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The twist is, it happened for real early this week when Reliance Big Entertainment, the integrated media and entertainment arm of the US$75 billion-revenue Anil Dhirubhai Ambani Group -- owned by the sixth richest man in the world with a net worth of $40 billion -- said that it had entered into a slew of development deals with eight Hollywood-based production houses to make “at least” 10 films in the next two years at a cost of $1 billion.
These Hollywood production houses belong to leading Hollywood actors, including George Clooney’s Smokehouse Productions, Nicholas Cage’s Saturn Productions, Tom Hanks’ Playtone Productions, Brad Pitt’s B Entertainment, Chris Columbus’1492 Pictures, Jim Carrey’s JC 23 Entertainment, and Jay Roach’s Everyman Pictures.
“Each of the eight deals is an individual development silo,” said Amit Khanna, the RBE chairman, while breaking this news at the Cannes Film Festival. “Between the eight studios, a total of 30 scripts will be generated, of which we are confident of 10 scripts going into production. The structure for each script will be different in terms of the financial model.”
RBE sees these deals as its first major investment in Hollywood and its emergence as a new generation media company that will fully integrate moviemaking through production, distribution and exhibition.
Indeed, for the Hindi film industry -- popularly known as Bollywood -- that churns out the largest number of films a year this is a giant step. Not that these deals are Bollywood’s first tryst with Hollywood; over the past three years Bollywood has made several forays into Hollywood.
For instance, News Corporation, the third largest media company in the world, collaborated with Indian TV producer UTV Software to make “The Happening,” a thriller directed by Hollywood director of Indian origin M. Night Shyamalan. UTV is also producing movies with Will Smith, Hollywood’s famous singer, actor and producer all rolled into one.
Besides, PVR Cinemas, a corporate movie-hall operator, has recently acquired 250 theatres with 1,000 screens in the United States, while another local film distribution company, Shemaroo, has just set up hubs in the United States to beef up its content delivery for the non-resident Indian population.
And, just a day after RBE announced its deals, India’s Eros International said that it too is teaming up with the U.S. company Lionsgate to distribute Lionsgate content in all of South Asia.
Similarly, India has been the focus area for Hollywood too lately.
For instance, one year back Sony Pictures announced that it considered India as one of its top 15 markets and promised to commit an undeclared but “significant” amount of investment in this country.
In February this year, the maverick financier George Soros pumped in $100 million for a 3 percent stake in RBE parent Reliance Entertainment. And a few weeks later Walt Disney, the second-largest U.S. media company, created quite a bit of a stir when it picked up a controlling stake in UTV for $371 million.
However, the RBE deals are significant in that they represent the biggest entry into the Western media market by a Bollywood production house, as well as by marking a reversal to the flood of money that Hollywood has been pouring into the Indian movie industry.
For that matter, these deals may be equally significant for Hollywood, which according to reports is facing a potential funding crunch in the wake of the global credit crisis.
“For the first time ever we are trying to create a business model which we believe is tuned not only for the 21st century world but also for 21st century Hollywood,” said Khanna. "We have devised this method of investing, whereby Reliance can help advance the goals of several of the most important creators in the global industry.”
According to industry analysts, equity financing has dried up for many American studios that are now scouting for new funding sources in the aftermath of the global economic crisis.
Nevertheless, although Khanna says that RBE is looking at 100 film scripts that may “open doors for Indian directors to work in Hollywood,” the question is, given the sort of content Bollywood makes, can it really create international blockbusters?
After all, Bollywood content is unique in its own way and rarely finds favor outside Indian audiences. Typically a Bollywood movie is three hours long -- compared to one and a half hours for a Hollywood film -- and is always full of music, dance, drama and even melodrama. Hollywood movies on the other hand are usually more sleekly made, technically superior, and have a far wider global reach, which is evident from the fact that it grosses multiple times Bollywood’s revenues with a far lower number of movies. While Bollywood with its 1,000 movies a year grosses at best $4 billion in revenues, estimates suggest that Hollywood makes $85 billion a year with 600 movies.
Still “we aim to make films differently,” says Rajesh Sawhney, president of RBE. He added that instead of putting Bollywood films in Hollywood, RBE will produce content across genres concentrating on big-budget, live-action movies that will appeal to the global audience.
Moreover, feels Khanna, RBE has made this move at the right time. "India is the world's fourth largest economy and growing very fast, and we're the biggest filmmaking country. We have also put in place systems and processes comparable with the best in the world,” he said.
