Eros’ head office is found in a dreary industrial area in the run-down West London suburb of Park Royal. But in the car park sits CEO Kishore Lulla’s black Bentley coupe, a gleaming tribute to the power of Indian movies teamed with a well-tuned strategy for world domination.
Company, celebrating its 30th anni, is by a wide margin the biggest film company in Bollywood and operates in a fashion instantly familiar to any Hollywood studio exec.
While Eros only produces three or four pictures a year in its own right, company’s strength lies in distribution, where it handles 35-40 films annually in a chain stretching from theatrical releasing through to video-on-demand.
As such, it commissions and acquires more than 30 movies a year and has amassed a library of some 1,300 pictures. And if the employee head count at about 150 worldwide is smaller than most studios, B.O. revenues, which can reach $40 million per picture, are none too shabby.
With such a large share of the international market for Indian films — it claims 35% of the U.K. box office for Indian films — there is a sense that what is good for Eros is good for Bollywood, and that Bollywood has benefited as Eros has grown.
It has also been good enough for Lulla to collect this year’s BDO Stoy Hayward Business of the Year Award from the Eastern Eye Asian Business Awards.
Company was founded by Arjan Lulla in 1972 when the Indian film industry, despite its popularity and the country’s massive population, was still a cottage industry. Lulla’s proposition was to address the 35 million non-resident Indians (NRIs) who were wealthier and could afford a taste of home.
With the video era booming, Eros’ first decade saw acquisition of video rights and distribution in different formats. That was followed by the building from scratch of a theatrical releasing operation in the U.K. and U.S. with films predominantly booked into indie theaters. Marketing was kept tightly focused on NRI populations, with optimization, not maximization, the watchword.
Second decade saw further geographical expansion and growing sophistication as media evolved and value of TV syndication rights soared. Eros began to push its films into mainstream cinemas and nonspecialist videostores.
Last 10 years have seen growing recognition for Bollywood both within India, where it was granted official “industry status,” and outside, where crossover is occurring in countries without large NRI populations.
“We’ve done the legwork, and now even countries like China are beginning to work for us,” says Jyoti Deshpande, group chief operating officer and commercial director. “Now, Latin America is waiting to happen.”
Distribution is controlled through a network of wholly owned offices in Fiji, Dubai, the U.K., the Australian state of New South Wales and the U.S.
The newest distribution operation, started since Eros floated on the London Stock Exchange, is Mumbai. Company was finally tempted to launch its Indian distrib when the numbers became too big for it to resist.
Multiplexing has helped in terms of transparency and has raised ticket prices in big cities to $4-$5. Instead of selling off movies into India’s sprawl of local distributors and exhibitors, company has self-released seven movies in 2007, including two pics, “Nishabd” and “Namastey London,” from Adlabs, which normally handles its own.
Eros has partnerships with Pathe in Benelux, among other countries and regions, and with Bavaria Media’s Eurovideo subsid in Germany. On its TV ventures, which since last year span VOD, it is partnered with Comcast and Intel.
Deshpande says new media is not a new division but an integral part of Eros’s evolving distribution strategy. “The 80:20 rule of distribution (i.e., 80% of revenue comes from 20% of locales) can be changed by digital. We can do day-and-date theatrical and online releases without much cannibalization,” she says. “Most piracy occurs where it is not cost effective to distribute.”
Eros also is looking to be in the vanguard of companies supplying its movies for e-cinema and d-cinema distribution, partly because digital’s programming flexibility will get Bollywood films in front of more mainstream auds.
The other newish link in the vertical chain is production, which kicked off in a serious fashion with “Waqt — The Race Against Time,” delivering Eros’ biggest hit of 2005.
While there’s been no Indian crossover hit like “Crouching Tiger, Hidden Dragon,” the trend toward production of more films in English suits Eros well, allowing it to use more mainstream promotion channels. It gave Aishwarya Rai starrer “Provoked” its U.S. release on May 11 in theaters more used to giving Rolls-Royce treatment to the fall’s Oscar fare.