By Anant Mathur (July 27, 2011)
Again, it's the budget that will make this film a loser for its distributor. In order to recover its cost the film will have to do a business of over 400 crores nett, here's why... The first week distributor's share is 50% of the nett collections, so even if Ra.One breaks all previous records for Hindi films and earns 120 crores nett (an impossible 1.5 times more than the current record of Dabangg) in the first week, the distributor only earn 60 crores. Week 2 distributor's share is 42.5%, let us stay positive and presume that the film only drops to 75% in collections and earns 90 crores in the 2nd week - the distributor's share is 38.25 crores - that's a total of 98.25 crores distributor's share for the first two weeks (almost twice as much as current record holder 3 Idiots). Week 3... considering the number of screens it will release on, by this time most people who still visit the movie theatres have seen the film and at best its collections will be 50% of the 1st week - third week's distributor's share is 37.5% which would translate the 60 crores nett collection into 22.5 crores distributor's share. 4th week onwards the distributor's share is 30% and again presuming that the film drops down to 30% of 1st weeks collection and earns 36 crores nett, the distributor's share comes to 10.8 Crores. After the first 4 weeks it's highly unlikely that the film will earn more than another 50 Crores nett theatrically in its life time (I'm being very generous here, the actual figure will be much less than that for week 5 and beyond) this would give the distributor another 15 crores. So lets add up all these numbers and being optomistic the most Shahrukh Khan's Ra.One can earn its distributor is... 146.55 Crores (far less than the distributor's cost of 175 crores). Of course all this depends on whether the film is liked by the audience or not, if not, then all these number will be much lower. Another thing to keep in mind is that Shahrukh is a multiplex actor, his films don't fare well at the single screen theaters, Dabangg and 3 Idiots did bumper business at single screens as well as multiplexes - the distributors get a larger share from single screens than multiplexes.
The highest grossing 3 Idiots earned the distributor, a record, 99 crores nett - giving them 59 crores in theatrical profits. It's unthinkable that Ra.One would have the ability to almost double that, especially when the biggest of films average less than 40 crores as the distributors share each year. The only other exceptions are Dabangg whose distributor share was 77 crores and Ready which has just crossed 64.5 crores). My guess is the maximum Ra.One will earn for its distributor is 135 crores worldwide (45 crores foreign plus 90 crores domestic - that's if it manages a nett business of $25 million overseas then the distributor's share is 45 crores which may not be possible for a Hindi film) add to that 35 crores from satellite rights and the film would still fall short of the distributor's cost. I'm being very optimistic here but the truth is, with a cost of 175 crores, Ra.One has lost before it even gets to the theater. In Hollywood, a number of films have crossed the $1 Billion mark, but you don't see them increasing the budgets of their films to $1 Billion simply because a handful of films have earned that much, budgets should be based on what the market can sustain not the revenue one or two film have generated. Also, in Hollywood, films don't just generate revenue from Theatrical and Satellite rights a major chunk of it comes from DVD/BluRay sales/rentals, Pay-Per-View, Netflix, Merchandising, etc. - avenues that don't exist for Bollywood films. Again, when only one Hindi film has ever crossed 175 crores in total nett collections how can filmmakers consider making a film which costs so much - contrary to what these corporate distributors believe - the market for Indian films is not so large that a film will make 400+ crores nett to recover the 175 crores in cost. In fact, only 8 films in the history of bollywood have every collected more than 75 crores nett, so 400+ crores is an impossible target. When no film has ever provided a distributor a share larger than 99 crores how can they release a film that's costing them 175 crores. We also need to keep in mind that there have already been many films that have made over 50 crores this year, by the time Ra.One rolls around, people won't have the same cash flow. Distributors need to wake up and learn basic Math, so films have a chance at the box office.
Well, that's my two cents before the release of this future flop. Below is a link for the trailer, judge for yourself...
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