Anil Ambani-promoted Reliance Entertainment to spend $100 million on Bigflicks venture

30 August 2007

Mumbai: The Anil Ambani-promoted Reliance Entertainment Ltd (REL) is set to synergise the online model of movie rentals largely present in the US and European markets by adding online distribution of entertainment content to its portfolio.

The company has launched an internet property (IP) under its ''Big'' brand, christened www.Bigflicks.com. REL also plans to enter into the offline DVD / VCD rental business, in a model likely to be similar to US DVD rental company Blockbuster, by launching retail stores under the same brand - Bigflicks.

Reliance Entertainment president Rajesh Sawhney has announced that the rental business will commence this September, with the first three outlets under the Bigflicks banner coming up in Hyderabad, Pune, and Chandigarh. The company is looking at a count of 100 outlets by the end of this financial year, and plans to grow it to 500 stores over a three year period.

The average Bigflicks store would be spread over a 400-500 sq ft area, with larger flagship stores measuring upto 1,000 sq ft. The company is looking at a mix of leased and owned stores. According to Kamal Gianchandani, COO, home entertainment, Reliance Entertainment, the company plans to invest $100 million in both the ventures, 75 per cent of which has been earmarked for the offline DVD/VCD rental business.

The company envisages revenues accruing from the online venture, with a significant proportion coming from the rental business. Subscriptions are seen to be the primary revenue driver for the rental business.

Recently, companies like seventymm.com and moviemart.in, along with a few others already operate in the DVD / VCD rental business in the country, which is still dominated by the largely unorganised neighbourhood VCD libraries that function as a left-over from the erstwhile proliferation of Video cassette libraries of the late 1980s.