Slouching dragon, hidden
camcorder By Anastasia Liu
HONG KONG - Global audiences love Chinese
films. House of Flying Daggers, Zhang
Yimou's latest epic drama, grossed US$11 million
at the US box office alone. But the films could
fare better at home. Given the country's
population of 1.3 billion and per capita GDP of
about 70,000 yuan (US$5,600), China's 2004
box-office figure of 1.5 billion yuan looks
meager.
This estimate from the Chinese
broadcasting authority breaks down to an average
of less than 1 yuan per person spent on movie
tickets. A recent authoritative study described
the Chinese film
industry as being mired in a
"10-year industry recession". Even Zhang Yimou,
one of the most commercially successful Chinese
directors, grossed only 153 million yuan with
House of Flying Daggers, about one-fifth of
the film's US box office. In neighboring India,
which has a lower per capita GDP of US$3,100, per
capita box office receipts have averaged 9 yuan
per person in recent years.
Executives
from the Beijing Forbidden City
Film Company spoke feelingly on the Chinese
industry's decline at a forum hosted by Hong Kong Baptist
University in mid-November. "In my youth, the film
industry was vibrant, and an important source of
information, if not the only one. Now, business is
not good," said Yan Yujing, secretary for
Forbidden City.
Until recently, only
state-owned companies like Forbidden City were
licensed to produce films. Forbidden City has
invested in several major Chinese films and TV
series in the eight years since its founding, such
as the recent blockbuster No Thief starring
Andy Lau and Rene Liu. The film grossed 53 million
yuan in its first eight days of release, but only
after its main investors, Huayi Brothers - the
largest private filmmakers in China - spent about
half that sum on advertising. Yan blamed the
decline partly on increased competition from other
entertainment media, such as TV and the Internet.
Yet such factors are also at play in other
countries like India. Why are Chinese studios
limited to such poor box office returns?
In a nutshell, vestiges of the planned
economy still hold sway over the developing
market, the film production line has yet to be
streamlined, and movie producers lose to piracy
almost as soon as films open in theaters.
Foreign and Chinese filmmakers alike have
long bemoaned the prodigious Chinese pirated DVD
industry. "Pirated DVDs are all over the place.
The salesmen now take their wares door to door,
and let you choose some of the newest movies at
such a low price - 5 yuan. And the image is very
clear," Yan said. The Internet is a new source of
woe, especially with sites offering free
downloads. This April, Forbidden City took the
portal Sohu.com to court for hosting downloads and
online viewing of the company's film Weiqing Xueye
for a fee.
Burdens of history also pose
obstacles to an open movie market. In many sectors
of the industry, state control trumps the market
mechanism. While competition from TV movies is a
common concern for filmmakers worldwide, China's
studios face a systemic disadvantage. Because of
the state's monopoly on TV stations, studios are
forced to accept the government-sponsored movie
channel's price for broadcasting rights. Yan
estimated it to be between several hundred
thousand and 1 million yuan for broadcasting
rights to over 30 provinces.
Theaters, the
most important movie outlet, used to be
state-owned. Even now, few conglomerates have
merged individual theaters into sizeable chains,
and guanxi (personal connections) are the
key to getting the best time slots for showing a
film, according to Yan.
In addition, many
filmmakers think prices for tickets, currently set
at around 50 to 60 yuan, is the main culprit for
poor showings. "China's movie tickets are the most
expensive in the world. Watching a movie in
Beijing costs the same as in Hong Kong. Such a
price, compared to our average income [about
one-sixth of Hong Kong's], is proportionally the
most expensive in the world," said Zhang Qiang,
manager of Forbidden City. "Ticket prices in
mainland China may not be fair. For example, older
films or matinee showings might cost less, but we
don't have that yet," said Yan.
The
relatively new industry also lacks professional
marketing. "In the US there is professional
marketing distinct from [distribution], and they
have authoritative critics writing articles to
guide the public in watching movies. China does
not have professionals in this segment," Yan
observed. Instead, studios and distributors,
though lacking in sufficient funds and expertise,
take it on themselves to promote their films.
Although a secretary of a state-owned
enterprise himself, Yan also criticized the state
governance of the industry, where rules are either
fragmented or not enforced, especially in auditing
transactions between distributors and individual
theaters. "For instance, when theaters
under-report ticket sales, suing them is a huge
undertaking. It's difficult to prove your case,"
he said.
While these problems still thwart
the movie industry's growth, remedies are fast
emerging. Several days after No Thief
opened, pirated DVDs of cinema footage taped with
handheld cameras surfaced in the market. Huayi
Brothers executive Wang Zhonglei told reporters
that these were swiftly and effectively dealt with
by government officials and the film's
distributor.
This is part of a larger
effort by the government since 2003 to reform the
film market. Huayi Brothers director Wang Zhongjun
told Caijing magazine this February that the most
important aspect of government policy was the
privatization of filmmaking. "We can now reach the
public directly without relying on state-owned
studios. Legalized licensing has given a great
push to help private companies go global," said
Wang Zhongjun.
Even the infamous state
censorship has loosened up. Rules released in 2003
require only a plot summary to launch most
productions. Within a year, private companies also
broke the monopoly previously held by state-owned
enterprises over movie distribution. Caijing
magazine has predicted that the plethora of new
private distributors will form closer links to
production studios. Some state-owned enterprises
are catching up in creative access to the market.
In an attempt to tap the vast cyber audience,
Forbidden City launched an interactive movie with
popular portal Sina.com in December last year. At
the "imovie" site, netizens can vote to decide the
story's ending.
Modernized theater
management may prove pivotal to the movie
industry's revival. Zhejiang province was the
first to introduce multiplex cinemas at the turn
of the millennium, and these now account for 80%
of the province's box office, according to Yan.
After a recent change in government
regulations allowed foreign investors to enter the
theater industry, they have joined in the
rebuilding of over 100 theaters in China. Warner,
for example, plans to open 12 new multiplexes in
China by year's end, aside from the many they
already co-own. This is expected to streamline
cooperation between distributors and theaters,
perhaps for more transparent auditing and ticket
pricing.
Most movies in China now target a
younger audience. If quality productions and lower
prices can get younger Chinese in the habit of
watching flicks at the theater, there may be hope
yet for Chinese films in China.
Anastasia Liu is a journalist
based in Hong Kong.
(Copyright 2005
Asia Times Online Ltd. All rights reserved. Please
contact us for information on sales, syndication and republishing
.)
