MUMBAI: The going has not been easy for Hollywood studios in India. Faced with a stubborn loyal market that prefers local products, American studios are finding it difficult to sustain growth. Hollywood accounts for just five to eight per cent of the film revenue pie in India. Fox shut shop earlier this year. However, one way to penetrate the Indian market is to forge tie-ups with local distributors who understand its complexities.

Earlier this year, Miramax forged a tie up with UTV who will distribute its films in the country. Now Paramount Films of India (PFI) a subsidiary of United International Pictures (UIP), which distributes films of Paramount, Universal and Dreamworks, has tied up with four Indian film distributors.

PVR Pictures will distribute PFIs product in Delhi and Gurgaon. Eurasia Visuals will handle UP, Rajasthan and East Punjab. Shravan Shroff's Shringar Films will handle Maharashtra, Gujarat and Central India. Hansa Pictures will handle the Southern states of Tamil Nadu, Andhra Pradesh, Karnataka and Kerala.

PFI will continue to distribute films directly in the metros. The first major product under the new deal is Steven Spielbergs War Of The Worlds. Speaking to Indiantelevision.com on this, Kurt Rider, UIP senior V-P sales and marketing Asia, while not divulging the revenue sharing arrangement details, said, We are very mindful of our costs. India can be perilous in that you can spend too much and not be profitable."

"Over the years we have been able to carefully judge what films work and what dont. This way we have not spent too much on our overheads. Now that we have an alliance with these four players we feel that we can be a bit more aggressive and spend a bit more money. One factor that will help us grow the business is the multiplex boom. This will enable us to bring in a bigger variety of films.

Rider says that paramount is looking at building up long term relationships with its partners. Prior to us deciding on the partners, we had companies approaching us and offering attractive money for a few major titles. However, we do not want to focus too much on the short term profits. We did not do a bidding process. We made our choice based on their willingness to work with us for 52 weeks. These companies have a transparent network, great connections. They are trustworthy and are incredibly hardworking.

While conceding that India is small in terms of revenue, Rider expressed more confidence in India faring as a revenue source for Hollywood compared with China. Of course, nobody is going to be biting their nails about the revenue that comes from India compared to Japan, Taiwan and Korea. Those markets account for 7580 per cent per cent of our revenue in Asia.

Outside the US, our other key markets include Britain and France. However, what is promising about India is that Indians love movies. It is okay that we are not number one. We are not looking to conquer the whole world. However if the cinema outlets grow, then we will also benefit. In Korea, despite being pushed to number two by the local film industry, our revenues have still grown.

Shroff said that Shringar is looking to open an office in Kolkata to handle that market. When that happens
PFI may work with them there. Rider acknowledged the fact that the government has allowed Hollywood to have
a level playing field. There is no government interference and some of the problems that Hollywood is facing in India are also being faced by Bollywood. The biggest one is piracy. He noted the difficulty in checking piracy in Asia at a time when the counterfeit DVD is as good as the genuine product. What we need is more cooperation from the different governments."

"They need to realise that they are also losing out on tax revenue. As far as India is concerned, I would like to see the government strengthen the optical disk law. Digital distribution is the way of the future. Right now though, we do not support E Cinema because the product is not as good as what you get on a 35mm screen. We support the D system.

As far as distribution in other countries in Asia are concerned UIP does it directly. In China it goes through China Film which is a government owned distribution entity. In Philippines, Hong Kong and Indonesia, UIP has agents to manage the business. As far as marketing and promotional activities are concerned Rider noted that the Internet is a key tool in Korea and Japan. It has a tie up with Hitachi in Singapore, China and Japan for "War of The Worlds".