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.

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China’s Leading Movie Production Companies


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by Robert Cain for China Film Biz

July 29, 2012

With their import quotas, foreign film blackouts, and other methods of market management, SARFT and the PRC government have made it abundantly clear that protection of local films and producers is a major Chinese policy goal.

Since Chinese protectionism is unlikely to go away, U.S. and other foreign producers who seek to participate in China’s booming film business will need to start engaging more with local Chinese companies.

There are several thousand licensed production companies in China (more than 1,500 in Beijing alone), so outsiders need systematic ways to narrow their lists of potential collaborators down to manageable size. One such method is to measure companies by their respective market shares. That’s my purpose here.

I’ve listed below China’s top production companies by their market share during the first 7 months of 2012. In calculating market share I’ve attributed each Chinese language film to a single production company, even though in some cases there were as many as 15 production companies credited on a single film. In such cases I’ve attributed credit for the film only to the company that received the first position credit. Co-productions with foreign companies are attributed to the mainland Chinese partner.

ImageSource: Pacific Bridge Pictures research

Here’s more detail on the top five:

Ningxia Film Group

Ningxia Film Group is the official government owned production company of Ningxia Autonomous Region, a tiny northern Chinese province that borders Inner Mongolia. The company landed at the top of this list by virtue of a single film, Painted Skin: The Resurrection, the only film it has ever produced. Ningxia’s President, Hong Yangtao explained that he had only one chance at making a movie: “We shot this film to survive.” His strategy for producing and launching Painted Skin 2 has resulted in mainland China’s most successful film ever, so it’s very possible that Ningxia may avoid the fate of becoming a one-hit wonder.

China Film Group

With all of its financial strength, distribution clout, and government influence, it’s surprising that China Film Group’s production division has managed only a 3 percent share of its home market this year, far less than any one of the Hollywood studios have captured in China. The Beijing-based company is a government-owned behemoth that is far more influential in the distribution sphere, where it has played a role in releasing 19 of the top 20 grossing films of 2012. Under its Chairman Han Sanping, CFG is preparing for an upcoming IPO.

Huayi Brothers

China’s most powerful independent (i.e., non state-owned) entertainment conglomerate, Beijing-based Huayi Brothers is a diversified company engaged in film and TV production, distribution, theatrical exhibition, and talent management. Huayi Brothers trades on the Shenzhen stock exchange at a market capitalization of US $1.5 billion. The company’s Wang Brothers are skilled at attracting top directors, and they consistently rank among China’s market share leaders. If any Chinese company can challenge Hollywood’s studios for market dominance in China, Huayi Brothers is certainly a top contender.

Bona Film Group

Like Huayi Brothers, Beijing based Bona Film Group is also an independent, publicly traded company engaged in both production and distribution of films. Trading on the US NASDAQ exchange, Bona’s current market capitalization is US $345 million. Under President Yu Dong the company has been a reliable supplier of blockbuster hits in recent years, and usually captures at least a 10 percent share of the domestic market. Bona is one of the more internationally-oriented Chinese companies, with interests in Hong Kong and the United States, and is now 20 percent owned by News Corp. Look to Bona to be one of the next producers of a crossover hit that breaks out internationally.

Enlight Media

Under CEO Wang Changtian, Enlight Media rarely mis-fires in its production and distribution of feature films.  Squarely focused on the action and romance genres, Enlight usually places several films in China’s top 20 grossers, and currently has in release the country’s fourth highest-grossing Chinese language film, The Four. Enlight is also a major player in China’s TV series production and distribution businesses. Under the leadership of its CEO Wang Changtian, the publicly traded, Beijing-based company has achieved a market capitalization of nearly US $1 billion.

Companies that didn’t make the top 15 ranking above but that are worthy of mention include Shanghai Toonmax, Stellar Pictures, Xiaoxiang Film Group, Henan Film Studios, DMG Entertainment, and Dadi Films.

Too many production companies are competing in China for scarce resources—and for even scarcer quality scripts. If the PRC’s film regulators are serious about making their domestic industry more competitive, they should focus less on protectionist measures and more on encouraging consolidation and cooperation among the industry’s disparate players.

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.

Bribery Accusations Make Waves in China’s Film Circles


by Robert Cain for China Film Biz

May 2, 2012

My friends who are close to China Film Group (CFG) Chairman Han Sanping tell me that Han is battling accusations of corruption in the wake of the SEC’s recent announcement that it will investigate Hollywood’s studios for alleged violations in China of U.S. anti-bribery laws. While some defend Chairman Han as being above reproach, others, perhaps his political enemies, have been quick to vilify him. Whatever the truth may be—and I can only speculate—the ferocity of the rhetoric flying around in Beijing underscores how deeply political the business of film is in China.

With the PRC in the midst of a momentous, once-in-a-decade power transition that has already spawned enough sordid tales of lust, intrigue and murder to fill a lifetime of soap opera episodes, tensions are high and the rumor mill is rife with chatter. A figure as powerful and visible as Han can be an easy target for those jockeying for position in the new power matrix.

Whether the allegations are true or not, the centralization and vise grip control that Han’s China Film Group enjoys over all film production and distribution activities in China unfortunately result in a system where bribery is often encouraged. Every step from script to shooting to distribution requires government approval. And with the notoriously low salaries that China’s government employees receive—one friend tells me that according to public records, Han’s official monthly salary is lower than those of most entry level employees in Hollywood—the motivations for accepting “gifts” must be powerful. While China’s adoption of WTO ordained business practices has had a positive impact on business ethics, China is still a long, long way from being as clean as, say, Sweden or Australia.

Han’s rise to power has been swift and unparalleled in the history of China’s film industry. A mere 8 years ago when China was the world’s 25th largest film market and Han was fairly new in his post, he wrote pleading letters to certain Hollywood stars in hopes of luring them to participate in China’s modest film productions. Now, with China having vaulted to 2nd place behind the U.S. in theatrical revenue and its industry awash in cash, Hollywood’s studio heads regularly fly to Beijing to pay tribute to Han and to beg for seats at his box office banquet.

Han has been responsible for the production and distribution of hundreds of movies, and for launching the careers of dozens of China’s top stars and filmmakers. However his CFG career ends—it’s been widely expected that he’ll relinquish his post when the new political regime takes power later this year—he has presided over one of the most extraordinary periods of growth ever seen by the global film industry. It would be a shame if his career were to end in ignominy, and I, as one who has enjoyed some pleasant and entirely above-board dealings with Mr. Han, hope that he will be cleared of any allegations of wrong-doing.

On another money-related note, I’ve been gratified to be able to arrange meetings for several of the world’s most powerful money managers during their visits to Los Angeles in recent weeks, and I’ve been impressed by the lengths to which certain multi-billionaire businessmen have bent over backwards to accommodate my overseas guests’ schedules. Although some Hollywood moguls were unable to join us on short notice, I greatly appreciated the efforts of those who did, and to those who were unable to reply to me in time (or to those whom I may have inadvertently overlooked in a rather manic couple of weeks) I would like to extend an invitation for the next time these money mavericks come to town.

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 Film Personality: Han Sanping


by Robert Cain for China Film Biz

March 7, 2012

This week Hollywood welcomes one of the Chinese film industry’s most important and influential players, Han Sanping (韓三平). As Chairman of the Chinese government/business mega-conglomerate China Film Group, Han is responsible for more financing, production, distribution, export and import of films than everyone else in China combined.

Han is visiting Los Angeles this week to meet with executives at several studios (Universal, Sony and Disney have been specifically mentioned in the industry trades) to seek out co-producing partners, and to consider requests for precious import quota slots. A couple of clients of mine are meeting Han this week to ask that he allow their blockbusters to screen in Chinese cineplexes.

There is no real Hollywood equivalent to Han, because he wears so many hats: producer, director, studio executive, government administrator, and mentor. If you took Jack Valenti, Lew Wasserman, and Steven Spielberg and rolled them into one, you’d begin to get an idea of Han’s power and influence in China. He has overseen the production and distribution of hundreds of movies and television series, he manages the Beijing Film Studios, and he has final greenlight authority on all co-productions with foreign partners.

Han is also widely recognized as a kingmaker who has nurtured the careers of such top directors as Chen Kaige, Zhang Yimou and Feng Xiaogang, and of many leading Chinese actors and actresses as well.

The kingmaker’s own career was nurtured and mentored by my new friend Liu Cheng. Han began producing movies nearly 20 years ago, which makes him the equivalent of an OG in China because there are few film veterans who can claim that sort of longevity. He has had a producing role on numerous Chinese blockbusters including Red Cliff (directed by John Woo), The Warlords (Peter Chan), Shaolin (Benny Chan) and Aftershock (Feng Xiaogang), and on such Hollywood films as Mission Impossible III and The Karate Kid. He also directed two of China’s highest grossing films of the past three years, the star-studded, Chinese Communist Party sponsored propaganda films The Founding of a Republic and The Beginning of the Great Revival.

Last year I helped Han to evaluate Hollywood visual effects companies for one of his films, and as a result I gained some access to his inner circle. I’ve heard that his trip this week has yielded at least one major surprise: there has been a marked negative shift in the major studios’ attitudes toward co-production with Chinese partners.

Apparently, in the wake of the Chinese government’s recent announcement regarding its relaxation of film import quotas and its enhancement of revenue sharing, the studios’ appetites have diminished for co-production as a means of boosting their China business. With enough quota slots now for each major studio to average 5 or 6 Chinese releases per year, and with their share of revenue now bumped up to 25 percent of box office gross, the Hollywood giants see little incentive to deal with the hassles of Chinese co-production. An unanticipated consequence of Beijing’s opening up of the Chinese market is that it may encourage less Hollywood cooperation, not more. Most of the studios have had trying experiences in the past with Chinese partners, and any incremental revenue they might theoretically earn by making movies in China isn’t considered sufficient compensation for the risks, creative restrictions, and headaches they would have to bear.

From my vantage point this is a good thing. China still wants access to Hollywood expertise and market clout, and the less the studios want to provide these things the more opportunity there will be for entrepreneurial American and other foreign companies. We may see more Chinese money begin to flow into high profile independent productions.

Han Sanping won’t have to concern himself with these issues for much longer; he’s nearing the mandatory retirement age of 60, and it’s widely anticipated that he will soon be leaving his post. Some speculate that Zhang Qiang, a younger protégée of Han’s, will step into the China Film Group chairman’s seat later this year.

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 Film Personality: Liu Cheng


By Robert Cain for China Film Biz

March 3, 2012

Last week I had the privilege of attending a luncheon event that yielded two most unexpected gifts. The first was a copy of a beautiful Chinese book, the Three-Character Primer of Film (电影三字经), given to me by the author himself, Mr. Liu Cheng (柳城). The second was the gift of meeting and beginning what I hope will be a long friendship with Mr. Liu, a warm and generous man who has inspired and influenced countless filmmakers in China and around the world.

The luncheon was part of a day-long celebration of the installation of Mr. Liu’s newly translated Three-Character Primer at the Motion Picture Academy’s Margaret Herrick Library in Beverly Hills. Written in admirably poetic style in just 900 classical Chinese characters, evocatively translated into English, and exquisitely bound on rice paper, the book is a marvel of economy and truthful insights about the art, craft and power of film.

Mr. Liu himself is a unique individual: accomplished and modest, powerful and gentle all at once. He was the man of the hour among an august group** of American and Chinese filmmakers, producers and industry executives, and the respect, admiration and affection for him in the room were as rich and piquant as the Chinese delicacies on the table.

A few choice morsels from his book:

In scene and storyline, less is more,
Stress what’s important, stick to the core.

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For subject let obsession be your guide,
Release the yearning that lies deep inside.

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Emotional truth is your glue and your weave,
Conflict comes from desires to which we cleave.

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Liu Cheng’s career has encompassed teaching and leadership positions at the Beijing Film Academy, at the State Administration of Radio, Film and Television (SARFT), and currently at China’s national film channel, CCTV-6. He has been responsible for screenplays and movies at the highest levels in China’s industry, and counts among his friends film luminaries the world over.

The 50-plus commentaries and testimonials to his book reveal the impact he has had on global film industry leaders. A selection of quotes from these testimonials follows:

Zhang Yimou, filmmaker: “It amazes me that he was able to produce a major work using so few words and present a major truth so neatly… This is a book which is deceptively simple, but full of surprises. It seems effortless, but has been carved out through painful effort.”

Im Kwon Taek, filmmaker and the ‘Father of Korean film’: “I hereby recommend the Three-Character Primer of Film to all my Korean colleagues, as well to young people who hope to make a career in film. They will find the wisdom that the writer has acquired through a lifetime at filmmaking.”

Han Sanping, Chairman of China Film Group: “It would not be excessive to hail the Primer as a classic, not because of its three-character format, but because it has put the finger on the essence of the art of film as well as upholding an attitude to life itself.”

Jane Campion, filmmaker: “There is poetry in film, but Mr. Liu Cheng has written a poem on film itself, thus worthy of our attention.”

Janet Yang, Producer: “The Primer has a deceptively light touch. The writing must have been a very demanding job: one must be knowledgeable about film, one must master classical Chinese, and one must understand life.”

Jon Avnet, filmmaker, Chairman of the Motion Picture Association of America: “When I read Mr. Liu’s poetics, I felt he captured the essence of filmmaking. He has done it in rhyme, and he has done it concisely.”

J.J. Abrams, filmmaker: “As a fan of script writing and filmmaking books, this fantastic volume from across the globe has become one of my favorites. It is slight in page count only; the contents herein are critical truisms to which we all should adhere.”

David Seidler, screenwriter: “Please don’t read the Three-Character Primer of Film by Liu Cheng. If you do, you’ll become extremely wise in the ways of screenwriting, and I don’t need the competition.”

It is tempting for those of us in the west who have little insight into the inner workings of China’s film establishment to dismiss it as a faceless bureaucracy, an adversary standing in the way of our ambitions. But we can all take comfort that rare individuals like Liu Cheng, lettered, passionate about art, and optimistic about the future, are there in China, ready and willing to lend us a hand.

(**My table at lunch comprised a convivial group that included producer and former AMPAS President Sid Ganis, producer Janet Yang, Rhythm & Hues president John Hughes, visual effects master Doug Smith, writer-director Anna Chi, Wuxi Studios business development executive Rita Cahill, CCTV on-camera personality Maggie Wang, and Mr. Liu Cheng.)

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.