The industry can boast of making the first 3D film in India, "My Dear Kuttichathan", and the first cinemascope film in southern India titled "Thacholi Ambu". But after scaling great heights in the 1980s and 1990s, it is now going downhill.
In one sentence, if one has to describe the present status of the Malayalam film industry, the answer is "chaotic".
At the heart of this downfall are strikes and conflicts -- for the past four days shootings have come to a grinding halt. The Kerala Film Producers Association has decided to suspend work after its pleas to reduce cost of production fell on deaf ears.
Suresh Kumar, a veteran producer, who has been in this business for the past three decades, said they have no other option because if the industry has to survive, then costs have to be slashed.
"How many of you know that in this calendar year, out of 70 films that have been released, six ended up in the red, and 30 films have had a collection of less than Rs.1 million? This is the sorry state of affairs of producers," said Kumar.
In 1990, there were 1,400 theatres in the state, but today just 470 cinema halls are operational.
Theatre owners are divided into two groups - Film Exhibitors Federation and the Film Exhibitors Association.
The Federation represents about 295 theatres, located in 70 business districts, and these screen all new movies.
The Association basically has theatre owners who have moviehalls in smaller towns and villages which are not allowed to screen new releases and where there is not too much crowd.
From Nov 1, the theatre owners, who are members of the Federation, have been on the war path after the state government threatened to cancel the service charge of Rs.2 on per ticket sold.
Because of this, the Federation is not screening any Malayalam movie, as a result superstars Mammootty's and Mohanlal's new films, which were supposed to come out last month, have been deferred indefinitely.
The situation worsened after the Film Employees Federation of Kerala (FEFKA), which has 19 organisations under it, including those for drivers and directors, announced they would have to produce films themselves to get rid of the problem.
"We would welcome directors turning producers because it would make them understand the pains of a producer. The crux of the issue is that many established directors prefer to work with first-time producers because then no questions are asked and the new producers act as mere 'cashiers'," said a producer on condition of anonymity.
"I am a producer and I have been in this field for a while and as a producer I question each and every financial transaction."
Incidentally, the industry showed a consensus only when the new Oommen Chandy government assumed office in May and decided to give the film portfolio to actor-turned-politician K.B. Ganesh Kumar.
But Kumar is finding the constant squabbles and ego clashes tiresome.
"We will certainly have a discussion to see how production costs can be cut down and for this I will meet up with the Producers' Association and representatives of the Association of Malayalam Movie Artists," said the minister.
He has also made it clear that there would be no discussions with theatre owners till they resume film screening.
But theatre owners, who are members of the Federation, are not happy with the minister's decision to charge an additional Rs.3 on every ticket sold to set up a producers' welfare fund.
"He said if this is not done, he will withdraw the Rs.2 service charge that the theatre owners charge on every ticket. We said it would be unfair to burden us and then face the wrath of moviegoers because the price of the ticket would further go up. If we are pressurised, then we would have no other option but to close down theatres," said a theatre owner on condition of anonymity.
Theatres under the Federation will decide whether to go on indefinite strike at a meeting Nov 19.
