During the COVID era, OTT platforms like Netflix and Amazon Prime emerged as game changers for the Indian entertainment industry, offering lucrative deals to filmmakers. These platforms paid massive sums to acquire digital rights, providing a financial cushion to producers amid uncertain theatrical prospects. However, that golden phase seems to be fading fast.
In recent times, the OTT landscape has witnessed a noticeable downturn. With changing audience behavior and theatrical releases regaining momentum, major platforms are now approaching deals with caution. In fact, they’ve begun renegotiating terms even after a film’s release—something unheard of during OTT’s peak years.
A prime example of this shift is the case of Thug Life, the high-profile collaboration between Kamal Haasan and Mani Ratnam. Following its underwhelming performance at the box office, reports suggest that Netflix, which had originally secured the film’s digital rights, is now renegotiating the agreement. The platform is reportedly seeking to slash the payout by as much as 30%, citing the film’s lack of appeal to OTT audiences due to its theatrical failure.
This development has raised concerns across the industry. If this trend continues, it could soon affect Tollywood, which has so far enjoyed strong support from OTT platforms thanks to its consistent box office hits. Telugu filmmakers are currently commanding premium deals, but poor-performing films in the future may face similar renegotiation hurdles.
With streaming giants becoming more calculative in their investments, the message is clear: the days of OTT platforms absorbing theatrical losses are over. Going forward, producers may need to focus more on quality and audience connect to ensure financial stability both in theatres and online.
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