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No new Southern films are likely to be released this week

Standoff between producers and digital service providers continues as efforts to arrive at some agreement fail.

Aruvi producer SR Prabhu

Manigandan KR

It now appears that no new films will be released in South India this weekend.

The producers' councils of the Telugu, Tamil, Kannada and Malayalam industries are adamant that there will be no new releases from 1 March to protest against the exorbitant fees being charged by digital service providers (DSPs).

Efforts were on till the last minute to arrive at some sort of agreement and avert the strike, but all talks between representatives of the four South Indian film industries and DSPs like Qube and UFO have failed.

The main bone of contention is the virtual print fee charged by the DSPs. The producers say this fee is exorbitant and eats into their profits. 

The DSPs said they offered multiple options, including a flat rate of Rs14,000 instead of Rs22,500, to avert the strike. But the producers rejected them. 

The producers disputed this. Well-known producer SR Prabhu said the offer was only to reduce the fee to Rs20,000.

Prabhu explained that for a film of his like Aruvi (2017), made on a budget of Rs2 crore, he ended up spending Rs50 lakh as VPF when it should not have cost more than Rs15 lakh.

"Of the Rs2.2 crore VPF that we paid for four films in 2017, someone ate up around Rs1.5 crore," Prabhu said. "We could have made one more film with that saving!"

Prabhu also said producers and distributers pay VPF thinking that after a certain period, the projectors would be handed over to the exhibitors. But the DSPs say they own the equipment.

"How can a third party pay for a first party’s equipment and, finally, the second party say the equipment is theirs?" he wondered.

But Prabhu's claim that DSPs charged him Rs50 lakh for Aruvi was contested by Qube India, which released the figures for the film from its books. According to Qube, it charged only Rs24,24,725 for Aruvi. 

With both sides contradicting each other, it has been difficult for the negotiators to find an amicable solution. Late last night, the Tamil Film Producers' Council said its decision not to release any new film from 1 March stands until further notice.