Nigeria's Movie Industry Untapped Goldmine - Report

29 September 2020

The Nigerian film industry is a gold mine waiting to be tapped with piracy identified as one of the major obstacles hindering the sector from realising its potential, a report by the Financial Derivatives Company (FDC) has stated.

The FDC stated this in its latest monthly economic bulletin.

While the report ranked the Nollywood as the world's second-largest movie industry by volume, surpassing Hollywood and coming just short of India's Bollywood, it pointed out that Nollywood does not surpass both the Hollywood and the Bollywood in terms of production quality or return on investments.

According to the report, Nollywood currently produces more than 2,000 movies and TV series each year, most of them in Yoruba, Hausa, Igbo, and English, the most widely spoken languages in Nigeria.

However, the returns on investment are still far below Bollywood.

For instance, while the highest-grossing Nollywood movie, 'The Wedding Party' (2016) made just $1.176 million (N453million), India's Dangal (2016), grossed about $296 million (N113.8billion).

The study also revealed that the production of quality films in Nigeria has been hindered by poor funding.

According to the report, it takes an average of $10,000 to make a Nollywood film compared to Hollywood's average budget range of $70 million to $100 million while a premiere blockbuster could cost between $200 million and $400million.

Similarly, the Bollywood's budgets range between $200,000 and $700,000.

The report revealed that 30 leading global entertainment companies, including big names such as Netflix, HBO, and NBC Universal, in collaboration with the Alliance for Creativity and Entertainment (ACE), are joining forces to stop pirates from stealing Nollywood movies and TV shows.

This alliance would allow the IP holders to pool resources to conduct research and work closely with law enforcement agents to find and stop pirates from tampering with Nigerian movie products.

According to the report, pirated versions of films often appear in circulation just days before their actual release dates, which it stressed undermines profits and the ability for producers to fully pay their cast and crew.

The report stated that one of the ways Nigeria could curtail piracy, even at the risk of limiting its citizens' online freedom, would be by introducing online censorship for piracy sites as India did in 2017 after the Madras High Court ordered approximately 2,650 websites to be blocked nation-wide as an interim measure against the infringement of the copyright of certain films.

The report also stated that "Nollywood should address the issue of distribution by capitalising on its fledgling international recognition. The global powerhouse, Netflix, has set up partnerships with Nigerian production companies, releasing "Lionheart" in 2018 and teaming up with Ebony Life studios to embark on a string of Netflix-branded projects," adding that "more distribution channels need to be established both domestically and abroad in order to attract more viewers and potential investors and to limit piracy."

The FDC also recommended that Nigerian producers and stakeholders should promote Nigeria's domestic streaming services such as Showmax, Filmhouse One, and IrokoTV in order to improve domestic demand.

"The Nigerian movie industry is a potential gold mine waiting to be tapped, and though steps are being taken to unlock this potential, they barely scratch the surface. Nigerians must look towards the advanced film industries, their issues, and how they attempt to solve them and take note of what needs to be done to improve Nollywood," the report said.

The FDC also identified lack of investment, infrastructure, and distribution challenges as among the major factors militating against the growth of the Nollywood, which contributed 2.3 per cent (N239 billion) to Nigeria's GDP in 2016 and caused the PwC to name it as one of the priority sectors in the realisation of the Economic Recovery and Growth Plan (ERGP) of the federal government.

"If Nollywood is to live up to the potential predicted by PwC it needs to look to its big brothers in film, Bollywood, and Hollywood for creative investment solutions, piracy enforcement and innovative distribution that leverages Nigerians' love for a home video through the streaming opportunities available today," it added.

The FDC stated that there are only 68 cinema chains and about 218 screens for the country's 200 million people. These cinemas, according to the report, are almost solely available in the main cities of Lagos, Abuja, Port Harcourt, and Kano.

"It is very rare to experience a vibrant cinema culture in other parts of Nigeria, not because the people in these parts hate films, but because investors do not believe that they will get a high enough return on investment.

"For the cinemas that do exist, they are primarily used to host foreign movies, as domestic movies fail to attract significant audiences. Those perennial problems of quality and piracy continue to haunt Nollywood as it attempts to expand into the international cinema market," the FDC said.

The FDC traced the history of the Nollywood industry as it is known today the release of 'Living in Bondage' in 1992 as the first Nollywood blockbuster that was released straight to video and the first movie to show how lucrative film making directly on video could be.

"The movie's release ushered in the home video boom of the Nigerian film industry, in which many aspiring directors and producers turned to direct-to-video production methods in order to cut costs. While this proved effective in terms of quantity, the quality of most of the films was lacking," the study said.

The study recommended that Nigerian producers should attract investors through corporatisation of film studios, much like how Bollywood studios UTV and Eros, as a sure way of improving budgetary processes as these studios handle the production, distribution, and marketing of their content thus limiting the tendency for directors and producers to exceed their budgets.

The FDC said: "Despite the initial success of movies during the home video era, the low quality quickly left people disillusioned, to the point where many Nigerians refused to support Nollywood. For many people, the inability to produce films on the same caliber as Hollywood blockbusters discouraged them from supporting the movie industry referring to the movies as a 'disgrace to the Nigerian people.'

"Low-quality movies cannot only be attributed to low budgets and rushed productions. Inadequate infrastructure is another problem which plagues many film studios, as they are chronically underfunded, and piracy remains a major concern for home videos."

More From: This Day

Don't Miss

AllAfrica publishes around 900 reports a day from more than 130 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.