Bollywood makes $2 bn – but loses $2.7 bn to piracy

India’s film industry, said to be the largest globally with some 1,000 movies produced each year, earns around $2 billion from legitimate sources such as screening at theatres, home videos and TV rights. But with $2.7 billion, piracy earns 35 per cent more, and a way out has proved elusive.

Red Chillies Entertainment, a production house promoted by actor Shah Rukh Khan, was a victim of film piracy with ‘Dilwale‘ last year. It grossed Rs 148 crore at the box office, but its pirated version, circulated a day before its release, grossed a much higher amount, stakeholders said.

Recent films like ‘Kabali‘, ‘Great Grand Masti’ and ‘Udta Punjab‘ have all faced similar music.

“Content theft or piracy in the film industry originates from ‘camcording’ in cinema halls. Over 90 per cent of new release titles originate from cinemas,” said Uday Singh, Managing Director, Motion Picture Distributors’ Association (India).

“The infringing copies appear online within few hours of a film release,” Singh told media, and added: “The Indian film industry loses around Rs 18,000 crore ($2.7 billion) and over 60,000 jobs every year because of piracy.”

This figure is also what the World Intellectual Property Organisation (WIPO) brandishes in its magazine, quoting noted filmmaker Anurag Basu. While the Indian film industry is, indeed, flourishing, piracy points toward how much more its stakeholders can make, he said.

According to the latest KPMG-Ficci report on the Indian media and entertainment sector, the film industry here is projected to grow from Rs 138.2 billion ($2.09 billion) in 2015 to Rs 226.3 billion ($3.43 billion) by 2020 at an annual growth rate of 10.5 per cent. But piracy could also grow exponentially unless checked.

“Currently, the government is focused on inclusive society initiatives, aimed at connecting villages via broadband. This has the potential to incentivise piracy, as people would find it much easier to watch a movie on their laptop than travel to far off theatres,” the report said.

“Hence, there is need for a collective, structured, scientific, multi-pronged and proactive approach to combat piracy.”

Adding another dimension, Patrick Kilbride, Executive Director for International IP with Global Intellectual Property Center of the US Chamber of Commerce, said piracy also limits the economic contribution which creativity can make in India.

“Issues such as copyright infringement, film piracy, camcording and content leakage weaken the industry by hampering the deserved revenue production,” said Kilbride.