New Delhi: India’s second-largest multiplex chain, Inox Leisure has ended its contract with online ticketing platform BookMyShow (BMS) due to disagreement over payments. BookMyShow challenged the contract termination in Bombay High Court following which the court asked both parties on September 18 to start arbitration on the issue and reach a decision within four weeks, reported Economic Times.
It may be noted that the whole issue began earlier this month when Inox asked for more money from BMS for selling its tickets, stated ET citing sources. BMS however, refused to pay more citing the clauses within the contract which will valid till 2023. This led to Inox terminating the contract saying BMS has allegedly breached the terms of the contract, the report further mentioned.
The financial daily quoted a source saying, “BookMyShow had to pay a larger sum to PVR Cinemas when it renewed the deal with the multiplex chain last month to sell its tickets on the platform. Inox demanded similar terms and sought an extremely high price from BMS to continue the partnership, which they refused.” The report further stated that while an Inox spokesperson responded to their email query saying they do not have a contractual relationship with BMS at present, BMS declines to comment on the issue.
According to experts, the contract termination will impact Inox ticket sales negatively as over 32 per cent of INOX’ box-office revenue is generated by BMS alone. Inox officials responded told the national daily saying that Paytm and Inox’ own website, as well as the mobile app, are responsible for 44 per cent of the total revenue.
Worth mentioning here is that the termination of the contract with BMS has not yet been disclosed to stock exchanges by Inox Leisure which is a listed company. According to company’s September 22 stock exchange filing, it currently runs 129 multiplexes with 523 screens in around 65 cities with a total capacity of 1,27,275 seats.
Inox’ rivals PVR and Cinepolis might enjoy some benefits for short-term because of this contract-termination.