Is $50 Million the New $100 Million for Hollywood Movies in China?


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By Robert Cain for China Film Biz

April 24, 2013

At this time a year ago American film producers and distributors had cause to be exuberant about China. The Chinese box office was booming, new theaters were opening at a rapid clip, and the grosses for Hollywood movies were going up, up, up. Whereas a $30 million gross would rank a film among the top 10 releases in China in 2010, in 2011 the top 10 threshold was $40 million, and in early 2012 $60 million became the new benchmark. American films were the primary drivers of this upward trend.

China had clearly fallen in love with Hollywood movies, and it seemed reasonable to expect that imported American tent-pole films would continue to ride the swelling box office wave.  Pictures like Mission Impossible: Ghost Protocol ($102 million gross) The Avengers ($91 million) and Titanic 3D ($154 million) began fueling the expectation that $100 million totals would soon become routine.

In 2013 the wave has continued to roll, but somewhere along the way Hollywood got stuck in the shallows. China’s box office is still booming, and nearly 5,000 new screens have opened in the past 12 months, yet as Chinese language films have leaped ahead to $80 million, $120 million, and even $200 million grosses, American movies have drifted back to 2011 levels, when the Chinese market was half the size it is now.

Blame shifting audience tastes, blame government interference if you like, but whatever the reason, Hollywood’s releases in China have had trouble cracking $50 million in 2013. Only two U.S. films have reached that level this year: Skyfall at $60 million, and The Hobbit at barely $50 million. Others will certainly get there—G.I. Joe: Retaliation is a current possible candidate—but few if any will reach the numbers the U.S. studios were aiming or hoping for when they submitted their import applications to SARFT.

It’s not entirely clear at this point what Hollywood can do to reverse the trend. Co-productions might be one possible method for Hollywood to recapture market share, but whether China wants co-pros with big U.S. companies anymore is becoming a real issue. Even while announcements of U.S.-China tie-ups were flooding out of last week’s Beijing Film Festival, SARFT was dithering about whether to allow the biggest U.S.-China film collaboration in history, Iron Man 3, a favorable release date during the upcoming Chinese Labor Day/May Day holiday. If such a major, high profile joint-venture can’t get equal treatment with local movies, then the whole idea of the value of U.S.-China co-productions must be called into question.Box office week ending April 21, 2013

For only the fourth week out of 16 this year, a Hollywood film carried the top spot in the Chinese box office rankings. G.I. Joe: Retaliation ran up $33 million in its 7-day opening week, a good showing given the above-mentioned lowered expectations for Hollywood films in general. G.I. Joe slowed down considerably on Monday and Tuesday of this week, with less than $4 million over those two days, so it’s still uncertain that it will reach the $50 million mark.

Dreamworks Animation’s The Croods opened soft with $6.2 million in its first two days, signaling a probable final gross of less than $20 million. This is consistent with China’s pattern of giving short shrift to original animated features. Mostly it’s the sequels and pre-sold animation franchises like The Smurfs that bring in the big bucks in the PRC.

As I had predicted, aggregate national revenue in Week 16 fell short of the total for the same week last year, but not by much, which bodes well for the weeks ahead.

Year-to-date box office sales in China surpassed the $1 billion mark last Saturday, more than a month earlier than it reached that milestone last year. It won’t be a surprise if the PRC posts another 40 percent annual increase in 2013.

Since Iron Man 3 now looks unlikely to bow on its originally intended April 26th release date, the youth romance So Young should open big on Friday without much competition to impede it. Although a few of my Chinese friends think the film’s melancholy tone will dampen its grosses, most believe the film’s star appeal and excellent early reviews will drive it to blockbuster numbers. Check in later this week for more about So Young.

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 Box Office Bests Previous Weekly Record by 61 Percent With Scant Help From Hollywood


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

By Robert Cain for China Film Biz

February 22, 2013

What a difference a year makes. Last February, Hollywood action pictures like Mission Impossible: Ghost Protocol and Journey 2: The Mysterious Island dominated China’s multiplexes, seizing a 70 percent share of the market and leaving only crumbs for local Chinese films. Tom Cruise reigned as box office king with his Mission Impossible hitting $100 million, only the fourth film to reach that plateau in Chinese history. Hollywood’s long-term hegemony over the Chinese movie landscape seemed secure.

A year later, the situation could scarcely be more different. So far this month Hollywood’s share of Chinese theatrical revenue is barely 10 percent. Tom Cruise, whose new action flick Jack Reacher debuted to a tepid $5 million last weekend, has been supplanted by a Chinese star named Bo Huang, who has notched three successive breakout hits: Lost in Thailand, Journey to the West, and now the China-Japan co-pro (!) romance Say Yes. Chinese action-comedies are routinely cracking the $100 million threshold, while Hollywood action movies are underperforming to a troubling degree.

One non-Chinese player that has fared exceptionally well in China of late is Village Roadshow Pictures Asia, which nabbed the number one and number two box office rankings last week with its co-pro entries Journey to the West and Say Yes.Box office week ending Feb 17, 2013

Journey to the West broke numerous records, including the biggest single-day gross with nearly $20 million on Valentine’s Day, the biggest weekly gross ever ($93 million) and the fastest arrival at the $100 million mark (8 days). As of Tuesday, its tenth day in release, the film’s cume stood at $122 million. I don’t think I’m going too far out on a limb here in predicting that Journey will break Lost in Thailand‘s all-time record Chinese language film gross of $201 million.

Say Yes, a Chinese-language remake of the hit 1991 Fuji Television drama “101st Marriage Proposal,” debuted to an impressive $19 million. Journey and Say Yes combined gave Village Roadshow and its partners an 83 percent share of the week’s $135 million nationwide gross, also an all-time record. The previous weekly record gross was $84 million.

Year-to-date, China’s aggregate box office is up by 30 percent, while U.S. films are down by 59 percent. Some might blame the U.S. films’ decline on long release delays or on the individual films themselves (Skyfall, Gone and Jack Reacher), and they may be right, but I believe the most important factor is that Chinese audience tastes have shifted.Weekly box office 2012 vs 2013

Not only have several Chinese language films caught on with audiences, but the non-Chinese films that are indexing well now are different than the ones that indexed well a year ago. During the past several months the foreign pictures that have over-indexed in China have been more offbeat or intellectual movies like Life of PiLooper, and Cloud Atlas, or the more quirky action films like Bait and Expendables 2.

The trend could turn again in favor of Hollywood’s tent-poles, with upcoming releases that include The Hobbit on February 22nd, Les Miserables on February 28th, and Oz: The Great and Powerful and a Good Day to Die Hard in mid-March (I had previously been advised that the latter two films might open on the same day, but I’m now told it’s more likely they’ll be spaced at least a few days apart). The only certainty in China is change, and for the moment, anyway, it is trending in favor of China’s local producers and those foreign producers who have committed to serving the Chinese 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.

“Cloud Atlas” Floats to Top Among New Debuts in China


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By Robert Cain for China Film Biz

February 5, 2013

China may not completely save Cloud Atlas from sinking in red ink, but it will definitely keep the $100 million picture alive and afloat for a little longer. In its first four days in the PRC the film has grossed $11 million, a 14 percent boost to its anemic $78 million worldwide total.

Word-of-mouth for the Wachowski/Tykwer directed sci-fi/fantasy flick has been reasonably good in the Middle Kingdom, despite a reported 40 minutes of footage cuts at the hands of the SARFT censors. If it gets a pre-holiday boost, and if it doesn’t get clobbered by the New Year’s day release of Stephen Chow’s highly anticipated Journey to the West, Cloud Atlas’ gross in China could possibly surpass its $27 million North American total.

Overall it was a decent week at the multiplexes, with several family-oriented releases enjoying solid debuts. As I’ve noted previously, Chinese audience tastes appear to be broadening, and for the first time since October nine films grossed 8 million RMB ($1.3 mm) or more in the same week.Box office for week ending February 3, 2013

Still, aggregate weekly revenues of $53 million were down 12 percent from the same frame in 2012, when ticket sales exceeded $60 million. The culprit in the drop-off from last year is Skyfall, which continues to lag far behind last January’s box office champ Mission Impossible: Ghost Protocol. I won’t rebuke those who doubted my accurate call regarding Skyfall’s under-performance after the first day of its release in the PRC, but I will say–to paraphrase Kevin Spacey’s line in the new “House of Cards” TV series–“After 20 years in China’s film biz, I can smell which way the wind is blowing.”

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.

China’s Box Office: Bird Soars with ‘Mission 4’


By Albert Wang with Robert Cain for China Film Biz

February 3, 2012

In mainland China, the seven-day-long Spring Festival is a holiday break to commemorate the Lunar New Year, and it is also the time when many make the long and arduous trip back home to celebrate with their families and relatives.  For about a hundred million  Chinese migrant workers this holiday break is one of the few times during the year they ever have a chance to visit home.  And so as one might expect, the Spring Holiday is an incredibly difficult travel season, regardless of whether one is traveling by plane or train.

If the week’s box office numbers are anything to go by, mainland Chinese are also increasingly taking time out of this hectic annual holiday break to enjoy movies at their local cinemas.  Weekly box office was up by about 25 percent (in US dollar terms) over the comparable holiday week last year, with a total of $62 million. The month of January was very strong, running 43 percent of January, 2011, though it should be noted that this is not a direct comp, since last year’s Spring Festival didn’t occur until the beginning of February.

The big winner for this week was the Brad Bird directed action picture Mission: Impossible 4 – Ghost Protocol, which in a span of only two days took in an estimated $15.8 million at the Chinese box office, or well over half of M:I 4’s $25 million weekend total on the foreign theatrical circuit.

Paramount claims that Mission: Impossible 4 took in a haul in China that was five times greater than that of 2006’s Mission: Impossible 3 opening weekend in China.  But this feat may not seem quite so impressive when one realizes that China’s box office has grown by more than six-fold during that period.

Rounding out the top 5 for last week were Sherlock Holmes: A Game of Shadows, The Viral Factor, All’s Well Ends Well 2012, and The Great Magician.

During the week-long holiday, the mainland Chinese box office totaled 390 million yuan (roughly $US 62 million), significantly higher than the Spring Holiday Week numbers from 2011 and 2010 (320 million yuan and 340 million yuan, respectively).

What makes this year noteworthy is the fact that non-domestic films dominated what has traditionally been a solid week for domestic Chinese films.

Typically, the Lunar New Year ushers in a selection of ensemble Chinese films headlined by big Chinese stars.  The All’s Well Ends Well series, for instance, is an example of this distinct genre; the franchise dates all the way back to 1992, when the original All’s Well Ends Well featured a massive Hong Kong cast that included Stephen Chow, Maggie Cheung, Leslie Cheung, Raymond Wong, Sandra Ng, and Teresa Mo.

Just last year, the Spring Holiday week (Feb. 2-Feb.8, 2011) saw three Chinese films – All’s Well Ends Well 2011, My Own Swordsman, and What Women Want – take the top spots at the Chinese box office.

This year’s Spring Festival Holiday, however, saw fewer big domestic films in this genre.  The week’s top grossing Chinese language film, for instance, was the Hong Kong-produced The Viral Factor, which released a week prior to the Spring Holidays and had no thematic connection to the Lunar New Year celebrations.  The only newly opening non-Hollywood films to crack the top 10  last week—the Taiwan-made Perfect Two and the Shangjing-directed Fan Ju Ye Feng Kuang—opened to less than $5 million each.  The latter was in fact a Chinese New Year film directed by the director of My Own Swordsman, a comedy that played to big opening numbers last year.

It remains to be seen whether 2012 marked a fundamental shift in box office behavior over the Chinese New Year Holidays. It may be that the Chinese government prefers to see domestic films dominate this culturally important holiday week, and would thus implement policies to favor domestic films.  This could have been the reason that M:I 4’s release came at the tail end of the holiday. Then again, with so much money being spread around during the Spring Holidays, party officials may not mind sharing in the profits that a Hollywood blockbuster like M:I 4 or Sherlock Holmes can rake in.

Albert Wang is an aspiring producer of US-China film co-productions who joined the Pacific Bridge Pictures team in December, 2011. His previous blog on US-China films can be seen at hollymu.com.

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.