By Princewill Ekwujuru
The Chief Executive Officer of HiTV, Mr. Toyin Subair has disclosed that fund and infrastructure have been the militating factors against the growth of the nation’s entertainment industry, whilst declaring that players in the field should begin to think along the line of infrastructure development.
Subair named the reluctance of banks and other financial institutions in giving loans to practitioners as the reason for lack of infrastructure in the sector. According to him, “In a country where the interest rates rove between 18 and 22 per cent, how many new businesses can start off on 180 days circle without the businesses dying midway because they are funded wrongly? When 80 per cent of the money needed to fund the business is debt and only 20 per cent is equity, you kill the business; it should be the other way round.
Today, many of us set up businesses because our uncles, and friends will put some money in it, since there is no institution that will invest in the business and give it a bit of equity. Looking at it strictly from the banks’ perspective, we go to them to use debt to fund what we should ordinarily use equity to do. So you put them in the driving seat.
Thus, they are giving you debt at huge fees on short-term, when the business really needs long-term equity. What do they do when they give you that money? They know that you are not going to last; they take the money from your account and they now leave you to begin working for them with huge debt and this kills businesses. And once you are paying the debt, the investment to grow the business you should use the money for, you will not be able to do that. You will not be able to enter a growth stage anymore; you enter a repayment stage, when you should invest in things that are growth in nature.”
He continued: “If we are in an industry where the only people you can attract are the artistes, who have no managerial, financial, legal and marketing expertise and you have to face a banking industry that is still razor type sharp, and you fall into the hands of those that give you money like money lenders (and for money lenders, it is short-term), they want their money back and you cannot do anything with it. And you begin to reduce element of investment, which is the real productivity; instead you are using it to repay debt to do film or album.”
Eighty per cent of monies according to Subair, should be directed into infrastructure and businesses that are based on infrastructure. “The good thing about equity is that when you put in money, you can determine management as opposed to debt. With equity, you can say you must get a Chief Financial Officer, Chief Marketing Officer, and some other officers. Therefore, you are insisting on a level of management. So the money must be intelligently used for businesses to avoid people taking it to buy houses, cars or build houses.
The money should be for developing infrastructure in the different sectors of the entertainment industry. From those that do stage prop, lighting, everything to stage a film properly. You give them so that when they start doing shows, those shots will look cool and people want to watch and pay for it. You want to invest in companies that are really doing that and need that kind of infrastructure. If the Nigerian film industry releases a film today, we have just about ten cinemas. In India, they have 2,500. If an Indian film comes out today, it is showed in cinemas, and piracy cannot disturb it. A film is supposed to go to cinema first before video, then television.
Ordinarily, Nigeria should have a minimum of 500 cinemas, proper, multiplexing cinemas, where you have two-case cinemas, restaurants and shops. We need that kind of infrastructure. Imagine the Mammoud Ali Balogun film or Dagrin film that just came out. I saw the number of people that came out of the cinema hall. You can imagine if those films were showed in 100 cinemas over the weekend. Maybe 20 around Lagos, 10 in Port-Harcourt, five in Enugu, three in Ilorin, five in Ibadan and Oyo area, and people go out in these areas to watch these films. You should begin to calculate how much money will come back on the first week for the Dagrin movie.”
The Nigerian movie industry has never had the opportunity to express itself through cinema because of lack of infrastructure, the HiTV boss submitted.