China Cinema News – Monday 22 January 2018

By | January 22, 2018 7:36 am PST

Will China’s BO overtake US; Chinese audiences go off 3D; battle of mobile ticketing platforms; Wanda cinema report and sheds assets abroad; SMI Group show off ‘new marketing’ ahead of backdoor listing; “Secrtet Superstar” is Bollywood’s first revenue share; “Last Jedi” bombs badly; CNY ticket discount curb; coffee machines in cinemas; Wuhan cinema insights; private cinemas become ‘love hotels’ and pirating ‘Ferdinand’ as a reward for the kids. 


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There is renewed speculation about when China’s box office could overtake that of the US. As before, this is often based on little more than extended the growth curve for the last year straight up, rather than any meaningful analysis of underlying market dynamics. “Judging from various factors, 2020 is likely to be the gold box-office intersection of China-US films for three reasons,” the article claims. But this entails US BO declining further in 2018 (unlikely), an average annual growth rate of 18% in China (also unlikely) and excessive belief in “lack of content innovation in Hollywood; and the threat from the Internet streaming media.” The end of the article carries some important disclaimers, including the inability of Chinese films to find any meaningful success abroad. WeiXin – 13 January 2018

The start of the end of 3D in China? (image: Mtime)

The start of the end of 3D in China? (image: Mtime)

Is China’s love affair with 3D is waning? Two of this years biggest Chinese New Years holiday films will be released in 2D only. Whereas only one of the Top 10 films in 2016 was released in 2D, by 2017 that number had increased to four. It is worth recalling that Universal hand to convert its fifth Bourne film to 3D just for China, causing audience complaints about the shaky camerawork not being a good match for 3D. This is because China’s hollywood quota is for 20 films plus 14 more 3D or Imax releases, meaning that Chinese film makers can ditch the format but Hollywood is stuck with it for now. Mtime – 18 January 2018

Battle of the ticketing platforms. (image: Sohu)

Battle of the ticketing platforms. (image: Sohu)

A good overview of the Chinese mobile ticketing platform market, which is turning into a duopoly with the rival Alibaba and Tencent back platforms. Mobile/internet sales accounted for  81% of all ticket sales as of 2017. Yet Sohu warns of ‘oligarchic trend’ in the market, as big data will enable these platforms to become vertically integrated media powerhouses. Yet mobile ticket growth is at a bottleneck:

The data from shows that the annual average viewing frequency of users in the Chinese movie market dropped from 7.36% of the previous year to 5.80% and the attendance rate also dropped to 13.3%, well below the 45% in Japan and more than 30% in North America.

This Chinese New Year’s holiday will be a test of the market, with the capping of discounts. Also, there are growing complaints by cinema operators about arrears by the e-commerce ticket providers. Sohu – 12 January 2018

Wanda Cinemas Logo

Wanda’s annual report for 2017 was released on Saturday 20 January and showed that Wanda had sold off CNY 200 billion (USD $31 billion) worth of assets overseas. Total value of its assets was down 11.5% to CNY 700 billion (USD $109 billion), of which 93% was in China and only 7% was overseas. Most of the assets sold were in real-estate, such as London property project One Nine Elms. It is reported that Wanda has been in discussions with six companies in the past three months about selling a stake or part of the AMC cinema empire. Interestingly, “non-box office revenue was 5.1 billion yuan [USD $796 million], accounting for 39% of revenue,” for its 516 cinemas with 4,571 screens in Mainland China. Sina Finance – 20 January 2018

SMI Group new retail event

SMI Group new retail event

SMI Group held a one-day event the attracted 300 of China’s big cinema players (Imax, Cat’s Eye, Ali Pictures, etc.) to outline its vision for “new marketing, new retail and new development” in the cinema sector. China is far ahead of any other country in turning cinema customer data into campaigns and retail opportunities. SMI will implement its ‘2.0’ reform across 100 cinemas this year and gave examples of how it is already succeeding in e-commerce vertical integration. Chinese cinemas aren’t just ahead but light years ahead of their US and European counterparts in this regard. The company is planning a backdoor stock listing, so this event can be seen as a roadshow for the company. Guandian.cn – 19 January 2018

Cast and crew of "Secret Superstar" at promotional event. (photo: Shi Yangkun/Sixth Tone)

Cast and crew of “Secret Superstar” at promotional event. (photo: Shi Yangkun/Sixth Tone)

Bollywood star Aamir Khan’s “Secret Superstar” will be the first revenue share Indian film to release in China. Previously films were sold for a flat fee, to avoid the import restriction quota. It is likely to top the charts in China this weekend, even if it doesn’t match the staggering success of his previous film “Dangal”, which took over USD $200 million and was one of the Top 10 films of 2017 in China. China Film Insider – 18 January 2018

The Force is not strong with this one. (poster: Disney / Lucasfilm)

The Force is not strong with this one. (poster: Disney / Lucasfilm)

“Star Wars: the Last Jedi” performed badly in China. Very, very badly. “Disney’s Star Wars: The Last Jedi has accomplished something in China that no other $200 million-plus budgeted live action movie has achieved in nearly five years: it has earned less than $50 million in box office grosses at the Middle Kingdom’s movie theatres.” Chinese audiences prefer action to sci-fi, which is why the “Fast & Furious” franchise performs so much better. Forbes – 17 January 2018

New minimum ticket price. (image: Sohu)

New minimum ticket price. (image: Sohu)

Chinese distributors and government bodies are working together to fight ticketing fraud and ‘malicious competition’during the Chinese New Year festival. There will be a minimum price of CNY 19.90 (USD $3.10) and no more than 500,000 subsidised tickets can be sold for any one film. Kang Li, COO of the ticketing and review platform Mayan is quoted as saying,  “With the implementation of this policy, the film market can get rid of the low-level price war competition stage as soon as possible and move into the content-centered phase of value-based competition.” But Forbes’ Rob Cain doubts this “attack on the symptom” will help create better Chinese films. Sohu – 18 January 2018

China vending coffee machine

China vending coffee machine

Chinese cinemas have traditionally been offering the same Coke and popcorn combination as cinemas around the world. But now Chinese exhibitors are waking up to the retail potential of coffee. “The unmanned coffee bar by a Chongqing Network Technology Co., Ltd. R & D, previously in Chongqing, Beijing, Sichuan and other regions put pilot coffee machine,” in a local cinema. Offices, hotels and other public places already have these. Price is CNY 5 to CNY 18 (USD $0.78 to USD $2.81) for a choice of coffee, tea, milk or more, with beans provided by Lavazza.

Wuhan cinema statistics. (source: Win Biz Network)

Wuhan cinema statistics. (source: Win Biz Network)

The cinema growth in Wuhan, China’s sixth biggest urban theatrical market, provides some interesting insights about the state of Cinema in China. The cinema count doubled in just four year from 59 to 119, the number of cinema goers also doubled from 22.579 million in 2014 to 44.597 million in 2017. Yet the per capita declined last year from 54 to 46 meaning that more cinemas means less average attendance.  Win Business Network – 10 January 2018

A toast to couples-only private cinema. (photo: smartzhike)

No hanky-panky! (photo: smartzhike)

A new worry for the private cinema market. Some places offer movie rooms with double beds and parents of some children are concerned. A  “room-like hotel package night without ID card,” is too much freedom for some youngsters to enjoy something more than just a date night movie away from the prying eye of parents.

 On December 21, the law enforcement officers of the Radio and Film Enforcement Brigade and the anti-pornographic and non-brigade enforcement team of the Municipal Law Enforcement Detachment of the Municipal Cultural Market jointly teamed up with a number of private cinemas and similar entertainment venues in the Third District of the city to see if they had relevant business procedures and films

As if private cinemas didn’t face enough challenges in complying with copyright, food and hygiene regulations, fire and safety standards and more, they now need to check under-18s. QQHRNews- 26 January 2018

Finally

No bull! "Ferdinand" pirate is caught. (image: People's Daily)

No bull! “Ferdinand” pirate is caught. (image: People’s Daily)

A man was detained by cinema staff in a cinema in Chaoyang for pirate recording the 20th Century Fox animated feature “Ferdinand” on his smartphone. His defence was not that he was looking to pirate it, but his child was busy cramming for school exams, so he had promised the film as a reward. Apparently he was unaware what he was doing was illegal piracy. The staff deleted the film form his phone and told him off. People’s Daily – 17 January 2018

Patrick von Sychowski
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Patrick von Sychowski

Patrick was a Senior Analyst at Screen Digest, went on to launch the digital cinema operations of Unique and Deluxe Europe, then digitised Bollywood at Adlabs/RMW, and now writes, consults and appears on panels about cinema all over the world.
Patrick von Sychowski
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