Beidou2020
SENIOR MEMBER
- Joined
- Dec 3, 2013
- Messages
- 7,857
- Reaction score
- -48
- Country
- Location
The Chinese film business is doing the unthinkable: Thriving without Hollywood
Huawei, TikTok and grain sales are not the United States’ only Chinese worries
A man walks past a poster in Beijing for the newest Star Wars movie. (Greg Baker/AFP/Getty Images)
By Steven Zeitchik
December 30, 2019 at 6:00 AM EST
The past year has been a heady time at the film box office. The first part of 2019 brought a massive interstellar action spectacle that broke records, while the summer yielded a computer-generated colossus that packed theaters week after week.
The movies in question? Not “Avengers: Endgame” and “The Lion King,” the twin blockbusters that anchored the Hollywood calendar. They’re “The Wandering Earth” and “Ne Zha,” two Chinese-language films that, though little known in the West, have blossomed into some of the biggest hits in Chinese history.
The two films collectively grossed a whopping $1.3 billion this year in China, the largest 1-2 punch in the country’s history. That means the three highest-grossing movies ever in China are something once thought impossible: Chinese.
With nearly $9 billion in box-office revenue last year, China has swollen to the second-largest film market in the world. It’s more than quadruple the size of third-place Japan and is closing in on the United States (nearly $12 billion). China is so large that it generates more box office dollars than the next six markets combined.
But in recent months a surprising — and, to Hollywood, troubling — trend has emerged: China is achieving much of that success with its own movies.
China will tally its highest annual box office total ever when the year ends Tuesday. Yet it’s probable that only two of the movies in its top 10 will have come from the United States — half the number than in recent years — as Chinese blockbusters take their place.
“What we’re watching unfold in front of us is the maturation of the Chinese film industry,” said Marc Ganis, the founder of the Asia-oriented entertainment company Jiaflix and an expert on the Chinese movie business. “There’s long been an expectation that movies coming out of Hollywood would always be the top draw there. And it turns out that’s not true.”
For years, conventional wisdom held that the rapid expansion of Chinese movie theaters and film attendance would be a boon for Hollywood. As the country’s moviegoing increased, so would Hollywood’s fortunes. And, in fact, they did.
Many in Hollywood took as a given that this would long continue. All one needed to do as a studio ,executive, then was to obtain a coveted government-awarded distribution slot and pump American product on to China’s 60,000 screens. Profits were sure to follow.
The Chinese surge, however, is flipping that script, offering an ominous portent for one of the United States’ most reliable exports. Experts say Hollywood may be running out of luck — and time — in its most lucrative international market. Far from an Asian landing pad for American blockbusters, China is exhibiting signs of becoming India or Nigeria, two large moviegoing markets whose film ecosystem thrives independently of Hollywood.
“Ne Zha” and “The Wandering Earth” are leading the way.
Chinese hits once emphasized patriotism over slick storytelling and visuals. These films mark a departure. Nationalistic themes are moved to the background. Effects are more polished. Stories are given a more traditional Western structure. They’re big-budget spectacles that just happen to be Chinese.
It’s part of a push by Chinese studios and financiers, often with government backing, to make movies that compete more directly with Hollywood.
“The Wandering Earth” tells a futuristic story about a rescue in space with splashy action — think “The Martian” meets “Mad Max.” The glories of Chinese know-how are present but less overtly (though the absence of Americans is notable; the hero’s key ally is Russian).
Meanwhile, “Ne Zha,” about a character’s quest to retrieve a mystical pearl, relied on more than 1,600 effects specialists across multiple companies to create its images, an operation on the order of a Hollywood animated film.
Both movies, directed by Chinese men in their 30s, take their cues from Hollywood. “The Wandering Earth” director Frant Gwo has spoken about how he was influenced by James Cameron’s “Terminator 2.”
Content diversity exists below the top tier. Among the other 2019 hits in China were the reliable tales of heroism, including anthology film “My People, My Country” and fact-based airline-rescue movie “The Captain.” There are also films that wouldn’t be out of place on a Hollywood release schedule, including car-racing drama “Pegasus” and science-fiction comedy “Crazy Alien.”
These films are catching on, experts say, because they offer the right combination of local flavor and global product.
“Most people in China would rather see stories of people who look like them and speak like them,” said Aynne Kokas, a professor at the University of Virginia and author of “Hollywood Made In China,” which is about the entertainment industry’s relationship with the country. “They don’t want a nationalist agenda but they want a movie to feel Chinese. If they can get that in big-budget blockbusters, they’re going to see them.”
The shift is happening quickly. Just six months ago, studios’ biggest fear centered on the U.S.-China trade war, which was beginning to take a toll on the number of Hollywood movies allowed into the country. (Foreign movies in China operate under a tightly run system, in which the government-led China Film Group dictates the number of films that will be allowed to play — in recent years, about 35 — and grants permission to individual movies.)
Part of the system’s goal has been to keep Hollywood movies from exceeding 50 percent of market share. But such protectionism is no longer needed, and the number of slots may no longer matter. The obstacle facing American movies is less they-can’t-get-into-China and more people-don’t-come-to-see-them-when-they-do.
Fears of a market that skews 60 to 40 Chinese, or more, are becoming real.
“Hollywood studios used to worry about the government stopping them from maximizing their profits,” Ganis said. “But what’s stopping them now has been the genuine interest of Chinese moviegoers in seeing local movies. It’s much more organic.”
The pain isn’t limited to certain studios. Disney has been regarded as the most successful foreign entertainment company in China; its “Endgame” took in a startling $614 million. Even it has had its share of misses, most notably with Star Wars. The series’ films haven’t always performed reliably, but “The Rise of Skywalker” especially cratered in China, opening in third place to just $12.1 million. That marks a series low, well behind $42.6 million for “The Last Jedi” and the $126 million that “The Force Awakens” generated.
One China-focused executive at a U.S. studio, speaking on the condition of anonymity because he was not authorized to talk to the press, said he was not worried because he believed China’s ability to create blockbusters lagged behind that of Hollywood, which will keep audiences seeing studio movies for some time.
The data paint a different picture. Just two films in the top 10 would be the fewest since the modern theatrical business was launched in China a little more than a decade ago. And even the two hits are holdovers from a time when Hollywood reigned; the franchises of “Endgame” and “Fast & Furious Presents: Hobbs and Shaw” each began in the aughts.
China is massively consequential to Hollywood. In a climate of flat domestic box office earnings, the Middle Kingdom remains central to studio profits and Hollywood’s ability to keep producing big-budget movies. Last year, China was responsible for more than $2 billion in ticket sales for studio films. The world’s next-biggest market, Japan, generated only about $500 million.
Whether Hollywood can regain its footing there remains far from certain.
“I think it depends on the kind of studio executive you’re talking about and how they react,” said Rob Moore, the former vice chairman of Paramount who conducts extensive entertainment and esports business in China. “If you’re willing to put in the work, you can be okay. If you’re not, you won’t. It’s just too radically different a market to have the same marketing plan you have in the rest of the world.”
“The days of studios just making $200 million for showing up, which is what was happening for years, are over,” he said.
In a best-case scenario, studios can stop the bleeding and ensure they retain at least 40 percent of the projected $10 billion market.
Moore and other experts say that a more draconian scene could emerge in the coming years: Chinese big-budget movies continue to gain share in their home country, squeezing studios to 30 percent or even lower. That then precipitates an even faster contraction, since without Chinese box office revenue, studios’ ability to finance these big-budget movies in the first place would diminish.
Essentially, the Chinese boom would create a domino effect leading to scaled-back production.
One way to ease the pain would be for Hollywood to reap more revenue from the tickets they are already selling. Studios get about 25 percent from movies in the Chinese box office, and there has been noise about boosting that percentage. But the issue was not front and center in the trade talks that led to the recent tech- and farm-centric ‘phase one’ deal, even though Treasury Secretary Steven Mnuchin, a veteran Hollywood financier, has extensive understanding of the matter.
Studios will also need to try to recover in China by adhering to content and censorship restrictions that remain as high as ever. Warner Bros.' highest-grossing movie of the year, “The Joker,” was not even allowed in the country, probably because government officials objected to its anarchist themes.
Roland Emmerich, the Hollywood director behind action hits like “Independence Day” and “2012,” caught the film world’s attention recently when he said that the idea of an American blockbuster would soon be an endangered species.
“There are sci-fi stories that will appeal equally to Chinese, German and American [audiences],” he told the Shanghai International Film Festival last summer when speaking of blockbusters in the new decade. “They will become more global and less Hollywood.” Emmerich has become closer to China, recently relying on Chinese investors to help finance his U.S. vs. Japan movie on World War II, titled “Midway,” and making a Chinese city one of the alien targets in his 2016 sequel “Independence Day: Resurgence.”
The Chinese boom also comes with one final chilling possibility for Hollywood: that Chinese films begin to compete with Hollywood movies even outside their home country, threatening studios’ dominance around the world.
While it’s unlikely Americans would see a Chinese action-adventure en masse, it’s not unthinkable that audiences in Europe, South America or elsewhere in Asia would.
“If you’re not seeing the movie in your native language,” Moore said, “does it really matter if you’re reading subtitles of English or Mandarin?”
Huawei, TikTok and grain sales are not the United States’ only Chinese worries
A man walks past a poster in Beijing for the newest Star Wars movie. (Greg Baker/AFP/Getty Images)
By Steven Zeitchik
December 30, 2019 at 6:00 AM EST
The past year has been a heady time at the film box office. The first part of 2019 brought a massive interstellar action spectacle that broke records, while the summer yielded a computer-generated colossus that packed theaters week after week.
The movies in question? Not “Avengers: Endgame” and “The Lion King,” the twin blockbusters that anchored the Hollywood calendar. They’re “The Wandering Earth” and “Ne Zha,” two Chinese-language films that, though little known in the West, have blossomed into some of the biggest hits in Chinese history.
The two films collectively grossed a whopping $1.3 billion this year in China, the largest 1-2 punch in the country’s history. That means the three highest-grossing movies ever in China are something once thought impossible: Chinese.
With nearly $9 billion in box-office revenue last year, China has swollen to the second-largest film market in the world. It’s more than quadruple the size of third-place Japan and is closing in on the United States (nearly $12 billion). China is so large that it generates more box office dollars than the next six markets combined.
But in recent months a surprising — and, to Hollywood, troubling — trend has emerged: China is achieving much of that success with its own movies.
China will tally its highest annual box office total ever when the year ends Tuesday. Yet it’s probable that only two of the movies in its top 10 will have come from the United States — half the number than in recent years — as Chinese blockbusters take their place.
“What we’re watching unfold in front of us is the maturation of the Chinese film industry,” said Marc Ganis, the founder of the Asia-oriented entertainment company Jiaflix and an expert on the Chinese movie business. “There’s long been an expectation that movies coming out of Hollywood would always be the top draw there. And it turns out that’s not true.”
For years, conventional wisdom held that the rapid expansion of Chinese movie theaters and film attendance would be a boon for Hollywood. As the country’s moviegoing increased, so would Hollywood’s fortunes. And, in fact, they did.
Many in Hollywood took as a given that this would long continue. All one needed to do as a studio ,executive, then was to obtain a coveted government-awarded distribution slot and pump American product on to China’s 60,000 screens. Profits were sure to follow.
The Chinese surge, however, is flipping that script, offering an ominous portent for one of the United States’ most reliable exports. Experts say Hollywood may be running out of luck — and time — in its most lucrative international market. Far from an Asian landing pad for American blockbusters, China is exhibiting signs of becoming India or Nigeria, two large moviegoing markets whose film ecosystem thrives independently of Hollywood.
“Ne Zha” and “The Wandering Earth” are leading the way.
Chinese hits once emphasized patriotism over slick storytelling and visuals. These films mark a departure. Nationalistic themes are moved to the background. Effects are more polished. Stories are given a more traditional Western structure. They’re big-budget spectacles that just happen to be Chinese.
It’s part of a push by Chinese studios and financiers, often with government backing, to make movies that compete more directly with Hollywood.
“The Wandering Earth” tells a futuristic story about a rescue in space with splashy action — think “The Martian” meets “Mad Max.” The glories of Chinese know-how are present but less overtly (though the absence of Americans is notable; the hero’s key ally is Russian).
Meanwhile, “Ne Zha,” about a character’s quest to retrieve a mystical pearl, relied on more than 1,600 effects specialists across multiple companies to create its images, an operation on the order of a Hollywood animated film.
Both movies, directed by Chinese men in their 30s, take their cues from Hollywood. “The Wandering Earth” director Frant Gwo has spoken about how he was influenced by James Cameron’s “Terminator 2.”
Content diversity exists below the top tier. Among the other 2019 hits in China were the reliable tales of heroism, including anthology film “My People, My Country” and fact-based airline-rescue movie “The Captain.” There are also films that wouldn’t be out of place on a Hollywood release schedule, including car-racing drama “Pegasus” and science-fiction comedy “Crazy Alien.”
These films are catching on, experts say, because they offer the right combination of local flavor and global product.
“Most people in China would rather see stories of people who look like them and speak like them,” said Aynne Kokas, a professor at the University of Virginia and author of “Hollywood Made In China,” which is about the entertainment industry’s relationship with the country. “They don’t want a nationalist agenda but they want a movie to feel Chinese. If they can get that in big-budget blockbusters, they’re going to see them.”
The shift is happening quickly. Just six months ago, studios’ biggest fear centered on the U.S.-China trade war, which was beginning to take a toll on the number of Hollywood movies allowed into the country. (Foreign movies in China operate under a tightly run system, in which the government-led China Film Group dictates the number of films that will be allowed to play — in recent years, about 35 — and grants permission to individual movies.)
Part of the system’s goal has been to keep Hollywood movies from exceeding 50 percent of market share. But such protectionism is no longer needed, and the number of slots may no longer matter. The obstacle facing American movies is less they-can’t-get-into-China and more people-don’t-come-to-see-them-when-they-do.
Fears of a market that skews 60 to 40 Chinese, or more, are becoming real.
“Hollywood studios used to worry about the government stopping them from maximizing their profits,” Ganis said. “But what’s stopping them now has been the genuine interest of Chinese moviegoers in seeing local movies. It’s much more organic.”
The pain isn’t limited to certain studios. Disney has been regarded as the most successful foreign entertainment company in China; its “Endgame” took in a startling $614 million. Even it has had its share of misses, most notably with Star Wars. The series’ films haven’t always performed reliably, but “The Rise of Skywalker” especially cratered in China, opening in third place to just $12.1 million. That marks a series low, well behind $42.6 million for “The Last Jedi” and the $126 million that “The Force Awakens” generated.
One China-focused executive at a U.S. studio, speaking on the condition of anonymity because he was not authorized to talk to the press, said he was not worried because he believed China’s ability to create blockbusters lagged behind that of Hollywood, which will keep audiences seeing studio movies for some time.
The data paint a different picture. Just two films in the top 10 would be the fewest since the modern theatrical business was launched in China a little more than a decade ago. And even the two hits are holdovers from a time when Hollywood reigned; the franchises of “Endgame” and “Fast & Furious Presents: Hobbs and Shaw” each began in the aughts.
China is massively consequential to Hollywood. In a climate of flat domestic box office earnings, the Middle Kingdom remains central to studio profits and Hollywood’s ability to keep producing big-budget movies. Last year, China was responsible for more than $2 billion in ticket sales for studio films. The world’s next-biggest market, Japan, generated only about $500 million.
Whether Hollywood can regain its footing there remains far from certain.
“I think it depends on the kind of studio executive you’re talking about and how they react,” said Rob Moore, the former vice chairman of Paramount who conducts extensive entertainment and esports business in China. “If you’re willing to put in the work, you can be okay. If you’re not, you won’t. It’s just too radically different a market to have the same marketing plan you have in the rest of the world.”
“The days of studios just making $200 million for showing up, which is what was happening for years, are over,” he said.
In a best-case scenario, studios can stop the bleeding and ensure they retain at least 40 percent of the projected $10 billion market.
Moore and other experts say that a more draconian scene could emerge in the coming years: Chinese big-budget movies continue to gain share in their home country, squeezing studios to 30 percent or even lower. That then precipitates an even faster contraction, since without Chinese box office revenue, studios’ ability to finance these big-budget movies in the first place would diminish.
Essentially, the Chinese boom would create a domino effect leading to scaled-back production.
One way to ease the pain would be for Hollywood to reap more revenue from the tickets they are already selling. Studios get about 25 percent from movies in the Chinese box office, and there has been noise about boosting that percentage. But the issue was not front and center in the trade talks that led to the recent tech- and farm-centric ‘phase one’ deal, even though Treasury Secretary Steven Mnuchin, a veteran Hollywood financier, has extensive understanding of the matter.
Studios will also need to try to recover in China by adhering to content and censorship restrictions that remain as high as ever. Warner Bros.' highest-grossing movie of the year, “The Joker,” was not even allowed in the country, probably because government officials objected to its anarchist themes.
Roland Emmerich, the Hollywood director behind action hits like “Independence Day” and “2012,” caught the film world’s attention recently when he said that the idea of an American blockbuster would soon be an endangered species.
“There are sci-fi stories that will appeal equally to Chinese, German and American [audiences],” he told the Shanghai International Film Festival last summer when speaking of blockbusters in the new decade. “They will become more global and less Hollywood.” Emmerich has become closer to China, recently relying on Chinese investors to help finance his U.S. vs. Japan movie on World War II, titled “Midway,” and making a Chinese city one of the alien targets in his 2016 sequel “Independence Day: Resurgence.”
The Chinese boom also comes with one final chilling possibility for Hollywood: that Chinese films begin to compete with Hollywood movies even outside their home country, threatening studios’ dominance around the world.
While it’s unlikely Americans would see a Chinese action-adventure en masse, it’s not unthinkable that audiences in Europe, South America or elsewhere in Asia would.
“If you’re not seeing the movie in your native language,” Moore said, “does it really matter if you’re reading subtitles of English or Mandarin?”
