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Venus Records & Tapes director Ratan Jain is a busy man, collecting box-office feedback from his new release De Dana Dan.
Built on Rs 670 million with Eros as an equal partner, the movie is crucial to Jain‘s expansion plans. He is readying a movie with Priyadarshan and another with Abbas-Mastan after having stayed away from film production for a brief while due to an unrealistic rise in prices.
Venus has one-third of its revenues coming from music. With a correction in prices, the company plans to swing back into acquisition of titles.
Venus is also considering an initial public offering (IPO) to fund its expansion plans.
The company expects to clock a revenue of Rs 1.20 billion this fiscal on the back of a big movie release and the music business.
Cutting across his busy schedule, Jain speaks to indiantelevision.com‘s Sibabrata Das and Ashish Mitra about the need to be cautious in an overheated movie market.
Excerpts:
Why has Venus been slowing down on movie production and acquisition of music rights for the last couple of years?
The prices skyrocketed and we decided to stay outside the ring. Some companies wanted to scale up and actors and technicians jacked up their rates to an unrealistic level. The movie industry went haywire. The same thing happened to the music industry. For the films that we released, we, however, kept the music rights. But it did not make business sense for us to acquire music rights at such inflated prices.
Do you see the prices having fully corrected?
They have definitely corrected to a large extent and things have come to some state of reality. But some actors and technicians are still looking at extremely high rates. Despite a fall in the cost structure, there is a scale down in the number of movies being produced this year.
Venus has swung back into action with a big budget movie De Dana Dan. Has the co-production with Eros come at the right time for you?
The movie is made on a budget of Rs 670 million and it is a 50:50 joint venture project with Eros. While Eros has kept the home video and international distribution rights, we have the India distribution and satellite TV rights. Baba Arts is handling the distribution for us. Early indications from the box office show that the movie is going to be a hit.
Priyadarshan makes out-and-out comedy films. De Dana Dan also marks the return of all three protagonists of Hera Pheri – Akshay Kumar, Suniel Shetty and Paresh Rawal.
Will this movie spur you to scale up particularly as it comes after a gap of more than a year since your last film Maan Gaye Mughal E Azam?
Yes, Maan Gaye… released on 22 August 2008. And I rolled the shooting of De Dana Dan on 26 November last year, the day the terrorists struck in Mumbai. I remember when we were in a middle of a shoot, we got a call from a friend of mine that terrorists were firing at CST.
As far as my film goes, we do a research of at least six months and then go in for shooting. This film has taken exactly a year.
I don‘t see Venus doing more than two movies a year. We could also be doing smaller movies but it is difficult to market and release them. We have two projects in the pipeline – one with Priyadarshan in August and the other with Abbas Mastan.
Will you go for a syndication model or sell outright the satellite TV rights for De Dana Dan?
We are in advanced negotiations to sell the rights. Syndicating the movie to multiple broadcasters is good for channels but not for us. It takes time to recover money. And it has worked when you have big hits like Jab We Met and Singh is Kinng which can have many runs across channels. Syndication also works when you have a basket of films.
‘We expect to clock Rs 1.20 billion in FY‘10. Venus is not just surviving on movie releases. We have a strong music business. We also trade in satellite TV and video rights‘
Have prices for satellite rights slumped this year?
Prices have fallen compared to last year. Internal competition and entrants have spoilt the market. We had fictitious prices ruling the market.
Has the downturn affected your revenues?
There is no recession in the entertainment business. We clocked over Rs 1 billion last fiscal and are expecting to have a turnover of Rs 1.20 billion in FY‘10. Venus is not just surviving on movie releases. We have a strong music business. We also trade in satellite TV and video rights.
What steps are you taking to boost your revenues from the music segment?
Music accounts for 30-40 per cent of our total turnover. Besides mainstream Bollywood, we bring out music CDs of all kinds including ghazals, regional languages and bhajans. We are exploiting the digital and mobile platforms. A major chunk of our revenue comes from downloading.
But you haven‘t been acquiring music rights aggressively in recent years?
With the prices going berserk, we largely stayed out of it. But we have a vast library, holding over 3000 music titles. While 600 are film music titles, the remaining are non-film music titles.
On the movie front, we have negative rights of 50 movies.
Zee had shown interest in acquiring 60 per cent stake in Venus in 2006. What went against the deal?
There were commitment issues. While at that time we thought of that as an expansion route for us, now we are not looking at such alliances.
Are you looking at other ways of raising capital to fund your expansion plans?
We are considering an initial public offering (IPO). We were not ready for a public listing then. Now we have taken the necessary steps. We could also be looking at a pre-IPO placement. But we haven‘t frozen our plans yet.
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