Indian Government Regulates OTT Platforms

The latest Media and Entertainment Outlook 2020 report by PwC states India is currently the world’s fastest growing OTT market, and is positioned to become the world’s sixth-largest by 2024. This means India is likely to overtake South Korea, Germany, and Australia in OTT revenue. Sizable investments by Netflix, Amazon, Disney+ Hotstar and other players in both originals and licensed content is expected to make up 93% of total OTT revenue.

This is good news in terms of consumer choices. It also means that with the increased flow of content, the supply chain starting from content production to content release needs to be robust enough to keep pace in the country. Therefore, the recent move by the Indian Government to regulate OTT platforms under the Information & Broadcasting (I&B) ministry may create some roadblocks in India’s OTT landscape.

India has resisted regulation of the OTT space and no laws or rules exist regulating OTT platforms. It is a relatively new medium of entertainment, classified as digital media. Unlike traditional media such as television, films, print or radio, which follow government guidelines under the direction of various regulatory bodies, OTT enjoys a free run. However, there have been frequent calls for censorship of online content by various political groups and social organizations. Shows like Netflix’s “Leila” and “Sacred Games” have invited the ire of certain groups leading to court cases asking for bans or regulation of streaming content. As a pre-emptive measure, in January 2019, nine streaming services in India announced a self-regulation code under the aegis of the Internet and Mobile Association of India (IAMAI). The code settled on some “best practices” to avoid government-led censorship. However, the government indicated that this might not be enough and started holding consultations on the subject.

Consequently, in February 2020, the IAMAI drafted a new code. At the Government’s insistence, a Digital Content Complaints Committee was created to serve as an appeals body that can penalize OTT players. This did not sit well with some of the OTT services indicating lack of consensus and adequate consultation within the IAMAI. In September 2020, the organization prepared a third version of the self-regulatory code. Signatories include 15 international and local platforms on board viz. Netflix, Amazon Prime Video, Disney+ Hotstar, ALTBalaji, ZEE5, Arre, Discovery+, Eros Now, Flickstree, Hoichoi, Hungama, MX Player, Shemaroo, VOOT, Jio Cinema, SonyLIV and Lionsgate Play.

The ministry of information and broadcasting asked IAMAI to consider other self-regulatory models since the government does not support the current one. The letter stated “The proposed self-regulatory mechanism lacks independent third-party monitoring, does not have a well-defined Code of Ethics, does not clearly enunciate prohibited content, and at the second and third-tier level there is an issue of conflict of interest.”

In a far-reaching move, a gazette notification issued Nov. 11 and signed by the president of India, online films, digital news, and current affairs content were brought under the purview of the Government’s I&B Ministry. With the government’s decision to regulate online content providers, the challenge for the OTT platforms would be keeping a check on their content. It is also likely that they would have to apply for certification and approval of the content before streaming. This could give rise to many conflicts as most OTT platforms showcase content that would otherwise be censored by the certification boards in India.

No specific guidelines have been announced as yet, but it is known that the Programme Code governing TV content and which found an outlet in the Cable Television Network Regulation Act, 1995, may serve as a template to frame rules for online content. So, while the industry waits for more regulatory guidelines from the I&B ministry, OTT platforms are likely to resist any plans to censor content being streamed in India citing infringement of creative freedom.

The Mulan Controversy

Disney’s new film “Mulan” has become a worldwide sensation, but not for the reasons one might think. The live-action film has generated an unusual amount of political debate. “Mulan,” directed by Niki Caro, is Disney’s remake of its 1998 animated film, based on the classic Chinese ballad. Due to the pandemic, the studio released the film on its streaming service Disney+, with plans to screen the film theatrically in countries where cinemas are open.

After keeping quiet calls to boycott the film dominated social media, top Disney brass admitted that a string of controversies created issues for the studio. During a virtual conference, chief financial officer Christine McCarthy discussed the challenges faced by Disney before and after the release of the film.

How does an innocent remake of an animated classic explode into a social media nightmare for a studio specializing in family fare? In this case, several things went wrong for Disney.

The Hong Kong Protests Controversy

In February 2019, China introduced a contentious extradition bill which allowed criminals to be transferred freely between Hong Kong, Taiwan, Macau and mainland China. Critics feared that the bill would be exploited to allow Hong Kong to send criminal suspects to mainland China. The people of Hong Kong saw it as one more attempt by the Chinese Communist Party to encroach on its freedom. Citizens protested strongly and the anti-extradition bill movement evolved into a pro-democracy movement. In retaliation, the Hong Kong Police used aggressive force to discourage protesters which increased the divide between the Hong Kong police and citizens.

Amid the protests, notable Chinese figures such as Jackie Chan and Liu Yifei, among others, voiced their support for both the Chinese government and the Hong Kong police. Liu, a naturalized American citizen, is the lead character who plays Mulan. She shared a meme which was construed as support for the Hong Kong police. It did not take long for the post to circulate and spark backlash from pro-democracy supporters. With that, the call began for a boycott of “Mulan” and #BoycottMulan started to trend in several countries. The second problem for “Mulan” is its filming location.

The Uighur Dispute

It appears parts of “Mulan” were filmed in Xinjiang, China, two years ago. Viewers noticed this in the credits when Disney thanked eight government bodies in Xinjiang, a western province in China where around 2 million Uighur Muslims have been allegedly forced into concentration camps by the Chinese government. The film credits specifically praise the police security bureau in Turpan, a city in eastern Xinjiang with a large Uighur population. Experts say that bureau is tasked with running some of the internment camps and was blacklisted last year by the U.S. Commerce Department.

The outcry over the filming location now includes U.S. lawmakers. Politicians from both parties have already criticized China over a range of issues in the run-up to the November 2020 elections. American politicians fired off vehement missives against Disney. Representative Mike Gallagher, Republican of Wisconsin, tweeted that “while the CCP is committing crimes against humanity in Xinjiang, @Disney thanked four of the propaganda departments that are lying to the world about these crimes. It also thanked the Turpan Public Security Bureau, which is on the entity list for its role in these atrocities.”

Reactions Against Direct to Streaming Release

Even in Europe, the strife doggedly follows “Mulan.” The news that Disney would bypass cinemas by premiering “Mulan” directly onto Disney+ provoked a furious backlash from international exhibitors who felt the studio was declining support in times of need. In France, Gerard Lemoine, a frustrated theater owner, displayed his anger with Disney’s decision in an extreme fashion. Lemoine, who owns the French indie venue Cinepal in Palaiseau, posted a video of him destroying “Mulan” pop-up art via Twitter. Lemoine’s video has over 328K views and the post received a substantial amount of replies.

Cultural Dissonance

Though Disney did its best to create a film that that would appeal to China, many Chinese viewers rejected the film as offensively inauthentic. “The Americans invited all the famous Chinese actors they could think of and piled together all the Chinese elements that they could find to create this car crash,” reads one of the most popular reviews. “It’s full of Western stereotypes and conjectures about China, and particularly ancient China.”

Many viewers in China felt that Disney’s new heroine starts out from childhood already equipped with superhero-like abilities, thanks to her extraordinary reserves of “qi.” While Chinese viewers are familiar with the concept of “qi,” they are puzzled by Disney’s take on the vital energy traditionally considered to underlie the practice of Chinese medicine and martial arts, asking: “What exactly is ‘qi’ here?”- hinting that concepts were applied without any real understanding of the cultural roots.

“Mulan,” much like “Crazy Rich Asians” was initially celebrated in the West for being a landmark for Asian American representation, due to its all-Asian cast. Yet many of the elements included to boost its cultural resonance have not succeeded in appealing to its target mainland audience.

One viewer wrote that the script’s constant repetition of the terms “loyal, brave and true” felt like “a Google Translate take on Chinese.” In one scene, Mulan throws away all her protective armor in the middle of a battle. To the ethnic audience, the choice is obviously nonsensical, but it is also highly unfilial, since the garb is a treasured heirloom from her father.

Chinese audience members are familiar with the original ballad in its classical Chinese. They intimately know final lines — an allegory for gender equality that male and female rabbits look identical when running side by side. Numerous respondents laughed at how the film presents this by having the young heroine spot two rabbits in a field and commenting on how she could not determine their gender, calling the moment one of “forced East-West fusion.”

Once again, “Mulan” clearly demonstrates Hollywood’s lack of detail and accuracy in its attempt to bridge the cultural gap between the East and the West.

Disney’s chief financial officer Christine McCarthy said, in her statement addressing the criticism, “Let me just put something into context. The real facts are that “Mulan” was primarily shot — almost entirely — in New Zealand.” She continued, “In an effort to accurately depict some of the unique landscape and geography of the country of China for this period drama, we filmed scenery in 20 different locations in China.” McCarthy then explained, “It’s common knowledge that to film in China, you have to be granted permission. That permission comes from the central government. So, in our credits, it recognized both China and locations in New Zealand. I would just leave it at that, but it has generated a lot of issues for us.”

Authorities in China recently ordered media outlets not to cover “Mulan’s” release in China. While no official reason is given, reports conclude the international backlash relating to Xinjiang is likely the major cause.

HBO Max Removes “Gone with the Wind”

HBO Max, the newest incarnation of the channel’s popular streaming platform, has removed “Gone with the Wind” (1939). This, the company claims, is because it portrays “ethnic and racial prejudices” that “were wrong then and are wrong today.” The film, based on the Margaret Mitchell novel set during the American Civil War, is about a slave-owning family who retain the loyalty of their slaves after the war has ended and slaves are freed. It was first released to streaming in March 2020.

“The movie had the very best talents in Hollywood at that time working together to sentimentalize a history that never was,” said John Ridley, the Oscar-winning screenwriter of “12 Years A Slave.”

Hatti McDaniel, who played Mammy in the film, was the first black actress to be nominated for and win an Academy Award for her role. The movie won 10 Oscars and was one of the highest grossing films of its time.

But does that make it a staple of American filmmaking, or is it time to take a long, hard look at what is allowed on streaming platforms? “Gone with the Wind” stands high on the Rotten Tomatoes scale at 91%, and has a G rating. This means it has been deemed acceptable for audiences of any age. By removing it from their streaming platform, HBO Max is not only calling out a film that “glorifies the antebellum south,” but is raising an important question about how films are rated.

In his Los Angeles Times op-ed, John Ridley asserts, “I would just ask, after a respectful amount of time has passed that the film be re-introduced to the HBO Max platform along with other films that give a more broad-based and complete picture of what slavery and the Confederacy truly were.”

“At a moment when we are all considering what more we can do to fight bigotry and intolerance, I ask all content providers review their libraries and make a good-faith effort to separate programming that might be lacking in its representation from that which is blatant in its demonization.”

Some have strongly protested HBO’s actions and proclaimed their support for the film by propelling its DVD edition to the top spot on the Amazon’s online sales charts. Megan McCain, TV host, expressed shock and dismay at HBO’s decision, tweeting, “Are we going to pull all of the movies in which women are treated as sex objects too? Guess how many films we’ll have left? Where does this end??”

According to Forbes, “Gone with the Wind” is not retired from HBO Max forever, but instead “temporarily removed…with the intent on returning it alongside contextual content.” The film is expected to return to the streaming service at a future date with an introduction from Jacqueline Stewart, a Turner Classic Movies host and professor in the Department of Cinema and Media Studies at the University of Chicago.

STX Entertainment Merges with India’s Largest Film Studio

STX Entertainment is merging with Eros International, India’s largest film studio, after a “trying year,” according to Variety, and will henceforth be known as the Eros STX Global Corporation. In 2019 viewers saw some midbudget films from STX, including “Hustlers” and “Ugly Dolls.” The merger with Eros International will bring both studios into a higher financial bracket, currently slated around $300 million for future revenue.

What This Means

Merger specifics include a “stock-for-stock” and publicly traded, independent content. Eros STX Global is currently set to remain on the New York Stock Exchange, according to Yahoo Finance and will maintain offices in Mumbai and Burbank. The newly consolidated company will also have a new distribution presence in the United States, India and China.

As new content is created, existing partnerships with NBCUniversal, Google, Apple, YouTube, Amazon and Microsoft will expand. Eros STX Global Corporation 2020 slate consists of 40 feature films and over 100 hours of original episodic content.

Company Expansion

New team members are excited. Robert Simonds, the new Co-Chairman and chief executive officer, spoke with Variety about the now vast resources the companies have brought to the table.

“Together we will have the relationships, management expertise and resources to create new content and grow rapidly in the largest and most attractive global markets,” said Simonds. “On Day One, we will have the ability to tap into our significant combined libraries and draw upon our deep relationships with A-list actors, directors and producers across the globe to create even more compelling content for millions of consumers.”

As a combined entity, the company is excited about creating new opportunities in China. Although STX has had limited success in China, Eros aims to bridge that gap. Eros has a good track record in distributing successful Indian films in China. Eros India CEO Pradeep Dwivedi explains that “Asian sensibilities of movies are very different from American sensibilities. There is a certain understanding of the cultural ethos of China that we believe we can work with much better compared to STX.”

Content Expansion

Taking a cue from the ongoing success of super-hero films, the company is also keen on building franchises based on stories from Indian mythology, eliminating the socio-religious aspects and adapting them for universal appeal much like the DC and Marvel models.

While STX’s recent film releases have garnered some attention, this union with Eros will serve to strengthen their viewership. Eros Now, a popular streaming platform, brings in roughly 188 million registered users around the globe. This association will increase that market share.

The existing Eros Now platform deals with Indian content, it plans to soon launch a standalone English-language subscription based offering. In March, Eros announced that it had signed NBCUniversal to join this tier. STX content will follow.

Eros also has a new technology deal with Microsoft. As part of the tie-up, Microsoft will build an online video platform for Eros using Azure technology, which will offer interactive voice search features in multiple Indian regional languages. It will also create an AI-powered platform that will enable high-speed subtitling and translations of Hollywood content. This will be available to customers in price-sensitive mass markets like middle India, Africa, Latin America and migrant workers in the Middle East.

Eros STX Global Corporation plans to complete the merger by the end of second quarter, 2020.

Concerns About Content on Streaming Platforms

OTT platforms are steadily expanding their international presence. Content providers want to be relevant in local markets by connecting with audiences through content that is culturally relatable. Platforms want to engage consumers to not only passively watch the content but also to share, comment and debate. However, it seems in their quest to provide cutting edge entertainment to customers, OTT platforms in India are ruffling some feathers on the wrong side of the political spectrum.

When it comes to the official government stance, Indian Ministry of Information and Broadcasting has adopted a more cautious approach. Ministry officials are exploring ways to address the issue by inviting suggestions from industry stakeholders. While it is no secret that the current Indian government has strong nationalistic ideologies, so far it has kept a hands-off policy on OTT and refrained from regulating the industry. However, pressure from influential groups could see this change.

Some political organizations want to block content critical of the Indian standpoint on Kashmir or defamatory to Hindu symbols and the Indian Army. One of the shows criticized is “Leila,” which is set in a dystopian future where Hindu nationalism takes over in India. The series has received disapproval from some quarters for showing Hinduism in a negative light. The popular Emmy nominated series “Sacred Games” is also accused of focusing on violence shown as the result of pro-Hindu sentiments.

For decades Indian broadcast and theatrical content has been censored. OTT streaming services are capitalizing on the freedom they enjoy outside the established regulatory codes by bringing content that is edgy and politically relevant to audiences. On the other hand, many think streaming content producers are taking far too many creative liberties in the absence of regulation.

It is possible a middle ground exists where viewers happily screen relevant creative content that maintains local sensibilities. Non-native content providers are not necessarily the best judge of local preferences and neither are governmental agencies always liberal. Finding a happy medium requires respectful discussion between industry stakeholders and regulators. For now, it appears India is following the democratic process of engagement between government and industry to identify collaborative solutions for the functioning of the OTT industry and this seems to be a step in the right direction.