Has Salman’s Race 3 really made 100cr before release? Satellite rights can make it happen

The throng at the box office on Friday is still the litmus test for a film’s commercial success, but these days, satellite rights have begun to play an equally big role in the world of cinema.

The latest rumour is that actor Salman Khan’s new film, Race 3, made on a budget of about Rs 120 crore, has already sold its satellite rights for a massive Rs 100 crore*. That’s nearly 85% of the money recovered even before the film’s release. In recent times, Akshay Kumar’s film Pad Man, made on a budget of about Rs 20 crore, as per trade figures, sold the satellite rights for Rs 40 crore*, making a 100% profit independent of ticket sales. (*As per industry estimates)

Explaining how the deal works, Bollywood trade expert Atul Mohan says, “Satellite rights mean that a film can be played across any channel that has acquired the rights of the film by paying for it. That channel can also share it with other channels, if it wants. Nowadays, channels have their own online streaming platforms as well, like Hotstar and Voot, from where the content can be monetised.” This, therefore, includes each and every film that we watch on television.

Pecking order for deals

Trade experts and filmmakers unanimously agree that when it comes to big stars like the Khans — Shah Rukh, Aamir and Salman — and Akshay Kumar and Ajay Devgn, satellite rights could be sold for a very high price on their name alone.

While declining to comment on the rumoured figure, Race 3 producer Ramesh Taurani says, “Big-budget films like Race 3 need to sell off the (satellite and digital) rights at a high cost in order to enter the safe zone.”

Prernaa Arora, co-producer of Pad Man, says, “The price (of the satellite rights) is decided on the basis of an actor’s value (commercially). Also, the price goes from high to low according to this list: at the top is a film that’s a part of a franchise; comedy is at number two; family films are at number three. Films starring A-listers have huge recovery at the box-office.”

Arora adds that a film’s budget is no indicator of how much it can command in satellite rights. “A producer can ask for a price that’s higher than the budget of the film,” she says, further explaining, “I have a huge number riding on Shahid Kapoor, who stars in my film Batti Gul Meter Chalu, as he’s satellite-friendly. There are also director-actor combinations sometimes that get a high value.”

No fees for top stars!

Among stars at the very peak of Mt Bollywood, the norm is not to charge any fees for doing a film now; instead, they take a percentage of the profits. Trade expert Komal Nahta says, “The price of satellite rights, in the case of big-budget films, is usually decided after their release. If a film producer asks for a huge price (before release), and a channel isn’t willing to pay, then they put in these clauses — if the film earns Rs 100 or Rs 150 crore, the filmmakers will be paid this amount; if it collects Rs 200 crore, then this amount; and so on. Many big actors don’t charge any fees. Their fee is the (share of) satellite rights and profit-sharing.”

Race 3 is an exception to the thumb rule of selling the rights after release, because Salman has reportedly struck an exceptional deal. Reports are doing the rounds that he has sold the rights of his next four films to a GEC (general entertainment channel) for Rs 400 crore — that’s a cool hundred crore per movie.

What’s left for producers?

In such a scenario, where top actors take away a chunk of the box-office profits and even the satellite rights profits, what’s left for the producer?

Nahta says, “These days, it’s the stars who are making money, especially the top stars. Films are made for these stars and technicians to make money. Unless you’re a Karan Johar or an Aditya Chopra, you don’t make much money; you just have to be happy that you made a film with a big actor, and be left with very little money. Of course, the negative of the film belongs to the producer, in partnership with the star.”

Mohan further explains how this advanced selling of satellite rights works for the actors. The analyst says, “Let’s say, Salman Khan has sold off a handful of films to a channel, which doesn’t know which films he’ll do. But they know that he’ll ensure that he does good movies, because his reputation is at stake. After that, if I’m a producer and I go to Salman with a film script, I won’t get a single penny from the satellite rights. I’ll have to earn from theatrical, overseas, and music rights.”

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