Piracy doesn’t dampen vid hopes

Observers expect homevid biz to grow while rights remain low

Homevideo in India sells 500 million units annually. The bad news for the film biz is that, according to industry estimates, 90% of them are pirated.

That’s one big reason homevideo rights for Bollywood films remain cheap. Indian territory homevid rights are sold at between 5% and 7% of cost of film, with the rare film managing 8%. Worldwide rights are sold at 2%-3%.

India’s homevideo market is dominated by the cheaper video CDs (VCDs), which account for 85%-90% of sales at about $6.67 per disc. DVDs, sold at $14, account for the rest.

Hiren Gada, VP, Shemaroo Video, India’s largest homevid distributor, says, “With pirates selling three to four pirated films recorded on a single (disc), which is cheaper than the cost of one legitimate VCD, how can homevideo right rates go up?”

Enthused by the Tamil Nadu state government’s stringent legislation to deal with piracy and the drop in piracy of Tamil-language films, the Indian Music Industry and National Assn. of Software and Services Cos. (Nasscom) is nudging other state governments to follow suit.

Keen to capitalize on the fledgling market, Yash Raj Films and United Television Motion Pictures have set up respective home entertainment divisions.

Observers expect the homevid biz to grow 20% in the coming years, but they don’t see the rights fetching more.

Muslim Kapasi, managing director, Excel Home Video says: “Rather than increased monies for the rights, I believe revenue sharing will be the way forward. This is speciallytrue with bigger producers setting up their own studio model and wanting to keep all the revenues with themselves.”

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