ET Intelligence Group: Revenues from the sale of digital or streaming rights of films are likely to show higher growth and fetch more revenue to film producers than from theatres in the next four years, as per a recent Media Partners Asia report.

Revenues from selling streaming rights of films are likely to grow at a CAGR of 8.2% to $1.1 billion (about Rs. 9,130 crore) by 2028 from $0.8 billion (about Rs. 6,640 crore) in 2024, the report estimated. In comparison, revenues from theatres are likely to grow at a CAGR of 4.6% to $0.6 billion (Rs. 4,980 crore) in 2028 from $0.5 billion (Rs. 4,150 crore) in 2024, it said.

“Premium video on demand revenues, both advertising and subscription, are outpacing traditional box office growth,” said Mihir Shah, vice president, Media Partners Asia.

“As the market expands, streaming majors will continue to invest heavily in local original content, particularly movies. In recent years, to deepen their market presence, established players have also focused on acquiring rights to successful regional movies, given the longer timelines involved in commissioning web series.”

At present, there are 59 streaming platforms in India. Analysts say that increasing competition among streamers to grab more and more content in creating bigger and more easily accessible libraries for subscribers will drive investments in acquiring films. According to Media Partners Asia, in the next five years, India’s online video industry has a potential to attract investments close to $17 billion. Between 2018 and 2023, investments in local entertainment increased to $5.8 billion from $3.3 billion, said the report.

Film trade analyst Komal Nahta said, “The growth in revenues from the sale of digital rights may be higher than the growth in revenues from theatrical in the coming years. This is a strong possibility. The habit or ritual of going to theatres every weekend is no longer the norm. A large section of the audience comes to theatres only when spectacular films like Kalki 2898 AD, Baahubali or RRR come to theatres.”

It is estimated that there are more than 200 unreleased Hindi films that producers are finding it difficult to release in theatres. The producers are said to be negotiating deals to get these films released directly on streaming platforms.