Chinese film finance to expand, become more rational – Shanghai Festival puts on starry opening
This news has been read 4640 times!
LOS ANGELES, June 12, (RTRS): “We plan more acquisitions to help the development of the Chinese film industry,” said Zhang Qiang, CEO of Alibaba Pictures. “The capital feast has just begun.”
Zhang was speaking Sunday at a seminar at the Shanghai International Film Festival about the massive influx of capital in recent years into the Chinese film industry.
“Alibaba’s investments in (online marketplace) Taobao and (payment system) Alipay are all about helping other businesses to succeed. Our investments in the film industry are in the same vein,” said Zhang. “They improve the efficiency of the industry.”
Zeng Maojun, VP of Wanda Culture Industry Group, and president of Wanda Cinema Line, described the $3.5 billion acquisition of Legendary Entertainment in a similar vein. “It is not because we want to influence Hollywood that we bought the company. Rather we need them to teach us more about the international industry. And also it is because Wanda is building many theme parks and need the kind of intellectual property they can bring.”
“Good chemistry is going to be generated when we combine acquisitions with our own companies,” siad Zeng, when questioned about Legendary’s reported financial losses.
Zeng also pointed to some of the distortions to the industry resulting from the capital surge. “Capital markets focus on the short term and if we are not careful that will affect the level and quality of the films made, which will in turn harm the box office.”
He also pointed a clear finger at some of the fraudulent manipulations that affected Chinese box office earlier this year. “People making derivative instruments based on film are harmful to the film industry,” Zeng said.
Industry watchers have seen the slowing growth of the theatrical box office in the past two months as a sign that the industry has hit a roadblock. But Alibaba’s Zhang denied that the film industry is a bubble waiting to burst. “There is a bubble in the capital markets, not at the box office,” he said.
The $145 million four days opening of Wanda- and Huayi Brothers-backed “Warcraft” this week also demonstrates that Chinese audiences will turn out in huge numbers for the films they like. The film’s opening weekend in China is on course to be five times greater than that in North America.
Similarly, Jerry Ye, CEO of Huayi Brothers Pictures said that the flurry of interest in Internet-derived intellectual property has further to go. “Professionals understand the real value of Internet IP.”
Capital has flowed into Chinese film from private equity sources, stock markets and corporate investments, especially flowing from Internet companies. It has already taken Chinese cinema in directions that are different to other countries.
Online ticketing — promoted by companies including Alibaba and social media giant Tencent among others — may now account of 90% of ticket sales. That puts the Internet giants and vertically integrated conglomerates at the heart of China’s movie industry and gives them analytical understanding of audiences not available to smaller players.
The recent box office slowdown may have been triggered by a reduction in the volume of subsidies provided by online ticketing services. But seminar speakers predicted that continuing cinema building will further drive box office. “There are individual cities such as Chengdu where we may be reaching saturation, but the market as a whole will not reach saturation until we hit 80,000 screens,” said Wanda’s Zeng. China’s nationwide screen count topped 31,000 at the end of 2015 and will approach 40,000 by the end of this year.
Also:
LOS ANGELES: Hollywood talent including Bradley Cooper and Ian McKellen and directors Ang Lee and Renny Harlin were on hand Saturday night to fete the opening of the Shanghai International Film Festival (June 11-19, 2016).
Top Chinese talent on the red carpet included superstars Fan Bingbing, Shu Qi and Jackie Chan.
The growing overseas star-power at the event reflects the exponential expansion of the Chinese film industry and its ripple effect across the global movie business. The opening night took place as the Chinese-financed, Legendary Entertainment-produced “Warcraft” surpassed $140 million on its fourth day of release in China.
Emir Kusturica was on stage as jury president, along with Canadian director Atom Egoyan, Korean producer and main competition juror Jonathan Kim.
Other execs and VIPs in attendance included Tang Media executive Janet Yang, Emperor Motion Pictures CEO Albert Lee, Hong Kong director Derek Yee, China Film Co’s La Peikang, ace producer Bill Kong, Bona Film Group boss Yu Dong, the MPA’s Mike Ellis and China representative William Feng and IMAX Pictures’ Greg Foster.
Next week the Chinese megacity will also play host to more stars and executives for the opening Thursday (June 16) of the Shanghai Disney Resort.
This news has been read 4640 times!
