remember really having Indian films.  All the Rajshri hits, and Dil Se, and a few others.  And then Rajshri and a few other companies started just straight up putting movies on their youtube channels, either for a token amount or with ads inserted.

(Rajshri still has most of their catalog for free on youtube.  Netflix bought Maine Pyar Kiya and HAHK I want to say about 16 months ago?  And I keep waiting for them to realize both movies are free on youtube and make Rajshri pull them down)

Netflix was even slightly behind the curve.  They started out with just the Yash Raj films, DDLJ, and also some funky older ones.  And then I remember getting excited when they got Chennai Express the same day it came out on DVD.  And when they suddenly had Andaz Apna Apna available.  That’s when they finally figured out what to put up for Indian films. (possibly it was Imran Khan’s father?)

Image result for imran khan actor

(Did you know that Imran Khan’s estranged father, Amit Pal, is Indian-American and works for Netflix?  And Imran was born in Michigan?)

It’s the same as the Netflix strategy for American films, really.  Old cult hits like people want to watch over and over again, and the newest release as soon as you can get it, keep it for a couple of years, and then dump it once interest dies down.  But they needed someone at Netflix headquarters who could steer them towards what is the cult hit and what is the big new release, who could comb through all the false data and tell them what was really happening.  For instance, I saw several American sources that reference Gangs of Wasseypur as a hit film, which is probably why Netflix leaped at the chance to buy it.  Only to discover (I am guessing) that it is the kind of movie you like watching at a film festival, and maybe on DVD, but not the kind of movie you want to stream over and over again to re-watch your favorite parts (like Andaz Apna Apna).

So that’s what’s happening with American Netflix, which has nothing to do really with this announcement.  This announcement is all about Indian Netflix which is a WHOLE DIFFERENT THING.

And it all starts with Koffee With Karan!  Did you know every single episode ever is now available streaming on the HotStar website?  Isn’t that wonderful?  And also, isn’t that an interesting sign that Indian media is beginning to be aware of the consumer trend towards cord cutting?  StarTV was on the forefront of the satellite television revolution in India, and now it is leaping forward with internet streaming.

Image result for kbc tv show

(KBC, originally a Star Plus show.)

But, you know why satellite was such a game changer in India?  No infrastructure!  Or at least, minimal infrastructure.  You just set up your satellite dish and ran the cord into your house, and that’s it.  Same reason satellite was such a game changer in rural areas worldwide, including North America.

This is not really the case with internet.  So far, those satellite style internet options where it just gets a signal from somewhere and you don’t need to run in a cord have been pretty limited.  Which means streaming services for content, like Netflix, Amazon Prime, HotStar, and all the others, have a much harder time breaking into markets like India where there is limited infrastructure investment.

Which is why the first time a movie plays on satellite in India is still a BIG BIG DEAL.  The satellite rights sales alone cover about 50% to 66% of a major film budget.  And they are upfront sales, this is why Shahrukh walked away from Ra.One with money in the bank, the satellite company paid him a HUGE amount before the movie released.  It’s also a big deal to the audience, which I know because even my tiny little blog gets a nice bump on certain film summary posts every few months (most recently, ADHM has had a resurgence), presumably every time that film airs on TV.

Image result for fan shahrukh movie

(Same for Fan.  Reports had it that the satellite rights were sold for 50 crore, on a budget of 90 crore, meaning the box office totals just had to skate past 40 crore and Yash Raj films would stay in the black, no matter how badly the critics and word of mouth blasted the film)

But!  This is all changing (hopefully)!  Reliance has just launched the “Jio” system which, they claim, has solved the internet accessibility issues in India.  Don’t know if this is true or not, but if streaming content wars are starting in the country, that probably means Jio (along with competitors taking the same leap to advanced internet coverage through satellite and phone) have made a difference.

Jio at least must really believe this, because remember a few months back it was announced that they were taking over from Eros in producing Padmavati for Bhansali films?  Despite the fact that Reliance already has a film division?  To me, that smacked of vertical integration, thinking that their streaming network would benefit from this kind of content and vice versa.

 

So that’s where we are now with Shahrukh selling his films to Netflix India.  Netflix is betting in increased high speed internet access in India, which makes it worth it to them to get serious about purchasing content for India.

But there’s another part of this story which is much much more interesting, and has a lot of really big personal and professional ramifications, which no one is talking about.

First, did anyone notice that Red Chillies had been quietly buying up all of Shahrukh’s back catalog?  Anyone besides me, that is?  This goes back to what I was talking about with how Indian film companies started jumping on American streaming options a while ago.

(Shahrukh still thinks this is his best performance of all time, not surprising it is one of the first films Red Chillies bought up)

Chamatkar, for example, had the rights owned by some random small production house I think.  And they posted it on youtube and Hulu and all sorts of places, for free, years ago.  Now, if you look up Chamatkar, poof!  It’s posted by Red Chillies Entertainment!  And also, Poof!, you have to pay for it!

 

This is true for most of Shahrukh’s older films now!  The funky early 90s ones that would be completely forgotten if it weren’t for the burgeoning SuperStar in their cast.  Essentially, what has happened is that Shahrukh and Red Chillies have cornered the market on Shahrukh movies digital rights.

Moving forward, Dear Zindagi was mentioned in the Variety article as part of this deal.  Dear Zindagi was a Dharma/Red Chillies co-production, but apparently Shahrukh retained the digital rights, if it is part of the Netflix deal.  Which means he probably also retained the digital rights for Raees and Fan and all his other recent co-productions.

I think this is the first time someone has done this?  At least, a Star.  Yash Raj Films very quietly bought up all the rights to every film Yash Chopra had directed about a decade ago, all of a sudden they started selling the “Yash Chopra Collection” on DVD, which included some films he had made for other production houses (like Aaina).

But Aamir’s a films (that corporation name always looks like a typo) and Salman’s SKF haven’t bought up their old stuff (although they are trying to retain some rights to anything new since the founding of the companies).  Maybe Amitabh’s ABCL would have gone in this direction considering their ambition, but of course that same ambition lead them to disaster and now Amitabh doesn’t have any company to use to store his rights, and therefore has no rights to anything.

So Shahrukh is heading into uncharted territory with this.  And his boat is speeding along on a direct collision course with his two best friends, Aditya Chopra and Karan Johar, who (through Dharma and Yash Raj) have already been attempting to snatch up digital rights.

You know the most interesting part of the Variety article?  It’s this:

Amazon has content deals with Bollywood studios Dharma Productions, T-Series and Vishesh Films.

Who cares about T-series, until their CEO gets murdered again they aren’t very exciting.  Although interesting that they are on the forefront of digital distribution, just like they were on the forefront of the cassette revolution back in the 90s.

No, check out Vishesh Films and Dharma!  That’s the interesting one.  Vishesh is the Bhatt digital wing, apparently.  Which means that Alia, Shahrukh’s charming little co-star and Karan’s mentee, is part of it.  And Dharma is of course Karan’s company.

Vishesh films shouldn’t cause any issues.  Chaahat is Shahrukh’s only film that would be under their rights, and it looks like he already snapped that up.  But Dharma!  If Amazon Prime has Kuch Kuch Hota Hai and Kabhi Khushi Kabhi Gham and Kabhi Alvida Na Kehna and My Name is Khan (and also Duplicate, for those strange perverts who like it), then Netflix is going to have an uphill battle bringing over the SRK fans for Chennai Express and Ram-Jaane and all those others.  These are big gaping holes in the Red Chillies catalog, and I don’t see anyway to fill them short of some not-very-nice business practices.

(In case you are curious, click the link above to see the current catalog)

So, what’s going to happen?  Are the digital wars going to end because Shahrukh won’t go after Karan’s business?  Or is this going to escalate?  Or are all the Shahrukh fans in India going to have to buy subscriptions to Amazon Prime and Netflix if they want the whole Brand SRK Experience?

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12 thoughts on “Fascinating Industrial News! Karan and Shahrukh Heading for a Battle Over Streaming?

  1. I’ve noticed RCE buying up his back catalogue–probably because you mentioned it here at some point, and also because RCE has been putting up HD versions of all the SRK/Juhi songs I love (without subtitles, sadly). Netflix US dumped a bunch of Hindi movies several months back, but they have consistently had KNHN, KKHH, K3G, and KANK. So when I read the news this morning, I thought–doesn’t Dharma already have some kind of deal with Netflix?

    Thanks for your thoughtful reporting on this!

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    • That dump is part of what I was thinking of with Netflix really “getting”, finally, how the Indian market works. Keep K3G and K2H2 and all of those, even if they are old and look less popular than the new stuff with the bigger box office, the reality is that these are the movies people will subscribe to Netflix to have access to, and will watch over and over again. Dump Hasee To Phasee and Baby and all the new stuff that people will watch, but not re-watch, after it’s been out for a few years. And keep Andaz Apna Apna! It’s survived several purges now, and it’s the oldest film they have available I think. They must know that is the re-watch gold standard.

      On Thu, Dec 15, 2016 at 1:57 PM, dontcallitbollywood wrote:

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      Liked by 1 person

  2. I think you have the “India only” part of this deal wrong. There are dozens of articles posted online that–I think–make it clear that the RCE catalogue and SRK’s upcoming movies will be available worldwide. Here’s Variety, for example: http://variety.com/2016/digital/asia/netflix-signs-content-deal-with-shah-rukh-khans-red-chillies-1201943116/

    Shah Rhuk’s quote is: “Red Chillies is surging ahead in global entertainment and for the first time, our great stories are going global on Netflix all at once and crossing all geographical barriers, waiting to be discovered over the world. No more waiting for our fans wherever they are,” said Khan.

    This is repeated in every story I’ve read today–and believe me I’m reading everything I have time for (you know, at work and sneaking a look here and there. Shhhh, don’t tell!).

    The articles also refer to Netflix’s 86 million+ subscribers. I don’t think there are that many in India alone. I think that’s a worldwide number.

    I hope I’m right about this one, and hoping that at some point we get to see some of those films that are hard to get here,

    Liked by 1 person

    • I hope so too! But I am cautiously optimistic, because I know usually streaming rights are strictly segregated by country. If this truly is a global deal, that alone is newsworthy.

      On Thu, Dec 15, 2016 at 3:20 PM, dontcallitbollywood wrote:

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    • Yeah, it’s the same link I was looking at I think. They use “global” a lot, but they also reference specifics that are only true in India. So I just don’t know what to think!

      (and really, I would be doing a lot more focused on magical thinking to make this deal global if I didn’t already own every single SRK movie on DVD. Streaming-not streaming, makes no difference to me! Oh, except for Zamana-Deewana, which I have worn out)

      (Just checked, Zamana-Deewana is one of those that Red Chillies doesn’t have the rights to. So yeah, no difference to me!)

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      • Ah, I, too have many CD’s. But they’re all on an upper shelf in one of my closets–they’ve all been digitized so we can listen on our phones or whatever. (Don’t ask me how that was done–my kids did it.) You may well ask why they are taking up valuable real estate in a New York City apartment but I don’t have a good answer!

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        • Same! I live in a tiny studio, and I have a massive plastic box of CDs in the closet. Although I did use them a couple of times, back in the day itunes didn’t store your music in the cloud, so when my computer crashed I had to go through every CD and reload them.

          On Thu, Dec 15, 2016 at 5:03 PM, dontcallitbollywood wrote:

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  3. “Who cares about T-series, until their CEO gets murdered again they aren’t very exciting.” I’m sorry, but I found this to be an amazingly insensitive statement. I think your excitement over SRK has made you blind to other major industry players. T Series is actually one of the big production houses in the Hindi industry, but even if they weren’t, to trivialize the assassination of a father in front of his children’s eyes (T Series, like Rajshri, is a family owned company) by the underworld over movie rights is, as I said, extremely insensitive.

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    • We are reporting about a sale of streaming rights like it is the biggest thing going, when there are actually life and death matters at play. I was trying to be tongue in cheek about how of course the most important fact about T-series is, and always will be, Gulshan Kumar’s murder. It’s something that the industry press tends to downplay, and the international press often misses entirely, that these film companies are still dealing with matters of life and death as part of their production process.

      In terms of industry players, T-Series is growing, but so far they still seem to be more focused on co-productions of larger films and lone productions of smaller films. Yes, they have a massive music library and a lot of clout in that area. But if we are talking about film streaming rights (which we are here), I don’t think they have the kind of library that Dharma and Vishesh films does.

      Also, Gulshan wasn’t killed in front of his children’s eyes, it was more of a drive by shooting while he was away from home. What makes the family owned part of it significant to you? Basically every film company in India is family owned or run (except UTV/Disney). Even Eros is publically traded, but still run by the sons of the founder. They may not actively promote themselves as “family companies”, but they are as family as Rajshri and T-series.

      Like

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