The director of Tilak Enterprises, which operates multiplexes like Broadway Digital Plex, is thankful to digital cinema for helping him cut costs and fight piracy.
Expects to add some 900 cinemas as clients by next month
MUMBAI: Lakshmichand Tilak Shah is buoyant. The director of Tilak Enterprises, which operates multiplexes like Broadway Digital Plex in Navi Mumbai, is thankful to digital cinema for helping him cut costs and fight piracy.
Come Diwali and nearly 900 cinemas are expected to show upcoming releases like Om Shanti Om and Saawariya using digital technology.
Sanjay Gaikwad, CEO and executive director of Mumbai-based United Film Organisers (UFO Moviez), told DNA Money more and more cinema halls are finding digital cinema a winning proposition.
UFO Moviez, part of Group Apollo, is aiming to set up digital infrastructure at nearly 2,000 screens in India and some 300 to 400 screens in countries like Mauritius, Sri Lanka and Nepal by March 2009.
Besides, negotiations are at an advanced stage for a tie-up with a multiplex chain in South East Asia.
Sanjay Gaikwad said: “An investment of Rs 12 lakh will go into setting up of each screen. We will get a fixed amount per show from the exhibitor. Our business model ensures that we rely on advertising mainly for generating revenue.”
He didn’t disclose the revenue figures.
Earlier this year, UFO Moviez saw private equity firm 3i infuse around $22 million for a minority stake in a deal based on projected earnings for 2009-10.
The deal which the company has signed with movie halls provides UFO Moviez exclusive right to advertise for five minutes each at the start of the show and during the interval.
Sanjay Gaikwad said that there has been a positive reaction from advertisers with companies like Hindustan Unilever,
Amul and Procter & Gamble treading this route.
Devang Sampat, vice-president, marketing and programming, Cinemax India, which sources digital equipment from UFO Moviez, told DNA Money, “Digital cinema is especially beneficial in tier-2 and tier-3 cities. It allows access to the latest movies at a tremendous cost advantage thereby curbing piracy and increasing revenues.”
Digital cinema dramatically reduces the cost of distribution by removing costly processes like making prints and transporting them to the movie halls.
It also allows for flexibility to have extra screenings for a hit and cancel screenings of a flop. In digital exhibition, the movie is routed through a satellite on to a server which uses special projectors to display content onto the screen.
Along with UFO Moviez, E-City Digital of the Essel group is also promoting digital cinema exhibition in India.
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