Are Hollywood Action Films Losing Their Punch in China?


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By Robert Cain for China Film Biz

February 2, 2013

Over the years one of the most reliable truths of China’s film business has been that Hollywood action films sell. Bond films Casino Royale and Quantum of Solace, the Transformers movies, Avatar, Men in Black and other Hollywood action tent-poles have been the rock upon which China’s booming multiplex business was built. Even North American duds like Battleship, John Carter and The Mechanic could count on China to shore up their grosses and give them a measure of international respectability.

But during the past year Chinese audience tastes have broadened, and U.S. action films have experienced a lull in popularity that just might be the beginning of a decline.

Since January, 2012, three Chinese language action pictures have crossed the $90 million mark in the PRC, as have two dramas and a comedy, but only one American action film, Mission Impossible 4, has managed the same feat. And that was a year ago.

Since then, Sherlock Holmes 2Spy Kids 4DWrath of the TitansGhost Rider 2The AvengersThe GreyThe Hunger GamesThe Amazing Spider-ManThe Dark Knight Rises, and Prometheus have all under-indexed in China. And the first Hollywood action release of 2013, Skyfall, has joined the club.Studio Action film indexing

The trend is clear: since May, 2012, more than two-thirds of U.S.-made action films released in China have under-indexed. Chinese audiences have increasingly turned toward comedies like Lost in Thailand, to Chinese action films like CZ12, and to effects-driven fantasies like Life of Pi and Painted Skin: Resurrection.

The trend could turn back this month, with Tom Cruise’s Jack Reacher and The Hobbit set to open in a few weeks, but I expect another Chinese film, Stephen Chow’s action comedy Journey to the West, will out-earn both of them. And meanwhile Cloud Atlas, a decidedly non-action film, looks likely to strongly over-index in China and perhaps surpass its U.S. total of $27 million.

The challenges for Hollywood action tent-poles are threefold:

1. Oversaturation. In 2011 there were 14 Hollywood action films released in China. In 2012 there were 23. Audiences may simply be tiring of these movies, with the trend away from action tent-poles signaling a broadening in their tastes. Ice Age: Continental Drift and Life of Pi outgrossed all but two of these 23 films. In a year when China’s box office revenue rose 30 percent and the average U.S. film’s China revenue was up 27 percent, the average U.S. action film’s take rose by only 14 percent.Average Action gross 2011-2012

2. Market Manipulation. In its efforts to manage the market and maintain a face-saving 50 percent share for domestic films, SARFT’s ‘domestic film protection’ efforts seem to be targeting U.S. action flicks more than other foreign pictures. SARFT slotted The Dark Knight Rises and The Amazing Spider-Man  for release on the same day, and Oz: The Great and Powerful and A Good Day to Die Hard appear to be headed for the same fate. While China isn’t exactly turning these movies away, it does seem to be more ambivalent about them than, say, family-friendly fare.

3. Piracy. Virtually all movies are affected by theft and illicit distribution in China, but Hollywood action tent-poles seem to be targeted more than others. Franchise films like the Bond, Mission Impossible, Transformers and other pictures tend to be highly valuable to pirates because they have widespread pre-release awareness, and in many cases SARFT delays these films for censorship or ideological reasons, allowing pirates a head start for getting illegal DVDs, Blu-ray discs, and online copies of the films into general circulation.

For these reasons, Hollywood studios looking to maximize their revenues in the increasingly important Chinese market would do well to broaden their offerings so they’re not overly action heavy. Fox, by far the best performing studio in China last year, had the most genre-balanced slate, with Titanic 3D, Life of Pi, and Ice Age ranking as its top three performers. The studios that fell behind in China were far more action-oriented in their China releases. These distributors ought to consider following Twentieth’s example.

Robert Cain is a producer and entertainment industry consultant who has been doing business in China since 1987. He can be reached at rob@pacificbridgepics.com and at www.pacificbridgepics.com.

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9 thoughts on “Are Hollywood Action Films Losing Their Punch in China?

  1. I like Number 3. Piracy, luckily product placement can benefit through that as piracy is for some the only way to view a high end film in low income households who may or may not be able to afford these products currently.

  2. Skyfall is most succesfull bond movie in china.Quantum of solace earned 21million dollars in china and casino royale earned 11million dollars.Seems like growing trend :P

    • Bond Fan: You’re comparing apples to oranges. Skyfall earned $20 million back in 2008 when China had 4,000 movie screens and its total box office revenue was $barely $600 million. Skyfall OPENED on over 6,000 screens, and China’s box office will exceed $3 billion.

      • It’s not apples and oranges.It’s James Bond franchies that earned in 2006 11mil,2008 22mil and will earn 66mil in china by the end of release if your projection is correct.Bond is not household name in china because of it’s coldwar past i belive,this is the first time it was mainstream in china.Maybe when next bond comes out there will be twice as many movietheatres and it will earn maybe twice that it will earn this year put would you call it failure for bond franchies.Im not english so sry for bad english.

      • Bond Fan, I have to disagree with you. The Daniel Craig-era Bond franchise has enjoyed great awareness and popularity from the beginning. “Casino Royale” was the 7th highest grossing film in China in 2006, when it took 3.3 percent of all PRC ticket revenues. “Quantum of Solace” was the 8th highest grossing film in 2008, and it also earned 3.3 percent of PRC revenues in that year. “Skyfall” has been far less popular, relatively speaking. It probably won’t even land in the top 15 films in the PRC in 2013, and it will only earn 2 percent of this year’s ticket revenue.

      • I think you’re way off here and your insistence that Skyfall has bombed or “under-indexed” is lessening your credibility. I mean, sure MI4 did $100M last year, but does that mean every expensive spy thriller should do $100M+ in order to be considered a hit in China? By your logic, both John Carter and Battleship and every other expensive scifi film should do a couple multiples of Avatar’s record-breaking $203M in order to be considered a hit. Not many films do $100M in China in the first place, let alone $50M. Generally speaking, films that do $20M-$30M are considered huge hits in China. The fact that Skyfall made $51M in about two weeks already puts it in the blockbuster status. Saying otherwise just makes you seem … um … stubborn. You made the wrong call when it opened, and you’re doubling down on a wrong call. Still doesn’t make it right.

      • Senh, you’re making a subjective, emotional, and completely uninformed argument, not to mention putting words in my mouth, about a topic that is purely objective. There is no debating the point: either a movie indexes in China by earning 11-12 percent of its global revenue there, or it doesn’t. Skyfall has fallen far short of that mark, and is in fact among the poorest indexing Hollywood films of the past year. I suggest you take a minute to actually read and understand what I’m saying, get your facts straight, and then flame me all you want if I’ve got something wrong. In this case, your arguments are easily refuted by the facts..

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