- The speaker discusses the issue of excessive spending on a few individuals in the entertainment industry
- They argue for a need to change the economic model to benefit all involved
- The speaker also highlights the lack of transparency and fair compensation for creators and artists
- They emphasize the importance of better storytelling and fair compensation for musicians in the industry

- The speaker discusses the lack of fair compensation for musicians at Indian weddings due to the IP system
- He questions the fairness of the current model for compensating creators in the entertainment industry
- The speaker argues for transparency and fair compensation for all involved in film production
- He highlights the disparity in pay between male and female actors in Bollywood
- The speaker emphasizes the need for transparency and fair compensation in the entertainment industry, particularly for musicians and actors.

Watch the full episode - https://youtu.be/hNV6urpwrk8

Listen to the full episode on Spotify - https://open.spotify.com/episode/7AzmH5TjRDyaSz4pPR9j9Y?si=764d0c91e58046ef

Listen to the full episode on Apple Podcasts - https://podcasts.apple.com/in/podcast/ep-8-wtf-is-going-on-in-the-world-of-content-w/id1677107935?i=1000624436462

Nikhil Kamath - Co-founder of Zerodha, True Beacon and Gruhas

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Ajay Bijli: Founder of PVR Cinemas & Managing Director of PVR INOX Ltd. (The merged entity of PVR Cinemas and Inox)

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Twitter https://twitter.com/ajaybijli


Vijay Subramaniam: Founder & Group CEO of Collective Artists’ Network

Follow Vijay Subramaniam here: 
Twitter https://twitter.com/vijaysubs
Instagram https://www.instagram.com/vijaysubramaniam84/
Linkedin https://www.linkedin.com/in/vijaysubramaniam/


Sajith Sivanandan: President & Head of Disney+ Hotstar

Follow Sajith Sivanandan here:
Linkedin https://www.linkedin.com/in/sajithsivanandan/

#Nikhilkamath #Podcast #WTFiswithNikhilKamath #WTFistheWorldofContent #Cinema #Movies #Media #Artists #OTT

Do you think if a movie or if content's budget, 50% of it is spent servicing, not even talent, but servicing the 2 or 3 people amongst a few hundred of the people you can put in the category of talent.

Do you think something is wrong with the ecosystem?

Vijay, remember a good business usually makes money.

And you manage all these people with really large egos.

We are cognizant to the fact that you manage most of them.

And I think it's a great conversation to call out the elephant in the room.

Everybody's here to, you're here for part of the 2000000000 dollars.

You know, you can choose to charge what you want tomorrow if hypothetically you have a subscription fee that a consumer who is at a particular socioeconomic class may not think it's It's a it's it's it's valuable enough you run what you run and obviously you're You're you're validated or not by the consumer paying for that.

I think my business is pretty much the same.

There is a, it is a marketplace of a buyer and a seller.

So I think the simple answer to that is, what really are the economics that make it work?

So if you don't want to pay on the front end, if you tell a guy that I don't want to pay this to you right up front, because say it costs, it really loads the film up front, what are the economics of the back end?

Are studios today willing to work under 50% our studios today willing to work by parting IP, our studios willing to work by changing the economics where it changes in a way where everybody in the process makes money.

Our producers of feature films today are in a position where budgets can be clean, right, in front of a performing artist.

Music licenses and royalties being paid out to a co-producer at a certain degree of transparency.

Some of the digital and satellite rights are diminishing.

You are not going to pay for the second cycle of a film that you bought.

You are not going to pay the same money that you paid for the first cycle of the film that you bought.

So I think there is a lot that goes at play.

I think, yes, are there room for certain corrections in prices?

I think today, if you're shopping in your world, if you're going to a flip cart and shopping, and you find a particular product SKU expensive, in a month, they discount it.

If that SKU is not selling, Why are the rules of marketplaces different here?

I think that's a very unfair argument, because the easiest thing to do is to bail the loudest cat.

But the fact of the matter is, yes, given it could be 1 or 2 or handful people who may be spoiling the economics at scale by and large.

We are at a very, very strong precipice in the business, right?

Because never before has the business been given an opportunity where artist, platform, whatever the platform is, it could be a big screen, it could be a small screen, medium screen, artist, platform and creator have the opportunity of coming together or deriving a new model.

I'd like a global multinational studio to tell me that they drop financing below 50%.

Typically when you do a studio deal, The studio back, the financier backs 50% of the film and 50% stays with the producer.

So for example, Nikhil is producing a film.

So he's diluted from his 100% to 50% of his idea.

You're saying, okay, you know what, bring down my fee up front.

But then I'm going to ask you, are you going to come clean with your budget?

So for example, I just said I made it a hundred.

I'm not doubting transparency here, but it's also that act, you know, I'm not going to sit in higher office of 10 people to see.

You are doubting transparency because that's the premise of what you just said.

I think what happens in the celebrity world is because they are celebrities, the ability or the inability of them to get out of commercial led conversations on capitalism specifically.

Why is it wrong for a celebrity to make money?

If you are saying that event films work, please give us the event films as producers and makers of content.

If you are saying that star films work, please pay the star because of whom that film is working.

You can't put us in the situation where it's an either or situation where neither do we know what's happening on the back end of things.

I don't know today how do I calculate music royalties for my music composer.

In the spirit of complete transparency and candour, I will take 1 name.

I believe fundamentally that we've been managing Preetamda for a while.

I don't think today India can celebrate without Preetam's music.

If you go to a DJ and say, in your music, remove his playlist, I don't think you'll last.

Technically, if music royalties flew in the way they did, he would be Taylor Swift.

Because the truth is, you're not making as much money.

Because he's making 2 billion dollars in a 50 billion dollar market.

You are making 2 billion dollars with 1 tenth of the population of the country being on your platform.

All of us are playing in the same economies of scale.

The issue is how do you want to slice the buy?

And I'm telling you, as somebody in the community and somebody who's fronting 1 part of the community, I'm more than happy to engage in a conversation of, is there a new model that we can explore?

Don't just slap it and say, you're charging a high fee.

If it requires, hypothetically, an awakening from a consumer or from a platform or from a competition to disrupt price points, I'm turning around and saying, you guys are, the production fold is basing this on content.

So, to Ajay sir's first point, it starts with the creator.

All your business models come to nothing if the creator system is not solid.

But That's exactly what I'm coming and telling you.

What incentivizes me to do today to become a writer?

He just said that 90% is working, 10% is not.

What incentivizes me today to become a Bollywood writer?

Because in that part of the world, writers are treated with as much reverence as a director or an actor.

So my question to you guys, and not just to you, to the larger producer community, is how do we tell better stories?

Because when, to your point, so you're talking about Kantara, it came from a story.

You have somebody out here who told you during our break that, as an audience, it didn't resonate to him because it came from Bangalore, from his part, from his, from south.

It resonated because, no, it resonated because it came from his town.

So, they say in Kannada we say Mandi Namaga, which means son of the soil.

Because better stories make for better films.

I'm saying today as a platform, if I came to you with a show, right?

You're not going to green light a show with me if you don't have IP.

Which means I need to make my money up front.

Because technically, what are you saying?

You're saying, you do the work, make the food, sell it to me, I eat it.

Then okay, I decide what to charge for that dish.

And you have no business to tell me what to charge for that dish.

Because you're not giving me a share of it.

If you tell me, come to the table, here is the cookie, let's split it.

You don't, I charge and I take and I'm not going to be guilty about it.

Why do you think musicians in India don't make money?

For all the Bollywood song and dance we talk about, why do you think they are reduced to making money from weddings, corporate shows?

The top 10 richest celebrities in the world, 70% are musicians.

India doesn't have 1 in the top 1000, I guess.

When the big fat Indian wedding is a global phenomenon, you don't have a single musician there?

Because somewhere the system is not allowing, the right system, the IP system in this country is not allowing the least, the last benefiter, which is the creator to benefit from it.

Hence, why should the creator be hold in a regulated form?

On content, the call out is very simple, don't blame it on the actor fee.

For example, in the US, on Ghostbusters, They made money off of video rights, this video on demand rights, which means whenever they sold VHS they made money.

Will you give me syndication across different countries?

When Hotstar opens up in 160 countries will I get money from those countries?

When Taza Khabar plays in 200 countries will I get money from those countries?

Will I have a share of the global business?

Let's talk about the waterfall business wide across OTT and across theatrical.

Because what we are being told is because we are putting the money, we take 50%.

What the end creator is being left down to is a salary.

So he'll charge the highest salary and there's nothing wrong with that.

I also resonate with him from a very free market principle capitalism standpoint.

If somebody is paying for a certain service, I don't think we can blame the person who's charging for that service.

All I'm saying is that, like you said, all, you know, everybody's not the same.

When we were doing production, and I'm not saying we were holier than thou or anything like that, But I found that...

And yet, the actor fee and the talent fee would not come down regardless of his performance in the previous film.

So, sometimes, all I'm saying is that sometimes a haircut is also important.

I can assure you as we speak, being in the business right now.

But there's an assumption that the producer and the financier will not be transparent.

I'm saying even if you're transparent and the script is good, the creative aspect is good, sometimes the movie became unviable.

Shir, I don't want to give any more names.

Some people just didn't budge from their feet.

Regardless of how their previous performance was.

So then the producers end up losing their shirts.

actually ask him how big a part did he play?

I wouldn't like to say problem, but an inflating actor's salary.

But we can still ask how big of a part he played.

I think I played the same part that the producers paid when suddenly their digital acquisition rights of films shot up and people were paying any money during the pandemic to acquire rights.

you had to predict, in 5 years from now, what percentage, say today an actor gets paid 100, 5 years from now will he get paid 70 or 130?

I think he'll get paid, the current model, 130.

I mean, he's saying assuming all goes well.

I am guessing he is going to the shitter as well.

Establish Bollywood actors getting paid market size.

It's a percentage of the total production budget.

But he is not wanting to talk about that 70% as well.

See understand this is the only business where some things are behind in a big wall.

The male stars definitely take a lion's share of it.

It depends on the story and the protagonist.

It's a function of how much role they have in a movie.

I'll put a neck on the line a little bit.

I'll say, I knew someone in the industry.

And her role and her co-actor's role was screen time was probably equal.

But, her salary in that particular movie was 1 hundredth of the male salary.

The fee is a part of the production budget, not a part of the monetization.

So for 2 billion a box office, how much was it made for?

It was made the same way for the male and the female.

No, no, I'm talking about overall talent fee.

So for example, today, you know that okay, music streaming is 1000 odd 2200 1300 crore market That gets divided by Bollywood 70%.

Now, in that, I can tell you music directors make nothing.

The actor's fees, what percentage of the budget?

What is the money spent on making movies in India?

Then you can extrapolate what percentage does a lead star get.

An average Bollywood film, a reasonable Bollywood film, hypothetically, we will go watch.

Not the 2 crore film that just, you know, nobody will go.

But add that too because we won't enter a market size.


Speaker 0: Do you think if a movie or if content's budget, 50% of it is spent servicing, not even talent, but servicing the 2 or 3 people amongst a few hundred of the people you can put in the category of talent. Do you think something is wrong with the ecosystem? I am asking you this.

Speaker 1: Vijay, remember a good business usually makes money. Healthy business.

Speaker 2: Yeah. So basically you are being nice to me

Speaker 1: all the time. You are supplementing that.

Speaker 0: And you manage all these people with really large egos. We are cognizant to the fact that you manage most of them.

Speaker 2: I think this is a long standing debate. And I think it's a great conversation to call out the elephant in the room. Everybody's here to make a living. Everybody's here to, you're here for part of the 2000000000 dollars. You know, you can choose to charge what you want tomorrow if hypothetically you have a subscription fee that a consumer who is at a particular socioeconomic class may not think it's It's a it's it's it's valuable enough you run what you run and obviously you're You're you're validated or not by the consumer paying for that.

I think my business is pretty much the same. There is a, it is a marketplace of a buyer and a seller. So I think the simple answer to that is, what really are the economics that make it work? So if you don't want to pay on the front end, if you tell a guy that I don't want to pay this to you right up front, because say it costs, it really loads the film up front, what are the economics of the back end? How is it favorable in the back end?

Are studios today willing to work under 50% our studios today willing to work by parting IP, our studios willing to work by changing the economics where it changes in a way where everybody in the process makes money. Our producers of feature films today are in a position where budgets can be clean, right, in front of a performing artist. Music licenses and royalties being paid out to a co-producer at a certain degree of transparency. How are you evaluating these rights? Some of the digital and satellite rights are diminishing.

They are not accretive. You are not going to pay for the second cycle of a film that you bought. You are not going to pay the same money that you paid for the first cycle of the film that you bought. So I think there is a lot that goes at play. I think, yes, are there room for certain corrections in prices?

I think it's not very different. I think today, if you're shopping in your world, if you're going to a flip cart and shopping, and you find a particular product SKU expensive, in a month, they discount it. If that SKU is not selling, Why are the rules of marketplaces different here? Because someone's famous? I don't think that's fair.

I think that's a very unfair argument, because the easiest thing to do is to bail the loudest cat. But the fact of the matter is, yes, given it could be 1 or 2 or handful people who may be spoiling the economics at scale by and large. But I don't think that's the rule. We are at a very, very strong precipice in the business, right? Because never before has the business been given an opportunity where artist, platform, whatever the platform is, it could be a big screen, it could be a small screen, medium screen, artist, platform and creator have the opportunity of coming together or deriving a new model.

Right? I'd like a global multinational studio to tell me that they drop financing below 50%.

Speaker 0: What does that explain?

Speaker 2: Typically when you do a studio deal, The studio back, the financier backs 50% of the film and 50% stays with the producer. Right?

Speaker 0: So wait, are there 3 entities? Studio, financier?

Speaker 2: No, so I'll tell you how. So for example, Nikhil is producing a film. Nikhil is the studio. Ajay sir is the producer. Right?

Nikhil is paying him to make the film. So you take 50%. So he's diluted from his 100% to 50% of his idea. Right? What's there to share?

Speaker 0: Is that the typical ratio?

Speaker 2: That is the typical ratio.

Speaker 1: These

Speaker 2: guys will back me on this. I'm the actor. You're saying, okay, you know what, bring down my fee up front. But then I'm going to ask you, are you going to come clean with your budget? Right?

So for example, I just said I made it a hundred. Right? Sure. How do I know you made it a hundred? I'm hoping you made it a hundred.

I'm not doubting transparency here, but it's also that act, you know, I'm not going to sit in higher office of 10 people to see.

Speaker 1: You are doubting transparency because that's the premise of what you just said. I'm not

Speaker 2: doubting transparency. I'm doubting the model. Here's what I'm saying. Listen, not all apples are rotten. Right?

That's the truth.

Speaker 1: That's the

Speaker 2: truth of the matter. I think what happens in the celebrity world is because they are celebrities, the ability or the inability of them to get out of commercial led conversations on capitalism specifically. Why is it wrong for a celebrity to make money? Why is it an issue? If you are saying that event films work, please give us the event films as producers and makers of content.

If you are saying that star films work, please pay the star because of whom that film is working. You can't put us in the situation where it's an either or situation where neither do we know what's happening on the back end of things. I don't know today how do I calculate music royalties for my music composer. In the spirit of complete transparency and candour, I will take 1 name. I represent Preetamda.

Right? I believe fundamentally that we've been managing Preetamda for a while. I don't think there is... I don't think today India can celebrate without Preetam's music. That's the truth of the matter.

If you go to a DJ and say, in your music, remove his playlist, I don't think you'll last. That's the truth. Your party won't last more than 2 hours. Technically, if music royalties flew in the way they did, he would be Taylor Swift. In her 10 billion dollar tour right now.

Fundamental problem is what? You're not making money. Because the truth is, you're not making as much money. Because he's making 2 billion dollars in a 50 billion dollar market. You are making 2 billion dollars with 1 tenth of the population of the country being on your platform.

All of us are playing in the same economies of scale. So The plate really is that big. The issue is how do you want to slice the buy? And I'm telling you, as somebody in the community and somebody who's fronting 1 part of the community, I'm more than happy to engage in a conversation of, is there a new model that we can explore? Don't just slap it and say, you're charging a high fee.

Of course I'll charge a high fee. Why shouldn't I? If it requires, hypothetically, an awakening from a consumer or from a platform or from a competition to disrupt price points, I'm turning around and saying, you guys are, the production fold is basing this on content. Right? The raw material of content is creator.

So, to Ajay sir's first point, it starts with the creator. All your business models come to nothing if the creator system is not solid. So my question to a platform, sorry.

Speaker 1: But that's the thing. Is the creator system, is it solid?

Speaker 2: It's not sir. But That's exactly what I'm coming and telling you. What incentivizes me to do today to become a writer? I'm asking you a very simple question. He just said that 90% is working, 10% is not.

Bollywood is not firing. What incentivizes me today to become a Bollywood writer? Why is the writer's strike happening? Because in that part of the world, writers are treated with as much reverence as a director or an actor. Because he's creating the content.

So my question to you guys, and not just to you, to the larger producer community, is how do we tell better stories? Because when, to your point, so you're talking about Kantara, it came from a story. You have somebody out here who told you during our break that, as an audience, it didn't resonate to him because it came from Bangalore, from his part, from his, from south. It resonated because, no, it resonated because it came from his town. So, they say in Kannada we say Mandi Namaga, which means son of the soil.

Right? Because better stories make for better films. Better films make for better economies. And hence it becomes better for actors. I'm saying today as a platform, if I came to you with a show, right?

You're not going to green light a show with me if you don't have IP. Which means I need to make my money up front. Because technically, what are you saying? You're saying, you do the work, make the food, sell it to me, I eat it. Then okay, I decide what to charge for that dish.

You don't. And you have no business to tell me what to charge for that dish. Because you're not giving me a share of it. If you tell me, come to the table, here is the cookie, let's split it. You change your model, I change mine.

You don't, I charge and I take and I'm not going to be guilty about it. Because you're not changing yours. Why do you think musicians in India don't make money? For all the Bollywood song and dance we talk about, why do you think they are reduced to making money from weddings, corporate shows? Why don't they get music royalty rights?

The top 10 richest celebrities in the world, 70% are musicians. India doesn't have 1 in the top 1000, I guess. Why is that? When the big fat Indian wedding is a global phenomenon, you don't have a single musician there? Because somewhere the system is not allowing, the right system, the IP system in this country is not allowing the least, the last benefiter, which is the creator to benefit from it.

Hence, why should the creator be hold in a regulated form? On content, the call out is very simple, don't blame it on the actor fee. For example, in the US, on Ghostbusters, They made money off of video rights, this video on demand rights, which means whenever they sold VHS they made money. Will you give me syndication across different countries? When Hotstar opens up in 160 countries will I get money from those countries?

When Taza Khabar plays in 200 countries will I get money from those countries? Will I have a share of the global business? Let's talk about the waterfall business wide across OTT and across theatrical. Let's see how the pie is being modeled. Because what we are being told is because we are putting the money, we take 50%.

What the end creator is being left down to is a salary. So he'll charge the highest salary and there's nothing wrong with that.

Speaker 0: I also resonate with him from a very free market principle capitalism standpoint. If somebody is paying for a certain service, I don't think we can blame the person who's charging for that service.

Speaker 1: No, not at all. All I'm saying is that, like you said, all, you know, everybody's not the same. When we were doing production, and I'm not saying we were holier than thou or anything like that, But I found that... We were putting everything on the table. You know, for sharing and stuff.

And yet, the actor fee and the talent fee would not come down regardless of his performance in the previous film. So, sometimes, all I'm saying is that sometimes a haircut is also important. Because you look at...

Speaker 2: I just saw the haircuts happening. I can assure you as we speak, being in the business right now.

Speaker 1: But there's an assumption that the producer and the financier will not be transparent. I'm saying even if you're transparent and the script is good, the creative aspect is good, sometimes the movie became unviable. Because the... I'm not

Speaker 2: talking about transparency. I'm talking about the model.

Speaker 1: I'm not talking about transparency. Shir, I don't want to give any more names. Where actually the back end happened. And it worked for everybody.

Speaker 2: I know multiple

Speaker 1: examples. Multiple examples.

Speaker 2: We know multiple examples.

Speaker 1: Some people just didn't budge from their feet. Regardless of how their previous performance was. So then the producers end up losing their shirts. I would like to

Speaker 0: actually ask him how big a part did he play? I wouldn't like to say problem, but an inflating actor's salary.

Speaker 1: But he is incentivized to do so. He is only doing his job. So, to be fair. To be fair,

Speaker 0: there is nothing wrong with it. But we can still ask how big of a part he played.

Speaker 2: I think I played the same part that the producers paid when suddenly their digital acquisition rights of films shot up and people were paying any money during the pandemic to acquire rights. And if

Speaker 0: you had to predict, in 5 years from now, what percentage, say today an actor gets paid 100, 5 years from now will he get paid 70 or 130?

Speaker 2: I think he'll get paid, the current model, 130.

Speaker 1: It depends on his performance, yeah.

Speaker 2: I mean, he's saying assuming all goes well. I mean, If everything is going

Speaker 1: to the shitter, then... I am guessing he is going to the shitter as well.

Speaker 0: Establish market size.

Speaker 2: Tough. Because models are very, very different.

Speaker 0: Establish Bollywood actors getting paid market size. Simply.

Speaker 2: You can't establish that market size. It will be a factor of this.

Speaker 0: No, but let's say

Speaker 2: there are... I won't know. What he

Speaker 1: is saying is it's very opaque. That's what he is saying.

Speaker 2: A. It's very opaque and B. It's a percentage of the total production budget. But he

Speaker 0: manages like 70% of it.

Speaker 1: But he is not wanting to talk about that 70% as well. Why is that Vijay? We are

Speaker 0: not asking you for like a bifurcation.

Speaker 2: See understand this is the only business where some things are behind in a big wall. Don't say that.

Speaker 0: 10 stars male and 10

Speaker 2: stars female. Let me put it this way. The male stars definitely take a lion's share of it.

Speaker 0: Next question.

Speaker 1: I think we've got to change that.

Speaker 2: I'm more than happy. Why don't sort of female led...

Speaker 1: It depends on the story and the protagonist. If the protagonist is a lady. It's just all... It's a function of how much role they have in a movie.

Speaker 2: No, no. Also it's a function of box office.

Speaker 0: I'll put a neck on the line a little bit. I'll say, I knew someone in the industry. And her role and her co-actor's role was screen time was probably equal. Okay. But, her salary in that particular movie was 1 hundredth of the male salary.

Speaker 1: That much difference?

Speaker 0: 1 hundredth.

Speaker 1: You are not just making

Speaker 2: that up. The fee is a part of the production budget, not a part of the monetization. How much? So for 2 billion a box office, how much was it made for? Was it made for a billion?

Was it made for half a billion?

Speaker 0: It was made the same way for the male and the female.

Speaker 2: No, no, I'm talking about overall talent fee. Right. So for example, today, you know that okay, music streaming is 1000 odd 2200 1300 crore market That gets divided by Bollywood 70%. Now, in that, I can tell you music directors make nothing.

Speaker 1: The actor's fees, what percentage of the budget?

Speaker 0: That's an interesting point I missed. What is the money spent on making movies in India?

Speaker 1: Then you can extrapolate what percentage does a lead star get.

Speaker 2: I talk about Bollywood films. Because you'll have a key understanding. An average Bollywood film, a reasonable Bollywood film, hypothetically, we will go watch. Which will come into our consciousness. Not the 2 crore film that just, you know, nobody will go.

It won't come into our...

Speaker 0: But add that too because we won't enter a market size.

Speaker 1: Let's say, if we take 300 films a year, we'll be 5...

Speaker 2: We'll have 8-10 record.

Speaker 1: Yes, yes. That's how much it should be.

Speaker 0: Is it that close? The amount of money spent on making movies is 2 billion. The amount of money spent in theatres is 2 billion. The amount of money spent on OTT is 2 billion. Yeah.

All 2 billion each.

Speaker 1: There's coincidences. I mean, it's a coincidence. No, theatrical is about 10,000 crores, which is a little less.

Speaker 0: But we added food and

Speaker 1: advertising and got to 40,000. Oh yeah, yeah, yeah, correct. If you add all that, yeah. Of course, of course, yeah.

Speaker 2: You would say that if you're making a big ticket film, the actor would be anywhere between 20-50% of that. 25-50% of that.

Speaker 0: Hi, I'm Nikhil Gawmat. I'd love to know what you thought of the episode. Comment, like and subscribe and thank you for watching.

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Why Bollywood Actors Charge Multiple Crores - Top Celebrity Agency Owner Explains