The issue stares in our face now and cannot be wished away. Is 100% FDI in entertainment sector killing our domestic players? While we have been talking about it since long, the industry big wigs have maintained a studied silence over it. That is changing now. None other than the most cogent, coherent, and effective voice of the industry Ronnie Screwvala has tightened the screws over this issue.
Speaking at FICCI Frames 2019 during its inaugural session, he had indirectly hinted at how nowhere in the world foreign players are allowed to control an entire industry. This was coming from someone who was an ‘insider’ until a few years ago and profited hugely from his business association with Hollywood studios. He would bat for them and act as their points-man while using the forum of the FICCI Entertainment Committee that has virtually turned the handmaiden of Hollywood studios and was instrumental in furthering the cause of the broadcasters’ lobby led by Murdoch’s Star Network.
Screwvala has escalated a serious matter to the Competition Commission of India (CCI) now and has charged leading multiplex theater chains like PVR, Inox, Cinepolis, and Carnival Cinemas of discriminatory trade practices favoring foreign film distributors. He has raised the issue of Virtual Print Fees (VPF) multiplex chains continue to charge domestic producers and distributors while exempting Hollywood studios from it.
He has not stopped at that and made the Multiplex Association of India (MAI) a respondent in his complaint and charged it of various unfair trade practices including holding back advance payments multiplexes get from on line booking portals. He also claims that VPF was to be charged only for a gestation period of five years yet multiplex chains continue to charge it from domestic players beyond it. He has also pressed the raw nerve in the process and accused MAI of indulging in cartelisation and forcing domestic players to sign on dotted lines leaving them no choice about the number and timing of shows.
The unfair trade practices indulged in by multiplex chains do not come to us as a surprise. We know what’s going on. However, domestic producers and distributors had kept mum until now. Their trade associations are mostly defunct thanks to an earlier intervention of CCI and various orders from the High Court of Bombay. MAI is the only association that seems powerful in this scenario. It can dictate terms to individual producers and distributors and make them sign on dotted lines. However, when it comes to Hollywood studios it’s MAI that readily signs their global agreements without a whimper.
It’s obvious that Hollywood studios have turned real masters of the Indian film and entertainment industry. They monopolized platforms like the FICCI Entertainment Committee, and the Producers’ Guild and successfully pushed for 100% FDI. We don’t even know if they really brought in any FDI in India post the change in govt.’s policy pushed through by pliant and ignorant bureaucrats.
It’s interesting to note that while Disney-Fox merger was subjected to various Anti-Trust laws and intense scrutiny of American lawmakers, in the absence of an anti-trust law in India the impact of this merger on Indian market went unnoticed. We don’t even care to notice that foreign entities nearly control 80% of all distribution platforms in India – from theatrical to satellite and internet, and have completely marginalized domestic players.
Ronnie Screwvala’s petition to CCI can be a good wake up call for the industry.