In the filmed entertainment sector Los Angeles, or Hollywood, has been the dominant cluster for many years and is the most globally recognised centre for film and television production. However, India is the largest market globally in terms of total box-office admissions and number of films produced. Filmed entertainment in India was estimated around 112 billion INR in 2012 by PWC expected to cross 200 billion INR by 2017. Digital distribution has transformed the markets with movies releasing with large number of prints across India and abroad thereby capturing revenues early combating piracy.
The market share of Hollywood films is about 9%, mostly from multiplexes in large metros. Indian film clusters evolved in a different way compared to Hollywood where all mainstream Hollywood films are produced, financed, distributed (and, to some extent, exhibited) by a handful of integrated media conglomerates (News Corp, Walt Disney, Viacom, Time Warner, NBC Universal, and Sony), and non-mainstream films are practically isolated from the mainstream system of finance and distribution. There is even structural difference amongst film clusters in Hyderabad and Chennai and Bollywood.
After Indian Independence in 1947, Bollywood films have been produced, financed, distributed, and exhibited in complex collaboration among hundreds of independent producers each owning a small-scale production company (with one or fewer annual releases), independent distributors (covering different regional territories), private financiers, and stand-alone cinema operators. seems to move towards an industry model based on alliances. Despite increased professionalism and horizontal integration in down stream processing & distribution, alliances mark the culture of Bollywood film cluster ushered in by refugee film producers, stars and entrepreneurs from Lahore. Star actors, even today are cast and signed though informal social relations, rather than through agents and lawyers, and unlike their Hollywood counterparts, written contracts are rarely used. The second category of social relations is those between producers and financiers. Since Bollywood's inception, producers have obtained most film finance either as advance payment from distributors or from private sources, and the production companies struck new finance and distribution deals for each production.
The growth of Film cluster in Hyderabad is attributed to Akkineneni Nagegewararao (ANR). At the height of popularity, he took a decision to shift to Hyderabad and insisted all his producers to shoot in Hyderabad only. He built his own studio in 1975. The formation of film cluster in Hyderabad shows that government initiatives like providing infrastructure (lands for studios, residence) and fiscal incentives (tax rebate , lower entertainment tax) etc are all important, a cluster champion is needed to form the nucleus.