Financing - Box office - Stars fell to earth

After a disappointing 2008, Indian distributors and exhibitors have high hopes for 2009. Last year began weakly, went on to have a few upswings thanks to some unexpected small-budget successes, and finished with two December hits. Take into account the cost of producing, marketing and releasing the films, however, and it appears the industry ended the year in the red.

"I estimate the Hindi film industry posted a net loss of about $20m (rup1bn) in 2008 as compared to a net profit of around $100m-$150m (rup5bn-rup7.5bn) in 2007," says trade analyst Komal Nahta of Film Information. "The loss figure for 2008 could have been as high as $40m if it were not for the last two big releases of the year, Yash Raj Films' Rab Ne Bana Di Jodi and Indian Film Company's Ghajini, both of which were big hits."

In overseas markets alone, Ghajini, which opened on December 25, grossed nearly $6m in its first week. Distributed outside India by Reliance's Big Pictures, produced by the Indian Film Company and starring Aamir Khan, the film opened at number seven in the UK top 10. Big Pictures now plans to open Ghajini in a further four territories - Burma, Uganda, Malaysia and Morocco - in addition to the 30 in which it has already been released.

Critical and commercial successes

Rajesh Sawhney, president of Reliance Big Entertainment, says: "2008 was a mixed bag. Besides regular commercial fare, 2008 has also seen the evolution of great cinema, both critical and commercial successes, with off-beat movies such as Rock On, Fashion and A Wednesday breaking many records at the box office."

Those three films explored contemporary, urban themes and broke away from the Bollywood formula of song, dance, villainy and romance. Rock On was a coming-of-age story, Fashion shone a spotlight on the machinations of the fashion world and A Wednesday dispensed with songs, sticking to a taut script about terrorism. It was released in the summer long before the Mumbai terror attacks.

Other 2008 winners included Jaane Tu Ya Jaane Na, Singh Is Kinng, Race, Jodhaa Akbar and Golmaal Returns. But for every success there were many more failures, such as Yuvvraaj, Roadside Romeo, Kidnap, Drona, Thoda Pyaar Thoda Magic, Tashan and Love Story 2050.

Industry figures agree the economic slowdown in Western markets is having little impact on the profitability and success of Indian films at home and abroad so far. Citing the example of three successful films released in November and December - Dostana, Ghajini and Rab Ne Bana Di Jodi - Sawhney says: "I do not think economic meltdown has had any impact on the box office. Good cinema will be unaffected even in not-so-good times."

Nahta agrees: "The films have lost out due to wrong costing, with star prices getting unreasonably inflated. Besides this, the catalogue of releases in 2008 shows Indian films have not grown that much in terms of content, and some were just made badly. The impact of the recession has been a correction in prices and certain production houses tightening their belts."

In international markets, traditional, star-laden fare such as Jodhaa Akbar, Race, Singh Is Kinng and Ghajini performed well, although there are fears piracy is continuing to bite into profits. "Piracy, both digital and non-digital, continues to suck billions from the movie industry and 2008 was no exception," claims Sawhney.

In an attempt to beat the pirates, distributors are flooding international markets with prints on the opening weekend - Ghajini, for example, was released on 300 screens across 30 countries in addition to India.

Hollywood vs Bollywood

Traditionally, Hollywood films do not make much of a dent in India's box office. In 2008, the five highest-grossing US films were Quantum Of Solace ($9m); The Mummy: Tomb Of The Dragon Emperor ($8.3m); The Lion, The Witch And The Wardrobe: Prince Caspian ($5.4m); Hancock ($4.9m); and The Dark Knight ($3.9m).

The first big release of 2009 is Warner Bros' Chandni Chowk To China, directed by Nikhil Advani and starring Akshay Kumar, which opened in the US and UK on January 16. Superstars Shah Rukh Khan and Hrithik Roshan both have two big releases this year. First up for Khan is his own production, Billu Barber, followed by Karan Johar's My Name Is Khan in which he plays an autistic man. Roshan will first be seen in Zoya Akhtar's Luck By Chance on January 30 and then in his father's production Kites. The other King Khans of the box office - Aamir and Salman - are starring in this year's Three Idiots and Wanted respectively.

Also much anticipated this year is Delhi 6, the new film from Rakeysh Omprakash Mehra, who directed the 2006 hit Rang De Basanti. Meanwhile, Sylvester Stallone is set to appear with Akshay Kumar and Kareena Kapoor in Sabir Khan's Kambakht Ishq, which is scheduled for May.