Bye bye celluloid?

Subhash Chandra, chairman, Essel Group, is known for his pioneering ways. And at group company Fun Cinemas, a part of a larger business called E-City Ventures, CEO Atul Goel is leading another first-of-its-kind charge. Goel is working on digitizing the entire film distribution process. “We manage the programming, we digitize the screens for theatre owners by putting in digital equipment, and we give the theatre owners committed revenues,” explains Goel.

Currently, the company has acquired about 90 digital screens, and hopes to get to 1,000 by 2011. Digitization means that instead of the normal celluloid 35 mm, the print is digital, which is more cost-effective. According to Goel, one single celluloid print costs roughly Rs 50,000 as against just Rs 3,000 for a digital print. Qualitatively too it is superior, as good as high-quality DVD. “Since distributors don’t have to spend Rs 50,000 on prints, they give us better terms,” says Goel.

The company has no real pan-India competition, except for a company called UFO. But then again, UFO’s business model is entirely different. It has nothing to do with programming but fits out theatres with digital equipment. Goel explains that unlike E-City Ventures, UFO does not provide a complete solution. In the south, there is a company called Pyramid Saimira, which does what Fun Cinemas is attempting, but it is focussed largely on Tamil Films.

The digital business earned Rs 15 crore in revenues in March 2007 for Fun Cinemas, and Goel is keen to double that figure in the current year. This in turn would be a little over a fourth of Fun Cinemas’ total revenues for 2007-08. Fun Cinemas’ biggest business today is multiplex screens, but Goel sees digital screens becoming the largest contributor in some time.