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.

“Skyfall” Fallout


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By Robert Cain for China Film Biz

January 23, 2013

I caught some flak yesterday from friends who were surprised by the tone of my article “Skyfall’s Hard Landing in China,” in which I described the latest Bond film’s opening day in China as “disappointing.” These friends, who are significant stakeholders in Skyfall’s success, called me out for being too hasty in judging the movie’s opening based solely on the first day’s grosses, and they were right. I want to clarify why I wrote what I did, and more importantly, to offer a mea culpa for suggesting that Skyfall may already be a failure in China, which was certainly not my intent.

Success or failure can only properly be judged against the backdrop of time and prior expectations. To be fair to Skyfall and those who have labored to release it in China, we should give the film a week or two to fully assess its trajectory.  As for everyone’s pre-release expectations, I surely don’t know what every individual stakeholder was hoping for, but I would be surprised if most aren’t looking at last January’s release Mission: ImpossibleGhost Protocol (“MI:4”) as the comparable against which they are gauging Skyfall. That’s where I was looking when I wrote yesterday’s article.

MI:4 is a good comp for Skyfall in several important ways. Both are big budget stunt- and effects-driven action vehicles that performed exceptionally well around the world before they arrived in the PRC (according to IMDB, MI:4 grossed $693 million worldwide, and Skyfall has just crossed over the $1 billion mark). Both experienced unfortunately long delays between their U.S. and China releases. Both opened during the late January, pre-Chinese New Year lull against little-to-moderate competition. And both faced the challenge of overcoming heavy pre-release piracy that undoubtedly cut into their Chinese theatrical grosses.

I also felt that Skyfall had two meaningful advantages over MI:4. China’s theatrical film business is 30 percent bigger now than it was last January, as measured both by screens in operation and by average weekly theatrical revenue. And Skyfall also opened on far more screens—at least 30 percent more by my calculation—than MI:4 did. Indeed, with some 5,500 prints and perhaps 7,000 engagements, Skyfall enjoyed the widest theatrical opening in China’s history.

Given all these considerations, my logic in looking at Skyfall is that it ought to gross at least 30 percent more than the $102.7 million MI:4 did last year in order for it to be considered a comparative success. So let’s call that a $133 million target. That may seem an unfairly high bar for Skyfall, but let’s not forget that in the past month alone China has seen Lost in Thailand and CZ12 easily exceed that threshold, while Life of Pi, a movie that grossed less than half globally what Skyfall has done, neared $100 million despite being pulled from mainland multiplexes after 30 days.

So when Skyfall took in 31 million RMB (US $5.1 million) after its first day, compared to the 57 million RMB that MI:4 earned in its first day a year ago, I saw that as a disappointment. After its first two days MI:4 stood at 101 million RMB, or $15.7 million; Skyfall is now at 62 million RMB and US $9.8 million after its first two days. There’s an important difference in that MI:4 opened on a Saturday whereas Skyfall debuted on a less desirable Monday, but even so, I expected and hoped for more from Skyfall. It is entirely possible that the Bond film will kick into gear in the coming days and prove me wrong, and I sincerely hope that it does for the sake of my many friends who are involved in the movie, but to my mind the signs aren’t pointing that way.

Still, I welcome the sort of feedback that my friends offered, and I was reminded by them that these humble musings of mine reach a large and important audience, so I ought to have chosen my words more carefully. I always welcome well-reasoned feedback that corrects any errors I may have made. I can’t say yet that I was wrong about Skyfall’s ultimate China numbers, but I do regret having inadvertently upset some of the film’s backers, and for that I wish to apologize.

As always, please feel free to write me at rob@pacificbridgepics.com with your thoughts.

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.

Skyfall’s Hard Landing in China


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By Robert Cain for China Film Biz

January 22, 2013

Skyfall opened on Monday in China on nearly 5,500 screens, which makes it the widest release ever in the PRC. But a nearly 3-month delay in its release, widespread piracy, and mixed-to-poor word of mouth among theatergoers doomed the Bond film to a disappointing $5.1 million opening-day mainland gross.

Sunday’s midnight screenings also fell below expectations at roughly $300,000. It now appears unlikely that Skyfall will come anywhere close to matching the take of last year’s first big Hollywood release, Mission Impossible 4, which opened in January, 2012 and went on to a final gross of $102 million.

As China’s film business has grown and as its audience has broadened deeply into the second and third-tier cities, it has become increasingly difficult to guess how the country’s audiences will respond to individual films. Skyfall seemed a natural given last year’s successes of action blockbusters like Mission Impossible, The Avengers, and Men in Black III. But to paraphrase the late, great Yogi Berra, “If people don’t want to come out to the theater, nobody’s going to stop them.”

Among the common complaints I found on Sina Weibo, China’s Twitter, were that the film’s rhythm was too slow and that there were too few action scenes. Some exclaimed that they felt “completely robbed.” Never mind that the film was both a critical and commercial smash in the rest of the world, it will severely under-index in the PRC.

Other recent surprises include the $13 million haul taken in the week ending January 20th by Bona’s Bring Happiness Home, a spin-off of a popular Chinese cable TV show that nearly knocked Grandmaster out of its number one spot. And the animation team at Shanghai Hippo, creators of the Animen films, must have been sorely disappointed by the tepid reception to their latest animated film Jungle Master, which grossed only $800,000 in its first 6 days.
Box Office week ending Jan 20, 2013

With audiences continually defying expectations in recent months, both to the upside and to the downside, 2013 looks to be an eventful and unpredictable year 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.

China’s Box Office 2012 Re-Cap: Another Stellar Year


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By Robert Cain for China Film Biz

2012 was one of the most eventful years I can remember in my 20-plus years working in and following the Chinese film business.

It was the year in which China surpassed Japan to become the world’s second largest movie territory.

It was a watershed year for investments from China into North American entertainment (more on this below) and from North America into China. IMAX continued its bold theater expansion, opening its 100th screen in the PRC, and Fox bought a stake in producer-distibutor Bona Group. Both IMAX and Fox were rewarded with superb returns this year on their China investments.

It was also a year of contrasts and contradictions. Consider:

2012 was the year when Hollywood showed that it can dominate the Chinese market, with a 63 percent market share in the first six months. It was also the year China’s filmmakers proved they can dominate their market too, notching two of the year’s three biggest hits—Lost in Thailand and Painted Skin: Resurrection—and three of the top four if we include CZ12’s revenues into the first week of 2013. All of these films were $100 million-plus grossers.

2012 was the year China’s government finally capitulated to years of WTO pressure by expanding its import quota and increasing foreigners’ revenue-share allowance to 25 percent. It was also the year SARFT aggressively protected China’s domestic films via extended foreign film blackouts and manipulation of release schedules to prevent Hollywood from exceeding its “allowed” share of the market.

It was a year when China’s film czars issued repeated warnings and censorship dictums to reinforce the Communist Party’s chaste rules of on-screen propriety and its strict prohibition of films that challenge the legitimacy of the Party’s autocratic rule. It was also the year when the country’s giant government-owned TV network, CCTV, aired a national broadcast of the U.S. film V for Vendetta, which details and glorifies the actions of a terrorist who violently overthrows a totalitarian regime.

It was a year when a Chinese company, Dalian Wanda Group, became one of America’s biggest theatrical exhibitors through its acquisition of AMC Theatres. It was also a year in which Chinese films dismally failed to attract American audiences, with the top ten Chinese language releases in North America—several of them huge hits in China—collecting a combined gross of barely $1.75 million at U.S. multiplexes.

Above all, it was a year of enormous growth. Let’s break down the numbers.

SARFT announced last week that China’s theaters earned a total of 17.07 billion RMB in movie ticket revenue in 2012. Using an average currency exchange rate of 6.31 RMB per dollar, this works out to $2.71 billion dollars, good enough for a 31 percent increase over 2011. That’s the ninth year in a row that China has logged a 30 percent or better increase (as measured in U.S. dollars).China v U.S. BO CAGR 2003-12

Source: Pacific Bridge Pictures research

During the past decade China domestic films revenues have grown at a compound annual rate of 40 percent. Had the North American market grown by the same rate it would now be a $190 billion industry. Unfortunately for those of us in Hollywood, North America has grown at the sluggish pace of just 1.8 percent annually, less than one-twentieth the growth rate of China, so we are in jeopardy of being surpassed by China—even if its growth slows considerably—in just five to seven years. At that point China will account for one in every four dollars of worldwide ticket sales.China Pct of WW BO thru 2020

Source: Pacific Bridge Pictures research

2012 saw five new film releases go on to gross $100 million or more in China, more than reached that mark in all of China’s combined prior history. Three of those five films are of Chinese or China-Hong Kong origin and one, Lost in Thailand, will become China’s highest grossing film ever with a total of at least $215 million. I believe this qualifies as the highest gross ever for a film in a single territory outside of North America.

China Top 15 Grossing Films 2012

Source: Pacific Bridge Pictures research

To make the list of the top 15 films in 2012 required a $50 million gross; in 2011 the threshold was $30 million, and in 2010 it was $23 million.

Foreign films took more than half of all ticket revenue, reportedly the first time this has happened in China in a decade, according to SARFT. The vast majority of this share went to Hollywood movies. But Chinese films fought back and gained share in the second half, with purely domestic films capturing 20 percent and China-Hong Kong co-productions taking another 25 percent. If SARFT succeeds in its future manipulations of the market, foreign films will never again capture more than half of China’s ticket revenue.Share of 2012 China BO by Film Country of Origin

Source: Pacific Bridge Pictures research

Of course, had China allowed in more American films, the US share would have been greater. The average American release earns six times as much in China as the average Chinese film, and quite a few US (and other foreign) films are shut out of the market due to censorship concerns and quota limitations. Had China completely eliminated its import restrictions in 2012, and had it not instituted blackout periods, there’s little doubt that non-Chinese films would have easily taken at least two-thirds of the box office.Average China BO per Film by Country, 2012

Source: Pacific Bridge Pictures research

Action and adventure remain the top drawing genres, expanding their share from 30 percent of revenues in 2011 to 44 percent in 2012. Romance surpassed science fiction as the second most popular genre, as several love stories, most notably Titanic and Painted Skin 2, drew large numbers of moviegoers to theaters. Animation’s share dropped from 15 percent in 2011, when Kung Fu Panda 2 set records and some very tough comps, to just 9 percent in 2012. Sci-Fi fell even further, from 17 percent of receipts in 2011 to just 5.5 percent in 2012. Comedy rose by 2 points to 9 percent in 2012, largely on the back of mega-hit Lost in Thailand.

Share of Box Office Receipts by Genre, 2012

Source: Pacific Bridge Pictures research

Chinese audiences spend on movies far out of proportion to their incomes, and the extraordinary growth there shows little sign of slowing down. China added more than 3,800 new movie screens last year to reach a total of 13,118 screens by year’s end.  If we factor in the massive skimming that takes place at China’s ticket counters, total box office last year was probably closer to $4 billion than to the officially reported $2.7 billion figure.

China’s new status as the world’s second largest box office territory will be short-lived because China will soon surpass North America, and in 15 years or so it will dwarf the United States in importance to the global film industry.

Chinese filmmakers still have much to learn, but they will be backed by the full weight of the Chinese government in protecting their interests and helping them to compete. The successes of Lost in Thailand and Painted Skin: Resurrection demonstrated that Chinese audiences prefer mediocre local films that are at least “good enough” to better quality foreign language movies. And with government support, more and more Chinese films that are “good enough” will appear. The window is closing on Hollywood’s prospects in the PRC, and only those companies that remake themselves as more China-oriented producers will stand a chance of benefiting from the future’s biggest growth opportunities.

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.

Jackie Chan leads China to Torrid Start in 2013


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By Robert Cain for China Film Biz

January 8, 2013

Jackie Chan’s action comedy CZ12 took in $37.6 million last week in leading China to another record-smashing session of $86 million in total weekly box office, a 139 percent increase over the same frame in 2012.

China’s multiplexes have been overflowing with business of late. After a record-breaking December 2012 that saw box office takings increase by 74 percent over December 2011, January looks set to continue the sizzling pace.

Current box office champs CZ12 and Lost in Thailand have positively walloped last year’s January frontrunners, The Flowers of War and Flying Swords of Dragon Gate. The latter two films were 25 days into their runs by January 8th, 2012, with Flowers at an $88.5 million cume and Flying Swords at $79.4 million. This year, by comparison, as of January 6th Lost in Thailand had finished its 26th day with a $182 million cume and CZ12 its 18th day of release at $113 million. The two current films have earned 76 percent more revenue in 6 fewer screening days than last year’s leaders.Box office week ending 1-6-13

CZ12 is now the 2nd highest grossing Chinese language film and the 4th highest grossing of any film, domestic or foreign, in mainland history.  Lost in Thailand is poised to surpass Avatar‘s all-time box office record of $209 million by the end of this week or early next.

With the long-awaited Wong Kar-Wai action-biopic The Grandmasters opening today and Skyfall marking the return of Hollywood fare to the PRC on the 21st, January will likely be another record month.Box office growth 2013 v 2012

This extraordinary year-on-year growth signals an inflection point in China’s movie market evolution. The rapid addition of new cinema screens has certainly contributed to the mainland’s blistering run, but that’s only part of the story. More importantly, what has changed is that moviegoers have been coming out for Chinese movies with unprecedented frequency. They have shown that a quality local film can draw just as well or better than a Hollywood blockbuster. If China’s filmmakers can continue to make movies that Chinese audiences want to see, China’s trend of annual box office increases of 30 to 40 percent should continue through the rest of this decade.

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.

CZ12’s Massive Opening Marks a Massive Shift in China’s Film Business


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By Robert Cain for China FIlm Biz

December 21, 2012

On Thursday Jackie Chan’s and Huayi Bros’ action-comedy film CZ12 (formerly known as Chinese Zodiac) confirmed a reality that should strike fear in the hearts of Hollywood’s studio executives: China doesn’t need Hollywood films to break box office records.

One-man band Chan, who wrote, directed, produced and DP’d the $50 million CZ12, has exceeded all expectations by delivering a film that set a new December single day record in China with 43 million RMB (US $6.8 million) on Thursday, adding fuel to an already blazing hot month at PRC multiplexes. Last week China set an all-time single-week revenue record, and this week is on track to break that record.

CZ12 follows on the heels of smash Chinese hit Lost in Thailand, which will pass $100 million in its first two weeks and should easily eclipse $160 million by the end of its run (my Chinese colleague Firedeep was the first to go on record with a prediction that the film’s gross will exceed $200 million). That will make it the second highest grossing film in China’s history after Avatar. With its lower ticket prices, Lost in Thailand will actually beat Avatar’s record for total admissions.

Although I haven’t yet seen it, CZ12 gets my vote as the film most likely to break out from China and become an international hit. Release dates are lined up in Russia, South Korea, Malaysia, Vietnam, and all over Greater China, and a U.S. release now seems likely.

Just as Detroit mocked the clunky little imported Toyota cars from Japan in the 1950s and RCA, Magnavox and Zenith (remember them?) ignored Sony’s little transistor radios in the 1960s, Hollywood has so far done little to protect its position vis a vis China as the world’s leading provider of movies.

To be sure, China has a long way to go, but if Hollywood had any common sense it would be sending legions of smart, China-savvy execs and producers to the PRC to figure out how to make movies there and profit over the long run. Instead Hollywood has yielded that advantage to the Hong Kongers and South Koreans, who are now much better positioned to ride the China wave and profit there than Hollywood may ever be.

There is still time for the major U.S. studios to counteract the competitive threat from China, but the success of films like Lost in Thailand and CZ12 ought to be viewed as the first shots across the bow of Hollywood’s global hegemony.

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.

Shark Horror Flick Takes a Big Bite Out of China’s Box Office


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By Robert Cain for China Film Biz

October 16, 2012

For only the 2nd time in history a foreign film—namely the Australian horror-thriller Bait 3D—has opened to bigger numbers in China than in North America.

With its $8 million 3-day weekend China debut, Bait is running 30 percent ahead of its North American opening, and will likely run up a bigger final tally in China than the $15.3 million it has taken in stateside.

The first time a foreign film achieved such a feat was this past Spring when Titanic 3D logged a massive debut and finished up with a $154 million final gross, nearly three times its U.S. total. The difference this time is that Bait is a new release with virtually zero pre-awareness.

Bait has also set a new bar for horror releases this year, and depending on whether one considers Resident Evil 4 a horror film, Bait would qualify as either the biggest or second biggest debut ever for a horror flick in the PRC.

With a director and cast you’ve probably never heard of, and with an outlandish plot that involves a group of shoppers who are trapped by a freak tsunami in a submerged grocery store amongst a bloodthirsty group of great white sharks, one could be forgiven for thinking Bait an unlikely hit. But it seems that Chinese audiences were attracted to Bait’s combination of 3D with action and gore just like, well, like sharks are attracted to blood in the water. Producer Gary Hamilton of Arclight Films was delighted with the picture’s performance and tells me he’s planning a sequel.

Also noteworthy about this week’s box office chart is that it was the first time I can recall when the #1 and #2 films in China were both non-U.S. foreign films. Although foreign films took a 64 percent share of the weekly box office, U.S. films accounted for just 13 percent.

This doesn’t bode well for Hollywood’s studios, most of which remain bizarrely under-invested and under-represented in what has long been the world’s fastest-growing movie market. All year I’ve been warning that unless the studios begin to meet the Chinese halfway they risk getting squeezed out of this mammoth territory, and with each passing week it’s looking increasingly likely that’s precisely what’s happening.

Two other foreign entries, The Expatriate and The Cold Light of Day, didn’t fare nearly as well as the 3D fish tale, with both of the former films netting around $1 million or less. The next foreign debut in China is also a non-studio film, U.K.-based Working Title’s Anna Karenina, which opens today. It won’t be until the end of the month before another Hollywood studio film, The Bourne Legacy, makes an appearance 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

Post Lunar Holiday Box Office Update: The Official Numbers From China


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by Robert Cain for China Film Biz

October 9, 2012

The official numbers from China for the box office week ending September 30th are in, and they confirm the figures I’ve been publishing since last Wednesday, albeit with a couple of minor adjustments. With 6 new high profile releases opening over a 4-day span, it was an extremely tight field with a sharply divided audience and no runaway box office winner.

Taichi 0 took the weekly revenue crown, while Looper led the field in admissions during the Friday-Sunday weekend. With its higher average ticket price due to its strong attendance in IMAX theaters, Taichi edged out Looper in total weekend revenues. Assassins, which ran in theaters for two days longer than Looper, held its lead and grossed more than the latter film did for the week, although Looper’s cume vaulted ahead early in the following week.

Huaxia tried to counter-program against all the male-oriented action films with a romance starring Zhang Ziyi, but Zhang’s appeal has faded over the years and her film, a Chinese take on the 18th century French novel Les Liaisons Dangereuses, barely nosed into the week’s top 5.

Sunday the 30th marked the end of the 3rd quarter, the summer period, which would normally have seen a sequentially higher gross than the 1st and 2nd quarters. But because the SARFT-imposed blackout kept June and July clear of most major Hollywood films, attendance dipped in the summer, with the unusual result that the summer total was about five percent lower than the spring.

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

We’ll Be Right Back After This SARFT Holiday Break


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By Robert D. Cain for China Film Biz

October 8, 2012

More than a week after it was reported in the Hollywood trades and beyond that Looper opened with a record-smashing debut in China, there is still no official word from SARFT as to what actually happened at the PRC’s multiplexes. In a country where the designated president-to-be can disappear for 10 days without feeling the slightest obligation to explain or even acknowledge his absence, I suppose it’s too much to hope that timely box office reports might be delivered during a holiday week.

In the absence of official word, I’ll go out on a limb and offer my best guess as to what did occur in China over the past week and a half. Bear in mind that the figures below are only as accurate as my back-channel sources. Official numbers should be out in the next day or two, at which point I’ll provide an update.

First, Looper did open well in China, but it came nowhere close to the US $25 million figure that was initially reported by the Hollywood trades and picked up by more than 100 news outlets around the world. While the film did set several notable precedents, it didn’t break any box office records, and it now appears that my initial estimate of $4.3 million for Looper’s opening weekend was just about right.

The National Day holiday week of October 1st through 7th saw roughly $60 million in aggregate ticket sales, making it only the 8th best week of the year so far. Given the high expectations exhibitors had coming in to the week, they were likely disappointed by this result.

China’s year-to-date box office tally probably reached, or at least came very close to, the $2 billion mark last weekend. By the third week of October it will surpass last year’s record total of $2.06 billion. Had it not been for the bucket of ice SARFT dumped on the country’s sizzling box office growth by imposing its 2-month summer blackout of Hollywood blockbusters, the year-to-date total would now be more than $2.2 billion and China would have a shot at cracking $3 billion by year’s end. As it stands now I’m projecting a year-end total in the $2.7 billion to $2.8 billion range.

While China’s film bureaucrats continue to revise their priorities and tactics, two North American companies and one partially American one have exhibited great savvy in maneuvering through the ever shifting political sands of the PRC.

The two aforementioned North American companies are IMAX and Twentieth Century Fox. Both companies have made substantial investments in China and have been smart about how they conduct their business there. IMAX picked a winning film and a winning strategy when it decided to back the Huayi Bros action-fantasy film Taichi 0 with a large format theatrical release. IMAX was unquestionably a major factor behind Taichi  0’s winning box office performance. And Fox made the right move when it submitted Europa Corp’s Taken 2 as a French, rather than an American film, enabling that picture to slip through the holiday blackout and open on Sunday. Its estimated $2.3 million opening day bodes well for Taken 2’s China run.

The ‘partially American’ company I’m referring to, DMG, is a Beijing-based Chinese company that has strong American representation among its senior ranks. DMG pulled off several coups with Looper last week, getting a film that was clearly American (with Chinese flavor) released during a blackout week when Hollywood studio films were strictly prohibited. DMG also managed to obtain for Looper the first U.S.-China day-and-date release since Madagascar 3 opened in June. And DMG’s connections enabled it to achieve a strong screen count during an extremely competitive frame, and should enable it to keep the film running longer in China than most other American films. Although Looper’s China gross won’t come close to matching its U.S. total, it will likely wind up as one of the best indexing U.S. films in China this year.

Also of note: Lionsgate’s The Expendables 2 ended its spectacular run on Sunday, winding up at an estimated $53.6 million, which would put it ahead of The Amazing Spider-Man and just behind The Dark Knight Rises for China’s 9th best performance in 2012. Not bad for a film that grossed $84 million in North America.

And now back to our regularly scheduled program.

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

Did ‘Deadline’ Commit a China ‘Looper’ Blooper?


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by Robert Cain for China Film Biz

October 3, 2012

Over the past several days I’ve received an unprecedented volume of calls, emails, texts and tweets, all asking me whether Looper had just become the first film to earn more revenue in its China debut than in its U.S. debut. Apparently the “Deadline Hollywood” blog reported on Saturday evening that Looper had earned “between $23M to 25M grosses” in China over the weekend. The story was quickly picked up by other media outlets, and within 24 hours it was accepted as fact around the world that Looper had smashed all sorts of records in China.

I was immediately doubtful of this report for two reasons: 1) Looper could not be the first film to gross more in its China debut than in the US because Titanic 3D had already achieved that feat back in April; and 2) The $23-25 million opening over 3 days seemed unlikely for reasons I’ll explain below. I checked around with my sources in China and found that almost no one believed the Deadline story to be true. Most felt that Deadline had gotten its currencies confused, and that the real number was around 27 million Chinese yuan, which equates to roughly 4.3 million US dollars. If correct, that figure would put Looper’s China opening far short of its $21 million US debut.

I’m unwilling to go on record as saying that Deadline is wrong, because I won’t know for certain until SARFT publishes the official box office figures. But because it’s a holiday week in which the SARFT report will be delayed for at least several days, and because there is so much international interest in this story, I’m going to weigh in with a few thoughts and some figures of my own, with the disclaimer that much of what follows is speculative and based on what I consider reasonably reliable, but unofficial numbers. I will say that if Deadline had someone on staff who understood the Chinese market, it’s unlikely that they would have rushed to put out their report.

Following are a few reasons why I’m more inclined to believe the $4.3 million weekend figure for Looper than the $25 million one.

  1. Only two films have grossed $25 million or more in their opening weekends in China this year—Titanic 3D and Men in Black 3. Both were heavily pre-sold blockbusters with strong, dedicated followings in China, and both had little competition when they debuted. As good as Looper is, it had none of that going for it.
  2. Many of Looper’s prints didn’t make it to theaters in time. Because SARFT only decided at the 11th hour to grant Looper co-production status, distributors and exhibitors didn’t know until a few days ahead of time that they would be allowed to release the film. Looper’s marketing and distribution were hence severely disadvantaged.
  3. This past weekend was a major travel period for China, the biggest in its history. Hundreds of millions of Chinese were traveling in advance of the National Day holiday week. Lots of people who might have ordinarily gone to the multiplex were busy getting from one place to another, welcoming guests, or making preparations for the holiday.
  4. This past weekend was also probably the most competitive film weekend China has ever seen. In addition to Looper’s opening, four major Chinese movies featuring big stars—among them Chow Yun-fat, Tony Leung, Daniel Wu, Fan Bingbing and Zhang Ziyi—opened against it. With only about 12,000 total screens China’s box office capacity is limited, and for Looper to earn $25 million it would have had to thoroughly dominate all the other films. It’s unlikely that’s what happened.
  5. Although Looper’s U.S. producers Sony and Endgame apparently insisted that the film earned $23 – 25 million in China, no one else backed up that figure.

I’ve presented below the figures I’ve received through back channels in China:

That’s the story so far as I see it; if I’ve been wrong about this I’ll eat my words. As soon as the SARFT numbers come through I’ll publish an update.

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