When Bob Iger announced in February that streaming service Disney Plus would launch in India the following month, the then chief executive of the world’s biggest entertainment company hailed 2020 as an “opportune moment”.

“We see this as a great opportunity [to break into] one of the most populous countries and fastest-growing economies in the world,” he said of the move, which would come as it began broadcasting the Indian Premier League cricket season on Disney Plus Hotstar — a fusion of the US group’s service with a local streaming platform it secured as part of its acquisition of 21st Century Fox assets.

Weeks later the pandemic would force the cancellation of sports events and cause enormous headwinds for the wider Disney group — but the debut would still prove timely.

Lockdowns across the world have been a boon for streamers, and India — the world’s largest cinema-going nation — has proved no exception. With cinemas yet to reopen in India, groups including Disney, Netflix and Amazon have had a fresh opportunity to muscle in, snapping up a string of cinema-bound blockbusters from cash-starved Bollywood studios in a move which could upset the balance of power in the country’s giant but traditional film business.

These online releases were “really great catalysts — shots in the arm for the industry”, said Uday Shankar, Disney’s India head. “This is going to give a new lease of life.”

Line chart of Subscribers (m) showing Disney is expected to lead in India thanks to Hotstar

Rising incomes and fast internet adoption make India a promising market. The country already produces more films and sells more cinema tickets than anywhere else, at about 2,000 and more than 1bn a year respectively, although annual revenues of below $3bn make it considerably smaller than Hollywood.

The platforms have scored a number of early hits in collaboration with Indian studios and stars, but are yet to break into the Bollywood mainstream. Many of the industry’s biggest names, who often come from dynastic families of stars and producers, continue to gear production towards large cinema audiences.

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The number of subscribers to global streaming platforms has also remained relatively small.

While Netflix and Amazon Prime Video do not report figures, research group Omdia puts their subscriber bases at about 5m each, with the pandemic having boosted growth; Netflix overall has almost 200m subscribers worldwide. Disney Plus Hotstar said it had about 9m subscribers in the June quarter.

But the closure of cinemas in India, where there have been more than 4.2m reported cases of coronavirus, has already caused something of a shake-up in the country’s sprawling film industry, forcing top Bollywood studios to sell productions to streaming platforms and helping grow their audiences.

The pandemic had fast-tracked the streaming companies’ growth in India, said Vikram Malhotra, chief executive of studio Abundantia Entertainment. Alongside Sony, the Mumbai-based studio produced Shakuntala Devi, a biopic of the celebrated maths whizz, which was originally intended for theatrical release but was sold to Amazon as the pandemic wore on.

“If streaming platforms weren’t around, the entire movie industry would have been at a standstill,” Mr Malhotra said.

Amazon enjoyed its first coup in June when it released Gulabo Sitabo, a quirky comedy starring Amitabh Bachchan, one of Bollywood’s biggest stars.

In August Netflix released Gunjan Saxena: The Kargil Girl, a biopic of India’s first female air force pilot to fly in combat, from the country’s top producer Karan Johar, one of a number of originally cinema-bound productions it secured. Disney also announced this summer that it would stream seven blockbusters directly online through a new “multiplex” product on Disney Plus Hotstar, which Mr Shankar argued provided an invaluable outlet for the industry at a difficult time.

“The film business is one of the most heavily impacted [by coronavirus],” he said. “A lot of films were ready for release, but that hasn’t happened.”

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Uday Shankar, Disney’s India head, says direct-to-streaming releases will be ‘shots in the arm for the industry’ © Abhijit Bhatlekar/Hindustan Times via Getty Images

But the streamers’ expansion during the pandemic has been met with fury from some quarters.

India’s top multiplex chains, which had enjoyed rapid growth before Covid-19, have accused the platforms and producers selling to them of violating norms that ringfenced an eight-week window for theatrical releases.

Siddharth Jain, a director at Inox, one of India’s largest cinema chains with more than 600 screens, said he was “disappointed” with producers who bypassed theatres for online releases. “We told them let’s be together in this,” he said. “They’ve got the money in their pockets while we continue to bleed.”

That tussle mirrors disputes elsewhere, with Cineworld and AMC having banned Universal Studios films from their screens after the Hollywood film-maker released Trolls World Tour direct to streaming platforms earlier this year.

The streaming platforms’ champions argue that their ascendancy in India will bring a much-needed shake-up of an industry that has been slow to innovate.

Critics, including figures within the industry, argue that Bollywood has been held back by a dependence on cliques of producers, directors and actors who monopolise financing and viewers with reliable but hackneyed tropes — such as family melodramas — while crowding out new voices.

“The larger director-producers create mediocre scripts and stuff them with a lot of star talent, because they’ve all grown up together . . . We haven’t grown as a sector because it has been so incestuous,” said one veteran producer. More competition would “create huge opportunities for 90 per cent of the community, and will make 10 per cent — the top-of-the-pyramid guys — extremely insecure”.

India’s cinema screen count has fallen even as multiplexes grow

One advantage of releasing films directly online means avoiding regulations that strictly censor sex, violence or bad language in cinemas, affording the streaming platforms some leeway. Amazon series Made in Heaven, for example, received critical acclaim last year for its frank depiction of often taboo subjects like homosexuality.

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Srishti Arya, head of Netflix’s original films business in India, argued that the group offered both funding and freedom for new directors and producers. Netflix has invested Rs30bn ($405m) to develop its roster of Indian content through 2019 and 2020.

“There has been a certain democratisation of content with the influx of streaming services,” she said. “We’re working towards a very serious business in India. The money is an indication of that.”

Yet many in Bollywood remain sceptical about how much scale the streaming platforms can achieve. Punit Goenka, whose media house Zee produces content for TV, cinemas and its own streaming platform Zee5, said larger-budget films required a run in cinemas to make economic sense. “It’s not as if tomorrow the theatres will become ghost towns,” he said.

Mr Jain echoed that view. “I don’t see it as a sustainable model for all the streaming platforms paying top dollar [for first release]”, he said. “Can you imagine Avengers going to [streamers]? They’d ask for a billion dollars.”

Indeed, the studio behind two of India’s most hotly anticipated films of the year continues to hold out for a theatrical release.

Reliance Entertainment, run by embattled tycoon Anil Ambani, has shelved action flick Sooryavanshi and star-studded 83, which depicts India’s victory in the 1983 Cricket World Cup, until cinemas reopen. The studio said last month that it was “looking forward to celebrating the blockbusters in cinemas with our audiences everywhere”.

But Shravan Shroff, a venture capitalist who founded a multiplex chain that he sold to Inox in 2010, said that even when cinemas reopened it would take time to “win back the trust” of hygiene-conscious consumers.

“The dam broke as Amazon and Netflix went out and started acquiring these movies,” he said. “The cinemas will have to do something interesting, drastic to get people back.”

Via Financial Times