(This article is second in series of articles published by T360 about various aspects of overseas distribution. First one was about SGS and Brahmotsavam premieres. )
Yupp TV is a pioneer and one of the World’s largest over-the-top (OTT) entertainment solutions. It provides vernacular channels over the Internet. YuppTV under the dynamic leadership of Uday Nandan Reddy has been on a hockey stick growth path and is a household name for all telugu people overseas. Yupp TV with its aggressive marketing has made huge inroads into digital TV space. By some estimates, 1 out of 3 Non Resident Indian Telugu households have a digital channel package. YuppTV has recently started Netflix like service with a database of Telugu movies branded as YuppFlix . Customers have to pay $1.99 USD per month to get access to YuppFlix.
From beginning of this year, YuppTV has also introduced PPV (Pay Per View) concept in YuppFlix. Nagarjuna’s hit movie Oopiri was on YuppFlix right after 4th week of its theatrical release,another small budgeted hit movie Kshanam was on YuppFlix after its third week. As per our sources, YuppTV is moving aggressively in this area and working with producers to get digital exhibition rights of future movies. As per our analysis, this trend may disrupt overseas regional movie distribution model.
It is known fact that Telugu movies are over priced in USA in their first week. Premieres are sold at $16 to $25 , Regular shows at $12 to $18 and because of this over pricing, first week audience are primarily ardent fans and avid movie lovers. There is next section of consumers, 3 to 5 member family audience, who are budget oriented, wait till second week to watch when ticket price settles down at $8 to $10. This latter section adds up-to anywhere between $200K to $500K USD for big movies. Now, with the advent of YuppFlix , this section of audience doesn’t mind waiting another week to watch new releases directly on YuppFlix with just $5 per family rather than spending $50 per family in theaters.
Another negative side effect of YuppFlix is DVD quality piracy prints are coming in the market very next day the movie is streamed in YuppFlix.
Telugu360 has contacted a popular and well respected USA distributor for comments. “Yes, this is a big threat to overseas distribution model. I’ve overheard multiple people in weekend gatherings saying – “ aa yupptv lo vastundhi ga. next week chooddhamu” This is going to be a huge threat for medium and small size movies. I won’t be surprised in an year if small movies are released directly in Yupp or YouTube . From now on, we are going to write in the contract that movie can’t be screened in Yupp or similar formats until it telecasts on satellite TV.”
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Every model with abnormal pricing is ripe for disruption. Think about how a technology start up Uber upended Taxi industry. Even better, think of how Netflix has driven Blockbuster video to bankruptcy. This is bound to happen where technology drives overpriced incumbents out of business.
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Telugu360 has tried to gauge YuppFlix PPV consumers point of view ” Yes, rather than paying $80-$100 in first week or $50 in second week , i would wait another week to watch on Yupp for $5 for my whole family. Except Bahubali like blockbusters or any other movie that seems like “must watch on big screen ” …why should i spend more money for mediocrity ? ” opines a housewife.
In this case as well, Telugu movie producers and distributors should try to keep pricing under control so that movie is economical to everyone to watch on Big screen or loose their business to alternative media.
— Krishna (krishna@telugu360.com)
