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Money Back Gurantee film video hindi
"The combination of debt and equity helped us in reducing the cost of money to finance a film dramatically. It changed the whole economics of film making," he says, days before leaving for Cannes to network with buyers and sellers on an international platform.
Remember, some years back, it wasn't like this. Films were (mostly) financed by the underworld or diamond merchants charging exorbitant rates of interest - 30 per cent and more. The dons dictated the stars, interfered with the storyline, and sometime asked "special friends" to be cast alongside the hero, virtually guaranteeing that the film would bomb.
There are others who agree with the chairman of Pritish Nandy Communications [Get Quote], such as Anshuman Swami, CEO of the Aditya Birla-promoted Applause Entertainment that produced Black: "Today there is more funding available than there are good films in the market. And with the cost of money becoming cheaper, and with new innovations like joint marketing and revenue share deals, the risk factor in making movies is coming down."
Says Sanjay Bhandari, a chartered accountant who has structured various cheap money deals for producers: "The rate offered by banks is anywhere from a third to a sixth of what traditional financiers used to charge. That changes the whole economics of filmmaking."
Says Pritish Nandy, "The money will help us increase the number of films we make each year from three to at least eight. Also, we will make bigger films and reduce the number of small films to reduce the risks."
If the movie business suddenly looks attractive, industry experts say it's because the banks haven't lost money on any projects yet. In fact, they get their money back even before a film is released because distributors pay upfront, pick big banners to minimise risk, and have a stable collateral in the negatives. Producers say the upside is mind-boggling.
Says Pooja Bedi, who heads the company in India, "What we take care of is mitigation of two key risks - completion of the movie, and cost overruns. We underwrite these risks so financiers have no fear they will not get their money back."
It also worked out a deal with in-house cement company Ultratech and used its hoardings to promote the film. Says Anshuman Swami, CEO of Applause, "You have to spend around 10 per cent as promotion on a film, so by saving this money we were able to reduce the overall budget risk."
Adlabs has formulated a de-risking strategy by pre-selling distribution to just one company for a series of film projects. It has sold all rights for three films - Bluff Master, Rooh and Taxi 9211 - to UTV (except DVD and satellite). Says Shetty, "By pre-selling, we not only recouped our costs but even made money upfront."
And if you retain control over the intellectual property rights for your library, you could make good money - Yash Raj Films is believed to have earned Rs 60 crore (Rs 600 million) through selling the movie rights of films in its library to Sony for a limited period.
Producer: Distributors give him a minimum guarantee fee before the movie in return for film rights in a territory within the country. Producers can recover up to 30 per cent of the cost of the film, pre-selling it to distributors. If the movie does well and the distributor recovers his money, any additional inflows get divided between the two.
And where does he get his money? From banks, like Yash Raj does. He can borrow on the strength of his balance sheet, as UTV does. He can fund his films from IPOs, like PNC. Or go to individual high net worth individuals or companies to put in money as equity. Or, of course raise money upfront from distributors, or through selling some of the rights early to finance the cost of the film.
"We are planning to hit the IPO route and raise Rs 50-70 crore (Rs 500-700 million). We have an ambitious Rs 120 crore (Rs 1.2 billion) project to make the film Mahabharata, which we will finance through a combination of debt and equity. We are clear we won't put in more than 20 per cent of the money, so in case the project fails we can get up and continue to run"Bobby Bedi
Many outside of Hollywood fail to realize the longevity of film and television after-market income streams. Many commercial films and network television shows will make money for decades. For the investor who pays for part of the negative costs, the time value of money is important. For many movie investors the required rate of return for this "risky" investment may be 25% or more. This means that while there may be TV revenues for an additional ten years after the movie is released, the PV (present value) of those revenues is diminished by the required rate of return and the time it takes for these revenues to accrue. Ancillary revenues (VOD, DVD, Blu-ray, PPV, CATV, etc.), tend to accrue to the studio that purchased these residuals as part of their overall distribution deal. For many movie investors in the past, the theatrical box office was the primary place to gain a PV return on their investment.
Some U.S. states and Canadian provinces have between 15% and 70% tax or cash incentives for labor, production costs or services on bona fide film/television/PC game expenditures. Each state and province differs. These so-called "soft-money" incentives are generally not realized until a theatrical or interactive production is completed, all payments are made to workers, financial institutions, and rental or prop companies within the state or province offering the incentives. Many other limitations may apply (i.e., actors, cast and crew may have to take up residence in the state or province). Often, a certain amount of physical shooting (principal photography) must be completed within the state borders, and/or the use of the state's institutions. This would include rental facilities, banks, insurance companies, sound stages or studios, agents, agencies, brokers, catering companies, hotel/motels, etc. Each may also have to be physically domiciled within the state or province's borders. Finally, additional incentives (another 5% to 25% on top of the already generous soft money), may be offered for off-season, low-income area, or family entertainment projects shot in places of economic impoverishment or during poor weather condition months in a hurricane-prone state or Arctic province.
A relatively new tactic for raising finance is through German tax shelters. The tax law of Germany allows investors to take an instant tax deduction even on non-German productions and even if the film has not yet gone into production. The film producers can sell the copyright to one of these tax shelters for the cost of the film's budget, then have them lease it back for a price around 90% of the original cost.[12] On a $100 million film, a producer could make $10 million, minus fees to lawyers and middlemen.
In British tax shelters, the same copyright can be sold again to a British company and a further $10 million could be raised, but UK law insists that part of the film is shot in Britain and that the production employs a fair proportion of British actors and crew. By using British tax shelter methods, many American films like to shoot at Britain's major film studios like Pinewood and Shepperton and why a film such as Basic Instinct 2 relocated its action from New York to London.[citation needed] These are commonly referred to Sale & Leaseback deals; they were discontinued in March 2007, though those initiated prior to Dec. 31, 2006 were grandfathered in.[citation needed]
Although it is more usual for a producer to sell the TV rights of this film after it has been made, it is sometimes possible to sell the rights in advance and use the money to pay for the production.[citation needed] In some cases the television station will be a subsidiary of the movie studio's parent company.
From the late 1960s through the mid-1990s special regulations from financial regulation's and syndication's rules created relations between television networks and independent production companies. These rules stated that ownership of the rights to the programs reverted to the producer/production company after a specified number of network runs (syndication). Profits from any other sales, including syndication, generally benefited the production community. Because of this, production companies produced original shows at a loss, hoping that they would eventually be run by syndication and make their money back.[21]
Bridge finance has increased in prevalence in filmmaking in recent years. Bridge financing is an answer to the common "catch-22" problem of needing funding to get the actors, but not being able to get the funding without actors. Bridge financing, for example, can be used in scenarios where a filmmaker has a promissory note from an investor to finance a film provided the filmmaker can attach an approved actor, however without money to escrow for the actor's payment, the filmmaker is unable to meet the investor's criteria. In this instance, a short-term lender can provide a bridge loan to secure the actor with the promissory note as collateral; once the actor's payment is escrowed, the equity investment would be triggered, and the bridge loan would be paid back with a small interest.[22] In Canada, this form of financing is more commonly known as "greenlight financing".
The idea for slate financing came from "multifilm credit lines" that banks and investment firms created for studios in the late 1990s. There were three main advantages to this strategy: risk mitigation (since funds covered a pool of movies rather than one film), less interference from investors, and freeing up studio equity towards "big-budget franchises" for which they do not have trouble fundraising. In 2005, Relativity Media CEO Ryan Kavanaugh built upon these points to structure the first slate financing deal, a 17-picture joint deal with Sony Pictures and Universal Studios called Gun Hill Road that was backed by $600 million from hedge funds. Slate financing preserved the benefits of the earlier credit lines, as it allows them to risk less of their own capital when financing high-budget films. After deducting production costs, including prints and advertising (P&A) and residuals, studios split remaining box office revenue with investing partners; oftentimes they also split revenue from DVD and merchandise sales.[23] 2ff7e9595c
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