Malayalam film producers up in arms against steep star fees, call indefinite strike from 1 June

The Malayalam film industry had one of its best years in 2024, with gross box-office collection more than doubling to ₹1,165 crore from a year prior, but all’s not well within the fraternity.

The Kerala Film Producers Association has announced an indefinite strike starting 1 June in protest against exorbitant star fee that they say is making movie production unviable. While the association wants star fees and other issues negotiated and resolved for movie-making to proceed unhindered, some producers have claimed that the strike announcement was made without taking all stakeholders into confidence, and would affect the livelihoods of many involved in the cinema ecosystem.

However, industry insiders point out that that it’s not just steep star fees that’s causing stress in the Malayalam film industry. While it is true that actors had raised their fee after a surge in acquisition of movies by OTT platforms, a trend that appears to have weakened now, local body taxation and VPF (virtual print fee) charges have also added to the woes. Thus, many see the announcement as an empty threat, that is unlikely to be actually carried out.

Soaring star fees and OTT impact

Trade experts point out that despite hits like Manjummel Boys, Aavesham, and Premalu, Malayalam film industry, which spent nearly ₹1,000 crore in 2024, made only about ₹300 crore in profits. Box office recoveries are often dented by inflated star fees that eat into producers’ returns, even for successful films.

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“Actor remunerations are definitely going out of hand. Stars have become super expensive because streaming platforms were only buying films on their names. That surge has now died down, but actors feel charging lower fee would mean loss of face for them,” said a senior Malayalam film producer, requesting not to be named. 

The producer added that discrepancies arise from the fact that top stars such as Mohanlal and Mammootty co-produce a few of their own films, in which case, they take a share of profits and sell them to streaming platforms at lower prices. However, when working for external producers, they hike their fees, making recoveries tough. “These strikes are more like empty threats and definitely not the solution. A few producers may shut operations down for a while, as a PR exercise. But the greater need is to start backing films with new faces, which have anyway been successful, as seen with Premalu and other titles,” the producer added.

Veterans like Mohanlal and Mammootty charge ₹15-20 crore per film, while younger stars like Nivin Pauly, Tovino Thomas and Dulquer Salmaan make ₹8-10 crore, which is a 30-40% rise from pre-covid. Streaming platforms saw a precipitous rise during the covid lockdown, when people, confined to their homes, binge-watched content to beat back boredom.

To be sure, entertainment industry experts agree that producers do have a reason to feel disgruntled given how the digital market has collapsed, but actors, including second-rung names, continue to demand high salaries. “The association is powerful, but it can’t impose a shutdown. Individual producers may continue to make films or receive investments from fly-by-night funders,” independent trade analyst Sreedhar Pillai said.

Film producer Yusuf Shaikh pointed out that while artiste costs have hit the roof, it isn’t the only issue plaguing the Malayalam film industry. Producers are also protesting against double taxation in the form of a local body tax levied on cinema tickets in addition to GST that eats into profits.

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Further, the VPF (virtual print fee) issue remains unresolved. Last year, PVR had decided to stop screening Malayalam films after the Kerala Film Producers Association demanded that movies must be released at screens in malls of the state at a low VPF, using content mastered at the PDC (Producers’ Digital Cinema), a facility promoted by the producers. The conflict was later resolved with the chain screening Malayalam films as usual but theatre owners remain firm in their stand on VPF costs being borne by producers and say the expense isn’t high, considering that filmmakers would pay much higher rates in the days of physical prints.

VPF is a cost borne by producers to show their films using digital projectors and technology supplied by digital service providers such as UFO Moviez and Qube Cinemas that theatre chains such as PVR Inox work with. It can cost the film producer up to ₹25,000 per screen.

“Producers are feeling the angst and the announcement of the strike is like a warning to figure these things out and resolve them. If negotiations don’t fall in place, they will go as planned,” Shaikh added.