Disney sends movie theaters rushing to cover this major market
The coronavirus pandemic has dealt a severe blow to cinemas around the world. Social distancing measures put in place to contain the spread of COVID-19 have kept theaters closed for almost four months now, leaving multiplexes without a source of revenue as they struggle to pay rents and wages.
But the loss of theaters has proven to be a tailwind for video streaming platforms that have rushed to fill the entertainment void caused by the closures. There have been a sharp point streaming video in recent months as consumers have turned to online platforms for entertainment away from home.
This may have put traditional cinemas in a difficult position as more production houses turn to over-the-top multimedia platforms (OTT) that stream movies via the internet. Disney (NYSE: DIS) is one such company that is taking advantage of this trend in India, a country with one of the largest film industries in the world.
Disney puts film premieres online in India
Disney recently launched a new platform, Multiplex, to stream local movies directly to its Indian streaming platform Disney + Hotstar. Between July and October, the Disney + Hotstar Multiplex platform will release seven films featuring popular Bollywood actors and actresses (the local film industry is based in Mumbai, the financial capital of India).
Disney aims to generate theater-like excitement with these releases through its “Day One, First Show” promotional campaign. The initiative is expected to take off on July 24 with the release of the platform’s first film, Dil Bechara (which means “the helpless heart”). A Hindi language adaptation of The fault of our stars, Dil Bechara has already set an impressive record by becoming the first movie trailer to get over 10 million likes on Alphabetis YouTube.
Since the trailer premiered on July 4, it has been viewed over 75 million times on YouTube, indicating the film could become a major hit – and help Disney attract more users with a plan. attractive subscription. Users who wish to watch the films premiering on Disney + Hotstar will need to purchase an annual subscription worth only Indian Rupees 399 (approximately $ 5.30).
That’s a very low price to pay, as the average cost of a weekend movie ticket in India is around 199 rupees ($ 2.65), according to third-party data from ValueChampion. For example, consumers can purchase an annual Disney + Hotstar VIP membership for the price of just two movie tickets. More importantly, Disney + Hotstar subscribers can enjoy multiple theatrical releases from the comfort of their own homes, instead of spending money on new tickets every time they go to the movies.
This value for money proposition could hurt cinemas in India for a few simple reasons.
Why traditional movie theaters need to worry
According to a survey conducted by an online ticketing platform in India, 54% of those polled said they were ready to visit a movie theater 15 to 90 days after the coronavirus restrictions were lifted. The survey involved 4,000 respondents in 235 towns and villages across the country.
However, the survey was carried out in May, when India’s COVID-19 infections were around 190,000. That number has now swelled to nearly one million, and there is no sign of flattening. of the curve for now. Unsurprisingly, the government has yet to decide when to reopen theaters, and the growing number of cases could sow fear in the minds of consumers.
There is also a precarious economic situation in India. Goldman Sachs estimates that India’s gross domestic product fell 45% in the quarter that ended in June compared to its earlier forecast of a 20% contraction.
Moreover, India’s unemployment rate stood at 11% in June, and things could get worse as employers predict massive layoffs in important industries such as information technology. The restaurant and hotel industries are already in dire straits.
In this uncertain scenario, we can expect consumers to stretch their budgets. They might choose to be entertained at home instead of going out, where the risk of contracting the virus remains. After all, 60% of those polled by media consulting firm Ormax Media recently said they consume a lot more content on OTT platforms.
As such, video streaming in India is likely to take advantage of movie premieres at the expense of traditional cinemas, paving the way for Disney to become a major player in the country. media industry, because he is already making intelligent gestures.
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