THE FORMAL-INFORMAL BALANCE

India’s Film Industry

Industry Statistics (2009-2010)

13 screens per million people3 billion theatrical admissions annually

FICCI-KPMG Indian Media & Entertainment Industry Report (2011)

India’s Linguistic Landscape

23 official languages and 1,652 dialects spokenRegional industries as strong as BollywoodAlso a big market for English Language Films

Core Creative Content

Film include music Film DVD / Music CD Outlets (Cinema / TV / Radio / Internet / Mobile)Markets (Retail outlets / Informal markets / Online)

Informal Economy

80–90% of Indian workforce informally employed #

“The ordinariness and ubiquity of piracy in the contemporary Indian media landscape have been vectors not only of “consumption” in a narrow sense but also of cultural participation, education, and innovation for a wide range of Indian publics.” (SSRC, 2011)

# National Commission for Enterprise in the Unorganized Sector – India (2009)

SSRC - Social Science Research Council (Report titled Media Piracy in Emerging Economies )

Challenges

Physical Piracy (Informal markets)Online Piracy (Peer-to-peer networks)Local TV channels – suburbs (Licensing issues)

Responses

Lowering of retail prices of CDs/DVDsOnline retailDirect-to-home TV modelsPrice controls in cinema admissionsStricter policing in the first weeks of release

(markets)Anti-piracy service providers (online)

Co-evolution (Early 1990s)

Gulshan Kumar (Super Cassette Industries)

A nationwide distribution network operating in the informal economy where local wholesalers and pavement traders flooded the country with cheaply produced cassettes

Buyback schemes to reduce risks to its retailers, Dropped the prices within the reach of the massesPenetrated even the smallest towns

Research Hypothesis

Will the booming middle classes act as catalysts for a prospective transformation of informal markets towards more formal ones?

OR

Is this an opportunity for the formal market players to get down the value chain and compete for a big slice of the informal markets?