Filmmakers are talking about how Hollywood players fine-tune China strategies at the 2017 US-China Film Summit.
From left to right：Patrick Frater (Variety), Gilian Zhao (Warner Bros.), Elaine Chin (Disney), Wendy Reeds (Lionsgate), and Barbara Robinson (Former director, Sony).
How Hollywood studios tackle China’s game rules to enter the fast-growing market
Wearing short hair, a black dress, and a colorful scarf with floral print, Gilian Zhao was chatting with executives from Fox International Productions, Lionsgate and Walt Disney Studios at the 2017 US-China Film Summit in Los Angeles.
This is the second year for Zhao to serve as the executive vice president and managing director at Warner Bros. China. Before that, she was the CEO of China’s Wanda Pictures, having produced over 30 films and witnessed how Wanda Group had grown from a real estate conglomerate into China’s top private film company in less than four years.
“It’s an obvious signal sent by Warner Bros. that we have people [like me] who know China better to sit here and talk about the company’s China strategies, Zhao said in Mandarin to hundreds of American and Chinese filmmakers at the summit.
She said, Warner Bothers always paid much attention to Chinese market. Warner Bros. is one of the first Hollywood studios to set up offices in China, and it opened office in Shanghai in 1993 and imported the first U.S. revenue-sharing film The Fugitive (1993) to China.
Warner Bros. is definitely not the only Hollywood studio yearning for getting a slice of the world’s second-largest cinema.
Charles Rivkin, the CEO of the Motion Picture Association of America, said at the summit, “In cities large and small, the country is adding 20 more cinema screens every day, and box-office revenue there is on pace to surpass $8 billion by the end of the year.”
China is now on track to overtake the United States as the world’s largest film market by 2017, said Mike Ellis, who heads the Asia Pacific operations of the Motion Picture Assn. of America, according to the Los Angeles Times.
Filmmakers are talking about the opportunities and challenges of US-China co-productions.
From left to right: Sarah Platt (Wanda Studios), Marc Danon (Broad Green Pictures), Bill Grundfest (writer-producer), Manfred Wong(Hong Kong producer), and Seagull Haiyan Song(Hogan Lovells).
Sell “leftover” films to China in the 1980s
Janet Yang, chair of the 2017 US-China Film Summit, was working for Universal Studios to sell Hollywood movies in China in the 1980s. “When I was back in China in the 80s, you couldn't even talk about really making money in China. The industry is just starting out. And what's happened since then is extraordinary,” Yang said.
"When I was back in China in the 80s, you couldn't even talk about really making money in China." -- Janet Yang
She can still remember how she carried the actual 35 millimeter prints of Roman Holiday flying over the Pacific Ocean. Roman Holiday (1953) and Love Story (1970) were picked by the studios for the Chinese market then, because they thought the old romantic films would fit with the taste of Chinese audience.
“We were very careful to pick movies,” Yang said. “That were not too fast not too loud not too crazy, and that would just appeal to the purity of people's hearts really, and something that was non-controversial.”
Before 1984, the Chinese film industry operated under state-controlled monopoly. Yang and her colleagues could get free movie tickets once a week or two weeks from their leaders at the Foreign Language Press in Beijing when she was working there.
(Click the image to enlarge or diminish)According to Box Office Mojo, there are 11 Hollywood movies among the top20 highest-grossing films in China, 2017. These 11 movies grossed more in China than in America, such as “Transformers: The Last Knight”, “The Fate of the Furious” and “xXx: The Return of Xander Cage.”
Watching movies was rarely seen as pure leisure entertainment for Chinese people then, but a short break from work. “It wasn’t like people voluntarily just rushed off to the movies,” she said.
Yang saw films exhibited in the countryside in China by hanging them on a sheet. “People would come with a brick, they’d sit on a brick and they’d pay with an egg,” she said.
Without decent theaters and substantial audience, the Chinese film market is not attractive at all. The studios didn’t want to sell their newest Sci-Fi film “Star Wars” in China because they thought the supernatural stories could be “too shocking” for Chinese people, said Yang.
But selling “leftover” movies are not the case right now.
Sci-fi franchise “Transformers” and action movie “Fast & Furious” sequels are the highest-grossing Hollywood films in China. And some films were released in China even two weeks earlier than in America such as “Pirates of the Caribbean: Dead Men Tell No Tales (2017).”
Play with China? First, Learn the Game Rules
To please the lucrative Chinese audience, some Hollywood studios are scrambling to add Chinese elements and Chinese actors in their films. The biggest Chinese celebrity Fan Bingbing played an unnamed nurse in “Iron Man 3 (2013),” and Chinese actress Li Bingbing also showed up in “Transformers 4: Age of Extinction (2014).”
But Manfred Wong, a Hong Kong film producer, is skeptical about the American strategy. “American producers are just starting out in Chinese film industry. They assumed that casting Li Bingbing and Fan Bingbing could guarantee a box office hit. That’s totally wrong,” Wong said in Mandarin.
In 2016, four Hong Kong co-produced films are among the top10 highest-grossing films in mainland China, including “The Mermaid,” “Operation MeKong,” “From Vegas to Macau 3,” and “The Monkey King 2,” according to the Box Office Mojo.
Wong said that the big success of Hong Kong filmmakers was because they have spent almost 20 years to deal with Chinese film regulators and fathom the taste of Chinese audience since Hong Kong and mainland China signed the Closer Economic Partnership Agreement (CEPA) in 2002.
“Any countries wanting to make movies with China should learn about China’s game rules, that is censorship,” Wong said, “American people can make fun of their president, Chinese people also can make fun of American president, but they should be careful about the other topics.”
China’s film censorship is tricky for American companies, and even for well-known Chinese filmmakers like Feng Xiaogang.
China Film Co-Production Corporation (CFCC) oversees the administration and coordination of Chinese-foreign film co-productions. Miao Xiaotian, the president of CFCC, told the ChinaFilmInsider that “setting up a film rating system can be beneficial for the market as well as the audience. It can protect children from inappropriate content and also enables the audience to enjoy diverse films. However, developing such a system or policies should be based on our own culture and conditions; we won’t just copy other countries’ rating systems.”
To protect domestic movies, the Chinese government bans imported releases during peak movie going periods, such as Spring Festival, National Day “Golden Week” holiday and summer vacations.
This blackout period disappointed many studio executives, but Zhao said that Warner Bros.’ solution was to produce local Chinese-language movies so that Warner-produced movies could keep showing up in Chinese theaters throughout the year.
Besides censorship laws and blackout period, China’s current import quota also makes headache for Hollywood studios.
China currently allows 34 foreign films to be imported on a revenue-sharing basis every year, but qualified US-China co-productions are treated as “local” films to circumvent the import quota.
The U.S. is currently negotiating with China on a new trade agreement based on the current one that has been in place since 2012. The officials haven’t offer updates on the talks. But Yu Dong, CEO of Bona Film Group, said that China would probably increase the 34-film import quota in this new deal.
Co-production is not an easy way
As a Chinese American, Janet Yang was born in New York City and she went to China for the first time when she was sixteen years old.
“While I was there [China] that I was struck by this strong impression of how great it would be if there were more Chinese on screen so people could have a better understanding of who we are, a more three dimensional portraits,” said Yang, “That really launched my mission of wanting to bring more content, more Asian characters and stories onto the screen.”
After going back to the U.S., she produced “The Joy Luck Club (1993)” which is the only Hollywood movie with all Asian cast, and a US-China co-production “Shanghai Calling (2012)” about a New York attorney’s adventure in Shanghai. Yang is now working on an animation film “Over the Moon” for Oriental DreamWorks about a Chinese mysterious moon goddess named Chang’e.
The Oriental DreamWorks is a joint venture of DreamWorks Animation. Both of them co-produced “Kung Fu Panda 3 (2016)” which was in top10 and top20 highest-grossing films in China and in the U.S. respectively, according to the Box Office Mojo.
But not each co-production was blessed with good luck. The biggest-ever US-China co-production “The Great Wall (2016)” failed in box office, way more than the Universal Pictures had anticipated.
Reflection on the unexpected failure of “The Great Wall” has become a common topic among filmmakers. So, what can make a successful US-China co-production? Check out the videos below to see.
Audience is the King
Without female character, much dialogue, and soldiers’ face-to-face fighting scenes, Christopher Nolan’s “Dunkirk” seems not appealing to Chinese people who are not familiar with the Dunkirk evacuation of World War II, said Zhao. But this movie grossed $50 million in China and got a high rate (8.6/10) from viewers online.
The success of the Warner-produced film surprised Zhao and her colleagues that Chinese audience appreciate good movies much more than filmmakers imagined.
But it’s not easy to make money from Chinese audience who have fast-changing tastes.
Zhao noticed that Chinese audience paid less attention to the big-budget and high-tech movies than before. Small-budget movies like "Dangal"(grossed $ 193 million) and "A Dog’s Purpose"(grossed $88 million) winded up with high gross in China this year.
This also surprised many other film executives. Now the China Film Group Corporation encourages Warner Bros. to submit more art films, small-budget movies and contemporary stories that are relative to people’s real life experience.
