Digital platforms and Telugu cinema: Has the bubble burst?

Sankranthiki Vasthunam, Thandel, Court and MAD Square are among the select Telugu films to have sold digital rights for a good price; many others struggle as OTT players get selective.

The OTT rights for one of this year’s Telugu box office hits, Thandel, was reportedly bagged by Netflix for over ₹45 crore. The film directed by Chandoo Mondeti, starring Naga Chaitanya and Sai Pallavi, was made on a budget of nearly ₹75 crore. The massive hit, Sankranthiki Vasthunam, produced with a budget of around ₹50 crore, reportedly sold its digital rights to Zee5 for nearly ₹30 crore. Such pre-release deals help the makers recover a substantial portion of their production costs. 

However, not all films get lucky. For every film that secures a lucrative deal for digital rights, several others have to contend with lower prices or find no takers. Digital platforms that were eager to acquire new films during the pandemic to consolidate their subscription base, are now tightening their purse strings and setting terms.

What worked in case of Sankranthiki Vasthunam were the previous blockbusters delivered by Venkatesh-Anil Ravipudi duo. Thandel benefitted from the presence of director Chandoo Mondeti of Karthikeya 2 fame, the Naga Chaitanya-Sai Pallavi collaboration after Love Story, and production house Geetha Arts.

Leading digital platforms are said to be purchasing films going by the box office track record of the lead actor, director or the production house, and dictating the release dates to suit their digital release calendar. For instance, films sign up for either a four-week or eight-week window  following the theatrical release after which the films will stream digitally. The platforms prefer to stagger the films for streaming, for better viewership.

Director and producer Sai Rajesh, whose 2023 film Baby was a massive hit, explains, “There is no dearth of films being made, ever since the industry sensed the digital potential during lockdowns. But the business model of digital platforms has changed since then.” 

At the time, several films made with modest budgets and not boasting a star cast also found takers. Some caught the attention of viewers while others went unnoticed. As digital platforms analysed viewing patterns, they began favouring films that generate pre-release buzz in the form of music, teaser and trailer. 

“Film units cannot take things for granted. If the pre-release content generates audience interest, there is a better chance of bagging digital rights for a good price. Else, OTTs prefer that the film is released and then decide on the price, going by the box office reception,” says Sai Rajesh.