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It's time for multiplexes to go innovative

Nithya Subramanian
Ratna Bhushan

NEW DELHI, May 25

IT should not be a case of premature death. For, even as multiplexes and entertainment complexes are burgeoning across the country, the duds that Bollywood is consistently churning out, is by no means a catalyst to growth.

Already, the industry buzz is that some multiplexes in Jaipur and Ahmedabad have downed their shutters. Now, the ones with deep pockets are leaving no stone unturned to keep their heads above water.

Take the Delhi-based Satyam Cineplexes, which has been operational since December last year.

According to Mr Deven Chachra, Director, Satyam Cineplexes, the cineplex is keeping its business alive with innovative marketing exercises.

For example, during the World Cup, Satyam aired cricket matches, and relevant marketing events are organised from time to time.

``Even though the supply from Bollywood has been disastrous, we are generating 40 per cent occupancy levels. We are hoping the slump gets over soon. We expect to close the year with 55 per cent occupancy,'' Mr Chachra said.

The DLF Group-owned DT Cinemas, which is planning a Rs 150-crore strategic expansion over the next 12 months in the multiplex and family entertainment centre (FEC) segment, intends to focus on the FEC segment, with only 10 per cent of its budgets being allocated to stand-alone cinema and food & beverage properties.

Industry analysts say it is essential for multiplex developers to reinvent themselves, considering the state of the film industry. According to Mr Sanjay Bhutiani, General Manager, Leo Entertainment, cineplexes are now attempting to offer consumers a `different' experience with food, entertainment and other differentiators thrown in.

For instance, in Mumbai, morning shows have been revived and tickets are sold for almost a third of the regular prices.

``For multiplexes to survive, prices will have to come down. The existing ticket prices which range between Rs 140 and Rs 180 are too steep,'' Mr Bhutiani said.

Internationally too, companies such as the Australian Village Roadshow have forecast losses of $30 million this year, due to the war in Iraq and SARS.

In the US, despite a good show by Hollywood, 13 different companies in the sector have had to file for bankruptcy protection since 1999 and many more could follow, say analysts.

The emergence of megaplexes with facilities such as more than a dozen screens per theatre and stadium-style seating has left the industry with an oversupply of screens.

According to reports, 20 per cent of the US' current 34,000 screens need to close down for the economics of the industry to improve.

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