Southern movies account for over 75% revenues

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South Indian cinema industry, which dominates the Indian filmdom, dwarfing Bollywood. Can’t believe it?  Films made in the four southern languages—Tamil, Telugu, Kannada and Malayalam— accounted for more than three-fourths of the country’s total revenues from film content in 2008-09, generating more than Rs 1,700 crore. Also, the Telugu film industry makes more movies than the whole of Hindi film industry. Last year, 230 Telugu films were released, according to a report prepared by Ernst & Young (E&Y) and the Federation of Indian Chambers of Commerce and Industry (Ficci),

Mind it, South spearheaded the Indian film industry’s transformation over the last five years or so in adapting latest technologies, from special effects to animation. Don’t forget that the two Indian Oscar winners, AR Rehman and Resul Pookutty, learnt their craft there. Yet, South Indian cinema is still to find its place under the sun, known to the rest of the country mostly for Rajinikanth antics and Quick Gun Murugan stereotypes. But that’s OK as far as box-office story remains the same. The success of this script lies in its winning formula and execution.

The industry control its film releases tight, says Farokh Balsara, partner & national leader, media & entertainment practice, at Ernst & Young. Nothing appears on TV till a year after the film has released, giving theatrical a huge push. Out of the Rs 1,700-crore revenues in FY09, Rs 1,300 came from domestic theatrical collections. The region accounts for more than half the total operational screens in India. “The industry has also shifted gears in terms of changing business models, moving from doing many small budget movies of say Rs 1-3 crore to upgrading production standards.

The immediate effect of this can be seen in that, 65 per cent of the revenues are coming from films with budgets above Rs 7 crore, up from the earlier 45 per cent,” says Mr Balsara. While South Indian movies are yet to make a big mark in the rest of the country, within the four states crossover contribution has increased significantly. One-fourth of Tamil movie revenues come from neighbouring states. “While the vibrant industry continues to build on its strengths, there is immense potential for the South Indian film industry to further enhance its reach and revenues like in the international market, home video as well as of course crossover,” says Mr Balsara.

Following in the line of the Hindi film industry, the stars down South have also started charging as much as 30 per cent more in the last two years, leading to a surge in the cost structure as well. In terms of overall revenues, the Telugu and Tamil cinema account for approximately 45 per cent each, while the Malayalam cinema accounts for 8 per cent and Kannada for 2 per cent. The E&Y-Ficci report will be released on Wednesday in Chennai at the Media and Entertainment Business Conclave 2009. Meanwhile, Bollywood champions can study the larger-than-life movies from down south and learn a trick or two from the sambar cowboy.

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