MUMBAI: Fewer, quality films will be greenlit according to the Ficci EY Report.
Given the environment of caution in 2025, the report expects that fewer films will be produced on account of rising production costs, less digital and broadcast prefunding/
pre-sales of rights, and higher dependence on theatrical revenues, especially for certain categories of small- or mid-budget films
The report expects to see longer production times, larger writers’ pools and more consumer research being used to select films for production
A lot of unsold content from 2023 and 2024 could get sold as originals on digital platforms
Now that films are attracting audiences across language markets, we could see more investment in pan-Indian content, more intermingling of stories, cultures and themes, of production values and music, than ever before
Theatrical infrastructure will evolve
While the largest multiplex distributor has planned to add 100 new screens in FY2026 using an asset-light model, the report believes that low priced theaters, aided by
the growth in mass-themed films, will come into being in the medium term, and this will expand the number of families and footfalls which can enjoy the theatrical
experience
The report believes that very low cost theaters (with a capital investment below INR4 million each) will also come into being across approximately 88 cities with populations
between 100k and 500k, and in the next 300 to 500 even smaller towns with populations below 100k. These theaters, which will thrive on mass and spectacular films, will have lower ticket and food and beverage prices, and will help in growing footfalls from underserved
markets
Portable and inflatable cinemas are also revolutionising the way movies are screened, particularly in regions like Chhattisgarh, Odisha, Andhra Pradesh, Telangana,
Madhya Pradesh, Uttar Pradesh, and Goa where traditional cinema infrastructure is limited
TVOD will scale
► The growth of wired broadband and connected TVs is providing a fillip to TVOD revenues, and we can expect this trend to gain importance, including for India’s high
volume of films which do not find digital buyers
► The growth of aggregators like Play Store, Prime Video, Dor, Watch, WAVES and TataPlay Binge will increase the potential of TVOD offerings, and we could also expect
online platforms like ticketing portals to enter the space of long-tail online film distribution
► To penetrate smaller markets effectively, a georestricted TVOD window could complement theatrical releases, either simultaneously or shortly after. This approach ensures that audiences in areas with limited theater access can still engage with the content digitally
► The large number of unsold digital films could also release in increased numbers on AVOD platforms like YouTube, on the AVOD portions of pay OTT platforms, and even on social media platforms that have large audience reach, on revenue share models
High quality and spectacular films will be made for theaters
Given the niche segment of India’s population who watch films, and the growth of larger screens at home, the type of films which will be made for theatrical releases will be of the highest quality
Films with a large amount of VFX, high-concept films, and larger-than-life stories will be created with increasing frequency, while smaller budget films with limited special effects will find it increasingly difficult to find release windows
At the other end of the paradigm, broadcasters will commence producing/ commissioning films in the sub Rs. 15 million cost range, particularly for FTA and regional channels
Release window innovation will increase
► In order to manage high acquisition costs, some platforms will start creating theatrical windows for their made-for-OTT films, or even for film versions of their original episodic content. Such monetization may not impact their revenues, but can also act as marketing for
the platform
► The four-week digital window will be strongly reviewed as many producers feel it impacts the theatrical window, though it is expected to remain a negotiation criterion
for some time to come
More movies will be made for release across all three screens (theater, TV and mobile) and consumption data will be used to impact story telling
Films will create derivatives: IP 360°
Content created for the cinema screens with a large fan base will generate derivative content such as OTT series extensions, prequels and sequels, side stories, interactive games and even related events, with the original film helping to market the derivative content
The 360-degree model of nurturing film IPs will gain traction as consumption fragments across audiences, devices and windows
Technology will bring efficiency
Underutilisation of technology leaves significant inefficiencies in the production pipeline, limits scalability in distribution, and reduces the effectiveness of marketing efforts, ultimately hindering the industry’s growth and competitiveness
The report expects increased use of GenAI in content production, across background scores, backgrounds, storyline creation, translation, budgeting and other areas
Technologies like geo-restriction will create new monetisation windows for regional and other films’ dubbed-language versions, enabling less affluent audience to watch content in parallel to the main theatrical release
In marketing, personalised campaigns leveraging AI, location data and analytics could better target audiences, driving engagement and maximizing ROI
Alternate revenue opportunities
Developing compelling characters and franchises is critical for sustaining long-term interest and creating a foundation for monetization across multiple platforms
IP owners are currently beginning to evaluate alternate monetisation opportunities in merchandise sales, experiences, fan clubs and gaming, which can significantly enhance brand value and audience engagement
Merchandising related to entertainment characters is estimated by us to be around INR80 billion to Rs. 100 billion annually, mostly related to foreign characters, leaving a significant opportunity to build-out domestic character licensing
Games based on Indian film characters hold immense potential to captivate audiences by merging India’s love for cinema with interactive entertainment
