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Will Dheeraj Kumar's foray into films work?

Arti Sharma | July 19, 2003

He turned mythological serials into a divinely profitable business on the small screen.

Starting back in 1996, Dheeraj Kumar, chairman and managing director of the Rs 18 crore (Rs 180 million) production house Creative Eye, has been telling Indian audiences stories about immortal beings and they've lapped it up.

Now, after exhausting stories based on the lives of a gamut of gods, Kumar is looking at programmes revolving around the lives of mere mortals.

Moving away from the gods, Kumar and his team are looking at making programmes based on social themes. That's not all. They are also making a foray into film making.

There are plans to release two films by next April. One is a Rs 8 crore (Rs 80 million) budget children's film -- Aabra Ka Daabra -- utilising an in-house developed and patented technology called 3D Plus.

The film, directed by Kumar, stars 40 children and actors like Anupam Kher, Satish Kaushal and Archana Puran Singh.

"Film production is a natural extension and a growth opportunity for production houses. After all, how many mythological serials can one produce?" asks Kumar.

Also in the pipeline is a crossover film directed by Roger Christian (who won the Oscar for the set decoration of Star Wars) starring, among others, actors Irfan Khan and Gulshan Grover, which will be called Behind the Painted Veil.

Kumar had planned to enter the film industry early last year, but he pushed the project to the backburner after seeing the high mortality rate of romantic films.

Besides this foray into movie-making, Kumar also plans to experiment with distribution in two major territories -- Delhi/Uttar Pradesh and Mumbai. In addition to this he will also be picking up a 10 per cent stake in a multiplex outside Mumbai.

What has inspired this sudden change of course? "The market has changed and we have to change with that," says the actor and producer.

Till 2000-01, 94 per cent of Creative Eye's Rs 52.39 crore (Rs 523.9 million) turnover came from Doordarshan as compared to last year when only 26 per cent came from DD.

The switch away from DD came after it changed policies and began demanding a minimum guarantee to air programmes. These charges started at Rs 26 lakh (Rs 2.6 million) for a prime time half-hour slot, and then escalated to as high as Rs 39 lakh (Rs 3.9 million) for the same programme after it had run for 13 episodes.

Not being able to afford such expensive guarantees, Creative Eye had to do a quick re-think and shift from being aired primarily on DD to the satellite channels.

Satellite and cable viewership had become more popular, covering 79 million households as compared to 50 million in the mid-nineties when Creative Eye's mainstay was DD.

But the channel switch hit Creative Eye's turnover. In 2001-02 it fell from Rs 52.39 crore to Rs 17 crore (Rs 170 million) and net profits fell from Rs 4 crore (Rs 40 million) in fiscal 2001 to Rs 1.4 crore (Rs 14 million) in the next financial year.

Suddenly, Creative Eye had fewer programmes on air and the revenue models of the national channel and satellite channels were completely different.

While producers had to pay DD for the airtime, they had the freedom to market it  and made profits from the sale of the free commercial time that came with the slot.

However, the satellite channels  follow a different system and the producer sells the programme to the channel which then markets it.

The industry had also changed in numerous different ways. Production houses like the Rs 186-crore (Rs 1.86 billion) Balaji Telefilms changed the face of prime time programming, storming the idiot box with daily soaps like Kyunki Saas Bhi Kabhi Bahu Thi, and notching up high television rating points (TRPs, which are used to measure TV viewing).

In the process, smaller and niche production houses like Creative Eye suffered since they specialised in subjects like mythology which catered to a limited audience. Says an analyst, "Entertainment had changed, audiences were looking for something different."

So, Creative Eye turned its lenses in new directions and started producing social dramas. It roped in a former Sony employee Roopa Das to oversee the creative side. It also upgraded production values to suit satellite television requirements.

But the competition was tough and there was too much me-too programming vying for airtime, so the company wasn't able to make much of a dent in the market.

Even on DD its luck turned for the worse. It went back on air, after the minimum guarantee system was withdrawn, with two daily afternoon social soaps -- Kamayabi Zindgai Ki and Ghar Sansar. But it couldn't sell the two programmes and made a loss of Rs 1.18 crore (Rs 11.8 million) in fiscal 2002.

The shows have since been withdrawn.

Currently the company is running  Shri Ganesh, a mythological on Sony TV and a re-run of its flagship  Om Namah Shivay on Star Vijay, the southern channel.

Now with this new technology -- 3D Plus -- developed with an investment of Rs 3 crore (Rs 30 million), in conjunction with animation and graphics company, FX Factory, Kumar is hoping that both topline and bottomline growth will double by the end of 2005.

The technology, says Kumar, enables exhibitors to show 3D-style films without changing the cinema screen to hi-definition luminescence or adding lenses to their projector.

That costs about Rs 1.45 lakh (Rs 145,000) per theatre and that's how previous three-dimensional films like Chota Chetan and the recently released children's flick Chotta Jadugar came to the screen.

Instead, all that are needed are a pair of special eye-glasses. The plan, says Kumar, is to get companies to endorse the glasses and then use the technology for both print and television as well.

Apart from this, he also plans to distribute both the films in Delhi/UP and Mumbai to try his hand at distribution. "If the results are good, we will take it further," he says.

Kumar is also looking at cashing in on the intellectual copyrights of older serials in the overseas market. Currently the overseas market contributes 6 per cent to turnover. And by the next quarter it plans to sell two more serials to Hindi channels Sony and Star Plus.

Then there are also plans to foray into animation and graphics. Already, 30 people have been taken on board to start work in this area.

There are roadblocks in this plan. First, Kumar's grand plan to get consumer companies like Hindustan Lever, Procter & Gamble to endorse and distribute the glasses for the usage of the 3D Plus technology may not work.

Then, whether the technology will actually lead to revenues and profits as projected, is a question some industry observers are asking. The other big question the trade is asking is whether the film will do as well as is being anticipated.

Again children's films are of limited interest and serve niche audiences. "I don't think it's fair to discount it. The budgets are small and we are taking a calculated risk," says Kumar.

Then again, the announcement of these new ventures hasn't excited shareholders. The share price only moved slightly upward to Rs 18.41 in the second week of July and then settled back to the Rs 15 level it has maintained for the last few months.

Clearly, investors and analysts are  waiting to see where all this leads to. And Kumar himself is waiting to see if the gods will smile favourably again.



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