In the beginning, celluloid film cinema was the only formal medium for Nigerian filmmakers to make revenue.
Cinema in Nigeria started during colonial times in the 1900s. Though mostly for foreigners rather than indigenous Nigerians.
In 1903, Herbert Macaulay, a Nigerian nationalist and Lagos socialite, invited Mr Balboa of the Balboa film company of Spain to showcase his silent feature films at Glover Memorial Hall in Lagos Island. This is recorded as the first time a movie was screened to audiences in Nigeria. Silent film already gained full maturity in Europe in the 1900s, so European film exhibitors toured the world with their films; it was both a marketing effort and cultural export.
But only certain foreign movies were screened in the cinemas, and cinema-goers consisted of foreigners and elites. This was because the British didn’t want their colonies to be exposed to information that could make them more sensitive to their exploitation.
Eventually, in the years leading up to independence, the masses were also able to watch these films as rules were relaxed. The films shown at the time were mostly documentaries produced by foreigners. One of which was Daylight at Udi, a documentary film on the Igbos in Enugu, which won an Oscar award for Best Documentary Feature in 1950.
Admission fees into the cinemas cost around 1 shilling, equivalent to what £2 can buy in the UK today. Back then, film revenues hinged on ticket sales.
The post World War 2 influx of American films into the country, combined with the relaxation of rules led to a steady rise of cinema houses in Nigeria. History shows that, by Nigeria’s independence in 1960, there were 12 cinemas in Lagos and three in the neighbouring state of Ibadan.
The happenings of the pre-independence era started the development of the film business in Nigeria. After Nigeria gained independence, more indigenous Nigerians got into the celluloid film cinema business, and the industry took off.
The Nigerian cinema business began
While foreigners operated celluloid film cinemas during the colonial times, indigenous theatre practitioners, like Chief Hubert Ogunde, were producing stage plays to entertain the local people in communities.
After independence, Nigerian theatre arts and celluloid film would integrate into the development of the Nigerian film industry. Adaptations of plays for cinema became the core of filmmaking.
One of the earliest Nigerian filmmakers was Ola Balogun, who began celluloid film production in 1969, after returning from film school in France. He partnered with Chief Ogunde in 1979 to direct and co-produce Ogunde’s first celluloid film, Aiye, an adaption of one of his old stage plays.
From the 1970s to the 80s, cinema culture grew into full maturity. The turnover of all cinema houses in Lagos is estimated to be around ₦20 million in 1983 - just under ₦5 billion in today’s currency. Including films like Papa Ajasco making ₦61,000 in three nights (₦14 million in current times). The cinema business was lucrative in the 80s until its decline during the military regime.
Ehizojie Ojesebholo, an actor and filmmaker, explains: “We were yanked out of democracy and thrust into the military rule for quite a good number of years, and as such, security became an issue. Rumour has it that the soldiers would receive information that ‘bad guys’ were meeting at these complexes, and this would lead to a raid on the building. [Appalling] for the audience who just wanted to see a movie and have a good time with family and friends. It was safer to stay at home.”
The economy also suffered between the 80s and 90s. This period weighed heavily on the middle class—an important spending group in the economy. However, two significant events also happened: the rise of TV sets and Video Home Systems (VHS).
Source: Denise Jans via Unsplash
Videos: VHS, VCD, DVD
In the 90s, affordable VHS tapes became a major contributor to the Nigerian film industry. Consumers at home found that with these tapes and a video player, not only could they watch films in the comfort of their homes whenever they wanted, but they could rewind and fast forward too.
It started with foreigners and affluent Nigerians importing movies produced in VHS tapes into the country. But Nigerian filmmakers saw it as an opportunity to adopt these VHS tapes to create local movies as well.
The first of which was Living in Bondage, an Igbo film shot as a straight-to-video movie with English subtitles in 1992. It sold over a million copies, and its success is said to have birthed Nigeria’s prolific film industry, Nollywood.
In the early 2000s, camcorders replaced celluloid and VHS video cameras as recording devices. Hence, VCDs and DVDs replaced VHS tapes.
For filmmakers, producing movies in these formats entailed lower costs as opposed to celluloid film. The production of Nigerian movies on portable formats also generated more demand at home. People could also rent films from traders’ shops at lower prices instead of purchasing them. DVDs sold over 20,000 units, the most successful reaching 200,000.
It was a significant boost for the distribution of Nollywood movies outside of Nigeria as well.
However, piracy was a major hindrance.
To increase profitability, Nollywood filmmakers’ went to the electronics market, like Alaba International Market, the largest in Nigeria, to duplicate their movies into more discs, so as to have more quantities for sale.
But traders exploited this trend, duplicating unapproved copies to sell to consumers at lower prices. The profit from these copies went into their own pockets instead of going to filmmakers.
PayTV: DStv’s Africa Magic
However, it wasn’t until 2003 that it launched its Africa Magic channel for Nollywood movies. It added two flagship channels devoted to showcasing Nigerian films in Hausa and Yoruba in 2010, realising the commercial potential of Nollywood movies and the demand for it in homes. In 2015, it launched an Igbo channel, therefore catering to audiences in Nigeria’s major languages.
As opposed to DVD distribution where filmmakers lost potential profits to piracy, licensing movies to Africa Magic was a safer bet. Filmmakers were also able to secure good screen time.
“When Africa Magic takes your film, they are obligated to show it at least 24 times within a two year period, though it may be more or less” Ehizojie Ojesebholo, director of Jimi Bendel explains.
For consumers, they could watch one movie multiple times and had a wider range of content on one platform - they didn’t have to buy or rent many physical copies. Filmmakers enjoyed revenue through licencing. Today, M-Net’s acquisition of Nigerian movies ranges from ₦2 million to ₦4 million today (although some language movies are acquired for less).
Yet, not everyone had DStv decoders in their homes, especially mass-market consumers; so filmmakers still produced on DVDs in the 2000s.
Source: Michael Rank via Flickr
Online streaming: YouTube, IrokoTV, Netflix
In 2011, after Google launched YouTube in Nigeria, electronic traders from Alaba international market found a new opportunity to strike. They converted their unofficial archive of old Nollywood DVDs to MP3 video formats, exported them to YouTube and made money through advertising revenue.
The same year, IROKOtv launched with a paying subscription. But, free movies on Youtube undermined the value proposition of paying on-demand video streaming; especially for the mass market in Nigeria
IROKOtv had to consider this in its pricing strategy to attract consumers and acquire a market share. They initially targeted the diaspora and a global audience who had more disposable income for online streaming.
Video streaming services provided new opportunities. And with the arrival of companies like Netflix, more revenue.
The return of cinemas
Throughout this journey, cinema never died out as VHS or DVDs have.
After its decline, cinema culture began to rise again in the 2000s when the Silverbird group launched its first cinema in 2004, streaming mostly foreign movies.
“What is unique about Silverbird is that it was the first digital cinema. Most cinemas were designed to screen celluloid films, but Silverbird was the first to digitise their systems. So you could actually screen a movie from DVD or hard drive (today we use DCP) in the cinemas,” Ehizojie explains.
In 2006, Kunle Afolayan’s Irapada was the first Nigerian movie to stream there, his other movie, The Figurine was the second in 2009. These movies marked an introduction into the rejuvenation of the Nigerian film cinema-going culture.
Kunle Afolayan performed a straight-to-cinema release for the first time (again) in Nollywood, instead of releasing on a DVD format first. From then on, more Nigerian filmmakers would do the same for higher budgeted movie productions while others continued to release low-budget movies via DVDs or through Africa Magic.
Growth continued; Ozone Cinemas and Genesis Deluxe cinemas were established in Lagos in 2008. Filmhouse joined in 2012, and more proceeded apace.
This second era of cinemas provided more money-making opportunities. When all taxes and fees have been deducted from the gross earnings at the cinema, a producer can take home about 35% of total sales. This provides a higher earning opportunity than say African Magic licence fees - four Nollywood films made over ₦100 million last year. But of course, not all movies will have the budgets to aim for high box office sales.
Unlike the beginning, when cinema was the main distribution channel, filmmakers now have different opportunities to make revenue. The general trend now is for big-budget films to start at the cinema before using other channels like African Magic and online streaming services.
That could be changing, though. The arrival of Netflix and its higher acquisition fees may start persuading filmmakers to explore going straight to video-on-demand streaming even without a prior cinema release, as we saw with Genevieve Nnaji and Lionheart on Netflix in 2018.
While it’s hard to see cinemas losing their place as primary revenue earners for big movies, online streaming is here and vying to write the next chapter.
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