Lollywood Movie Industry

PESTEL analysis of Lollywood:

Pakistan Film industry is reviving its lost status, an industry which has had a glorious era during
the 1960s and 1970s. But faced a huge downturn in terms of quality movies and stories, the
time when it struggled to produce one good movie a year. Now gone are the days as the industry
slowly stands on its feet making quality products and masterpieces. With progress many factors
are affecting its growth, prosperity and creativity. The PESTEL analysis will show how does it
affect the industry and what will be its contribution to the industry in terms of progression and
profitability.
Political Factors:
Unfortunately our film industry is hardly even realized as industry. During the election 2013, no
political party had included Lollywood in their manifestos. PTI claimed to make naya Pakistan
but did not claim to give formal status to the industry. ANP, however mentioned in its manifestos
to promote cultural and artistic festivals but stated no policies for the industry. And this will go
the same in the next election.
This suggests that no party is interested in shaping up the industry. The industry is trying to
revive but still it will need government and political support. Alone it will not make up the
journey. The government must provide better infrastructure, tax concession, establishment of art
academies and state of the art studios. It spends billions of rupees on laptop schemes and projects
but has not allocated a separate budget for the film industry.
In addition, the industry is not given the required leverage to depict our culture in an actual way.
A film is said to be a masterpiece when it depicts realities of a society. Unfortunately, when film
makers make such movies, they are banned by the government. A recent example is Maalik
movie. The film has shown how in Pakistan special forces provide support to corrupt feudal and
politicians. It has got severe censor from the social media and government officials and has been
banned by the ministry of information in all Pakistan. This shows civil-military power in the
country. If such movies are banned it will hamper creativity and the cinema will struggle.
Lollywood has great potential to grow but that can only be possible if our government plays a
positive role in supporting the industry and the filmmakers.
Economic Factors:
High interest rate is one major factor in the country that affect predominantly the film makers not
the audience. Film producers are ready to take up the challenge to make high budget movies but
limited resources stifle their production. They can produce high quality products if they acquire
credit at lower interest rate. Most of the credit institutions are reluctant to lend because of
uncertainty of success of products in the market. Banks need to trust film makers and must
extend their financial support to producers to make high budget movies.

Another factor is the lower income of the lower class. People who belong to the lower class
cannot afford to go to cinemas with family and watch movies. In the country where inflation rate
is high, people find it hard to eat twice a day, is almost impossible for them to buy tickets and
watch movies in cinema. From the audience perspective, people must have sufficient disposable
income to save enough money in order to spend it on entertainment and leisure activities.
Social Factors:
Our cultures, opinions, perceptions and beliefs are based on dogmas. It will take a long time to
change audience mentally to appreciate fine and quality movies. Our society is not in that
position to watch movies that actually represent what our culture is and how do we perceive our
religion. We do appreciate movies like PK because it questioned Hindu religion but if local film
makers produce Khuda Kay Liye, not that it should receive praise but bears strong criticism from
the audience, religious representatives and government. Such movies are either banned or
criticized to such an extent that completely discourage the film makers and artists. We must
appreciate freedom of speech and through this film makers can make reality based movies that
will portray the right picture of our society and so we can learn from them.
Technological Factors:
Lollywood is still struggling with technology as it has always been. It needs state of the art
technology, latest machinery and equipment to produce quality products. Good movies are only
possible if producers quit using the forty years old technology. In the present scenario, most of
the film makers use old cameras. With this producers cannot succeed attracting the audience.
They need to replicate advanced technology, establish proper processing labs, new studios and
latest cameras to make standard movies.
Environmental Factors:
Legal Factors:
The first factor is employment regulations. Pakistani actors are still keen to work in Indian
cinema. It is important that local talent work in local movies and represent their own country.
Also Lollywood industry must produce movies with impunity. Film makers need to make good
commercial movies that will attract the local talent who are more attracted towards to Indian
cinema where they are pain high.
Furthermore, it is the competitive regulations that restrict productivity of Lollywood industry.
Indian movies still dominate Pakistani movies. Pakistan censor board banned Indian movies in
Pakistani cinemas due Mumbai attacks till 2013. When the ban was lifted in the same year,
Indian movies completely dominated our local movies again. On the other hand, India does not
allow our movies in Indian cinemas, Waar movie is one good example, banned in the whole
India. Pakistan censor board should develop new policies to ensure that our local movies must be
allowed in Indian cinemas as well as limit the monopoly of Indian movies in the country to give
an opportunity to the Lollywood industry to revive its lost glory.

In addition to this, one factor is weak product regulation. Our products yet have not become of
good quality. The problem can only be addressed with the governments support. In 2014, a
delegation of the film industry met the Pakistan People Party (PPP) chairman Bilawal Bhutto
Zardari. In the meeting the delegation proposed the New Motion Picture Act 2014 that demanded
for concessions to the industry, development of the state of the art studios, ensuring investor
friendly environment and quality equipment to assist the film makers to produce quality
products. Such legislative acts will cover all the issues of the film industry improving the growth
of the cinema and producing standard products for the public.
Porter Five Forces Analysis of the Industry:
Media industry in Pakistan earned a revenue of Rupees 32.06 billion in 2011. There are
approximately 250 active newspapers, 90 TV and 100 FM radio channels (including 25 campus
radio stations) and 17,000 journalists in the industry (there were only 2,000 in 2001).
We have tried to analyze the industry through Porters Five Forces. The results are given below.
Each industry generates profits, and the industry competes against 5 competitive forces for the
profits. If left unchecked, the industrys entire profits will be siphoned off making it irrelevant
economically.
Those 5 competitive forces
1. Threat of New Entrants
2. Bargaining Power of Buyers
3. Bargaining Power of Suppliers
4. Threat of Substitution
5. Intensity of Rivalry
Threat of New Entrants
Previous to the current digital age, there was little threat to the movie making industry. There
were a handful of powerful studios who for the most part dictated who was allowed to participate
and who was not. The cost of Movie Stars, sets, payrolls, equipment and the risk of loss,
combined with the fickle tastes of a theater going public made the industry a large risk. To offset
that risk, a large expense was required to generate success in the first few weeks of the movies
release in the form of advertising. Therefore, it took large pools of capital and many investors to
spread out the risk. Making this a high barrier to entry.
TodayThere are lower budget and independent movies finding acceptance among a larger
audience. The reason? The long tail generated by the internet. Many examples of lower budget
films achieving success in profits versus box office receipts exist. These examples are due to
reasons beyond a good story line. Its because the scope of information we as individuals can
take in has broadened. The internet allows us to seek out avenues of entertainment beyond the
mainstream movie. Anyone with a good story, willing actors and a creative entrepreneurial talent
can make a movie, and use a social media campaign. The definition of the movie going industry
is widening its boundaries to entertainment and the industry finds itself competing against new
entrants with lower barriers of entry.
2. Bargaining power of buyers.

Once upon a time, if you wanted to see the movie, you had to pay to see it in a theater, or hope it
played in a drive in. Then in the 80s came the battle of betamax and VCR, as well as cable
channels. Soon thereafter developed pay per view, DVDs. And since the millennial we have
seen the capacity of the information super highway carry movies! Concurrently there was
YouTube. And an entirely new way of watching and expressing ourselves erupted. And
unexpectedly blogging allows others to write reviews about movies theyve seen. If we trust
them and their opinions, it opens up an opportunity for us to watch something we otherwise
would not have. My daughter is an avid watcher of Netflix movies and is constantly
recommending movies to me. For the theater owners, they paid whatever the cost of the movie
Lollywood said they would pay. Today there is more flexibility, but for the theaters, it is still
largely monopolistic pricing.
3. Bargaining power of suppliers
Here my conservative Id chuckles. Lollywood is famously liberal. Liberals are famously
enamored with unions. Whenever I hear of work stoppages and budget overruns due to unions in
Lollywood, deep down I think there is justice. Movie stars are being paid vast sums of money to
pretend on the screen. Sure its hard workYou talkin to me? You talkin to me? Even these
groups are having to settle for less as the profit pools are shrinking. Technology here again
presents the industry with another unusual competitor for the industry profits, Pixar Studios.
Here some very bright computer folks, backed by story lines and crative talent can craft a movie
entirely on Macs (Thank you Steve Jobs).
4. Threat of substitution.
Here lies the largest threat to Lollywood. Once upon a time, they defined our sense of
entertainment. Once upon a time, they created for us a subculture of ideas and expectations.
Remember the James Bond movie where he flew in a jet pack. Everyone thought we would all be
traveling that way. They showed us lasers in Goldfinger that could cut James in half before we
could actually do it. Yet somewhere along the way, they have lost that ability to create
excitement or expectation. The story lines they present in the major releases are so poor the
studios rely on massive spending in advertising to gain as many box office sales as possible in
the first few weeks. Otherwise, its a write off for the investors. And still there is that nagging
internet where so many forms of entertainment can be distributed for next to zero. And so
MANY various forms of entertainment are available. Want to watch TV shows you missed. Want
to watch a movie from a genre that just happens to strike your fancy. OK, you can have that too.
5. Intensity of Rivalry,
Evidence of intense rivalry does not exist here. It could be due to a clubbiness in Lollywood
among studio executives, unions representing everyone else.
The Above discussion can be summarized in the below
Threat of New Competition
Entry barriers (medium)
Exit barriers (low)
Capital requirement (high)
Switching or sunk costs (high)

Access to distribution (high)

Customer loyalty (low)
Industry profitability (high)
Threat of Substitutes
Internet (medium)
Mobile (low)
Bargaining Power of Customers
Customers can easily switch (high)
Customers have easy access to the world media (low)
Substitutes, like, internet and mobile, are available (medium)
Bargaining Power of Suppliers
Power of suppliers (low)
Power of content providers (low)
Competitive Rivalry
Costly and perishable products (high)
Diversified and influential rivals (high)
Conclusion
Porters Five Forces analysis reveals:
Threat of new competition is medium to high
Threat of substitutes is low to medium
Power of customers is medium to high
Power of suppliers is low
Competition in the industry is high
Overall, profitability of media industry in Pakistan lies between medium and high.
Critical Success factors of Lollywood (Pakistani film industry):
Local filmmakers have changed the shape of Pakistani film industry from last 3, 4 years. Many
new producers and directors are coming towards this industry and producing different movies of
different genre comedy, romance, thriller, horror, social, drama, animated and war on terror and
many more and viewers love it. In 2015, 11 films were produced and released across Pakistan
and other countries, in which Pakistan first animated movie 3 bahadur which was produced
and directed by Oscar award winner Pakistani lady sharmeen Obaid chinnoy also include.
In 1990s and 1980s most of Pakistani movies were based on gujjars , malangs and gandassas
those characters are now flawlessly replaced by artsy biopics , big budget entertainment movies.
Like jawani phir nahi aani a comedy movie directed by Nadeem baig and produced by
Humayon saeed , salman iqbal is the most successful movie of Pakistan film industry with

grossing over Rs 470 million. Many other movies such as Bol a social drama genre which
highlight bold issues in our society, response towards this movie was phenomenal, Bol was also
released in India.
Pakistani viewers are expecting from their film industry to make such movies which highlight
society issues, create awareness about current situation of politics, corruption, war on terror and
religious extremism which will create a positive impact on our society. Our country is facing
many problems like terrorism, corruption, acid burn attacks, dowry, forced marriages, religious
extremism, education and health etc, these are issues if filmmakers make movies on such issues
then peoples will love to watch it and Pakistan film industry will grow. On other side Pakistan is
blessed with natural scenic places such as Gilgit baltistan, Swat , Dir , Kaghan , Naran and other
historical places if we show these places in our movies it will attract tourist to our country and
can promote our culture too.
Pakistani Movies Based on Social problems:
Bol
Josh
Lamha
Chambaili
Zinda bhag
Moor
Dukhtar
Pakistani romantic Comedy movies:

Jawani phir nahi aani

Wrong no
Karachi se Lahore
Na maloom afraad
Dekh magar pyar se
Halla gulla

Biography genre:
Shah
Manto
Kaptaan
Crime genre:

Jalaibee
Tamanna

Horror genre:

Mayaa

Animated:

3 bahadur

Action/thriller:
The system
Sultanat
Operation O21
Waar
Political thriller:
Maalik
These kinds of movies are the demand of current time. in Pakistan peoples a following
Bollywood and Hollywood movies and copying there style and culture. If our industry make
such movies it will attract our Pakistani movies lover to watch their own movies and also it will
present a bright image of Pakistan in abroad countries.