Are Hindi films struggling due to quick OTT releases? Aamir Khan thinks so

Aamir Khan said the current business model in Hindi cinema was flawed, as filmmakers urged audiences to watch their films in theatres but made them available on OTT within eight weeks if they did not

Bollywood star Aamir Khan has raised concerns over the current trend of releasing films in theatres and then making them available on OTT platforms within weeks. He argues that this is not a viable business model, as theatres have increasingly become a luxury experience rather than a space for regular movie consumption.

 

During a conversation with Aamir, veteran screenwriter and lyricist Javed Akhtar asked, “The [Hindi] films have lost all connectivity with the audience. Dubbed South Indian films, featuring stars who are unknown to audiences here in North India, are releasing and doing ₹600-700 crore business. Even the few of our films that end up working are also directed by people from the South. What happened to our people?”

 

Aamir argued that this is not a North vs South problem. “The problem we are facing is something different,” he said before highlighting a flawed business model in Hindi cinema. “Please come and consume our product. If you don’t, we’ll come and drop it off at your doorstep in eight weeks (through OTT platforms). This is our business model,” he added.

 

How has OTT disrupted the theatrical business?

 

OTT platforms have transformed the theatrical business by offering viewers convenience, cost-effective access, and a personalised viewing experience. Unlike theatres, OTT allows audiences to watch content anytime and anywhere, with the added flexibility of pausing, rewinding, and fast-forwarding. The affordability of subscriptions compared to theatre expenses—including travel and snacks—has also made OTT an attractive alternative.

 

Industry experts argue that OTT platforms have enabled filmmakers to reach global audiences, bypassing traditional distribution barriers. Data-driven content strategies help target niche viewers more effectively, leading to the creation of tailored content. The Covid-19 pandemic accelerated this shift, as theatres shut down and streaming platforms became the primary entertainment channel.

 

Younger audiences, in particular, have adapted to the flexibility of OTT, leading to a shift in traditional viewing habits. However, despite this disruption, the immersive experience of theatres remains unmatched. In response, theatres have focused on offering premium services, such as IMAX and recliner seating, to compete with home entertainment.

 

The VHS disruption in the 1980s and 1990s

 

The Hindi film industry has faced technological disruptions before. The rise of VHS technology in the 1980s and 1990s posed a significant threat to theatres in India. The ability to watch films at home led to a decline in theatre attendance, with video rental stores making movies easily accessible. Piracy also became rampant as VHS tapes were easily copied, impacting revenues.

 

As a response, the industry evolved by introducing multiplexes, offering better seating and sound systems to enhance the viewing experience. Family-centric films such as Qayamat Se Qayamat Tak (1988) and Hum Aapke Hain Kaun (1994) helped bring audiences back to theatres. Marketing strategies also changed, promoting films as special events rather than just entertainment products.

 

India’s economic liberalisation in the early 1990s played a crucial role in reviving the film industry. Increased investment led to a “New Bollywood” era, characterised by improved storytelling and production values. These developments allowed the industry to adapt and regain audience interest despite the disruption caused by VHS technology.

 

Theatres and OTT: A coexisting model

 

While OTT has reshaped the industry, it is unlikely to replace theatres entirely. Instead, both mediums are adapting to coexist. Theatres are enhancing their cinematic experience with immersive technologies and premium amenities, while OTT platforms continue to innovate in content distribution. Some filmmakers still prioritise theatrical releases before moving to streaming platforms, especially for high-budget films such as Sooryavanshi and ’83.

 

During the pandemic, Bollywood saw a surge in direct-to-OTT releases, with major films such as Laxmii and Coolie No. 1 skipping theatres. These films reportedly performed well on streaming platforms, suggesting that they could have been box office successes. However, the shift to OTT was primarily driven by the uncertainty of theatrical openings.

 

Why filmmakers are opting for quick OTT releases

 

Many Indian filmmakers and distributors continue to release films on OTT soon after theatrical runs due to several monetary advantages. OTT provides a secure revenue stream, reducing financial risks associated with theatrical releases. A film reaching OTT after a brief theatrical run benefits from pre-established awareness, minimising marketing expenses.

 

The pandemic also forced commitments to direct-to-digital releases, which some filmmakers are still honouring. Some platforms now prefer films with theatrical releases first, as it demonstrates the producer’s confidence in the content.

 

The hybrid model—where films release in theatres first and then on OTT—has become an ideal strategy. However, with uncertainty around audience turnout, OTT remains a safer bet for many producers.

 

Direct-to-digital: A changing marketplace

 

The pandemic led to a boom in direct-to-digital releases, with OTT platforms offering 80-100 per cent premiums over production costs to secure content. However, with theatres reopening, these premiums have reportedly dropped by 30-40 per cent.

 

Previously, streaming services were willing to pay high prices to acquire ready-made content and drive subscriptions, but the market has since shifted in favour of buyers. The box office has also struggled, with many high-profile films underperforming despite big names attached.

 

Even when films deserve a theatrical release, many struggle to secure sufficient screens or favourable showtimes. Some niche films, such as The Mehta Boys, Monica O My Darling, Do Patti, Sikandar ka Muqaddar, and Plan A Plan B, found more success through direct OTT releases rather than risk losses in cinemas.

 

For smaller films, OTT provides a relatively safe revenue model, but it is becoming harder to secure deals as platforms hesitate to spend heavily on marketing. This has led many OTT players to prefer films that have had a theatrical release first, where streaming deals are finalised after their box office run.

 

How do OTT platforms determine pricing of a movie?

 

OTT platforms consider several factors when deciding how much to pay for a film. Market demand and anticipated popularity play a crucial role in setting the price. Highly awaited films or those featuring top actors tend to fetch higher premiums.

 

Production costs are another major factor, with OTT platforms generally ensuring that producers recover their investment, sometimes offering additional profit margins. Competition between streaming services can drive up prices, especially when multiple platforms bid for exclusive rights.

 

Platforms use different monetisation models, such as flat fees or revenue-sharing agreements, which impact how much producers earn. Some services pay a fixed amount upfront, while others offer a percentage of revenue generated through views.