In recent years, OTT platforms have become a major revenue stream for big-budget films.
In fact, several high-profile projects have been able to recover a significant portion of their production costs even before their theatrical release, particularly when they feature star-studded combinations of actors and directors.
A prime example is Pushpa 2, which reportedly secured a record-breaking OTT deal, making headlines across the Indian film industry.
However, the tide appears to be turning. Streaming giants are becoming increasingly cautious and have begun renegotiating deals, especially when films underperform at the box office.
A recent case in point is Thug Life, starring Kamal Haasan and directed by Mani Ratnam. Released earlier this month, the film was a major theatrical disappointment.
In response, Netflix is reportedly renegotiating its post-theatrical streaming rights, slashing nearly 30% off the originally agreed amount.
If confirmed, this would deal a significant financial blow to Kamal Haasan and Mani Ratnam, who co-produced the film.
This development could have ripple effects in Tollywood, where producers have so far enjoyed some of the most lucrative OTT deals in the country — often outperforming their Bollywood and Kollywood counterparts in streaming revenue.
If Thug Life becomes a benchmark for future renegotiations, Telugu producers may face tougher terms going forward.