Entering 2013, there were grave concerns about the domestic film industry. For the first time in a decade, foreign films out-earned domestic movies, the 'water army' scandal of fake web postings to alter a movie’s rating was an embarrassment and the Chongqing Economic Times reported that 80 percent of mainland films recorded a deficit. 365 days later and how things have changed. China's box office topped RMB20 billion for the first time ever, with domestic films making up 58 percent of that revenue. The country is now officially the second biggest film market in the world and Shenzhen’s TCL even purchased the naming rights to famed Mann's Chinese Theater on the Hollywood Walk of Fame.
With event films like Police Story 2013, Firestorm and The Monkey King either just hitting movie screens or coming soon, 2014 looks like it will be even bigger. It's a trend that Beijing-based entertainment industry research institute EntGroup has been tracking for years.
“China's box office has grown rapidly recently and is expected to reach RMB22 billion, but it's not a special phenomenon,” says EntGroup analyst Liv Yi. “Currently the quality and quantity of movie theaters can't meet the needs of this audience and as new theaters open in third-tier cities, these numbers will keep growing for the next five years.”
Indeed, part of what's been fueling the escalating numbers is the growing number of cinemas. Almost 1,000 new cinemas were built last year, with 17,500 screens available – a remarkable growth from the 3,527 available in 2007.
There is more to it, however. Over the past fifteen months, there's been a notable phenomenon of smaller, character-driven films turning into box office gold. The best example is Lost in Thailand. Made for around US$2 million and released in December 2012, the comedic caper is China's highest grossing film with over US$200 million in sales. This continued last year with Zhao Wei's college-set So Young and the bio-pic American Dreams in China rubbing elbows with big-budget action epics from home (Young Detective Dee) and abroad (Pacific Rim) in China's top 10 highest grossing films from the year.
A fascinating success has been the Ning Hao-directed No Man's Land. The Xinjiang-set thriller was held up for nearly four years by the State Administration of Press, Publication, Radio, Film and Television (SARFT) before winning the box office in its early December release.
The SARFT has faced scrutiny all year long, with the Django Unchained opening day debacle and the noticeable hold-up of internationally beloved art house director Jia Zhangke's highly acclaimed A Touch of Sin.
However, the SARFT may be slightly misunderstood. Due to the lack of an age-based ratings system, China's current censorship system typically makes cuts to films to make them appropriate viewing for all ages. Nearly 40 minutes were cut from Cloud Atlas – primarily love scenes.
Cultural cuts do continue to occur. Despite partially taking place in Shanghai, the latest James Bond film Skyfall included a small scene where a Chinese security guard is shot by the villain, which was removed from the Mainland version.
"There has been some talk about changing to an age-based system but it will take a few years at least,” Yi says. “SARFT's control over movie content shows no sign of loosening but despite concerns, Feng Xiaogang's upcoming movie Personal Tailor was released without a hold-up last month and No Man's Land did make it onto the big screen.”
In response to No Man's Land, the SARFT posted their complete set of criteria for submitted films online but continue to be plagued by rumors like the false summer report that Despicable Me 2 was banned (see pg 36).
Film Business
Early last month, British Prime Minister David Cameron negotiated a coproduction deal that enabled UK and Chinese companies to work together, joining America and South Korea in having this arrangement that theoretically bypasses the quota system. It was widely celebrated and co-productions have become the buzzword. An August agreement cemented the terms: foreign producers are entitled to 25 percent of Mainland film gross for imported films but 40 percent on coproductions.
While Paramount Pictures reached a deal with the government-run Chinese Movie Channel and its online movie service partner Jiaflix to produce Transfomers 4, official co-productions have been rare. Despite partnering with Beijing-based DGM Entertainment and releasing a notorious special Mainland version, Iron Man 3 ultimately did not qualify as an official coproduction.
“The concept has become quite vague with more film productions going international in terms of financing or staffing,” says Yi. “The major concern for Chinese producers is how important their roles will be in a cooperative relationship.”
Regardless, last year was a banner year for business deals. Jiaflix reached deals with MGM and Lionsgate to distribute films such as the Twilight saga and the upcoming Robocop remake on its online streaming platform m1905.com. Disney will make films like The Avengers and Toy Story 3 available on Tencent's Hollywood VIP digital service.
China's online streaming services have become an increasingly important battleground as the country subtly introduces efforts to combat piracy. Last summer, Beijing police arrested eleven suspects in an unprecedented take-down of piracy website silu.com, which offered unlicensed downloads of 18,772 films to its over 400,000 registered members.
In November, Baidu was sued for RMB300 million for copyright violation in a joint lawsuit by Youku, Tudou, Tencent, Sohu.com, Dalian Wanda and the Motional Picture Association of America (MPAA). Later that month, the government announced plans to establish a court devoted to intellectual property rights protection as part of their 60-point roadmap.
Despite this, Yi predicts the change will be gradual. “Chinese people have become accustomed to viewing or downloading films for free,” she says. “Video sites also have a lot of advertising. However, as people’s purchasing power grows, this model will naturally increase.”
Although foreign companies are hoping to tap into this emerging market, Chinese companies like Dalian Wanda are hoping to conquer the world. After purchasing the American AMC theater chain in 2012, Dalian Wanda's founder Wang Jianlin outdid himself. A-listers like Leonardo DiCaprio, Zhang Ziyi, Catherine Zeta-Jones and Ewan McGregor attended China's richest man's September party, where he announced the company’s next project – the Oriental Movie Metropolis.
Part film and TV studio and part theme park, the RMB50 billion project is set to open in Qingdao by June 2017, and will include twenty sound stages including the world's first underwater studio.
With a target of producing 130 films annually – including 30 foreign films – and a studio that matches or surpasses the capacity of any Hollywood studio, Dalian Wanda epitomizes what two-time Academy Award-winning director Ang Lee told reporters at November’s Golden Horse Awards – that China will overtake Hollywood within ten years.
// For more news, visit english.entgroup.cn
Recommended 2014 Films
On top of giving us an education on China’s film industry, Entgroup’s Liv Yi gave us her list for the most highly anticipated Chinese films for this year.
Gone with the Bullets
Dir: Jiang Wen
This sequel to 2010 hit Let the Bullets Fly takes place in glamorous 1920s Shanghai and will include intricate song and dance numbers. Jiang’s friend Robert De Niro expressed interest in appearing.
Death Defying Encounter
Dir: Ning Hao
Not much is known about the No Man's Land director’s upcoming film except that it stars Lost in Thailand's Huang Bo and Xu Zheng. Ning has promised that it will be a “healing” film rather than a “crazy film.”
Tracks in the Snowy Forest
Dir: Tsui Hark
Tsui is a legend, directing the Young Detective Dee hits and producing John Woo's triad classics like Hard Boiled. This 3D remake of the 1960s film promises to be a visual delight.
Home Coming
Dir: Zhang Yimou
Zhang reteams with his first muse Gong Li in this adaptation of Yan Geling’s acclaimed novel, The Criminal Lu Yanshi, which follows a Chinese intellectual over several decades.
Don’t Go Breaking My Heart 2
Dir: Johnnie To
The Hong Kong crime film maestro snagged acclaim with last year's Drug War. However, he returns with the sequel to the romantic comedy hit which was his Mainland breakthrough.
The Crossings
Dir: John Woo
Best known as an action innovator, John Woo returns with an epic star-studded drama that follows three couples that board the ill-fated Taiping ship, described as the Chinese Titanic, bound for Taiwan in 1949.
I Am Somebody
Dir: Derek Yee
The iconic Hong Kong director secretly shot this completely self-financed film that examines the lives of small-time actors working as extras at one of the world’s largest film studios
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