We Don't Know For Whom We Are Making Films, Says Tollywood Producer

“We don’t know for whom we are making films these days,” he says on condition of anonymity. “OTT rates have fallen to just 20–30% of their earlier value, leaving us with no proper avenue to recover our investments.”

He explains that producers were initially drawn into the OTT ecosystem by lucrative deals. “Digital platforms once paid ₹50–70 crore per film. Telugu producers entered that space, and platforms gained massive Telugu viewership. But after that, they slashed budgets drastically and introduced new rules, including pay cuts,” he says.

The producer also criticizes the growing trend of linking OTT pricing to theatrical performance. “They are equating theatrical collections with OTT rates, even though the audiences for both are completely different. This is unfair,” he adds.

Another major concern is the payment structure. “Payments are split into four instalments. If a film underperforms in theatres, they skip the last one or two instalments. Producers are left with no voice and are forced to suffer in silence,” he points out.

Reflecting on changing audience behavior, he says, “Earlier, we made films for theatre-going audiences. Now, with new-age viewers skipping cinemas, we don’t even know who we are making films for.”

He notes that only a handful of stars—like Prabhas, Mahesh Babu, Jr NTR, Allu Arjun, Ram Charan, and veterans like Chiranjeevi and Nandamuri Balakrishna—continue to command a steady theatrical market. “What about the rest—producers, directors, and actors who don’t enjoy such footfalls?” he questions.

According to him, the industry has become highly unpredictable. “A film today is either a blockbuster or a complete flop—there’s no middle ground. It has turned into a buyer’s market where producers have little control despite investing everything. Being a producer today is more pain than passion, except for a few big production houses,” he concludes.

Meanwhile, veteran producer C. Kalyan echoes similar concerns, pointing out that major OTT platforms like Netflix, Amazon Prime Video, Disney+ Hotstar, and ZEE5 have slowed down acquisitions of Telugu films.

“It is true that digital giants have reduced their intake of Telugu movies, and this has set alarm bells ringing in the industry. It’s a worrisome situation, and most producers are clueless,” he says. “For star-driven films, digital rights used to cover a major portion of the budget. Now, with reduced OTT spending, we are in dire straits.”

He further raises a critical question about rising remuneration. “During the OTT boom, superstars and directors hiked their pay significantly. Now that digital platforms have cut back, will they reduce their fees to ease the burden on producers?” he asks.

C. Kalyan also highlights how deal structures have changed over time. “Earlier, satellite rights from television channels ensured advance payments once a film was launched. Now, OTT platforms don’t offer such upfront deals. Instead, they impose lengthy agreements with multiple clauses—ranging from expected box office performance to revenue benchmarks—before signing any deal.”