Theatrical window for films' OTT debut likely to go up as Maharashtra set to reopen cinema halls

With theatres being allowed to reopen in Maharashtra from October 22, the theatrical window for a film's debut on OTT platforms is likely to go back to the pre-Covid norm of three months over time, according to experts.

The gap between a film's theatrical release and OTT release had come down to one month with the pandemic eating away footfalls during the two waves in April 2020-October 2020 and April 2021 to July 2021. A staggered reopening by various states has been underway since July 2021.

"Once normalcy returns, this one-month window will increase because the bargaining power of multiplexes is very high. The short window was more of a Covid response," said Edelweiss Securities Executive Director Abneesh Roy.

He gave the example of Kangana Ranaut-starrer Thalaivi. Multiplex owners refused to release the Hindi version of the biopic of former Tamil Nadu CM J Jayalalithaa because producers had opted for a 15-day gap between the film's release in theatres and on OTT platforms. "But a 15-day window is dangerous for multiplexes because viewers would rather wait out that duration than rush to see it in a theatre," he added.

The issue was eventually sorted out when the producers agreed for a one-month window for the film's OTT release.

Direct OTT release of large films had anyway come down as studios were waiting for the Maharashtra circuit to open up, said Elara Capital's SVP and research analyst Karan Taurani.

According to a report by the firm, 23 Hindi films released directly on OTT platforms in FY21. Only nine films have gone directly to OTT between April and July 2021, including the Salman Khan-starrer Radhe, which failed to make a mark. Now, there may be 3-4 additions to that list, including Taapsee Pannu-starrer Rashmi Rocket and Vicky Kaushal-starrer Sardar Udham Singh, which have announced a direct-to-OTT release, he added.

There are at least 24 Bollywood, 18 Hollywood and 22 regional films lined up for a theatrical release. And 23 Hindi movies have announced release dates all the way till December 23, 2022, soon after Maharashtra announced that it would permit theatres to reopen from October 22.

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With 75-80 per cent of collections for any film contributed by theatrical release, producers have been more optimistic of audiences returning to theatres, replicating global trends in China, the US & the UK, according to the Elara Capital report. So, producers have been holding back movies to release them in cinema halls, it said.

A marquee film like Radhe acquired for Rs 225 crore was able to generate only Rs 35 crore-Rs 40 of collections, and the balance allocation (digital rights and TVOD - Rs 135 crore) was the cost of customer acquisition, it said.

The report also likened the trend in India to the US, "where cinema halls remained the preferred choice for release of large films once the COVID-19 impact dissipates given they increase monetisation opportunity for a producer".

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