China’s movie business continued its rapid growth in 2012 and for the first time in four years, Hollywood imports accounted for the majority of the box office. Theatrical receipts in the world’s most populous country increased 28 percent to $2.7 billion (16.8 billion yuan), according to data released by the State Administration of Radio, Film and Television (SARFT).
China is now the world’s second-largest film market, surpassing Japan. Ticket sales for imported movies totaled 8.8 billion yuan or 51.54 percent of gross ticket revenues. Though the domestic movies’ box office was off, the 48.46 percent share still exceeds market expectations issued earlier in 2012 following the signing or a new China-U.S. film agreement that increased the annual import quota of Hollywood blockbusters from 20 to 34 and lifted their share of revenue from 17.5 percent to 25 percent.
2012 was a remarkable year for China’s film industry. It was the first year that 14 additional American films were contracted to enter Chinese mainland’s cinemas. It’s also the first time in a while that these imported films have grabbed more than half the share of the market.
But doing business in China is still difficult and frustrating. Imported movies, mostly from the U.S., accounted for 68 percent of box-office receipts in the first half of 2012, and in the second half the state-owned China Film Group began opening some blockbuster imports on the very same date in an effort to limit their box-office success. That strategy, along with several “blackout” periods during which no imported movies were allowed to play in theatres, appears to have worked, as the lopsided box-office receipts balance tilted back toward Chinese productions in the second half of the year.
Just recently, Chinese censors cut 40 minutes from the film Cloud Atlas, which opened in China on Jan. 31. The film’s three directors—Andy and Lana Wachowski and Tom Tykwer—were not involved in the re-edit. A report from a Shanghai newspaper said expository sequences and “passionate love scenes” were cut from the film, while graphic scenes depicting a character being shot in the head and another having his throat slit remained intact. Chinese censors also clamped down on the James Bond film Skyfall, as shots of a Chinese character being killed and dialogue referring to prostitution and politics were either edited out or omitted from the subtitles.
It’s too soon to guess whether certain mandates in China by the censors, SARFT and China Film Group will soften and make it easier and more productive to do business in China. But the size of the market and its potential business is hard to ignore. China is now the second-largest market outside the U.S. with only 12,000 modern screens operating.
A Convergence of Art Houses
For the sixth consecutive year, the Sundance Institute-sponsored Art House Convergence brought together the nation’s art-house operators in mid-January to discuss the issues impacting these passionate champions of specialized cinema. The Convergence has grown over the years from a very small gathering to a network of 120 independent cinemas.
As Matthew Helmerich, executive director of Key West’s Tropic Cinema, reports on page 44 of this issue, the biggest challenge facing the art-house community is the transition from 35mm film to digital presentations. A survey conducted by Juliet Goodfriend, president of the Bryn Mawr Film Institute, notes that 68 percent of art houses canvased in her survey have not converted any of their screens to Digital Cinema Initiatives-compliant projectors.
That’s an alarming figure, in light of Twentieth Century Fox’s decision to stop shipping 35mm prints after 2013, a policy likely to be enacted in the future by the other major studios. At the conference, film historian David Bordwell criticized the “shock-and-awe business plan” of those studios as neglectful of the needs of small art houses. But the digital ones and zeroes are already on the wall, and specialized cinemas without a plan to navigate the transition are in danger of going out of business. No doubt the Convergence gave those holdouts a sense of urgency and some useful advice on surviving in the digital age.
Sundance founder Robert Redford was the star attraction at the conference. The man behind the highly influential indie mecca called the Sundance Film Festival recalled his boyhood moviegoing days in South Los Angeles and noted how special seeing a movie with an audience has always been for him. “Don't let the screens get too small,” he urged the exhibitors in the room.
For Convergence director Russ Collins, CEO of Ann Arbor’s Michigan Theater, the local art house is all about creating and reinforcing a community. Whatever technological challenges lie ahead, the thing that makes art houses special is the human experience of sharing adventurous films together. Here’s hoping independent art-house entrepreneurs prove as spirited and resourceful as the daring and innovative movies they’re showing on their screens.