Oh boy!  My favorite juicy scandalous fascinating addictive news items!  That’s right, INSIDE INDUSTRY BUSINESS STORIES!  Let’s get into contracts and star rates and all kinds of fun stuff like that!  No joke, I really do find these stories way way way more fun to talk about than, like Anushka-Virat wedding news.  Maybe you do to!  And even if you don’t, you can just not read this!  That works too.

Quick less exciting stories first:

Shahid’s Price Goes Up

(here is the original story) This is sort of a micro-example of the way movie stars are not just actors, but tradeable investment commodities.  Shahid Kapoor has always been a known name, ever since his very first movie Ishq-Vishk was a surprise hit.  His value in the market, as determined by the success rate of his films and the level of their success, has gone up and down but never dropped below a certain level or risen above a certain level since his launch.  However, that changed with Padmavat.

(Oh Ishq Vishk!  They were all so cute)

There are several delayed reactions to this.  First, for Shahid himself, he can now choose to quote a much higher rate to his producers for his next film.  And he can expect to be offered higher profile films than before, movies with bigger budgets and bigger co-stars and everything else.

The reason he can do this is because his name being attached to a film will now bring an expectation of a higher box office.  Which means the bidding for the distribution rights to that film will go up and up as distributors anticipate a higher box office and therefore can pay more from their side and still expect a profit.  Which means the producers, who are the ones paying Shahid directly, will make more money by the right’s sale.  His name and commitment to the project brings a tangible measurable profit increase to all involved.

The real winner in all of this is Batti Gul Meter Chalu, the small social message film on electricity and infrastructure and stuff, which Shahid is almost done filming.  He committed to it before Padmavat, they got his old rate expecting to make a small off-beat film, and now they are able to sell the distribution rights for a massive profit thanks to Shahid’s increased value in the market and the increased expectations for this movie.

This is why the game of “spot the next star” isn’t just fun, but a deadly serious business endeavor.  If you are that star, obviously you want your film to do well.  Not because you get any kind of immediate benefit from it, but because you will benefit long term by being more valuable in the marketplace and given more options for your career.  But where things get really interesting is when producers and others try to buy low and sell high, as it were.

This is why you will sometimes see a gap in an actor’s schedule after a big film.  They know a producer is going to try this trick, so they will hold off on signing their next film until after the big film comes out so they can avoid doing that one last film at the lower rate.  Hrithik, for instance, did NOT do this.  After Kaho Na Pyar Hai, he had to dig through a lot of trash movies with uninteresting bad roles and (presumably) low prices, before he finally hit his first film at his new status.

(Not a movie you would expect the hottest new star in a decade to be making)

Of course, there’s the flipside to the gamble, if your big hit fails then your value may go down after it releases and you will regret you don’t have anything already signed.  Shahid has made the mistake of holding off a few times and been burned when the film wasn’t a hit.  He had a massive gap before and after Mausam and it severely damaged his career.  So I can see why he wasn’t willing to risk it for Padmavat and chose to move right on to the next movie even if it meant he would end up losing out on a potential higher rate by signing before Padmavat if it was a hit, because it would guarantee at least locking in that rate and that film before Padmavat if it flopped.

From the producer side of things, you can track filming schedules and get sneak peeks and try to figure out if the film immediately before your film might be a hit and use that to decide who to sign and when.  But that’s pretty tricky.  What is more common is the sort of long term investment hoping for an eventually pay out.  Going back to Shahid, his Ishq Vishk producer got dividends from him the next year, when he was in Fida which had an automatically higher profile because Shahid had a hit.  And then again 7 years later with Dance Pe Chance in 2010 when Shahid was riding high, really too high to do a film like that.  Spotting talent and helping young stars isn’t something producers do out of the goodness of their heart, it’s part of long term planning for your power and profit in the marketplace, just like investing in an up and coming stock and hoping it turns into Google in 10 years.

(Not a Shahid example, a Shahrukh one.  Aziz Mirza “invested” in Shahrukh Khan by casting him back in 1992.  16 years later his investment paid off when Shahrukh did the narration for Kismat Konnection)

 

Laila-Majnu and Starless Profit

(full story here) And then from the other side of things, we have the idea of a film with no stars and how to make a profit off of that.  Laila-Majnu, which was just announced out of nowhere, and will probably manage to make a profit even with no stars anywhere in sight.  It is produced by Ekta Kapoor and Imtiaz Ali, directed by Imtiaz’s brother Sajid, and produced by his ex-wife.  And starring two total unknowns.

But this is the kind of movie you want to make with unknowns!  This is Ishq Vishk again (going back to our Shahid theme).  There is a smaller production house behind it that will keep close personal control on the production, and a director who is on his first film, and therefore both cheap and obsessed with making it as good as possible.  And as a bonus you have the family film aspect, Imtiaz and his ex are presumably not taking payment for anything (I am sure a cut of any possible profits, but no upfront payment), and are similarly dedicated to the film’s success.  And finally, it is NOT launching star kids.  Star kids hike the price up.  Because their star parents are in there fighting for a big launch.  That’s what happened with Mirzya, it should have been a small artistic interesting film, but it got promoted and promoted and got a bigger release and flopped.  This movie, with two unknowns, can stay under the radar if it wants.

(Gorgeous film, should not have been promoted that much and should not have been given that much money.  It was never going to be an all-family hit)

Also, with two unknowns, you go back to that “investment” concept.  Ekta, for instance, invested early in Vidya.  She gave her her first acting job, in the Hum Paanch sitcom.  And years and years later, she got her payoff with Dirty Picture.  I suspect that Ekta is “investing” here too.  Both in Sajid Ali the director, and in the new faces who are leading the picture.  She will want people with actual talent and promise, if she is hoping for a future profit off of them.

 

Directors as Middlemen and STUPID FITOOR

(full story here and here) Oh this is SO EXCITING!!!!  And interesting and fun to talk about!  Oh boy oh boy oh boy!  It’s all about the new corporate middleman structure to the film industry and the switch from handshake to contract agreements.  Fun fun fun!!!!

So, this is a story that has been brewing for a while, just waiting for the test case to put it over the edge.  In Olden Times, things were simple, the director/producer borrowed money direct against his house or from the mob or his parents or whoever, made his movie, sold his distribution rights, paid back the mob or his parents or whoever, and kept whatever profit remained.

In theory you could pull a scam, since you were just handed this money and the film industry is such a funny business, you could take way more money than you needed and pocket the difference.  Or promise a product and not deliver it ever.  Or even just get caught up in your artistic vision and take 3 times as long to finish the film and keep asking for more money to sink into it.  But you wouldn’t, because then the mob would kill you.  Or your parents.  Or you would lose your house and your wife would kill you.

(These guys.  Well, the real life people these guys are playing.  They are the ones who would make sure you paid your money back)

But then the film industry became corporate.  And suddenly you weren’t borrowing money from your family, or scary men with guns, but from some multinational corporation.  At first you saw these big big flops.  Saawariya, for instance.  Multinational corporation handed Bhansali Films a big blank check and got back a big big loss.  It was a very “take the money and run” attitude on the part of the Indian filmmakers, and a very “gamble big, lose big” experience from the multinationals.

But then they tried a new tactic.  Now, there were middlemen.  Big big corporations gave money to small heavily involved Indian production houses who then found and supervised the individual filmmakers to make sure there wasn’t a big big loss.  Fox Searchlight and Dharma films was one of the first tests of this model with My Name is Khan.  Fox put up the money and the international distribution, Dharma did all the grunt work on the ground.  And of course it made a big profit. And then this model kept gaining popularity in films big and small.  Khoobsurat, for instance, Disney produced it, but through Anil Kapoor/Sonam’s production house. It wasn’t a blank check handed directly to the director.  And now this model is almost the norm.  Unless the film is produced by Yash Raj, it is most likely funded by international money at some level.  Maybe not fully funded, but that’s part of the cash that is in there.

(It has kind of a Disney feel too, right?)

The only remaining gap in this system is the enormous amount of power directors traditionally have in Hindi filmmaking.  Since they were traditionally also the producers and writers and the people who would be killed if they went over budget, they were kind of in charge of and trusted with absolutely everything.  Which, I think, is a very creatively rich way of going about things.  All financial decisions were made with a creative goal in mind, and all creative decisions were made with a financial goal in mind.  If you look at the great directors of the past, Guru Dutt to Yash Chopra, they balanced both considerations and turned out stellar products.

So what do you do when you end up with a director who has enough artistic sense to get hired, but not enough to put the value of his product above all?  And who has enough business sense to figure out a con?

In the olden days, what you would do was kill him (“The Mafia: Supporting Honest Business Practices Since 1947”).  But, powerful though they are, multicultural corporations can’t really do that any more.  And so now, there is no recourse.

Which brings me to Abhishek Kapoor.  His first movie, Kai Po Che, was an excellent product.  It was produced by UTV, which means no other creative figure was involved, just moneymen giving Abhishek free rein.  And worked great.  There were a lot of movies around then that worked great that way.  Disney gave money to UTV, UTV and it’s experienced Indian film industry guys found talented young artists and passed the Disney money on to them.

(The 3 brightest young stars working today, all got their launch in the same film.  Surreal.  Oh, and no Disney branding on this film, even though they own UTV so every UTV film is a Disney film.  But they choose which ones are really really Disney)

And then there started to be more and more movies that didn’t work so great.  For a lot of reasons.  For one thing, my personal feeling, film is an artistic production as much as a business one, and their needs to be an artistic mentorship.  The most successful middleman houses, Excel and Dharma and Yash Raj, have a strong artistic hand on the wheel that is mentoring and guiding and picking projects.  Without that, companies like UTV floundered and even T-Series.  But then, you also need a business hand. Bhansali films, for example, has been a bit up and down in their productions partly because there doesn’t seem to be a strong business instinct guiding it.

And now we have new houses that were never independent entertainment business not creative companies (like UTV or Zee was) or independent director lead banners (like Excel, Dharma, Bhansali, etc.) but rather are a hybrid of the two.  Ellipses Entertainment, for instance, founded by an ex-CEO of UTV and a photographer/agent.  Business minds, able to find and control finding, but also an artistic instinct, able to assess products and help them flourish.  And of all of these various new houses, KriArj is rapidly up and coming.  It was founded just 2 years ago and has already released 3 films and has another 5 coming.  They were the ones savvy enough to sign Shahid before Padmavat came out, and they are the ones with the rights to Anushka’s Pari, her first post-marriage film, and they are the ones behind Akshay’s last three solid small hits.

(Even their name kind of supports my feeling as to what makes a good production house.  Arjun, the pure of heart and talented, in combination with Krishna, the intelligent and tricky)

Now, let us go back to the idea of that director who just doesn’t care.  Abhishek Kapoor directed Rock On!!! for Farhan Akhtar and Excel.  No doubt he had a lot of hands own guidance in that, Farhan wrote the dialogue and starred along with producing.  I have issues with Farhan (STOP PRETENDING TO BE A ROCKSTAR AND HAVING A MIDLIFE CRISIS AND WRITE DON 3!!!!!!!), but there is no doubt that he is a brilliant brilliant director.  In a way that combines creativity with commercial.  And so having Farhan there with you while making your first movie is an invaluable help.

It took 5 years for Abhishek to get his act together and get his next film Kai Po Che off the ground.  It was based on a book, so he only needed to alter the story for film not create it.  And he had Chetan Bhagat and UTV to help with the promotion and so on.  And someone involved was smart enough to keep the budget and expectations low.  3 (very very very talented) semi-unknown actors, a modest but solid promotional campaign, and it got a big international release to bring in that good international money.  Kai Po Che made a profit and was a good movie, Rock On!!! was a good movie, it seemed as though Abhishek was a good director.

And so UTV put their faith, and Disney’s money, into Abhishek.  Well, and they also put the younger brother of the head of UTV into his movie.  Nepotism definitely plays a role here.  Along with many other things, I am sure it blinded Sushant Roy Kapur to the disaster this film was shaping up to be.  Abhishek took the money and ran away with it, essentially.  The film went over budget, the promotion campaign was intense because it was supposed to be a big hit, and then it was just No Good.  A combination of two failures, no artistic hand to help Abhishek see where he should be going, and no business hand to step in and stop the flow of money.

(NO!)

But Farhan, once again, proved that he is a little better than the rest (although, still, PUT DOWN THE GUITAR AND WRITE DON 3!!!!!!) and immediately dropped Abhishek from Rock On 2.  He wrote the script, he came up with the original concept for the first film, by all rights he should have been allowed to direct.  But Farhan dumped him.  Looking at the timing, it looks like before Fitoor even came out, he saw the signs.

Abhishek should have been unhireable at this point.  But there were a few things in his favor.  First, he had made those all important connections.  He could get the increasingly valuable actor commodity Sushant Singh Rajput on the phone.  That matters.  Second, he was cheap now, humbled, willing to take his talent and work for a smaller production house and follow their orders.  Unusual in a director with his career by this point.  And so KriArj snapped up his project.  And Amrita Singh opted for it as the launch of her daughter, with an experienced director at the helm and a hot new male star opposite her.  It was a romantic drama starring Sushant Singh Rajput and Sara Ali Khan.  With all the production work to be done by Abhishek’s company Guy in the Sky.  All KriArj would have to do is funnel the money from T-Series to Abhishek, and then sit back and wait to receive the finished product.  Just like the deal they had with Padman, for instance, Twinkle did all the legwork, KriArj put her together with the money people and helped with the ultimate distribution.  Only, Padman worked because Twinkle was competant and sincere and hired a professional director and did her work perfectly and on time.  Not the case here.

 

First, Abhishek went wildly off schedule.  To the point where, most damaging, he wasn’t able to match the available dates of the actors.  He committed to delivering the film in June 2018, and that is definitely not happening.  And because of this, he is also now wildly off budget, KriArj has had to come up with more and more money.  And, the final straw, he took it upon himself to announce a release date of December 2018, conflicting with Shahrukh’s Zero.  Which is a terrible business idea from all sides.  And he is not willing to budge from that date.

And so KriArj is going to do the unthinkable.  They are taking a film away from a director, a sin in the Hindi industry as bad as taking a child from their mother.  And they are suing him for breach of contract.  Which is, also, almost unheard of.

A new era dawns!!!!!  If the mob threats can’t keep costs down any more (The Mafia: Supporting Honest Business Practices in the Hindi Film Industry Since 1947), then legal threats will have to take their place.  And if directors can no longer be trusted to look to the greater good instead of a quick buck, then producers will have to serve to keep them in check.  NEW ERA.