New Delhi: Fees of big actors, which had taken a jump after streaming platforms started buying films for huge amounts, are now correcting as the platforms turn conservative on the films they purchase.
“There is a more cautious and tailored uptake of content by trade (streaming platforms), in light of which everyone in the value chain, be it actors or crew, need to recalibrate and realign with market forces and realities,” said movie producer Tanuj Garg, who is managing partner at Ellipsis Entertainment.
Top stars had increased their fee by 20-30% after the first wave of covid when OTT buying was at its peak. While some of this rationalized as sales fell, a backend model is now coming into play, where studios like Yash Raj Films are are increasingly asking lead stars to take a share of profits instead of a fat fee.
While senior names like Shah Rukh, Salman Khan, Ajay Devgn and Akshay Kumar have agreed, the younger lot of actors such as Vicky Kaushal and Shahid Kapoor are yet to consider a share in profits, and signing fewer projects as they remain wary of such strategies, trade experts said.
“For all producers, there is a realization that the film has to work at the box office and while it is important to be comfortable with digital, music and other revenues, there is now lower dependence on these,” Shariq Patel, chief business officer at Zee Studios said. “The cushion from such ancillary streams is becoming thinner, which means ATL (above the line) costs will have to rationalize and everyone should be ready to ride the risk.”
Star fee is a conversation that’s perpetually work in progress, Patel said, but there definitely are actors who have begun to smartly accept a portion of the backend.
To be sure, the correction doesn’t seem as sharp across the board because a lot of actors are taking time to green-light projects, preferring to take an upfront fee for their time instead of a share in profits.
However, since there is an attempt to create grander, more large-scale projects that can draw audiences to theatres after covid, producers are finding it difficult to commit to high remuneration of lead actors, when costs of production and visual effects are likely to be massive.
A trade analyst said on condition of anonymity that this is the reason there are fewer announcements taking place of late and the realization has dawned faster upon established names like Shah Rukh and Salman Khan, Ajay Devgn and even Ranbir Kapoor, many of whom tend to anyway be co-producers on the films they feature in.
“The overall costs have to come down because it has become very challenging for films to even open at the box office. A certain austerity is needed both in terms of star fee and the paraphernalia around them. It’s all about ensuring you have great content made at the right cost,” said Vivek Krishnani, CEO of MovieVerse Studios, the film production arm of IN10 Media Network.
Meanwhile, with more data and insight now available on what works for their audiences, streaming platforms are themselves adopting a more conservative approach to buying films. Trade experts say this will undoubtedly have a ripple effect across the value chain and all stakeholders will have to become more realistic in the compensation they expect from projects, for them to be commercially viable.