Streaming platforms review budgets for big Bollywood studios as flagship titles flop

With paid subscriptions having hit a ceiling and margins under pressure, streaming platforms had anyway slowed down on commissioning content over the past two years. However, exceptions were often made for web originals backed by Bollywood studios that came with the advantage of popular theatrical movies that they would license.

Experts said with many recent bets not having paid off, streaming companies have realised that caution needs to be extended to mainstream Bollywood collaborators too and the hard negotiations have now started.

“The budget cuts may not be as steep as those for smaller producers, but all platforms have started negotiating harder with big producers too,” said a streaming platform executive on condition of anonymity.

The executive said film studios that would earlier strike output deals for all their streaming originals with one platform have now had to spread their bets with no one service willing to accommodate all titles or pay a premium.

“The medium has been massified and the woke content made by these studios isn’t firing. That said, since these studios also come with a library of theatrical releases with popular stars, they still have some sort of an upper hand,” the executive said.

No free hand

Experts emphasised that earlier, big studios had the advantage of getting large budgets without much resistance, but that free hand is disappearing. Instead of outright budget cuts, platforms are also likely to tie budgets to content performance – meaning studios may have to justify costs with data, audience engagement, and long-term value.

Expensive marketing campaigns might be scaled down, and studios may need to take on more responsibility for promotions.

“We are becoming more cautious with spending… In the past, we often approved large budgets based on a studio’s repute and box office performance but that doesn’t always work for an OTT platform where content performs for a lot longer than two weeks and needs depth in the storyline,” said Ujjwal Mahajan, co-founder of Chaupal, a platform specialising in Punjabi, Haryanvi and Bhojpuri content. “Moving forward, even major studios will need to adapt, focusing on efficiency and measurable impact rather than just big names.”

Sarthak Dasgupta, founder and chief creative officer of The Salt Inc, an independent content and design agency, agreed that big studios can no longer assume that OTT platforms will write blank cheques for their projects.

“We have already seen how some high-profile, big-budget web originals haven’t delivered expected results. We might also see a move towards leaner productions and revenue-sharing models, where studios don’t get paid upfront but earn based on a project’s success. At the end of the day, budgets won’t disappear, but they will be earned, not assumed,” Dasgupta added.

While smaller, independent companies have succeeded on OTT platforms by being more agile, adaptable, and willing to experiment, big Bollywood names have floundered since their traditional audience is different from OTT viewers, who have distinct preferences and viewing habits, according to experts.

Authentic stories

Then, there is the inability to adapt to new formats as OTT platforms require episodic content, which can be challenging for Bollywood filmmakers accustomed to feature films. Over-emphasis on star power rather than focusing on storytelling, writing, and direction, can be another reason.

Kaushik Das, founder and CEO of AAONXT, a platform specialising in Odia content, said many mainstream studios and faces initially approached OTTs with a theatrical mindset—star-driven rather than story-driven. However, the success of independent creators and regional content proves that audiences prioritise fresh narratives and authentic storytelling over big names.

“The cautious approach of Indian streaming platforms towards budgets will definitely impact big-name web originals as well. With many mainstream film studios and makers producing flops, the platforms are reevaluating their spending habits. There is also a growing emphasis on regional content, which has significantly lowered the production costs compared to Bollywood productions,” said Rajat Agrawal, chief operating officer, Ultra Media & Entertainment Group.