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How do Movies released on OTT earn money?

Updated: Jun 12, 2022

Starting with Amazon Prime Video entering the Indian market in the year 2014, the beginning of Over The Top(OTT) movie platforms had started in the country. At this date, there are several popular OTT platforms in India like Netflix, Disney plus Hotstar, Zee5, AltBalaji, Voot, and some more.

With the severe impact of COVID 19 and flow of content on streaming platforms, viewers have started accepting the model of OTT platforms for their entertainment. This has made a positive impact on the number of users on the platforms. More and more movies are getting released on OTT platforms and a huge number of them are directly released on these platforms.

Popular movies like Dil Bechara, Gulabo Sitabo, Shershah, Big Bull, and many more are directly released on different OTT platforms. They have received appreciation from the audience but the question remains how these movies make money?!

These movies earn a little differently from movies that are released in theatres. Movies that are released in theatres earn money from the footfalls in different theatres and by distribution of rights to the satellite that helps companies to stream movies on television. On the other hand, moviemakers of movies that are released on OTT platforms sell digital rights of their movie to the OTT platform. These digital rights are provided at a fixed cost irrespective of their success on the OTT platforms.

The fixed amount that movie makers get on the distribution of digital rights is dependent on several factors. Some of these factors are the budget of the film, star cast of the movie, success of the director and star cast in their previous movies, and many more. Both the moviemakers and the OTT platform come together to negotiate on the fixed amount for the streaming rights.

How do Movies released on OTT earn money
How do Movies released on OTT earn money

Movies with small budgets that are directly released on OTT platforms do enjoy a benefit of earning considerable profits. For example, Gulabo Sitaabo movie had an approximate budget of 45 crores and the digital rights of this movie amounted to around 65 crores by Amazon Prime Video. This resulted in a direct profit of 20 crores for the moviemakers.

Also OTT platforms are beneficial for movie makers who want to experiment with their content and don't want to suffer huge losses. Along with this many low budget movies with great content are made available to viewers through OTT platforms. Previously, many low budget movies were not even released in theatres because of insufficient finance.

Most of the movies that are released in theatres are also streamed on these OTT platforms after a short period of time. So such movie makers try to gather profits from both the mediums. For example, RRR and K.G.F chapter 2 had a successful run in theatres and now they are being released on OTT platforms.

It is not guaranteed that a movie released on an OTT platform will definitely earn profit. If a movie with a huge budget and comparatively newer star cast is made, it is possible that their digital rights are sold for a lower cost than their actual budget. This entirely depends on the deal between the movie makers and the OTT platforms.

Conclusively, we can say OTT platforms has been a good choice for movie makers to experience their content as well as earn decent profits through their streaming rights. This has helped them in the period of pandemic and will keep on continuing now as well.

For more such interesting content about movies and TV shows, visit the RecoBee app. Here you can find honest reviews about different movies and TV shows. You can also start discussions about this with your friends.

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