Who lost Spielberg, UTV cracks US Top 20 and Snoop goes Bollywood

An assortment of news with an Indian flavour in the last few days.

It is talked about as if the ink is dry on the paper, but this article from the New York Times gives a bit more context to the Ambani-Spielberg/Reliance-Dreamworks deal under negotiation, particularly the financial climate in which an Indian conglomerate trumped Hollywood studios and traditional investment banks to the world's most commercially successful director:

But there was still an element of shock [following the announcement of the Reliance negotiations]: Hollywood could not come up with a rich enough deal for Mr. Spielberg, the most bankable director in the business and a “national treasure”? His last movie alone, “Indiana Jones and the Kingdom of the Crystal Skull,” has sold $743 million in tickets and is still playing in theaters around the world.

For that matter, there wasn’t anybody on Wall Street willing to write a blank check for the guy with “Jaws” and “Jurassic Park” on his résumé?

The pending deal with Reliance underscores some realities about Mr. Spielberg — mainly that he has become so expensive that few public companies can afford him. Mr. Spielberg’s standard deal, on par with other blue-chip talent, is 20 percent of a movie’s gross from the first ticket sold, although he agreed to a somewhat less aggressive paycheck on the latest “Indiana Jones” installment to offset its high budget.

And:

Hollywood’s seeming inability to close a deal with Mr. Spielberg highlights the shift toward a more corporate, buttoned-down movie business. Just a few years ago, bragging rights often drove business decisions. Steven Spielberg is available? Back up the money truck. We want that jewel in our crown no matter what the cost. And studio bosses could justify such ego-driven loss leaders: In the entertainment business, talent draws talent.

And:

As for Wall Street, the firm belief in Hollywood is that the arrival of Reliance marks the end of the private equity and hedge fund boom that has propped up the industry. With the capital markets in turmoil, terms have tightened substantially for movie deals. Investors are demanding faster payback schedules, better guarantees and even a say in how movies are made and marketed.

So out with the Germans and in with the Indians, confirming once again that Hollywood is colour blind when it comes to foreign investment, as long as it is dollar-green.

Elsewhere follow Indian company UTV has just cracked the Top 20 US distributors list on the strength of several Bollywood hits. From THR.com:

UTV Motion Pictures said Monday that it earned $5.48 million from ticket sales in North America in the first half of the year, becoming the first foreign-language distributor to rise into the ranks of the top 20 distributors in the territory. North America's growing South Asian population flocked to see such UTV releases as the historical epic "Jodhaa Akbar," which earned $3.44 million in ticket sales; action-thriller "Race," which earned $1.37 million; and recent musical release "Jaane Tu Ya Jaane Na," which has earned $539,857 so far.

Not bad, but I am sure that the likes of UTV and Eros can and will climb even higher than this, possibly all the way up to the Top 10.

An unlikely convert to all things Bollywood is bad dog rapper Snoop Doggy Dog. But soon he will be seen duetting on the big screen with Bollywood's comedy star du jour Akshay Kumar. Sayz the Snoopster himself in IHT.com:

"I really dig how much music is infused with the movies" in Bollywood, Snoop Dogg said in an e-mailed response to questions. "Lots of hip-hop tracks sample Indian music, and a lot of their music sounds like it was influenced by hip-hop," he said. "We're putting together something real big" in India, that will include collaborations, live shows and "more movies with some of my Bollywood homies."

"I'm coming to take over Bollywood," Snoop Dogg promised during the video shoot. "I've never been able to come over there and do shows for you all, but now I'm going to come and do shows," he said in a clip that the video's promoters put on YouTube. "This is just the beginning."

I for one can't wait.

Reliance-Spielberg discussions "going well"

I have just returned to Mumbai - which is looking particularly lush and green after several weeks of rain - now that I have secured a permanent work visa. Lots of things have been going on while I attended SAWA and Cinema Expo, but over in the States the discussions to enable Spielberg to set up DreamWorks as a stand-alone studio with Reliance ADAG's support are apparently going well. From THR.com, which leads both the international and domestic daily with the news:

Representatives of Steven Spielberg and the Indian conglomerate Reliance continue to talk daily about terms of a $1.5 billion proposal to fund a privately owned DreamWorks that would produce more than 30 films over the next five years.

Reliance executives are expected to hold sit-down talks with Spielberg reps soon in New York or Los Angeles, though things are going so well they might hold off flying in until a meeting to close the deal later this summer. The business plan being discussed would see Spielberg and top DreamWorks execs create a new company financed with about $550 million in equity funding by Reliance, a senior debt facility and possible additional equity from whichever studio is chosen as a theatrical distributor.

"Things are going well, and God willing we'll get there," said Schuyler Moore, a Strook & Strook & Lavan attorney representing Reliance in the DreamWorks talks.

God willing, indeed. Who knows, perhaps Mr Spielberg will even be persuaded to come out to India at some point, though as you can see from the article above the deal would be signed in Hollywood.

Reliance partners Bollywood's Top Film Family

In India there is no greater or more popular actor than Amitabh Bachan (know simly as Big B) and he heads a family that includes his successful-in-his-own-right son Abhishek and his daughter-in-law Aishwarya Rai (Miss Universe 1994), as well as wife Jaya. We learn today that Reliance BIG Entertainment has struck a major deal with them. From THR.com:

Reliance Big Entertainment, the film arm of the Indian conglomerate courting Steven Spielberg and other top Hollywood names, strengthened its Bollywood roots Wednesday by forming a pact with India's "first family" of filmmaking. RBE, a division of Reliance ADA, will launch a production entity with Amitabh Bachchan and his family of actors to produce films and television content, president Rajesh Sawhney saidtold The Hollywood Reporter. "If we want to engage globally, we have to engage with Hollywood. And that means engaging with talent," Sawhney said.

And

The new unnamed RBE-Bachchan entity will see RBE handle finance, marketing, distribution and other management issues while "the Bachchans will focus on creative aspects," Sawhney said. Without providing investment figures, he termed the agreement "long-term and open-ended." The Times of India speculated that the deal could be worth about $300 million, but Sawhney dismissed the figure as "baseless," adding that the investments "really depend on the nature of projects, which are still to be finalized."

So it is Big B meets BIG Entertainment. Quite the suitable match really. Big B writes about it on his own blog:

Because of the announcement of the Reliance Entertainment and our tie up, there was media bombardment from all sections. The phone was filled with queries and requests for answers and talk ins and bites from the electronic community. They are all friends and i consider it common courtesy to respond to them even if I am completely unable to comply with their requests.

Though for all things Bachan, log on to TheBachans.com

Being back in London briefly after Cinema Expo, I was amazed by how many people had read about the Reliance-Spielberg-DreamWorks discussions. It really has put India and Reliance on the world map.

Trades' view of Ambani-Spielberg / Reliance-Dreamworks

The trades follow the scoop by WSJ that there are serious discussions underway for Anil Ambani's Reliance BIG Entertainment financing Steven Spileberg's break-away of Dreamworks from Paramount. THR.com notes:

Indian business group Reliance is considering a plan to invest $550 million in return for a 50% stake in a new version of DreamWorks, which Steven Spielberg would create after exiting his deal with Paramount.

The Mumbai-based conglomerate was approached as a potential DreamWorks investor by CAA and likely will take at least two more weeks to mull the proposition. Hired by DreamWorks chairman David Geffen, entertainment attorney Skip Brittenham has created a detailed business plan that would give Reliance a key role in the new DreamWorks but grant Spielberg extensive creative control of the reinvented studio.

Details including $500 million or so in accompanying bank debt could take the rest of the summer to sort out, and even the issue of ownership control remains fuzzy. Spielberg has been on the hunt for equity and other financing for several weeks or more. The interest from Reliance was first reported on the Wall Street Journal's Web site.

It is no small irony that the same issue of THR has an article called 'Global media gains will be built by BRIC', which observes that 'Growth in the roaring economies of Brazil, Russia, India and China -- the so-called BRIC nations -- will outpace the more mature markets of the U.S. and Western Europe, with PwC forecasting 13.6% average annual growth in BRIC compared with just 4.8% annual growth in the U.S. media industry and 5.4% in Western Europe.' It is just that the PWC report had not anticipated one of the Indian growth engines to set up a virtual studio in Hollywood.

Meanwhile Variety goes into more detail about the implications of this possible deal:

The emergence of Reliance as DreamWorks' principal new financier marks the latest and most dramatic example of talent -- and their agents -- aligning with outsiders and using other people's money.

Beyond emerging as DreamWorks' principal new financier, the Indian company closed development deals with seven Hollywood heavyweights.

At Cannes last month, Reliance trumpeted deals with seven production companies headed by high-profile thesps (Daily Variety, May 19) and this week pacted to pay each company at least $1.2 million-$2 million to develop projects.

More than one option

• (Co) Daily Variety
  Filmography, Year, Role
• (Co) Daily Variety

And

Reliance's deals with Cage, Carrey, Clooney, Columbus, Hanks, Pitt and Roach will potentially give that talent the opportunity to fashion a finished script that can be shopped to studios along with 50% of the film's financing. That will allow the talent to make the most favorable deal possible, because if a studio doesn't want to pay a star or director's usual gross deal, the package can be shopped to another studio.

While CAA is steering Reliance at a deliberately measured pace, the Indian conglom likely sees the arrangement as getting its foot in the door. Reliance may well finance the films itself and make a distribution deal with a studio.

A very exciting time to be working in India, that's for sure.

This 3D article makes me sound sooo gay

While I am busy preparing the 2K Keynote for this weeks Cinema India Expo, digital 3D intrudes in the form of AccessIT's latest announcement and an article that quotes me about the prospects of 3D for India's digital cinema. AccessIT first.

Almost a year ago at IBC I met with representatives of International Datacasting Corp. and Sensio, showcasing a product for Live 3D, whose USP was that it could be sent down a single HDTV channel. I knew that they had a winner on their hands, so it is no surprise that their technology will be implemented by AccessIT in their digital cinema network. from the press release:

Access Integrated Technologies, Inc. ("AccessIT") (NASDAQ:AIXD) announced today, its plans for the installation of 150 of its leading edge CineLiveSM product in key markets throughout the United States. The technology, which enables the live broadcast to movie theatres of both 2-D and 3-D events such as sports and concerts, will be added to those theaters that are part of AccessIT’s satellite network, all of which are part of the company’s completed 3700 plus screen Phase 1 digital cinema deployment plan. Installations of CineLive will begin immediately in 50 sites and are anticipated to expand to at least 150 by the end of 2008.

The releases will be handled by AIX's alternative content division the Bigger Picture. Carolyn Giardina's take in THR.com is that, "The move underscores a growing interest in this alternative content possibility," and that , "Deployment is set to begin immediately on the first 50 CineLive systems, which will include installation in key markets including New York, Los Angeles and Chicago. Access IT expects to have at least 150 in place by year's end."

The news brought a smidgen of cheer to AIX's share price, which came dangerously close to touching $2.00 last week, before climbing up to $2.37 in current trading.

Meanwhile 3D fever is spreading to India as well, ahead of talks about it in this week's Cinema India Expo 2008, where I will be presenting a Keynote on 2K Digital Cinema in India. DNA ran a story headlined 'Cricket cheerleaders in 3D? Possible…' that actually pre-empted the AIX announcement. (For those who wonder what 'Cricket cheerleaders' look like, they are American Football cheerleaders flown in for the IPL tournament):

Multiplexes are gearing up for their next leg of digitisation that may see 5,000 3D digital projections being installed by 2009. This means by next year, live-action screenings in multiplexes like IPL matches will promise an altogether new experience for viewers — by taking them as close to the action as is virtually possible.

This will also mean that those live-actions screenings that are hugely popular overseas, such as the U2 Live Latin American concert, may now also enter Indian multiplexes.

Currently, there's only one theatre in the country — Satyam Cinemas in Chennai — that has a 3D cinema or stereoscopic digital cinema projection in place. But by next year, most premier digital cinema chains like Adlabs and PVR will have 3D digital projections installed. Both the companies are currently in talks with digital cinema infrastructure providers like Real Image Technologies for 3D cinema systems.

I got interviewed for the article and got quoted towards the end about the prospects for 3D film productions in India:

No major 3D productions have been announced from India yet. However, Patrick von Sychowski, COO, Adlabs Digital Cinemas, says within the next 1-2 years "there should be some announcements on that front."

When asked if Reliance Big Entertainment has any plans to produce 3D feature films, Sychowski said, "Reliance has been the front-runner in a number of initiatives, so you never know."

Adlabs is part of Reliance ADAG, which acquired Hollywood-based DTS Digital Images, a company that industry observers say will help Reliance Big Entertainment supply technology solutions to the rapidly growing 3D content market.

Then comes the bit where the writer took some creative freedoms in interpreting my comments:

Sychowski said live action 3D films were "about a year or two" away for India and digital animation possibilities in 3D, seem more likely to be exploited. "Shooting in 3D requires two cameras held in close proximity, therefore making it more difficult to shoot SRK's six pack."

I had said that it was more difficult to "shoot Shahrukh Khan" but nothing about his six pack. Seriously. If that had been on my mind it would have been something about the ample charms of Preity Zinta, Bebo or, hell, even Rakhi Savant for that matter.

But I do think that 3D film making will have a considerable impact in India very soon. More about that and 2K at Cinema India Expo. I will post an update after the conference.

Reliance's second $1bn deal at Cannes, this time with the Hollywood 8

The follow up to Reliance Big Entertainment's Billion Dollar film production deal was unveiled on Sunday in Cannes. It may not quite rival MGM's claim of 'More Stars than there are in Heaven', but it is not far off.

Deals have been struck with the actors and their production houses listed below, to develop scripts that will go into production with established Hollywood studios, with Reliance coming in as co-financing partner. The deal does not replace the existing deals that these production outfits have with Universal etal, but suppements.

- Nicolas Cage (Saturn Productions);

- Jim Carrey (JCB 23);

- George Clooney (Smokehouse Productions)

- Chris Columbus (1492 Pictures)

- Tom Hanks (Playtone Productions)

- Brad Pitt (Plan B Entertainment)

- Jay Roach (Everyman Pictures)

(+ one that is as-yet un-announced)

More details on thr nature of the deals form the Calcutta Times:

Another day and another billion announcement from Anil Ambani whose Reliance Big Entertainment today announced in Cannes that it will provide “development funds to eight leading creative forces in Hollywood”.

The value of the 30 films being developed jointly will be a billion dollars, “but this will not be the billion dollars that we talked about the other day,”said Amit Khanna, who is chairman of Reliance Big Entertainment and has been acting as the entity’s chief spokesman in Cannes.

“What it means for the average Indian is a sense of pride that India has finally arrived on the global media map,” Khanna explained to The Telegraph after his main press conference.

A billion here, a billion there... Pretty soon it starts to add up to some real money.

As the Times of London also notes, "the deals represent the biggest entry into the western media market by an Indian group and mark a reverse to the flood of money that has been poured into the Indian film industry by Hollywood production houses in recent months." Coming, as it does, not long after Sony, Disney and NBC-Universal's investment spree in Bollywood.

As my intrepid namesake P. Frater at Variety notes, these deals are not meant to rock the Hollywood studios' boat:

Deals are described as “production silos” under which Reliance Big Entertainment provides development coin to enable the talent to nurture or acquire movie projects before taking them to the studios with which they have first-look arrangements. In a second stage, deals allow Reliance to participate in up to 50% of a movie’s subsequent production funding and to secure rights in India.

“We are totally respectful of the existing first-look deals that each of our partners enjoys and are confident that the respective studios will welcome our development silos and our subsequent co-financing ability,” said Reliance prexy Rajesh Sawhney. “We are breaking completely new ground and not just as an Indian-based company.”

Khanna said the silos will likely become involved with 30 projects in the next couple of years, of which at least 10 will go into production. Reliance execs and CAA reps, who brokered the deals, were at pains to explain that Reliance coin is supplementary to the stars’ first-look deals rather than alternatives.

“We will increase the speed and safety of the elevator, but the destination is still the top floor,” said Reliance Big Entertainment CEO Amit Khanna"

The key to understanding Reliance ADAG is not to think of it as an Indian company abroad, but also to recognise it as a company that occupies the number one, two and three position in its home market with regards to the 'competition'. This is not boasting, but the distilled essence of my experience after more than half a year here. Reliance ADAG does not enter ANY market in which it is not sure that it will be number one and will do everything to ensure that position.

As an example, see the announcement on the same day of the launch of Reliance's Big TV DTH service into 4,000 Indian towns, which aggressively undercuts the competitions' prices while offering a better technology platform. Also on the same day, Reliance ADAG's gaming group Zapak announced its own $100m acquisition fund for expansion.

Given the size of such undertakings, the company is not interested in small deals and something like the Lowry Digital acquisition (a relatively paltry $7.m in comparison) was undertaken because it was strategic and would ensure the company became number on it this particular field.

Returning to Cannes, the second Billion Dollar Deal is particularly timely THR.com notes:

“This is a good thing for the studios with equity financing drying up thanks to the financial crunch,” said an agent from CAA, which brokered the deal. “It provides a new source of funding for the studios, and gives the studios a foothold in the India, a market they are all expanding into.”

If you doubt the crdit crunch impact on production, then read the IHT article 'Hollywood dreams face cold financial reality' and expect to read more in the future about what Mr Khanna (pictured above) calls "the reach and potential of India's steadily growing soft power".

Photocredit: Viewimages.com

Reliance's Billion Dollar Entertainment Baby

The Cannes Film Festival is in full swing but I didn't make it this year. Instead it was my boss' boss who went there to announce Reliance Big Entertainment's Billion Dollar Plan.

While the company has previously been involved in film production and distribution, nothing could have prepared the world for the magnitude of this commitment to making films in India and beyond.

From the Economic Times:

CANNES: Reliance Big Entertainment, the media and entertainment arm of the $75 billion Reliance Anil Dhirubhai Ambani group, on Friday announced that it would spend $1 billion on the Indian film and entertainment business over the next 12-15 months.

This is by far the biggest commitment made by an Indian entertainment company for show business. Amid the glitter and glamour at the 61st edition of the Cannes Film Festival at the French Riviera, Reliance Big Entertainment also revealed that 69 films in nine languages would be ready for distribution over the next 18 months. Over a dozen films will be released this year.

"India is uniquely positioned in the global economic order. We believe this is the right time to make this commitment of $1 billion for the film entertainment business," said Amit Khanna, chairman of Reliance Entertainment.

The best coverage of the Cannes event itself comes from the Telegraph of Calcutta:

The Ambanis don’t do things in small ways — and today Anil Ambani chose Cannes to make public what the media had been promised would be information on a “major and unique event”.

The news conference had been organised by DDA, a PR firm which usually handles established American and European clients. In the last few days, its publicists have been calling up journalists to make sure they would be in the Salon Diane of the Majestic Hotel to hear the announcement at 10am today.

It was left to Amit Khanna, chairman of Anil Ambani’s Reliance Entertainment Pvt Ltd, henceforth renamed the Reliance Big Entertainment, to drop the bombshell — the group would invest $1 billion (around Rs 4,250 crore) to change the face of the Indian movie industry as we have known it.

And the ambition is not confined to India alone. My very diligent namesake Mr Frater does a good job of capturing it all in Variety's 'Reliance sets out its very Big ambitions':

The company is expected to follow Sunday with further announcement about relationships and production deals involving Hollywood talent such as Will Smith, Tom Hanks, Julia Roberts, George Clooney, Brad Pitt, Tom Cruise and Bruce Willis. “It is time for Indian companies to step up and take on the world,” Reliance CEO Amit Khanna said.

From THR.com 'Reliance goes Big with billion-dollar unit':

Reliance's empire spans production, distribution, home entertainment and exhibition across the subcontinent and also has outposts in Sri Lanka and Mauritius among others. Khanna said the company plans to open offices in New York and Los Angeles.

Even our own little digital cinema effort got a mention at Cannes and in Variety: 'Unlike other digital cinema initiatives in India, Reliance Big Entertainment and its stock-market listed Adlabs unit, are rolling out fully DCI-compliant 2k systems.'

Yup, that's us. But more on those plans another time. Maybe Cinema Expo.