The recent hype across the globe around the movies Barbie and Oppenheimer has once again put the spotlight back on the theatrical experience and has ignited the discussion about digital vs theatre.
Motilal Oswal recently shared a report on PVR-INOX and it contained some interesting insights on the entertainment industry as a whole. Here are some of the highlights:
Digital is growing not just in India but GLOBALLY
- As per the Motion Picture Association Report, the share of theatrical, which stood at 48% in CY17, has declined to 21% in CY21
Regional content is ruling the box office
With Oscar worth movies like like Liger, Brahmastra, Kabhi Bhai Kabhi Jaan helping box collections of hindi movies plunge from 45% in 2018 to 33% in 2022. South Indian films contributed nearly 50% of the total box office collections in 2022 and have also surpassed pre-covid collections despite releasing movies like Aadipurush.
Apart from theatrical releases, there is a strong surge in the share of regional movies on OTT platforms as well. This can alternatively be seen as positive, with an improved audience base for regional movies.
Structural shift in consumer preference?
Closure of cinemas due to the pandemic led to a shift in consumers toward digital channels. Along with sub-par content, the overall increase in cost of watching a movie in theatres might also be contributing to a possibility of a shift in consumer preference.
For eg: Even after increase in the average ticket price, number of movies crossing the 100 crore marks declined by more than 50% while the collections for these movies declined 40% YoY to 1720 crore in FY22, the average collection per movie improved to 25 crores, indicating that movies with better content were rewarded appropriately
How’s PVR-INOX doing?
With 1,700 screens and gross ticketing revenue of 2600 crore (FY23 combined basis), the merged entity commands a leading position having 18% screen share and 30% revenue share in the box office collection.
While Average Ticket Price (ATP) improvement has supported a recovery in ticket revenue growth, occupancy remained 30% below the pre-Covid levels.
For PVR-Inox, FY23 occupancy stood at 25%, which was below the pre-Covid level of 32%.
The rise of OTT and Digital Segment
- The digital subscription market, which stood at merely 1400 crore in CY18, grew to 7200 crore by CY22 mainly driven by the changes that pandemic brought into our lives. It is expected to grow exponentially and reach 10000 crore by CY25, as per the Federation of Indian Chambers of Commerce & Industry (FICCI) and EY report.
Are you team #digital or team #theatre?
