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  • The Rise and Fall: The Top 10 Global Brands That Failed in India

    India, with its booming middle class, massive population, and one of the fastest-growing economies in the world, has always been a dream destination for global brands looking to expand their footprint. From food chains and fashion retailers to automobile giants and tech players, the lure of tapping into over a billion potential consumers is hard to resist. Getting your company into the Indian market isn’t as easy as setting up shop or running glitzy ads.

    Why does this happen? Sometimes it’s poor timing. Other times, it fails to adapt products, marketing, or pricing to local realities. But almost always, it’s a reminder that in India, cultural relevance and customer insight aren’t optional; they’re essential.

    Let’s take a deep dive into 10 global brands that failed in India and unpack the real reasons behind their downfall. Each case teaches why even the biggest names in business can’t afford to underestimate the Indian market.

    Kingfisher Airlines
    Bisleri Pop
    Chevrolet 
    Tata Nano 
    Bloomberg TV India 
    IKEA
    Axe Effect
    Walmart
    American Apparel
    eBay

    Kingfisher Airlines

    Once positioned as the “king of good times,” Kingfisher Airlines, founded by liquor baron Vijay Mallya, was India’s most luxurious airline when it launched in 2005. Plush interiors, gourmet meals, and attractive branding earned the airline quick popularity. However, a combination of reckless expansion, high operating costs, and poor debt management caused it to spiral into a financial crisis.

    By 2012, Kingfisher had grounded operations, leaving behind unpaid staff, angry creditors, and a massive INR 9,091 crore debt trail.

    Why did Kingfisher Airlines fail?

    Kingfisher Airlines failed due to poor financial planning and reckless expansion without sustainable revenue. Its focus on luxury added to high operating costs, which couldn’t be maintained in a price-sensitive market. On top of that, massive debt mismanagement led to a complete financial collapse.

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    Bisleri Pop

    Bisleri, a household name synonymous with bottled water in India, once tried to tap into the lucrative carbonated soft drink market with Bisleri Pop. Launched with high hopes, the beverage came in multiple flavours and aimed to compete with global giants like Coca-Cola, Pepsi, and even local rivals like Thums Up and Sprite.

    However, despite its brand recognition, the product fizzled out quickly. The market was already saturated with strong brand loyalty, aggressive advertising, and massive distribution networks. Bisleri Pop lacked the unique appeal or innovation to stand out on retail shelves. Moreover, marketing efforts failed to create the kind of consumer connection that its rivals had already mastered.

    Why did Bisleri Pop fail?

    It failed due to no clear uniqueness, tough competition from well-loved brands, and weak marketing that didn’t create a strong brand recall among consumers.

    Chevrolet 

    When General Motors rolled Chevrolet into the Indian market in 2003, it aimed to bring American engineering flair to one of the world’s fastest-growing automobile markets. With global success in its rearview mirror, GM had big plans for India. It launched a range of cars, including the Spark, Aveo, Beat, Cruze, and Tavera, all intended to woo Indian consumers across budget and premium segments.

    But instead of carving out a strong foothold, Chevrolet ended up skidding off course. Despite an aggressive launch and promotional campaigns, the brand quickly found itself in a traffic jam of problems. Indian consumers, who are extremely value-conscious, found Chevrolet cars overpriced compared to local alternatives like Maruti Suzuki, Hyundai, and Tata Motors. Even though the cars came with solid build quality, they lacked the fuel efficiency and affordability that Indian buyers sought.

    In 2017, General Motors finally hit the brakes and announced its exit from the Indian passenger car market, deciding instead to focus on exports from its Talegaon plant (which it later sold to Great Wall Motors and then to Hyundai). 

    Why did Chevrolet fail?

    Chevrolet failed because of a misaligned product strategy that didn’t cater to local preferences, poor localization of features, and a broken after-sales network that left customers frustrated.

    Tata Nano 

    The Tata Nano was launched with the vision of providing an affordable car to the masses, ranging between INR 1.45 lakh and INR 2.65 lakh.  With this bold move, Tata Motors wanted to redefine urban mobility and make car ownership accessible to the lower-middle class.

    The Nano’s biggest strength was its ultra-low price, & ironically became its biggest weakness. Indian consumers, driven by aspirations and status, didn’t want to own something known as the “cheapest car.”

    Safety concerns also tainted the Nano’s reputation. Several instances of the car catching fire, even though rare, and later addressed, went viral and damaged consumer trust. By 2018, Tata Motors stopped production, and the Nano quietly exited the roads it once promised to dominate.

    Why Did Tata Nano Fail?

    The negative perception of being the “cheapest car,” combined with safety concerns and limited features, hurt its appeal. Production setbacks and a lack of consumer trust led to its quiet exit from the market.

    Bloomberg TV India 

    Launched with the global muscle of Bloomberg and a sharp focus on financial news, Bloomberg TV India aimed to become the go-to channel for India’s business-savvy audience. But despite quality content, it failed to gain traction.

    The niche English-speaking business audience was already loyal to players like CNBC-TV18 and ET Now. 

    Despite high-quality global content, it remained a niche player. The English-speaking business audience was limited. With low viewership came lower ad revenue, which couldn’t sustain the channel’s high operating costs.

    In 2016, Bloomberg pulled the plug on its Indian partnership, and the channel was rebranded as BTVi (Business Television India). But without the Bloomberg brand and facing the same structural challenges, BTVi couldn’t survive either. It eventually shut down operations in August 2019, marking the end of the road.

    Why did Bloomberg TV India fail?

    The failure of Bloomberg TV India wasn’t due to a lack of content quality, but rather a combination of limited market size, poor brand positioning, and high operational costs that couldn’t be sustained over time.

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    IKEA

    IKEA opened its first Indian store in Hyderabad in 2018, bringing with it its famous Swedish food menu. The IKEA cafeteria, known globally for its meatballs, mashed potatoes, and smoked salmon, aimed to offer Indian shoppers a taste of Scandinavian cuisine with a side of affordability and novelty.

    While the concept generated massive curiosity in the beginning (with long queues for both furniture and food), the excitement around IKEA’s lunch offerings started to fade. The foreign flavours didn’t quite match Indian palates, and dishes like Swedish meatballs or smoked salmon wraps were seen as too bland, expensive, or unfamiliar for many local visitors.

    To appeal to the Indian audience, IKEA later added local favourites like biryani, samosas, and kebabs to the menu. Nevertheless, early disconnects in understanding local food preferences affected their momentum. Food quality inconsistencies and long wait times also dampened the dining experience for many.

    Why Did IKEA’s Lunch Fail?

    IKEA’s food strategy in India stumbled due to a cultural mismatch in cuisine, initial lack of localization, and unmet expectations around price and taste.

    Axe Effect

    The Axe Effect, a line of male grooming products by Unilever, became globally famous for its provocative and humorous advertising campaigns. In the West, ads featuring men attracting women with the spray were a hit. However, when Axe entered markets like India, its humour didn’t resonate. 

    The overtly sexual content and objectification of women did not resonate with Indian cultural norms, leading to criticism from various quarters. In response to the growing disapproval, Unilever announced a global shift in its advertising strategy, aiming to move away from sexist stereotypes and promote more inclusive messaging. ​

    Why Did Axe Fail?

    The cultural insensitivity and controversial advertising didn’t resonate with Indian values, and the brand failed to adapt its marketing strategies to local sensibilities, resulting in negative reactions.

    Walmart

    ​Walmart’s ambitious foray into India in 2007, through a joint venture with Bharti Enterprises, aimed to tap into the country’s vast retail market. However, the venture faced significant challenges that hindered its success.

    India’s complex foreign direct investment (FDI) regulations posed a significant barrier. Requirements such as sourcing 30% of products from small and medium enterprises and investing a minimum of $100 million in new facilities, with half allocated to backend infrastructure, created operational difficulties for Walmart.

    These factors, combined with internal challenges and policy uncertainties, led to the dissolution of the Walmart-Bharti joint venture in 2013.

    Why Did Walmart Fail?

    Walmart couldn’t succeed due to regulatory complexities, a disconnect with Indian shopping habits, and operational difficulties in adapting to a very different retail environment.

    American Apparel

    American Apparel, renowned for its provocative advertising and edgy fashion, entered the Indian market in 2010 with high expectations. However, the brand’s overtly sexualized marketing campaigns clashed with India’s conservative cultural norms, leading to backlash from various groups. 

    Additionally, the high price point for clothing perceived as “basic” deterred budget-conscious Indian consumers. These challenges contributed to the brand’s inability to gain widespread acceptance, ultimately leading to the shutdown of its Indian operations in 2016.​

    Why Did American Apparel Fail?

    It failed due to a cultural mismatch, controversial branding that didn’t resonate with Indian values, and a pricing strategy that didn’t appeal to the cost-sensitive Indian market.

    eBay

    eBay was one of the earliest global e-commerce giants to enter India back in 2004. Riding on its global success, the brand tried to replicate its C2C (consumer-to-consumer) marketplace model in India. But there was one big problem: Indian consumers were still warming up to the idea of trusting strangers online.

    While rivals like Amazon and Flipkart poured investments into building robust logistics, easy return policies, and reliable customer experiences, eBay took a more hands-off approach. The result? Frustrated customers, delayed deliveries, and a trust gap that widened with time.

    By 2017, eBay India was acquired by Flipkart in a strategic deal, but even that couldn’t breathe new life into the brand. Eventually, eBay exited the Indian market for good in 2018.

    Why Did eBay Fail?

    eBay failed due to poor logistics investment, a weak customer experience, and a business model that didn’t match Indian consumer habits.

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    FAQs

    Which major global brands have failed in India?

    Brands like Kingfisher Airlines, Bisleri Pop, Chevrolet, Tata Nano, Bloomberg TV India, IKEA, Axe, Walmart, American Apparel, and eBay failed in India.

    Why did Kingfisher Airlines fail in India?

    Kingfisher Airlines collapsed due to poor financial management, high debt, and operational inefficiencies, despite strong brand visibility.

    Why didn’t Walmart succeed in India?

    Walmart struggled with India’s complex retail regulations and couldn’t establish its full-scale retail operations before shifting to e-commerce.

  • OpenAI to Slash Microsoft’s Revenue Share Amid Major Restructuring

    According to various media reports, OpenAI, the company behind ChatGPT, has informed investors that it intends to reduce the revenue share it gives to Microsoft, its biggest sponsor, by 2030. The announcement of OpenAI’s intentions to lower Microsoft’s income share follows the corporation’s decision to withdraw its proposal to acquire the startup from its nonprofit division.

    OpenAI’s current proposal calls for transforming its for-profit division into a distinct public benefit company (PBC), although the non-profit would still have significant ownership and influence over the business.

     The new strategy aims to maintain the non-profit objective while enabling the AI startup to obtain more capital to remain competitive in the AI race. Microsoft had not approved OpenAI’s new restructuring plans, according to a media article shortly after the plan was unveiled.

     The Windows manufacturer wanted to make sure the modifications would safeguard its $13.75 billion investment.

    Bringing Down Revenue Sharing From 20% to 10%

    According to reports, OpenAI committed to share 20% of its earnings until 2030 as part of its current deal. By the end of this decade, it now hopes to cut it in half and lower Microsoft’s revenue share to 10%. Microsoft wants access to OpenAI’s technologies after 2030.

    “We continue to work closely with Microsoft and look forward to finalising the details of this recapitalisation in the near future,” an OpenAI representative told a media outlet. Notably, after OpenAI launched Project Stargate in January, a joint venture with SoftBank and Oracle of Japan to construct a $500 billion AI data centre in the US, Microsoft altered certain important aspects of its agreement with the ChatGPT provider.

     Notably, after OpenAI announced Project Stargate in January—a joint venture with SoftBank of Japan and Oracle to construct a $500 billion AI data centre in the US—Microsoft modified certain important provisions of its agreement with OpenAI.

    Chinese DeepSeek a Major Threat to OpenAI

    Early in 2025, China’s DeepSeek stunned Western markets by creating a comparable AI model at a fraction of the price, delivering OpenAI a serious blow.

    To keep its dominance in the AI market, the Sam Altman-led company has now introduced a number of AI solutions.

    Even though Google’s Gemini 2.5 Pro presently leads the benchmarks, ChatGPT is still one of the most widely used programs, especially in light of the recent viral fad for Ghibli and action figure-style graphics that its new image generator sparked.

    Additionally, OpenAI recently pledged to increase its use of Azure services for research and training. Microsoft now has the first say in adding capacity under a new deal, but OpenAI is free to construct more infrastructure.

  • Race Heats Up: 7 Firms Make the Cut in MeitY’s AI GPU Tender Round 2

    According to media sources, the IndiaAI Mission has selected seven businesses for technical review under the second phase of the graphics processing units (GPU) tender, including partners of Google Cloud, Oracle, and Amazon Web Services (AWS).

    The companies Cyfuture India, Sify Digital Services, Vensysco Technologies, Locuz Enterprise Solutions, Yotta Data Services, Ishan Infotech, and Netmagic IT Services (now NTT Global Data Centres & Cloud Infrastructure India, or NTT GDC India) have been invited by the Mission to present their technical proposals on May 14.

    MeitY Expects 15,000 GPUs

    In this round, the Ministry of Electronics and Information Technology (MeitY) anticipates receiving 15,000 GPUs. Locuz and Vensysco affirmed their partnership with AWS.

    Although the specifics of their collaboration for this proposal are unknown, Ishan Infotech is an Oracle partner and NTT-Netmagic is a Google Cloud partner in India. Appsquadz Software and AWS will be Vensysco’s consortium partners, according to Vikash Kumar Dubey, managing director of Vensysco Technologies.

    Vensysco will provide 2,300 GPUs, including 200 AWS Inferentia 2 GPUs, 100 AWS Trainium 1 GPUs, and 2,000 Nvidia H100 GPUs. In addition, it is providing 1,300 more GPUs this time around than it did the last time, which was 1,000.

    One of the five lowest (L1) bidders in the initial round was Locuz, which is currently owned by SHI International, a US IT infrastructure company.

    Yotta and Vensysco Emerged as L2 Bidders

    Among others, Yotta and Vensysco have been L2 bidders in the first round. Similar offers of 1,000 GPUs, comprising 700 Nvidia H100 GPUs, 200 AWS Inferentia 2 GPUs, and 100 AWS Trainium 1 GPUs, were made by Locuz and Vensysco in that round.

    Cyfuture India’s CEO, Anuj Bairathi, informed a news outlet that the company has placed purchase orders for 1,184 GPUs. These consist of AMD’s MI300 and MI325 GPUs, Intel’s Gaudi 2 and Gaudi 3 GPUs, and Nvidia’s H100, L40S, and A100 GPUs. Cyfuture, a cloud service provider with MeitY panels, developed Cyfuture.ai, a fully integrated AI platform.

    Technically, the business was not eligible for the GPU tender’s first round. ET’s queries for responses from IndiaAI, NTT GDC India, Google Cloud, Sify, Yotta, Ishan, and Oracle were not answered. In order to preserve its leadership in AI and national security, nations like the US have placed export limits on modern AI chips, particularly GPUs, making them a highly sought-after resource globally.

     In January, India formally began its INR 10,000-crore India AI Mission, in which empanelled bidders offered 14,517 GPUs at L1 prices, falling short of the 10,000 GPU threshold specified in the IndiaAI compute pillar.

    As part of the mission, the government is also providing investment funding and other forms of support to academia and industry to encourage the development of local language models. The goal of the action is to increase India’s AI capabilities.

  • Zomato Hits Pause on 50:50 Refund Policy with Restaurants

    Zomato, a prominent player in the foodtech industry, has suspended a policy that asked restaurant partners to split 50% of refund costs, just weeks after it was introduced. The new policy has been gradually implemented by Zomato over the last few months.

    Zomato stated in the emails it issued to its restaurant partners that both the firm and the restaurants would contribute 50% to the client refunds. In the email, Zomato said that unresolved issues cause a slow but continuous drop in client retention, which negatively impacts the restaurant’s and Zomato’s capacity to generate demand.

    Resolving a complaint is much less expensive than losing a customer. It also emphasised that the new refund policy is about more than just cost sharing; it’s about fostering trust, guaranteeing equity, and creating a more robust and sustainable food distribution system.

    Policy will be Relaunched After Necessary Alterations

    A few weeks after the new policy went into effect, the corporation stopped it. Zomato recently emailed some of its restaurant partners to let them know that the programme will be relaunched after taking into account the input they received.

    In an email, Zomato announced that it had put the programme on hold for the time being and would restart it after taking partner input into consideration. A media outlet was informed by a number of restaurant owners that Zomato is attempting to “cut its costs” with the new policy.

    A restaurant owner pointed out a policy flaw in a media report by asking why the business should foot the bill if the food is cold when the delivery partner gets there due to traffic or the delivery executive taking a longer route.

    Another restaurateur stated that although it was previously optional, Zomato appears to be forcing eateries to pay for refunds in order to reduce its costs. The proprietor clarified that following Zomato’s refund initiative, the restaurant partners were previously given the choice to accept or deny a claim.

    If the restaurant denied the allegation, Zomato was responsible for the full amount. However, the restaurant partners would have no say once the new policy was implemented.

    It is important to remember that Zomato often starts reimbursements for “high-value, power” customers—those who place large orders and rarely complain about them.

    Massive Decline in Zomato’s Business

    The development coincides with a slowing in the expansion of Eternal’s meal delivery service. Due to slow growth in food delivery and rising rapid commerce prices, Eternal’s consolidated profit after tax (PAT) fell 77.8% to INR 39 Cr in Q4 FY25 from INR 175 Cr in the same period last year.

    In the March quarter, Zomato’s adjusted EBITDA was INR 428 Cr, up 2% sequentially and 56% year-over-year (YoY). To INR 2,409 Cr, adjusted revenue increased 17% year over year and decreased 0.2% quarter over quarter (QoQ).

     In addition, Zomato announced that it would discontinue its Quick and Everyday services and delisted 19,000 eateries in Q4. In a letter to the company’s shareholders, Eternal CEO Deepinder Goyal acknowledged that the growth in meal delivery is still below projections.

    Additionally, Zomato and restaurants are already at odds over the new regulation. The National Restaurant Association of India (NRAI), a restaurant association, stated earlier this year that it was considering bringing legal action against Swiggy and Zomato for their respective quick meal delivery apps, Snacc and Bistro.

  • Adam Milstein: The Harbinger of DEI’s Dangers to Jews

    Since President Trump took office on January 20, 2025, Diversity, Equity and Inclusion (DEI) programs in the federal government have been in his crosshairs to dismantle. On day one of his presidency, he issued a sweeping executive order banning any and all diversity programs across the executive branch. DEI office staffers were put on paid leave, DEI webpages were taken down, and all trainings and DEI-related contracts were halted. Federal workers have even been encouraged to report any DEI-related activities to the Office of Personnel Management. 

    On January 27, 2025, Trump issued another executive order banning DEI programs in the military. Pete Hegseth, his pick for Secretary of Defense, has declared that “the era of DEI is gone at the defense department.” Despite a razor-thin confirmation margin, with Vice President Vance breaking the tie in his favor, Hegseth enters the defense department with a mandate from President Trump to rid the military and defense bureaucracy of any race-based preferential treatment. Going forward, military leaders will be chosen based on “colorblind and merit-based” parameters only.

    Many institutions, such as the ACLU, see these efforts as regressive and harmful, undoing “decades of federal anti-discrimination policy, spanning Democratic and Republican presidential administrations alike.” Trump’s knee-jerk reaction to blame DEI, without evidence, for the tragic January 29 airliner crash in Washington, D.C., was interpreted by many liberals as representative of the longtime conservative vendetta against such programs. What seems to be missing from both Trump’s breakneck dismantling of DEI and its defense by liberal institutions is an explanation of the complex reasons why DEI programs have become so problematic for so many groups. 

    Adam Milstein, a Los Angeles-based venture philanthropist and American of Israeli descent, has written tirelessly on this subject, especially as it relates to the marginalization of Jews in every sphere where DEI is prevalent. Milstein is the co-founder of the Adam and Gila Milstein Family Foundation, a nonprofit in Los Angeles founded with a mission to support a network of organizations that strengthen American values, support the U.S.-Israel alliance and combat hatred and bigotry in all forms. These organizations work on a range of issues, such as antisemitism education on college campuses, monitoring the media for anti-Israel bias, promoting U.S. interests in the Middle East and combatting the delegitimization of Israel.

    Milstein has been sounding the alarm on the dangers to Jews of progressive frameworks like DEI and Critical Race Theory (CRT) since well before Hamas’ October 7 attack on Israel and the anti-Israel reactions of American progressives that immediately followed. After the attack, he explained in a piece for the Washington Times why these reactions were such a shock to many Jews: 

    [L]iberal American Jews have long supported progressive causes. From supporting the civil rights movement in the 1950s and ’60s to fighting for LGBTQ rights to supporting critical race theory and diversity, equity and inclusion initiatives in education, liberal American Jews have often been at the front lines of promoting progressive causes. Instead of condemning the terrorists who slaughtered, tortured and kidnapped our people, [our political leaders and fellow activists] called us colonizers.

    The labels “colonizer” and “settler-colonialist” originate from the trendy anti-colonial, anti-imperialist bent that academia has taken on in recent years in an effort to lift up historically marginalized peoples and voices from their “oppressors.” It’s no surprise that DEI emerged from this same worldview. Milstein describes DEI as a framework that, in theory, was “supposed to foster inclusive environments that welcome those of all racial and religious backgrounds.” In an article for The Jerusalem Post, Milstein stated that “[t]he asserted goals of DEI are positive: to promote the representation, participation, and fair treatment of historically marginalized groups.”

    However, DEI measures have been aggressively implemented in universities, government, cultural institutions and the corporate world in such a way that they often have the opposite effect: marginalizing groups who need its advocacy, most notably Jews. Milstein argues that DEI propagates an “‘us vs. them’ mentality” that “promote[s] victimhood.” He believes that DEI: has been deployed to advance a radical agenda that undermines fundamental American values by promoting equality of outcome over equality of opportunity, collective identity (race, gender, etc.) over individual character, censorship of opposing viewpoints over freedom of speech, and a victim culture that crudely bifurcates society into oppressors and the oppressed.

    Thus, Jews are not “the right kind” of minority to DEI proponents, Milstein says.

    They and the Jewish state, he laments, are “maliciously portray[ed]” as “vicious oppressors” in the DEI mindset. Because Jews can pass as white and because many of them have found financial and cultural success, they are seen as oppressors and colonizers of other, less fortunate groups.

    “This line of thinking has allowed antisemites to come out of the shadows under the guise of righteousness, and it sets an incredibly dangerous precedent,” Milstein says.

    Tabia Lee, a former DEI department head at Silicon Valley’s De Anza College, wrote in a New York Post article that she was told by colleagues she “shouldn’t raise issues about Jewish inclusion or antisemitism” because “Jews are ‘white oppressors’ and our job as faculty and staff members was to ‘decenter whiteness.” She pushed back against this and was eventually fired. In this same vein, Milstein cites a Heritage Foundation study which shows that DEI staffers’ social media accounts “exhibit a remarkable level of virulence against the State of Israel” compared to positive feelings towards China, whose human rights abuses are well-documented.

    Across several articles over the last year, Milstein has made clear that the ideology that fuels DEI is a threat to Jews because of the pernicious antisemitism it breeds. Though haphazard, President Trump’s dismantling of DEI in government and the military could be a positive step toward its reform nationwide, but only if those who immediately come to its defense understand its flaws. Once President Trump is out of office, the political pendulum may very well swing back to the left, with DEI programs widespread in academia and our cultural institutions once more. Should that happen, Jews and non-Jews alike must advocate for a DEI that does not demonize certain groups in order to lift up others. As Milstein has said countless times, this strategy is nothing less than an insult to the liberal values America was founded on.

  • Government Launches Copyright Review Panel as AI Sparks Legal Storm

    A group has apparently been established by the Centre to examine current copyright legislation in light of the growing number of issues pertaining to artificial intelligence (AI). According to a media report, the Union trade ministry last month formed a group consisting of eight specialists to investigate AI-related issues and their consequences for India’s copyright law.

     According to the source, the team, which consists of government representatives, industry executives, and intellectual property attorneys, will determine if the Copyright Act of 1957 is sufficient to address issues pertaining to AI.

    In light of copyright concerns, the panel members have been instructed to identify and evaluate legal and policy concerns resulting from the application of AI. As a result, the government will get the committee’s report.

    Never Ending Trouble for Open AI

    The main issue raised by news platforms is that AI companies are using their copyrighted content to train their core models without obtaining a licence, permission, or payment. Last year, ANI brought a case against OpenAI in India before the Delhi High Court (HC).

     Media organisations such as NDTV, Network18, the Indian Express, and the Hindustan Times joined the case against the inventor of ChatGPT in January of this year. The Digital News Publishers Association (DNPA) and 20 companies filed a 135-page complaint in court, arguing that OpenAI’s “conduct” poses “a clear and present danger to the valuable copyrights” of DNPA members and other sources.

    On behalf of all of its members, including Rupa Publications, S Chand and Co., Bloomsbury, Penguin Random House, Cambridge University Press, and others, the Federation of Indian Publishers (FIP) also filed a complaint against OpenAI in the Delhi High Court earlier this year.

    Music Companies too Raising Concerns

    Major record companies including T-Series, Saregarama, and Sony also indicated in February that they would be interested to join the Delhi High Court’s ongoing copyright case against the ChatGPT creator.

    The HC at the time requested that OpenAI respond to the Indian Music Industry’s (IMI) motion to join the lawsuit. According to ANI’s plea, ChatGPT “reproduced verbatim or substantially similar extracts” of the news agency’s publications at the request of users.

    The lawsuit also alleges that by using ANI’s content to train its large language models (LLMs), OpenAI took advantage of the new agency’s content for its own financial benefit. ANI told the Delhi High Court at a hearing in March of this year that the ChatGPT maker’s use of its content dilutes its market, which results in unfair competition.

    Notably, the AI giant managed by Sam Altman previously urged the HC to reject infringement charges against it and informed the court that it is not required to form alliances with major media sites in order to use their content.

  • PwC to Cut 1,500 Jobs Across US in Major Workforce Shake-Up

    PwC is the most recent of the Big Four accountancy firms to lay off employees. The company is laying off about 1,500 workers in the US, or about 2% of its 75,000-person US workforce, according to a media report.

     Employees in the audit and tax departments are the main targets of the layoffs. PwC has also made the decision to reduce campus recruitment in addition to the job losses. Nonetheless, the company stated that it will honour all current employment offers given to the interns from the previous year, who are anticipated to start working for the company later this year.

    According to a PwC spokeswoman, this was a tough choice that the company made carefully, thoughtfully, and with a great deal of consideration for how it would affect its employees. The company acknowledged that historically low attrition rates over a number of years had necessitated this action.

    Up For Promotion: Ended up Losing the Job

    According to a media source, Microsoft Teams invites marked as “time sensitive” were sent to the impacted employees. According to the article, one impacted individual stated that several of them were up for promotion, but they are now being cut off instead of receiving a rise in salary and a promotion. Today’s layoffs caught everyone completely off guard.

    Similar actions have also been taken by other Big Four companies. Plans to cut employees in its US consulting division were recently reported by Deloitte.

    According to a statement released last month by Deloitte spokesperson Jonathan Gandal, there is still a high demand for the company’s services overall.

    Based on low levels of voluntary attrition, the firm’s government clients’ changing demands, and moderating growth in some areas, the company is implementing moderate personnel actions. KPMG lay off 330 workers in its US audit division in November, which amounts to around 4% of the company’s staff.

    Layoffs have Become a Common Scenario in 2025

    With big companies like Google, Microsoft, and others continuing to reduce their workforces, layoffs in the tech sector are not expected to halt in 2025.

    Companies are still cutting employees in an effort to simplify operations, save money, and emphasise automation and artificial intelligence, even though these figures are much lower than the major layoffs that occurred between 2022 and 2023.

    Layoffs.fyi, a website that tracks layoffs in the industry, reports that 93 organisations have laid off nearly 23,500 tech workers so far this year, and the number is still growing.

    Google and Microsoft are apparently contemplating a new round of layoffs, according to the most recent job reduction reports. According to reports, AI-led restructuring and performance-based terminations are part of the corporations’ goals to increase the effectiveness of their personnel.

  • Gemini 2.5 Pro Revealed: Google’s Next-Gen AI Takes Center Stage Before I/O 2025

    This month, Google is getting ready to host Google I/O 2025, its annual developer conference. However, the tech giant has unveiled a new iteration of its AI model, Gemini, ahead of its annual software presentation.

     The company’s flagship Gemini 2.5 Pro AI model has been enhanced and is now available as the Gemini 2.5 Pro Preview.

    With the intention of giving developers early access to its improved capabilities, the business unveiled the new model—named Gemini 2.5 Pro Preview (I/O edition)—earlier than anticipated. Google claims that the Gemini 2.5 Pro Preview has enhancements in a variety of code areas.

    Google Claims: Best Coding Model Ever Made

    Demis Hassabis, the CEO of Google DeepMind, wrote on X about the new AI model’s release. It is the best coding paradigm ever created, according to Hassabis. He goes on to say that the concept is perfect for developing interactive applications.

    Additionally, Haasabis posted a video demonstrating how to use Gemini 2.5 Pro Preview for idea development. Haasabis expressed his excitement about sharing the best coding model brand ever created in a post on X.

    The company is releasing the Gemini 2.5 Pro Preview ‘I/O edition’ today, which has significantly enhanced coding capabilities. Holds the top spot on the WebDev Arena Leaderboard and the LMArena Coding Ranking.

     It excels at creating interactive web applications; this example demonstrates how useful it is for concept prototyping. Try it in AI Studio (http://ai.dev), Vertex AI, and @GeminiApp. Savour the pre-I/O treats.

    New Improved Features of Gemini 2.5 Pro

    Google claims that Gemini 2.5 Pro Preview offers significant advancements in several coding areas, including front-end and user interface development, code editing and transformation, and the building of complex agentic workflows.

    It is anticipated that these improvements will expedite the development process, allowing programmers to create more inventive and effective apps.

    According to a blog post by Google, developers who are now using Gemini 2.5 Pro will benefit from improved coding performance as well as crucial developer feedback, such as fewer function calling errors and higher function calling trigger rates.

    No action is necessary to use the enhanced model, which is still available at the same price, as the prior iteration (03-25) now redirects to the more recent version (05-06).

    Gemini 2.5 Pro achieves 84.8% on the VideoMME standard, demonstrating cutting-edge video comprehension. When combined with code, this allows for new flows that were previously unattainable with earlier iterations.

    The Video to Learning App in Google AI Studio, for instance, shows how Gemini 2.5 Pro uses a single YouTube video to generate an interactive learning application.

    Compared to the prior basic example, the new Gemini 2.5 Pro model offers a more useful experience with enhanced video understanding and a comprehensive user interface.

  • Blockbuster: From Rental King to Digital Fade-Out | The Rise and Fall of Blockbuster

    The movie and entertainment industry is an ever-changing and ever-evolving field. New movies are being released every month, new streaming services are popping up, and new trends in the industry are emerging. It is important to stay up to date on the latest news and trends in the movie and entertainment industry to stay relevant and competitive. The rise of television began in the late 1920s and early 1930s with the invention of mechanical television. It was a primitive form of television that used a mechanical disk with a spiral pattern of holes on it to scan images. This technology was used until the 1950s when it was replaced by electronic television. This technology allowed for the transmission of images in colour and with sound. The first commercial television station began broadcasting in the United States in 1941, and by the 1950s, television had become a staple in most American households. Television programming expanded rapidly over the following decades, and by the 1990s, it had become a major source of entertainment, news, and information. Today, television is available in almost every home worldwide and continues to be an important form of media. There lies a business that runs around this sphere, a video rental business.

    A video rental service is a business that rents out videos and other media, usually on a subscription basis. The service may also offer to stream video content. Video rental services typically require customers to pay a monthly subscription fee, with additional fees for rentals or purchases. The service may also offer a selection of movies and television shows available for streaming. The growth of video rental services is directly correlated to the number of television sets that are in circulation. With the increase in television sets, the demand for video rental services will increase as well, as people will have more options available to them for watching movies and TV shows. The demand for video rental services will also increase with the introduction of new technology, such as streaming services, which offer access to larger libraries of movies and TV shows. As the number of television sets in circulation increases, the demand for video rental services will likely continue to grow as well. This article is about one such business. That business is known to the world as ‘blockbuster’, a famous foreign company that dealt with video rental services. We will discuss the rise and fall of blockbusters in this article.

    Blockbuster
    The Rise of Blockbuster | History of Blockbuster
    Blockbuster Timeline
    The Fall of Blockbuster
    The Reasons Behind the Fall of Blockbuster
    The New Streaming Business

    Blockbuster

    Blockbuster was an American-based provider of home movie and video game rental services through video rental shops, DVD-by-mail, streaming, video on demand, and cinema theatres. The company was founded in 1985 and went bankrupt in 2010. At its peak in 2004, Blockbuster employed 84,300 people worldwide, including about 58,500 in the United States and about 25,800 in other countries, and had 9,094 stores in total, with more than 4,500 of these in the US. The company also had retail outlets in Canada and the UK. Blockbuster offered customers the ability to rent VHS tapes and later DVDs and Blu-ray Discs, as well as video game consoles, video games, and other related merchandise.

    Customers could also purchase films or video games, as well as rent or buy previously viewed movies. In 2005, Blockbuster began rolling out its Total Access program, which allowed customers to return rentals to a Blockbuster store and receive a rental credit, as well as access to movies by mail. In 2010, Blockbuster filed for Chapter 11 bankruptcy protection. The company was acquired by Dish Network in April 2011 and was subsequently closed down in November 2013.

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    The Rise of Blockbuster | History of Blockbuster

    Before the Internet era, video rental businesses relied on customers physically visiting the store to rent a movie or television show. Customers would typically browse the store’s selection and then take the desired video to the checkout counter to pay for the rental. Many video rental stores also offered additional services such as popcorn, candy, and soda. Some businesses also provided gaming systems and game rentals. Video rental businesses also relied on word-of-mouth marketing to attract new customers. Owners would often promote new releases and special offers through flyers and newspaper ads. Additionally, video rental stores often developed relationships with local businesses, such as restaurants and coffee shops, to offer discounts and special promotions. Video stores also offered additional services, such as late fees for returns, membership discounts, and loyalty programs. These incentives helped to encourage customers to return to the store and increase their spending. The advent of the Internet has drastically changed the video rental industry. With the rise of streaming services, such as Netflix and Hulu, consumers no longer need to visit a physical store to rent a movie or television show. This shift has caused many video rental stores to close their doors.

    Annual Revenue of Blockbuster from 2002 to 2006

    The company was immensely popular throughout its history, particularly in the mid to late 1990s when it was the largest rental chain in the world. Blockbuster’s popularity was due in part to its large selection of films, its convenient locations, and its low prices. The company also had a strong online presence, allowing customers to rent films and video games over the internet. Then came a great invention from humans, the internet. The rise of the internet led to a decline in many sectors and changed how we build relations with products and services. Thus, stores had to make a big shift and move to the internet.

    The decline of brick-and-mortar businesses was primarily due to the rise of e-commerce. As online shopping has become more accessible and convenient, many customers are opting to purchase goods and services through the internet instead of going to physical stores. Additionally, brick-and-mortar stores have had to contend with rising rents and operating costs, which have made it difficult to maintain their businesses. Finally, large retail chains have been able to leverage their buying power to offer lower prices, making it difficult for smaller, independent stores to compete. The decline of brick-and-mortar video rental stores has been a result of several factors. The increasing popularity of streaming services such as Netflix, Hulu, and Amazon Prime has made it easier and more convenient for people to watch movies without leaving their homes. Additionally, the cost of renting movies has gone down significantly since the advent of digital downloads, making it a more economical option for consumers. Finally, the growth of the internet has led to more people downloading and watching movies online rather than in physical stores. All of these factors have contributed to the decrease in brick-and-mortar video rental stores.

    Blockbuster Timeline

    Blockbuster could have been a multi-billion-dollar business, but things changed rapidly. They did not shift to the internet medium, and they also lacked thick fur for the future. The company’s success was largely attributed to its ability to outcompete smaller rivals. It was able to offer a greater selection of titles, lower prices, and convenience to its customers. Blockbuster also invested heavily in new technologies, such as DVD and VHS players, which allowed them to offer customers the latest releases. However, Blockbuster’s success was short-lived.

    We can learn a lot from the story of the rise and fall of such a business. So here we present the Blockbuster history timeline for its business.

    History of Blockbuster
    Blockbuster Timeline
    • 1930: Blockbuster Music is founded in Dallas, Texas.
    • 1985: Blockbuster Video is founded by David Cook.
    • 1987: Blockbuster opens its first store in Dallas, Texas.
    • 1989: Blockbuster is purchased by Viacom and expands to nearly 1,000 stores.
    • 1992: Blockbuster launches its Total Access program, allowing customers to rent movies online and return them in-store.
    • 1994: Blockbuster reaches 2,000 stores worldwide.
    • 1997: Blockbuster launches its “No Late Fees” program, allowing customers to keep rental movies for as long as they want.
    • 2000: Blockbuster reaches its peak, with over 9,000 stores worldwide.
    • 2005: Blockbuster launches its Blockbuster Online service.
    • 2013: The last Blockbuster store closes in Alaska.
    • 2020: DISH Network acquires the brand, and plans to relaunch Blockbuster as an online streaming service.

    The Fall of Blockbuster

    The fall of Blockbuster began in the early 2000s with the rise of streaming services such as Netflix. The convenience of streaming services and their wide selection of new and classic films allowed customers to access the content they wanted without having to leave their homes. This quickly began to put pressure on the existing Blockbuster business model, which relied heavily on in-store rentals. The decline of Blockbuster was further accelerated by the growth of digital media, which made it easier for consumers to access content directly from their devices. This allowed customers to skip the middleman of Blockbuster, further eroding the company’s revenue stream. By 2010, Blockbuster had filed for bankruptcy, marking the end of an era of physical movie and video game rental stores. The dawn of streaming had begun, and the industry has since grown exponentially. With the success of Netflix, Amazon Prime, and other streaming services, the future of streaming is only looking brighter.

    The decline of video rental businesses after the internet era was a major blow to the industry. The rise of streaming services, such as Netflix and Hulu, made it easier and more affordable for people to watch movies and TV shows online. This shift in consumer behaviour caused a decrease in demand for physical video rentals and an increase in demand for digital content. As a result, many video rental businesses were forced to close their doors, unable to compete with the new digital options. Additionally, the decrease in demand for physical videos led to a decrease in the production and sale of physical copies, furthering the decline of video rental businesses.

    Netflix VS. Blockbuster
    Netflix VS. Blockbuster

    The Reasons Behind the Fall of Blockbuster

    The Rise of Blockbuster

    Blockbuster began in 1985 as a revolutionary video rental business that changed how people accessed movies. Customers could rent films from their local store or even enjoy home delivery, which was a big shift from the traditional rental system. By the early 2000s, Blockbuster had become a household name in America, boasting over 9,000 stores across the country and becoming a central part of home entertainment culture.

    The Internet’s Impact on Entertainment

    In the early 2000s, the internet exploded in popularity with the rise of social platforms like MySpace and Friendster. This digital boom brought a wave of new websites, apps, and services that transformed how people consumed content. However, as more people got online, concerns around safety and cyberattacks also grew, leading to a brief dip in trust and usage. Despite this, the internet bounced back stronger, becoming even more essential with the arrival of cloud computing and the Internet of Things (IoT), reshaping how we interact with media.

    The Fall of Blockbuster

    Blockbuster’s downfall came largely due to the rise of streaming platforms such as Netflix, Hulu, and Amazon Prime. These services offered unmatched convenience and affordability, which quickly won over customers. Blockbuster failed to keep up with changing technology, sticking to its outdated model of physical DVD rentals. Its rigid return policies and late fees, once accepted by customers, became a drawback. Most critically, the company was too slow to embrace online streaming, giving its competitors the edge they needed to dominate the market.

    Failure to Adapt

    Blockbuster struggled to keep up with changing times. In 2000, it famously turned down the chance to buy Netflix for just $50 million—a decision that proved costly. While Netflix moved toward a smooth, fee-free streaming model, Blockbuster stuck with annoying late fees and was slow to go digital. By the time it launched its own online rental service in 2004, Netflix was already way ahead.

    Financial Struggles

    On top of tech troubles, Blockbuster was drowning in debt from years of rapid expansion. As people shifted to digital downloads and streaming, fewer customers were renting DVDs, and Blockbuster’s earnings took a major hit.

    The Final Decline

    Everything came crashing down by 2010, when Blockbuster filed for bankruptcy. Dish Network bought its remaining assets in 2011 but couldn’t revive the brand. By 2013, all corporate-owned stores and the DVD-by-mail service shut down. The last company-owned Blockbuster store closed in 2014, marking the end of an era.

    The Decline of Blockbuster

    The New Streaming Business

    With the emergence of streaming services like Netflix, Hulu, and Amazon Prime, Blockbuster lost its competitive edge. Its stores were unable to keep up with the advancing technology, and customers began to abandon the chain in favour of these new services.

    When the video rental business declined because of the rise of internet services, there were many benefits that users could witness. With streaming services at our disposal, we got to see that there were many benefits. As people are moving and shifting rapidly towards the streaming movies side of entertainment. That trend, we can see, is also somehow continuing to this day. Let us see what are the benefits of streaming services.

    • Cost Savings: One of the biggest advantages of streaming services is that they can save you money. With streaming services, you don’t have to pay for individual downloads or CDs, or even a monthly subscription fee. Thus, saving money for the customer and increasing loyalty.
    • Convenience: With streaming services, you don’t have to worry about downloading or storing music or videos. Everything is accessible from the cloud, and all you need is an internet connection to access it.
    • Quality: Streaming services offer high-quality sound and video, so you can enjoy the best possible experience. That is your mini theatre for your home, which is portable and easily accessible.
    • Variety: Streaming services offer a wide variety of music and video content, so you can always find something new to watch or listen to.
    • Accessibility: Streaming services are available on multiple devices, so you can access your content from anywhere.
    • Personalisation: With streaming services, you can customise your experience and tailor it to your preferences.
    • Flexibility: If you don’t like a certain song or video, you can easily skip it and move on to something else.

    Conclusion

    Blockbuster attempted to compete with these streaming services, but it was too late. The company filed for bankruptcy in 2010, and all remaining stores closed in 2014. The Blockbuster era had come to an end. Although Blockbuster is now defunct, its legacy lives on. It paved the way for the current home video rental market, and its innovative business model provided the foundation upon which streaming services to built. So, the popular video rental chain allowed customers to rent movies and video games from physical locations.

    We can say that declining physical video rental businesses can look to alternative revenue streams to stay afloat. These include offering streaming services, subscription-based video on demand, and online sales of physical media. Additionally, they should consider expanding their offerings to include more niche titles and creating special promotions and discounts to attract new customers. Finally, they should consider partnering with other local businesses to offer additional services and promotions to their customers.

    FAQ

    When was Blockbuster founded?

    Blockbuster was founded in 1985.

    What was Blockbuster’s biggest mistake?

    Blockbuster’s biggest mistake was it did not involve the streaming company directly. In 2000, Reed Hasting flew out to meet with Antioco and proposed a partnership but Blockbuster turned it down.

    Why did Blockbuster collapse?

    Blockbuster driven by physical rental stores, began struggling to compete with streaming and mailing platforms. Blockbuster was driven into bankruptcy because it failed to adapt quickly enough.

    What is Blockbuster Video business model?

    Blockbuster’s business model revolved around late fees in their movie and video game rental services. Blockbuster charged a dollar per day in late fees if a customer didn’t return their movies on time. Late fees remained a hallmark memory for recurring customers and a primary source of income in the early 2000s.

    What has replaced Blockbuster?

    In early 2000, Netflix founders Reed Hastings and Marc Randolph offered to sell the company to Blockbuster for $50 million. Blockbuster turned them down. Eventually, Netflix triumphed over Blockbuster, popularized streaming, and forced the entertainment industry to adapt.

    How long was Blockbuster in business?

    Blockbuster was in business for about 29 years. It started in 1985 and peaked in the early 2000s with thousands of stores. However, due to rising competition and failure to adapt, it filed for bankruptcy in 2010. The last company-owned stores closed in 2014.

    Why was Blockbuster successful?

    Blockbuster was successful because it made movie rentals easy and accessible, offering a wide selection of titles in clean, well-organized stores. Its convenient locations, strong brand, and family-friendly atmosphere made it a go-to spot for home entertainment in the pre-streaming era.

    How did Blockbuster work?

    Blockbuster worked by letting customers rent movies or video games from local stores for a set number of days. People would browse shelves, pick a title, and pay a rental fee. Late returns came with extra charges. Rentals had to be returned to the same store.

    What did Blockbuster sell?

    Blockbuster mainly sold movie and video game rentals. It also sold DVDs, VHS tapes, video games, snacks like popcorn and candy, and sometimes movie-related merchandise.

    What was Blockbuster?

    Blockbuster was a popular video rental store chain where people could rent movies and video games. It started in 1985 and became a huge part of home entertainment before streaming services took over.

  • Movie Theater Business Model | How Do Movie Theaters Make Money

    A quote is a good way to start an article about art. If you are reading this, chances are you are aware of art. Any sort of art, for that matter. You read this article, a poem, a story, or you watch a film, listen to a song, or embrace a painting. All these are forms of this one term “Art”. That term has been constantly celebrated from time immemorial. Be it a hundred years ago or a hundred years from now, it will be relatable ad infinitum.

    The current times, the pandemic, and life afterward haven’t affected this culture. Our escape from the dust of daily life still hides in some form of art. Music and films are our top favorites of art. If you are a movie buff, then the first-day first show feel would be super important to you. This is where cinema halls and movie theatres come in to quench your thirst. They are temples for cinephiles.

    Have you ever thought about how these work? How is a movie released nationally? What do the numbers and charts say? This is an article about the business model of movie theaters. Read on to find out how movie theatres earn and how cinemas are run. How the current unprecedented times are changing our movie experience.

    “Art enables us to find ourselves and lose ourselves at the same time.” ― Thomas Merton, No Man Is an Island

    Cinema Halls
    The Distribution of Movies
    Revenue Sources or Income Generation of Cinema Halls
    The Unprecedented Pandemic times
    Behavioural Change of Moviegoers
    The Expected Future of Film Distribution

    Cinema Halls

    The journey of a movie starts with a story in the director’s mind. Which is edited multiple times to get just about the perfect fit. Drafts and drafts and more drafts. Actors and actresses are auditioned for character roles, and a big crew is assembled to kick off the production.

    Once the movie is produced, it is time for its distribution. The first distribution channel for any film has always been ‘Cinema Halls’. It is a century-old way of distributing what the actors and producers have produced.

    The model is also quite unchanged, visitors pay a fee for entering the hall. The hall has seats, lots of seats, and the movie is shown through a projector on the front screen. The screen is big enough to be seen from around the theatre.

    This has been the business model of a cinema hall for a very long time. However, it is added with some tweaks, like refreshments and snacks. More or less, this model is unchanged.

    The audience sits on padded seats. In most theatres, the seats are aligned on a floor that is sloped, to enhance visibility for viewers. The highest part of that slope is at the back of the theatre. Movie theatres often sell snacks like popcorn, carbonated drinks, etcetera. In some areas, movie theatres with allowances and licenses can also sell alcoholic drinks.

    Ho Movie Theaters Earn Money
    Movie Theaters Global Market Report 2025

    The movie theatre market has been growing steadily over the years. In 2024, it was valued at $79.62 billion and is expected to reach $83.16 billion in 2025, growing at a 4.4% annual rate. The movie theatre market is set to grow strongly in the coming years, reaching $102.46 billion by 2029. This marks a steady compound annual growth rate (CAGR) of 5.4%. This rise is thanks to several key factors from the past, like the golden age of Hollywood, the unique social and cultural experience of watching movies in theatres, big blockbuster hits, increasing urban populations, and changes in how films are distributed to theatres.

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    The Distribution of Movies

    The distribution has always been primarily in cinema halls, but it is on certain terms and conditions. The production and completion of a movie are just one part of the whole big picture.

    After the production, the movie is distributed via various channels. Cinema is the first tunnel, but thereafter too the movie travels the market. They are turned into DVDs, some go on to follow a streaming service way. But before the train moves to the next station, some decisions are made. These are known as the terms and conditions of the licensing of these films.

    In India, theaters buy movies from distributors, who acquire the distribution rights from producers:

    Role Responsibilities
    Producer Sells the theatrical rights to a distributor for a specific territory
    Distributor Acquires the rights from the producer and hires theaters to screen the film
    Theater Pays the distributor a rental fee for the right to show the film

    Theaters give 50–55% of ticket sales to movie distributors. They earn from showing new movies and selling snacks. A hit movie means more earnings. India’s film industry has 14 regions, each with its distributor. Most movies are sold to distributors with a minimum guarantee. Theaters can be single-screen or part of multiplex chains.

    Terms regarding revenue sharing and movie release timings are also decided in advance. Before we get further, we need to know some technical terms that will help us get a clearer view of what the process looks like, so here goes!

    Distribution of Box Office Revenue Worldwide in 2023, by Region
    Distribution of Box Office Revenue Worldwide in 2023, by region

    Producer

    A producer is a person who invests in producing a film. He is the investment guy who takes the risk of failure and the gains of success of a film. They invest in films under the name of a production house. For example, Karan Johar invests via a production house named “Dharma Productions”.

    Distributor

    The distributor is the person who distributes the film through the medium of theatres. The distributor buys the “distribution rights” directly from the producer. In most cases, he buys the rights in the very beginning, sometimes after viewing the final cut. Distributors can be of many types. They can vary in numbers, also.

    If we are talking about a big-budget movie, then there can be a domestic distributor who is responsible for distributing in the home country of the film production. Others can be overseas distributors who are responsible for distribution in the rest of the world. There are typically some forms of how a distributor deals with the producer. Here we discuss the types of distributors:

    Minimum Guarantee for Royalty

    A minimum guarantee is the sum that is paid to the producer by the distributor of a film. It is here to be noted that the price is irrespective of how the film performs, whether it is a flop or a hit, which does not affect the minimum guarantee royalty. Usually, producers who have a stronghold in the industry ask for a high sum due to their brand name, which pulls in crowds into theatres.

    After relieving the margin of the distributor, Anything more revenue earned than this minimum price is shared with the producer. So we see that the distributor cannot become the owner of the movie; he is licensing the movie.

    Outright sale/purchase

    As the name suggests, this is a contract of sale. The distributor buys the whole movie produced and all its rights. So lawfully, the distributor is the owner of the project. He is free to choose whatever medium he wants to use for the distribution. All the profits or losses earned or incurred are solely owned by him.

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    Commission Basis

    The commission is the typical model that many producers follow. They sort of hire a distributor to spread the movie. The distributor, instead of his services, asks for a fee or commission. In this case, he does not share profits or losses, he is just entitled to the negotiated commission. Risk is still left with the producer. However, the film performs, the distributor is entitled to his fee anyway.

    The Exhibitor

    He is the owner of a theatre that has the right to show the movie by the distributor. Both parties, the distributor and the exhibitor, are bound through a contract. That contract acts as a basis for sharing the revenue that is earned within the first, second, or third week of the release.

    Here are the basic, typical sharing agreement terms and conditions. Take note that this is just to be taken as an example. Agreements can be changed and made with further discussions and debates between the distributor and exhibitor.

    Duration Profit Percentage Sharing
    First Week After The Releasing of Film 65%:35% (Means 65% of Profit Share For Distributor and 35% of profit share is for Exhibitor)
    Third Week 55%:45% (Means 55% of Profit Share for Distributor and 45% of profit share is for Exhibitor)
    After Fourth Week 50%:50% (Means there after the profit sharing right is equal for both the Film producer and Distributor)

    How Movie Theatres Make Money

    We just learned how the movies of our beloved stars travel to the nearest theatre screen. This is a huge step; once distributed, the movie is ready for its trial. It is ready for criticism and reviews of any sort.

    How Movie Theatres Make Money
    How Movie Theatres Make Money

    With this onset, cinema halls are ready to be flooded with people. People like you and me who love the movie-watching experience. This turns the cash-making wheel. Here we are going to look at some of the most commonly seen revenue-generating sources for a cinema business:

    Tickets

    The revenue source of a movie theatre is mainly through ticket sales. A person who wishes to watch a movie in a theatre has to first buy a ticket to enter the premises. The premises where the movie is to be projected.

    As discussed earlier, it is common ground for every ticket carrying a person with seats and a movie projector. However, it is to be noted here that a cinema hall is allowed to have different sections of seats according to its floor plan.

    For example, some theatres also operate on a slightly changed pricing mechanism. They can give out some special seats for people who are willing to pay more. Those with premium seats would enjoy more comfort and more accessibility while watching the movie. All these are made in adjustments to improve the overall movie-going experience for the people.

    Eatery and Snacks

    A theatre has also added snacks to its revenue streams. It now also provides people with snacks for some extra bucks. The eatery can be assessed before the movie starts, in the middle of the movie (during the intermission break), or whenever the customer wants. However, this source of revenue is as per the customer’s needs, and even then, it has also become a strong money medium. The reason is the price differences of the articles that you buy while enjoying a movie.

    Yes, the snacks that you buy at the eatery at a movie theatre are significantly higher than the maximum retail price that you may find in a regular market. I am sure you must have noticed that by yourself, the prices are exorbitant.

    Once you are in a theatre, you unconsciously play by their rules. These are also known as MRP manipulations that not only theatres do, but they are also accompanied by companies. Companies produce the same products with an inflated or premium price for selected channels like our beloved theatres, cinema halls, eateries, etcetera.

    Business Model of Movie Theatres

    Advertising Revenue

    If you think that you will not witness a single second of an advertisement after paying the ticket price, you are probably wrong. Advertisements are always there in between the gaps of movies.

    Advertisements run on the reel before the movie starts, and they also immediately cover the screen when intermission comes. So this medium of advertisement, however small, also adds up to the cash for operating a theatre.

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    The Unprecedented Pandemic Times

    Until February 2020, before Corona, movies were first released in theatres and played exclusively for at least 75 days before home release. Home release means streaming online, video-on-demand, DVDs, etcetera.

    Then came the lockdown era, which changed the whole scene. Every movie theatre was shut, and the cinema business saw a tremendous downfall. Movies began flowing in a different medium, never expected before. That was the inception of day and date releases, in which a movie was available to watch the same day it hit the theatres. So, it was available for renting or streaming on the day of its release. This was a huge shift in cinema. This also led to a shift in the profits of the cinema and the box office.

    As this trend continued, the viability of these options began to diminish. The profits were distributed to OTTs and it changed the behavior of moviegoers. This raises the question of what the next strategy is for spreading movies.

    Before the pandemic, studios primarily hoped for box office revenues. Almost more than half of the total cash is earned through theatrical releases. Not only this. Theatrical releases also help in setting up a benchmark for the further spread of the movie or anything filmy.

    That benchmark, after the initial release, is used to sync negotiations of subsequent windows. Windows like that of ‘Licensing fees’ for television releases. The higher the benchmark is set by the initial release, the better the prospects of licensing fees for the artwork.

    Behavioural Change of Moviegoers

    COVID-19 encouraged two new behaviors – The first behavior was to watch movies in the comfort of our home. The reason for the decline in ticket sales is that home entertainment options have risen.

    Be it streaming services and television, video games, or even your smartphone, we have a lot of entertainment options within a distance of a mere 5 meters. This means people are becoming less and less likely to move to nearby theatres.

    Secondly, studios now care about their distribution. They are making their streaming services to capture more market share for the film. Hence, the pandemic caused studios to rethink their movie release and revenue model behaviours. Which was not to mention at least a century-old method earlier.

    The Expected Future of Film Distribution

    Now, you might think that streaming is the future. Whatever is happening in this industry makes it more flexible for the viewers. This is quite an obvious thought, but this industry is not that simple, and this pandemic shift in behavior is turning the revenues down. How do you ask?

    Studios cannot monetize all their produced content through streaming. Especially when they have to rely on third-party streaming services for their releases. Despite their expanding market, profits are mostly churned out. Even for the studios that own distribution channels, streaming is not an economical way to follow for release.

    The future of movie theaters will likely include new technology like virtual reality, 3D, and 4D for more immersive experiences. Filmmakers might try new ways to tell stories. Some theaters now offer extras like fancy food and drinks to bring in more people. They might also make money by hosting events or renting out spaces.

    Warner Bros. announced that after the release of ‘Wonder Woman 1984’, every film release will debut on HBO Max. That can be accessed with a subscription fee. This policy was later changed and made fit for 2022. When the situation became a little normalized, HBO said that it would be released first in theatres, and after 45 days it would be available to further audiences. Thus, studios are approaching the situation dynamically.

    On the other hand, Reliance Entertainment and T Series are hoping for the comeback of big screens in our society. They reportedly invest about INR 1,000 crores ($135 million) in big-screen releases.

    Disney, one of the most famous studios in the world, is doing something completely different. Disney is seeing this hurdle as an opportunity to burst out and grow its wings. It is trying to fight Netflix in world markets. It has its own distribution channel, “Disney+”. This shows that the studio is trying to capture markets, and it is long on the streaming game. So much so that short-term revenue doesn’t fit their perspective for now.

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    Conclusion

    How this balancing act between theatrical releases and streaming online will go, is to be seen. Only time will tell how studios manage to find a fit in these twisted markets. We discussed how the cinema hall business earns money. We also saw how a film is distributed in a geographical area.

    There is a lot of money that can be earned in this industry, which is often abbreviated as one of the most profitable domains. The entertainment sector has also been boosted by the ongoing global pandemic.

    In such a big country as India, with a population of more than a billion. Movies are the go-to entertainment, but with the rise of streaming services, it is witnessing a twist. Will a movie be celebrated even when it doesn’t hit the theatres? As studios think again about their movie distributing strategy, the more intense question is – Would you pay for a popcorn tub at the overpriced theatre, if you could stream the movie from the comfort of your home?

    FAQs

    How do movie theaters make money?

    Movie theaters receive a portion of each ticket sold. They also make money from Food, drink, and merchandising sales, Advertising revenue, and Public funding.

    How theater owners make money?

    Theatre owners make money from ticket sales, high-priced snacks, and showing ads before and during movies.

    How does the movie theater business work?

    The movie theaters give a portion of each ticket they sell to the production company of each movie.

    How do movie producers make money on Netflix?

    Netflix pays licensing fees to the production company of the movie to stream movies.

    How much theater owner earn in India?

    A cinema hall owner in India can earn up to Rs 5 lakh per month with an initial investment of around Rs 7.5 lakh.

    What is movie theater profit margin in India?

    The profit margin for a cinema hall in India can be around 20–30% after deducting the costs of film rights and operations.

    Is theatre business profitable in India?

    The theater business in India can be profitable but depends on location, movie releases, and competition. However, challenges include high operating costs, piracy, and online streaming platforms. Profits are higher for theaters showing popular films or offering unique experiences like luxury seating or food services.

    How theatre owners buy movies?

    Theatre owners buy movies by paying a fee or sharing ticket revenue with film distributors.