Whalesbook
Lionsgate Play's new strategy in India marks a significant shift, putting theatrical releases first for its premium Hollywood movies. The company believes this cinema-first approach will boost audience engagement and create more value before films become available on its streaming service, Lionsgate Play.
The Strategy: Big Screen to Streaming
Starting in September 2026, Lionsgate Play plans to bring 10 to 12 major Hollywood films to Indian cinemas annually. This is a big change from its past focus on direct streaming for many titles. The goal is to create a connected experience from the big screen to digital screens, maximizing both box office revenue and later streaming earnings. This move comes as Lionsgate Entertainment Corp. (NYSE: LGF.A/LGF.B) has seen price momentum, with its 'LION' ticker reaching $12.45 on April 17, 2026, while LGF.A traded at $8.59. The company reported a market capitalization around $1.9 to $2.4 billion and FY2024 revenues near $4.02 billion. Interestingly, this theatrical push for India contrasts with the parent company's recent sale of its Lionsgate Play streaming service in South and Southeast Asia to founder Rohit Jain for an estimated $20-30 million, suggesting a wider review of regional streaming operations.
India's Competitive Market
Lionsgate Play's pivot happens in India's fast-changing media market. Global players like Netflix and Amazon Prime Video, along with Indian companies like JioStar (Disney+ Hotstar), primarily focus on large local content libraries and multiple languages. These platforms often use mixed strategies, combining ads with subscriptions and offering bundles to attract viewers who watch their spending. For example, Amazon Prime Video plans to release four to six films in Indian theaters annually from 2026, though this aligns with its overall platform strategy rather than a strict window approach. Many international streamers partner instead of launching alone to cut down on high costs for content and new customers. Lionsgate Play's focus on premium Hollywood films in this environment presents a unique challenge.
Market Challenges and Digital Boom
The Indian cinema market is recovering but faces difficulties. Between 2019 and 2024, theatrical revenues have seen a small drop, and cinema attendance has fallen by 41%, with fewer than 150 million Indians visiting theaters yearly. Big blockbuster films are driving box office growth, making up over 40% of revenue from the top 10 films in 2024. However, audiences have become very selective, often waiting for streaming releases for non-major films. Lionsgate India LLP reported revenue of ₹71 crore for FY2024, with a negative CAGR of 10% in the last year, and its net profits have also shrunk. Meanwhile, the digital streaming market is booming, expected to surpass $9 billion by 2030, with over 1.45 billion monthly active users. This contrast creates a challenging situation for a theatrical-first strategy.
Key Risks for the Strategy
This theatrical-first strategy carries significant risks. Indian audiences are increasingly watching their spending, and Hollywood films have had mixed success in Indian cinemas, especially those not considered blockbusters. The 41% drop in cinema visits from 2019 to 2024 shows a smaller, though more dedicated, theater audience. Furthermore, the considerable costs for theatrical distribution, marketing, and exhibition might not bring back enough money, particularly compared to the more straightforward ways streaming services get viewers and revenue. The recent sale of the Lionsgate Play streaming service by the parent company itself hints at a decision to shed regional operations. This makes a renewed focus on theatrical distribution for Hollywood content in the same area a bold, potentially costly, bet. The market strongly favors platforms with extensive local content and integrated offerings, posing a hurdle for a slate focused solely on Hollywood movies.
Outlook for the New Strategy
India's media and entertainment sector is expected to continue growing strongly, fueled by digital use and the expanding OTT market. However, the success of Lionsgate's theatrical plan will rely heavily on its ability to select films that strongly appeal to Indian moviegoers, adapt to changing audience tastes, and successfully connect the exclusivity of cinema with the desire for quick digital access. Creating local content and integrating with wider digital platforms remain crucial for long-term success in the region.