For the last couple of years, films are being made in Malayalam with a single agenda – to break even or make profits through satellite rights.
The satellite rights are the hefty amount paid by TV channels to producers for the right to show the film for the next 99 years.
As a result, revenue from theatres have ceased to matter beyond a point, and regardless of the fate of the films at the box office, certain stars continue to have a market.
TV channels want films to be made for lighthearted viewing, like TV serials.
Comedies thus have a great market. That is why Dileep rules the satellite rights business.
That is also the reason why a superstar like Mammootty manages to have a rather smooth ride even after his films are turning out to be turkeys at the box office.
The economics is amazing by any standards. The satellite revenue earned by producers was about Rs 1 crore five years ago.
Due to the emergence of new channels, the presence of a popular star in a film could ensure satellite revenues anywhere between Rs 2 to 4.5 crore today.
Malayalam filmmakers have started exploiting this phenomenon.
They made substandard films, but make hefty profits due to the presence of saleable stars in the cast.
Almost everyone, from stars, directors to production managers have become producers, as the return on investment is assured.
Less than 100 Malayalam films were made every year until a few years ago. The number of releases crossed 125 in 2012 and in 2013, it reached 160. Nearly 100 more movies were in various stages of completion last year.
But the TV channels need only 70 to 90 films a year. So the increase in the number of releases gives the channels enough to choose from.
After being exploited by some highly respected names in the business, the TV channels stopped buying satellite rights for a while.
This resulted in a big crisis and the industry came to a standstill.
In the first two months of 2014, only around 25 films released. Most of them were actually scheduled for last year.
Only 1983 and Ohm Shanthi Oshaana did well at the box office.
With not many new films being announced, the Malayalam film industry is facing its worst crisis in recent years.
The “new generation” boom, which was heavily dependent on satellite revenue, seems to have ended earlier than anticipated.
The general assumption is that 2014 will be a year of “correction” for the Malayalam film industry.
The industry has no one to blame but itself. Clearly a case of digging one’s own grave!