Who is La Peikang and How Did He Get Here?


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La Peikang

By Robert Cain for China Film Biz

February 11, 2013

There’s a new sheriff in town and his name is La.

OK, that didn’t quite have the gravitas I was going for. The point is that China’s New Year’s holiday week is over and the dominant organization of China’s film industry, China Film Group, has a new Chairman, La Peikang (喇培康).

La’s appointment to the PRC’s top film job signals a new direction and some interesting potential changes in the years ahead, both for Chinese filmmakers and distributors and their overseas counterparts. Namely, La’s extensive international experience overseas and in China’s co-production bureaucracy point to a likely increased focus by CFG on international cooperation and expansion.

Variously described by those who know him as “serious,” “educated and academic,” “quietly effective,” “well-liked” and “outward looking,” La could scarcely be more different than his predecessor, Han Sanping.

In the role he held for ten years, Han Sanping was a hustler, a mover-and-shaker who presided over the massive rise of China’s film industry from its status as a tiny backwater with a mere 0.7 percent share of the global box office in 2003 to its emergence as the world’s most dynamic movie territory, with a 10 percent (and rapidly rising) share of the worldwide pie in 2013.

I remember the early days of his tenure when Han Sanping would show up in Hollywood unknown and barely acknowledged, begging for meetings with studio execs, agents, movie stars, anyone who would pay attention. Most dismissed him in those days as unworthy of their time, because China was so negligible as a territory, let alone as a potential source of financing. But Han’s “Baqi” (覇气) loosely translated as “lord’s air” or “domineering spirit,” drove him to oversee the incredibly rapid modernization of the Chinese market, with the construction of 16,000 new cinema screens and a corresponding 2,700 percent increase in domestic box office receipts. Nowadays, thanks largely to Han’s contributions, China is on everyone’s mind, and it would be difficult to find a serious agent or executive who doesn’t know his name.

Given the legacy that Han created, La will find that the tables have turned and that studio heads and movie stars will eagerly, if not desperately, court his favor. Those who meet him will experience a completely different breed of Chinese movie czar. In contrast to Han’s bulldog approach, La is a more sophisticated executive, a fluent English and French speaker who is apparently viewed by China’s leaders as the right person to lead their country’s movie business to maturity and, they hope, to increasing global influence.

Before his appointment was announced, few anticipated that La would be the one to win the top job. It’s not that he lacked credentials—he was Deputy Chairman of the SARFT Film Bureau, and he had previously run an important CFG subsidiary, the internationally focused China Film Co-Production Company. But other candidates were more in the public eye, perhaps because they were more effective at outwardly promoting themselves.

When it came down to it though, it was La’s connections, his political skills, and his perceived loyalty to his Chinese Communist Party bosses that ultimately allowed him to prevail. He was chosen for the job by the Party’s ultra secretive, extraordinarily powerful Organization Department (中国共产党中央组织部), China’s political king-making office. Richard McGregor of The Financial Times described the Organization Department’s status thusly:

“To glean a sense of the dimensions of the Organization Department’s job, [imagine] a parallel body in Washington…that would oversee the appointments of every US state governor and their deputies; the mayors of big cities; heads of federal regulatory agencies; the chief executives of General Electric, ExxonMobil, Walmart and 50-odd of the remaining largest companies; justices on the Supreme Court; the editors of The New York Times, The Wall Street Journal and The Washington Post, the bosses of the television networks and cable stations, the presidents of Yale and Harvard and other big universities and the heads of think-tanks such as the Brookings Institution and the Heritage Foundation.”

This Organization Department controls more than 70 million party personnel assignments across the country, and it is no small matter to win their approval for senior party roles like La’s. Although, as McGregor wrote, “their vetting process takes place behind closed doors and appointments are announced without any explanation about why they have been made,” it’s not difficult to imagine intense lobbying, backbiting, mudslinging, and all manner of political fisticuffs. And La would have had to pass intense scrutiny– the Organization Department has access to dossiers and background checking capabilities that put the CIA and NSA to shame.

So don’t let La’s quiet, academic demeanor fool you; he’s undoubtedly as tough and effective as they come in China’s political bureaucracy. And that’s saying a lot.

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.

L.A.’s Next Must-Attend Event: The U.S. China Film Summit, 11-5-13


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U.S.-China Summit

By Robert Cain for China Film Biz

October 22, 2013

Here’s an important heads-up: the U.S.-China Film Summit, North America’s biggest and best annual gathering of Hollywood and Chinese filmmakers and industry executives, will take place on November 5th at downtown L.A.’s Millenium Biltmore Hotel. Since its inception four years ago the Summit has grown bigger and more influential each year, and with the doubling of its size and scope this year it’s an absolute must for anyone participating in or planning to join the booming cross-Pacific movie trade.

I’m both on the planning committee for this year’s Summit and I’ll be a speaker as well, so I can tell you from an insider’s perspective that this is an unparalleled opportunity to hear from, and meet, many of the luminaries of the China film biz. Here’s a small sampling of the 30+ speakers who will attend:

Senator Christopher Dodd, Chairman and CEO, 
Motion Picture Association of America – Former United States Senator Chris Dodd is Chairman and CEO of the Motion Picture Association of America, Inc., which serves as the voice and advocate of the U.S. motion picture, home video and television industries around the world.

Dennie Gordon, Director, “My Lucky Star” – Director of the teen cult hit “Joe Dirt” starring David Spade, Christopher Walken and Dennis Miller, and “What a Girl Wants” starring Oscar winner Colin Firth and Amanda Bynes. Dennie’s latest film, the romantic comedy “My Lucky Star,” featured Chinese stars Zhang Ziyi and Wang Leehom, and was a bona fide hit at the Chinese box office.

Ellen Eliasoph,  President and CEO,
Village Roadshow Pictures Asia – Ms. Eliasoph leads the company in its business of identifying, developing, financing, producing, marketing and distributing feature films which are filmed principally in the Chinese language and designed for audiences in the Mainland China and other Greater China markets.

Li Bingbing, Actress, “Forbidden Kingdom,” “I Do” and the upcoming “Transformers 4” – One of China‘s biggest cinema and television stars, Bingbing has also had a successful crossover career in American film. She was most recently seen in Screen Gems’ “Resident Evil: Retribution,” directed by Paul W.S. Anderson.

Zhang Zhao, CEO,
 LeVision Pictures -
 In 2008, Mr. Zhang was named one of the top 10 most influential people in China Film and Entertainment Industry. Several films he produced and directed have won many international awards and have been recognized by the U.S. independent film committee.

The Summit will include luncheon keynote speeches from IMAX President Greg Foster and China Film Co-Production Corp’s Zhang Xun, and six panel discussions on topics ranging from digital media business opportunities in China to practical discussions on how to make films there.

The day will be capped off with a Gala Dinner and awards presented by the Asia Society to Senator Dodd and Ms. Li Bingbing.

For more information and to register for the event, please click on this link.  I look forward to seeing you there!

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.

Keanu’s Big Swing and a Miss in China


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By Robert Cain for China Film Biz

July 8, 2013

Nearly a decade in development and more than two years in production, Keanu Reeves’ directorial debut, Man of Tai Chi, was supposed to accomplish several ambitious goals:

  1. Enable Reeves to make the leap from actor to respected film director.
  2. Propel Reeves’ friend and Matrix kung fu mentor Tiger Chen to his own breakout as an action star.
  3. Establish a China beachhead for Reeves and enable him to make more movies there.
  4. Earn lots of money for the film’s investors, who include China Film Group, Wanda Media, Village Roadshow Pictures Asia, and Universal Pictures.

But the tepid audience response to Man of Tai Chi’s opening in China last weekend spells disappointment for everyone involved.  Although Reeves may still have a directing career ahead, his first film now appears more hindrance than help in advancing him toward that goal. I haven’t yet seen the movie so I can’t comment on Reeves’ directing capabilities, but the trailer has an odd direct-to-video feel to it and, according to Weibo chatter, lacks appeal for many in its targeted demographic.

At a reported $25 million budget, the picture will need to do a much better job drawing audiences in the U.S. and other territories if it is to turn a profit.  Wanda is said to have put up a substantial percentage of the negative cost in exchange for Chinese distribution rights, and turned over some 60 percent of its 1000+ screens to the picture. In hindsight that looks to have been a costly decision; given its $2.87 million nationwide total for the 3-day weekend, Man of Tai Chi will likely finish with less than $10 million in theatrical gross receipts over its entire China run. Wanda would have been better off allocating more of its screens to local hits Blind Detective and Tiny Times, or to the popular Warner Bros release Man of Steel.

Wanda and its partners in Man of Tai Chi  made a bet that audiences would turn out for Reeves because of his Chinese heritage and his track record as an action star with a genuine martial arts pedigree. My feeling is that the core moviegoing audience may simply be too young to know who Reeves is, and so he didn’t draw as well as had been hoped.

The U.S. market probably won’t offer much support, as the film still doesn’t have a scheduled release date there. According to The Hollywood Reporter, Weinstein Company’s Radius division picked up U.S. rights at Cannes with intentions for a fourth quarter U.S. release, but has not yet announced any firm plans. Universal’s decision not to handle the film despite having invested in it suggests they lack confidence in its North American prospects.

In Reeves’ and his backers’ defense, their task was not an easy one; few recent action or martial arts films have been successful both in China and abroad. Here’s hoping  Man of Tai Chi finds better luck in the global market.

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.

‘So Young’ is So Rich in China


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So Young director Vicky Zhao is ‘crying’ all the way to the bank.

By Robert Cain for China Film Biz

April 28, 2013

Month after month, China’s movie industry has been making major leaps that spell trouble for Hollywood’s creaking business model.  China has repeatedly proved that massive profits can come from tiny investments, while Hollywood’s studios keep making enormous financial bets in the face of rapidly dwindling returns. Where China’s distributors are piling up cash with the new equivalent of a “My Big Fat Greek Wedding” nearly every month, Hollywood has increasingly churned out cash burning duds like Jack the Giant Slayer.

The latest Chinese jackpot winner is So Young, a low-budget youth romance that put its financiers well into the black in just its first two days of theatrical release. After its huge $22+ million three-day weekend debut, and with the major three-day Labor/May day holiday about to start, So Young is now assured of posting one of the biggest 7-day debuts in Chinese box office history.

Based on the wistfully titled Chinese young adult novel “To Our Eventually Lost Youth”  (致我们终将逝去的青春), So Young is the latest in a string of Mandarin language films to employ a formula first made successful by the blockbuster hit Love is Not Blind back in 2011: adapt a successful novel (or in some cases a TV show or even an old American movie) to a contemporary Chinese context; cast popular, young, inexpensive actors; keep the budget low; choose an optimal release date, preferably a major box office holiday; leverage social media like Sina Weibo and WeChat to promote mainly to young female moviegoers; and let the box office magic happen.

The novel centers on a young woman whose romantic flame, played by Mark Chao (Caught in the Web, Black & White Episode), leaves her without saying a word to her, to study at a university in America. Then she falls in love with another young man, played by Mando-pop star Han Geng of Super Junior fame, who also leaves her to study in America. This leads her to a fit of rage in which she climbs to the top of a hill, faces the Pacific and shouts “The United States is an evil capitalist country. I hate you! Return my men back to me!”

I’m not sure this climactic scene was included in the movie, but really, what filmmaker could resist the pathos, the dramatic power, of those lines?

Kidding aside, So Young has been getting some of the best reviews I’ve seen lately for a Chinese film, with a 9.1 rating on movie fan site Douban. And distributor Enlight’s marketing team has generated tremendous buzz. First-time director and popular Chinese actress Vicky Zhao has pulled out all the publicity stops, recruiting many of her celebrity friends to tweet about the movie.

Zhao also reportedly made the Machiavellian move of visiting China’s government distribution authorities and tearfully convincing them to delay Iron Man 3‘s release by five days to give her film a big market advantage during the Labor Day holiday. Her ploy worked, and although I doubt So Young needed the help, it looks likely that it will beat the Marvel/Disney blockbuster in total admissions and revenue.

Whatever happens, there will be plenty of RMB to go around this week for both movies. Last year’s Labor/May Day holiday saw a total national gross of about $36 million. If current trends continue, this year’s holiday could double that amount.

Other films are enjoying excellent results, with Finding Mr. Right winding down its extraordinary run at a cume of roughly $84 million. G.I. Joe: Retaliation will surpass $50 million, and The Croods has benefited from excellent word-of-mouth and will beat my earlier forecast by at least $5 million to finish at no less than $25 million, a decent total for a non-sequel animated feature.

The disparities in box office expectations are becoming more and more stark. $100+ million is becoming an increasingly reasonable target for local Chinese movies, and an increasingly distant dream for Hollywood movies releasing in the PRC. If they want to keep up with the times, Hollywood’s studios ought to start putting filmmakers like Vicky Zhao on speed dial.

To my friends and readers in China, 祝大家劳动节愉快(I wish you a happy Labor Day).

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.

Lovers vs. Fighters in China, ‘So Young’ vs. ‘Iron Man 3’; and the Winner Is…


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By Robert Cain for China Film Biz

April 26, 2013

The PRC movie showdown between So Young and Iron Man 3 is now at hand. And what a showdown it is! The two movies combined couldn’t possibly generate as much drama, tension, and emotional angst as has the behind-the-scenes battle over IM3’s release date.

Although So Young has only just opened, and Iron Man 3 has yet to unspool in China, So Young has already won the battle, thanks to a relentless campaign by that film’s Chinese distributor Enlight to derail the Disney/Marvel/DMG machine. The story of the two films’ jockeying for position offers interesting (and somewhat damning) insight into how SARFT favors domestic movies over foreign ones.

Back in March it was announced that the romantic melodrama So Young and the Hollywood action tent-pole Iron Man 3 would open head-to-head on April 26th. This is an excellent date, just ahead of the three-day Labor Day/May Day holiday, when business is expected to be brisk.

As a local film, So Young’s debut on April 26th was locked. As a perceived foreign film, albeit one with a domestic Chinese investor and partner in DMG, Iron Man 3 was on shaky ground, subject to the indignities that several Hollywood movies have recently faced in China (see this article for a taste of how Hollywood movies have fared lately at the hands of SARFT).

After much lobbying by the producers of both films, and a confusing string of announcements by various parties about where Iron Man 3 would land, it now appears that the Robert Downey Jr.-starring action extravaganza has been granted a release at 12:01am on May 1st.

For So Young, this is great news. The low-budget romantic melodrama gets the holiday to itself, and five full days to rake in its spoils before the big budget Hollywood movie enters the scene. Indeed, early reports are saying that So Young has opened to an excellent $8 million Friday debut, and that it has a good shot at earning at least $100 million.

For Iron Man 3, the May 1st date has to be disappointing, but it’s much better than the May 3rd date that had been widely reported a few days ago. Never mind the rather silly assertion from “Deadline” that May 3rd was the date Disney and Marvel were “eyeing all along.” Why would anyone be happy to open just after a major box office holiday? That was pure face-saving spin, presumably from Disney’s PR folks. Credit DMG with fighting a nearly unwinnable fight and preserving at least one day of the holiday to bolster its debut.

Whether Iron Man 3 can overtake So Young and become the first Hollywood film in over a year to reach $100 million is an open question, but missing the first two days of the three-day holiday will certainly hurt its prospects.

According to ‘Firedeep’, my unfailingly reliable “deep throat” in China, Iron Man 3 was buffeted by a series of unexpected delays, which began with some late reshoots of its Chinese scenes. According to Firedeep, the locked print of the film wasn’t sent to the Film Bureau for technical censorship until the night of April 12th, which made the April 26th debut a rather iffy, although still perfectly possible, proposition.

Meanwhile, the translation and dubbing of the film ran into late hour delays when Marvel decided to replace the original translator.

But the biggest obstacle for Iron Man 3 emerged when So Young’s distributor, Enlight Films, decided to play the ‘local film protection’ card, putting up major resistance to its competitor’s holiday release date by appealing to China’s Film Bureau. It’s rumored that So Young’s celebrity director, Vicky Zhao, showed up at the Bureau and literally cried her way to sympathy and ultimate victory. The film authorities dithered and vacillated before finally announcing their ‘final’ decision about IM3 on Friday, causing great confusion amongst moviegoers and provoking howls of protest from Marvel’s Chinese fanboys.

As one sharp-tongued Chinese observer put it on a PRC film website, “Back and forth. This whole thing is a fucking mess. Fuck Enlight Pictures and fuck SARFT like every time.”

And as if to underscore the point, SARFT continued to torture Django Unchained by repeatedly approving and then un-approving that film’s re-release. On Thursday one announcement pegged Django’s theatrical revival for May 9th, and a day later it was supposedly pushed to May 12th.  It’s death by a thousand cuts. Meanwhile many frustrated Tarantino fans have undoubtedly downloaded the uncensored BD-rip from pirate sites, leaving one to wonder whether any among them will still be waiting to buy theater tickets if and when the movie finally goes back up on the big screen.

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.

China’s Censors Ride Into the Old West and Castrate ‘Django’


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By Robert Cain for China Film Biz

April 11, 2013

For a brief moment there it looked like China’s film authorities had taken an important and welcome step forward in loosening their censorship policies by allowing the theatrical release of Django Unchained. When news came out last month that the blood-spattered Tarantino film had been approved for an April 11th theatrical debut, many Chinese moviegoers and observers like me were encouraged that the censors’ strict barriers to violence and sexually suggestive material might be coming down at least a little.

No one expected Django Unchained would be shown in China completely intact; it was a marvel that it would be released at all.

But in a rather bizarre and disappointing move on Thursday, SARFT canceled the film’s release on its very first day. In some theaters the film had actually started playing when the projectors were turned off less than sixty seconds later. What legions of Django’s film adversaries failed to do, China’s censors managed to pull off in only a minute: they killed him.

SARFT explained only that the release was canceled for “technical reasons.” They are unlikely to provide any further insight, leaving China’s moviegoers to speculate about what really happened.

Much of the talk in China’s online film forums has centered on the film’s violence and nudity. The Chinese government censors movies before they can be released, and scenes that contain nudity, politically sensitive issues, or graphic violence, must be edited out before a film can receive a go-ahead from the authorities.

The Chinese publication IBTimes noted in this article that even after the censors’ cuts, a couple of scenes remained in the distribution prints that must have been inadvertently overlooked. One of those scenes is a long shot in which Jamie Foxx’s penis can be briefly but clearly seen. In the other Kerry Washington’s nipple can be glimpsed. As an online observer with the handle “Bob Violence” noted “With all the fuss over the violence, maybe someone forgot about the nudity.”

One internet wag in Shanghai with the handle “Alexbenetta” quipped “The government are agitated about the failure of castration of Django in the movie so they decided to do it themselves.”

Another observer, my Beijing-based friend “Firedeep,” speculated that “the sudden last-minute blocking of Django Unchained has a lot to do with the unwillingness of SARFT to see a [ratings] system getting further actively discussed, which is always a sensitive and inconvenient subject for them. Drug War, a drug enforcement themed film which was released last Tuesday has already stirred up some notable talk amongst the public regarding SARFT censorship and demands for the launch of a ratings system. With the coming of the Beijing International Film Festival next week, topics about films will predictably go even hotter. So it is reasonably argued that SARFT blocked Django Unchained to avoid any further heating up of these movie-ratings discussions.”

To which another observer “Polylove” replied “Whatever their intention was, now it backfired. Talk about Django Unchained‘s censorship raised more attention from people.”

Hu Xijin, editor-in-chief of the Global Times, a newspaper run by the People’s Daily, wrote on his microblog: “The harm created by the act (of suddenly suspending the screening of the film) will be much greater than what may be brought by some ‘dangerous scenes’ to the nation’s politics.” Hu said some authorities have frequently made questionable decisions at the expense of the government’s credibility.

As Firedeep noted, Django did manage to set two records in China:

1) Lowest grossing imported revenue sharing film: box office RMB 25,683 yuan (US $4,144)  with 716 admissions via 87 shows [midnight debut).

2) Shortest screening time (closed in less than 11 hours after midnight opening).

There’s been no word as to whether the “technical reasons” would be addressed or whether Django’s release would be reinstated. The unfortunate and rather ironic reality is that disappointed would-be theater ticket buyers in China will instead wind up watching the uncensored version of Django via internet piracy sites or pirated DVDs.

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.

‘Upside Down’ Flips the Script at China’s Theaters


Follow me on Twitter @robcain or Sina Weibo @robcain, or connect with me on LinkedIn. For info on China Pooch email info@chinapooch.comUpside Down one-sheet

By Robert Cain for China Film Biz

March 12, 2013

Although China’s distributors release roughly as many ‘buyout’ films—that is, foreign films acquired under flat fee purchase arrangements—as they do revenue sharing ‘quota’ films, it’s unusual for a buyout film to lead the box office. This is because quota films are mostly big-budget studio tent-pole pictures with major stars, while buyouts are most often independent ‘B’ level movies with less ambitious commercial aspirations. The numbers are pretty stark: last year the 31 foreign buyout films took only a 5.4 percent share of China’s total box office revenue, while the 34 foreign quota films earned 45.6 percent.

So it came as quite a surprise last week when a buyout, Millenium Films’ romantic fantasy Upside Down, became the first film in nearly a month to outgross box office behemoth Journey to the West: Conquering the Demons. The $60 million Kirsten Dunst-Jim Sturgess starrer, about a sort of interstellar Romeo and Juliet who are separated not only by family but also by the physics of the cosmos, was shot way back in 2010 and had earned only $8 million worldwide when it debuted last Thursday in the PRC.

In its first four days in China Upside Down nearly doubled its worldwide gross, and it also out-earned Journey by a slight margin. Despite its wide availability on pirated BD, DVD and online, it is now primed to become one of China’s highest earning buyout films ever. Top Grossing Foreign Buyouts

WIth the advantage of a full week of screenings versus Upside Down‘s four days, Journey to the West won the weekly box office crown for its fifth week in a row, a feat last achieved by Avatar back in 2010. Aggregate weekly box office was $42 million, a 38 percent improvement over the same week in 2012. Year-to-date, China’s box office revenue is running 46 percent ahead compared to the first 10 weeks of last year.

Although they continue to underperform, American films are at least beginning to gain market share, capturing 44 percent last week thanks mainly to Journey‘s slowing momentum. The Hobbit: An Unexpected Journey stretched its cume to $45 million, and will end its China run next week at around $50 million. Box office week ending March 10, 2013

On March 14th A Good Day to Die Hard will open wide with hopes that it can turn the tide and become the first studio film to over-index in China this year. Resident Evil: Resurrection is set to open on March 17th, presumably in a heavily edited version. Oz the Great and Powerful has been pushed back to April, so the next studio release will be Jack the Giant Slayer on March 25th.

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.

Will ‘Iron Man 3’ Get China Co-Pro Status, and Does it Really Matter? Most of the Co-Pro Benefits Have Come Already


Follow me on Twitter @robcain or Sina Weibo @robcain, or connect with me on LinkedIn. For info on China Pooch email info@chinapooch.comIron Man with Xueqi

By Robert Cain for China Film Biz

March 7, 2013

Two thoughts on all the media speculation about whether Iron Man 3 will get official co-production approval from SARFT for its China release this spring:

  1. It won’t, in my opinion.
  2. I doubt that Disney, Marvel and DMG—the film’s backers—really care.

A while back Disney, Marvel and DMG had to decide whether to comply with the strict SARFT co-production rules, or to sacrifice some of the benefits of official co-pro status and instead optimize Iron Man 3’s potential for the global market. Not surprisingly (as was revealed by a flood of press coverage that included some untimely revelations at last summer’s Comic-Con), they decided on the latter approach, making a film broadly aimed at the global audience.

Although they shot scenes in China last December with local actors—most notably the venerable Wang Xueqi and even a rumored appearance by movie diva Fan Bingbing—the partners’ overall creative and business approach precluded full adherence to the co-production rulebook. Namely, their strategy made it impractical to hire enough Chinese citizens to comply with the rule requiring that one-third of “major actors” be Chinese nationals, and they didn’t incorporate the requisite level of Chinese cultural content to qualify the film as an official co-pro under the Chinese guidelines.

But by working closely with the Chinese government, the co-producing partners have already secured many of the benefits they would have received with official co-pro status. These include:

  1. Iron Man 3 will almost certainly enjoy a rare day-and-date release, perhaps even a pre-U.S. release date. Current chatter on China’s movie blogs and chat sites has speculated that the film will release in China in April, before its May 3rd U.S. debut.
  2. The Chinese government has allowed the parties to promote the film since April of last year, whereas most U.S. imports only get a 2-3 week marketing window prior to release.
  3. IM3 has enjoyed a high degree of media access in China, at a level usually reserved only for high-profile local films. This has included various web and digital promotional activations; uncensored “leaks” of photos and news items to the national press; and an unprecedented promotional segment on the most watched TV program of the year, CCTV’s annual Chinese New Year Gala.

CCTV Gala-Downey and WangThey managed to work in a smart show of goodwill toward China on the Gala program by presenting the “Iron Man Hero Award” to a young Chinese boy who committed a heroic act worthy of Iron Man’s approval, as pictured below.Iron Man AwardThough no one at Marvel, Disney or DMG are talking publicly about their plans for IM3 in China, I’ve confirmed through other sources that they’re planning a major worldwide premiere for the film in Beijing, something that has rarely if ever happened before for a major U.S. studio.

The one major thing that these three companies presumably won’t get is the full 43 percent rental fee that comes with co-production status. But with all the other promotional consideration and support they’re receiving, by my estimation they’ve positioned the film to very likely become one of the top 3 U.S. films in China this year. Given the way things have been going for U.S. action films in China lately, that’s a very big advantage indeed.

In any case, for Disney and Marvel theatrical revenue is only a small part of a bigger picture that includes their interests in the Shanghai theme park and their consumer products business in China, both of which I expect will benefit nicely from the exposure and interest they’ve generated in the Iron Man franchise.This is exactly the sort of hustle and outside-the-box thinking that are required to ride the China wave. If Disney keeps up this level of focus and commitment to the market, this could be the year they win bragging rights as the top-grossing U.S. studio in China.

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.

“Cloud Atlas” Crosses $20 million in China; Stephen Chow’s “Journey” Will Go Big


Follow me on Twitter @robcain or Sina Weibo @robcain, or connect with me on LinkedIn.Year of Snake

By Robert Cain for China Film Biz

February 9, 2013

Happy New Year, dear reader! May the Year of the Snake bring you much prosperity and happiness.

Theaters went dark for much of the day on Saturday as China’s population turned its attention to New Year’s fireworks and lion dances.

The multiplexes reopened on Sunday with high expectations—and a massive screen count—for the release of Stephen Chow’s new action comedy, Journey to the West: Conquering the Demons. Based on the Ming dynasty literary classic commonly known as “Monkey” in the west, the film is a silly, slapstick parody with director Chow’s usual collection of rapid-fire gags.

Chow’s prior films Kung Fu Hustle and Shaolin Soccer were major hits both in Greater China and abroad, due largely to Chow’s zany energy as a leading man. This time, however, Chow will be absent from the on-screen action, leaving a hole that will be difficult to fill. Whether this picture works in pleasing audiences—reviews so far have been mixed—it is sure to open big, as it has reportedly racked up very strong presales.  Early word is that it cracked the $10 million mark on its opening day. Don’t be surprised if it goes well over $100 million in the next few weeks.

To accommodate the opening of Journey and four additional films on Sunday, Cloud Atlas and Skyfall will have to relinquish most of their screens, which will effectively slow the remainder of their China runs down to a trickle. Skyfall, as I previously noted, will wind up with $60 million or a bit more. Cloud Atlas, which crossed the $21 million mark on Saturday, could still possibly surpass its U.S. total of $27 million. While $27 million is only a middling tally for a foreign film in China these days, this would nevertheless represent some 25 percent of the movie’s worldwide gross, which would set a new record for a foreign film release in the PRC. The previous record-holder, The Mechanic, earned roughly 22 percent of its worldwide revenue in China in 2012.

Expect these percentages to keep climbing as China accounts for an ever-increasing share of the global box office. Chinese moviegoers’ tastes, which are proving to be very different than those of American audiences, will exert a steadily increasing influence over what movies get made and whom they target.

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.

Studio Report Card 2012: A Roller Coaster Year for U.S. Distributors in China


Follow me on Twitter @robcain or Sina Weibo @robcain, or connect with me on LinkedIn.2012 Year of the Dragon

By Robert Cain for China Film Biz

December 28, 2012

2012 has been an up and down year for Hollywood’s studios in China, offering a rising bounty of distribution revenues amid a series of sometimes gratifying, sometimes unsettling, but almost always surprising gives and takeaways from the unpredictable Chinese government’s film regime.

Early on, the Year of the Dragon looked to be a propitious one for Hollywood, perhaps the beginning of a long-term reign of market dominance for American films. But by summer the bloom was off the rose and Hollywood’s leaders were confronted with the question so many ‘foreign barbarians’ have faced throughout history: how to deal with the Middle Kingdom and win.

On the positive side, 2012 was the year in which China finally capitulated to years of MPAA and WTO pressure and meaningfully loosened restrictions on the import and distribution of foreign films. On the other hand, it was also the year in which China began making liberal use of blackouts—“domestic film protection periods,” in PRC parlance—to manage the grosses and maintain at least a 50 percent market share for domestically made films. By year’s end the studios had more to worry about in China than they ever did before.

None of this would matter so much were it not for the fact that China has clearly emerged as the world’s most important growth opportunity for Hollywood. For more than a decade the mainland’s aggregate box office has grown at a pace three to four times faster than its overall economy, and in 2012 it surpassed Japan to become the second largest film territory after North America.

The analysis presented below provides what I hope is a valuable snapshot, and a few useful insights, about where American distributors now stand at year’s end.

To conduct this analysis I reviewed the box office results of the more than 40 American films that released in China between January and December, 2012. These included both revenue-sharing ‘quota’ films and ‘flat fee’ imports. I classified each film as belonging to a single U.S. distributor, although in some cases multiple companies were involved. In deciding which film belonged to whom I assessed, as best as I could, which company was receiving the distribution receipts from China.

While the PRC’s rapidly rising revenue tide has lifted all of Hollywood’s boats, the benefits have not been equally apportioned. Twentieth Century Fox, for instance, grossed more than twice as much in the mainland as second place finisher Warner Bros. Universal lagged behind the other 5 majors, both in aggregate box office and in average gross per film. Although Lionsgate finished just behind Universal, the mini-major has come on strong in recent months to establish itself as a solid player at China’s multiplexes.Aggregate bo by studio 2012

Some might point to the outlier success of Titanic 3D ($154.8 million in China) as the key driver of Fox’s dominant showing, but the truth is that with its deep bench of strong performers like Life of Pi, Ice Age 3 and Prometheus, Fox would have beaten the others in total box office gross and average gross per picture even without Titanic.Average China bo by company 2012

While the PRC’s film regulators make efforts to appear even-handed in their dealings with all the studios, it is possible for a U.S. studio to win favor in the form of more rev-share distribution slots and better release dates. Fox, with its investment in local Chinese language films and its acquisition of a stake in Beijing based distributor Bona Film Group, appears to have earned special treatment as the only foreign company to have been granted six rev-share releases by SARFT in 2012. Disney and Warner Bros snagged five slots each, while Sony, Paramount and Universal each got only four. To its credit, Lionsgate won 3 slots with seemingly censor-defying pics as The Hunger Games and Twilight.

Another useful measure to examine is China indexing, that is, the share of total worldwide box office earned by each company’s films in China. This figure tells us how ‘China friendly’ each company’s slate has been; the higher the number, the greater the China appeal. The average index for all studio films in 2012 was 8.8 percent.China indexing 2012

Fox, again, came out on top by this measure, with its out-sized index of 15.8 percent. Universal ironically took second place because its international dud Battleship over-performed in China. Disney’s big China hit The Avengers was counter-balanced by the company’s under-performing animated films Wreck-it Ralph and Brave.

In many ways, 2012 has been a watershed year for Hollywood in China. Whether the studios are on an upward trajectory there or a downward one is impossible to say. But each studio’s fate in the Middle Kingdom is at least partly in its own hands, and 2013 may well be the year when those fates are ultimately decided.

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.