HERE'S HOW WE ARE GOING WRONG IN BOX OFFICE BATTLES

The debate over Box office is never ending in Bollywood with no proper structure and a single authentic source to track the earnings of a movie. At best, one can follow many of the trade sites and arrive at a logical conclusion. But even with the analysis that we get from media and trade, there are so many loopholes at a logical level. Here's How:

Typically, most trade sites calculate earnings of a movie by adding Theatrical revenue and then the ancillary revenues like Satellite rights/DVD/Music. But this is where they go terribly wrong. They forget that ancillary revenues go to producers while the theatrical revenue goes to distributors. The theatrical revenue is 50-55% of nett collection of movies which is the distributor share . Producers recover their investment by selling the theatrical rights of the film to distributors and selling satellite rights and music rights to TV channels and Audio companies. So how can satellite rights/music/dvd be added to theatrical distributor share?

So here are the figures that are important for deciding a movie verdict:

1) Cost of buying  theatrical rights by distributors All India

2) Theatrical share to distributors

If 2>1 , the movie is in profit and a success