Three years back, two major multi-national film studios -- Disney India and Fox Star Studios (FSS) -- found themselves in a super slump at the Bollywood box office. Both had a bad run at the movies with films like Tamasha failing to make an impact, despite a commendable cast and director. As a result, Disney India decided to take a step back from Bollywood.
For the second studio, FSS, 2015 was an exceptionally bad year with just one of the seven releases making an impact at the box office. However, instead of calling it quits, FSS decided to take a step back, re-evaluate its strategy, and start anew. Three years on, the new strategy seems to be paying off.
There continue to be some hits and misses, but FSS has managed to churn out commercially and critically successful films over the past couple of years, including titles like Sanju.
Going back to the drawing board, the studio realised that the focus needs to shift from actors to characters, or in other words, from scale to script. Thus came a renewed emphasis on story and working with partners -- actors, directors or co-creators, who brought as much to the table as FSS did. While the studio continues to have a long-standing working relationship with Karan Johar's Dharma Productions, it has also entered partnerships with Sajid Nadiadwala and Rajkumar Hirani.
"We had decided on two focus areas. The first was to do more home productions where our creative teams are driving the entire process, starting with the script. The other equally important agenda was to scale up through strategic alliances with key creative production houses who share our vision. These alliances include our longstanding partnership with Dharma, which we are very proud of, our successful association with Sajid Nadiadwala and, more recently, with Rajkumar Hirani and Vidhu Vinod Chopra. It's important to work with partners over several films to develop a shared agenda that maximises the synergies for both parties," says Vijay Singh, CEO, Fox Star Studios.
The strategy of alliances seems to be working since some of the biggest hits from FSS in recent years have come from the co-production slate like MS Dhoni have also managed to hit the bullseye.
Being picky about the scripts also allows FSS greater control on the budgeting. A longstanding issue in the industry has been the talent cost, which ends up frontloading a project heavily. Singh, however, reveals that with actors, especially the young lot, agreeing to work on a revenue/profit share basis, it has become easier to keep budgets in check, and hence improve the profitability of films at the box office.
"While I can't share the exact numbers, I can tell you that the RoI (returns on investment) on our projects has improved over the past couple of years. I still believe that the business model for Bollywood is not ideal and the risk-reward ratio needs to change. However, it is moving in the right direction. I am excited by the entry of OTT (over-the-top content) platforms as this will help develop an additional revenue stream for our films and, therefore, a more sustainable business model going forward," Singh adds.
According to industry estimates, recent films from the FSS stable have had positive RoI at the box office. Sanju has had a dream run at the movies with a net box office collection of Rs 3.33 billion, against a cost of Rs 900 million.
While the big profile films are helping FSS turn the books around, the studio continues to back smaller projects. The studio put its might behind Bioscopewala -- an adaptation of Rabindranath Tagore's classic Kaabuliwala -- this year. The film did not break any records in terms of commercial success but has been widely praised by audiences and at film festivals across the globe.
"Going forward, as a studio, we plan to focus on scaling up, developing great scripts and ensuring that we make films at the right budget. It feels great to have achieved our goal of becoming the No 1 studio, so the focus going forward will be on sustaining this No 1 position and ensuring better profitability. It's all about creating content that will capture the imagination of audiences," Singh says.