(SCMP) China’s rapid ascent towards the top of the world’s film market has ground to a virtual halt, with box office takings for 2016 edging up just 3.73 per cent to 45.7 billion yuan, compared with an astonishing 48 per cent expansion in 2015.
The anaemic growth, marking the slowest rate in the last decade, will have surprised many analysts and industry observers who had predicted that China would overtake North America as the world’s largest big-screen market in 2016 with ticket sales tipped to top60 billion yuan.China’s market had expanded more than three-fold between 2010 and 2015.
In fact, North American movie theatre receipts dwarfed China’s at US$11.4 billion (79.3 billion yuan), according to box office tracker comScore.
The five-year boom in mainland cinema - a rare sweet spot, seemingly untouched by China’s economic slowdown - reached a zenith during the Lunar New Year, when Stephen Chow’s The Mermaid earned 3.39 billion yuan to become the country’s top grossing movie of all time, before losing steam soon afterwards. The Mermaid was co-produced by China Film Group and Alibaba Pictures, a unit of the company that owns the South China Morning Post.
Both the summer and golden week holidays saw contractions in box office receipts, despite an aggressive build out during 2016 that put the mainland ahead of the US in terms of cinema screens for the first time in history.
“A chief issue is the weak crop of films. There are very few blockbusters, unlike in 2015 when dark horses like Monster Hunt gave a boost to the phenomenal growth,”said Angela Han, an analyst with China Merchant Securities.
Many big budget films turned into dismal flops that failed to break even on their investments. Chief among them were China’s most expensive film The Great Wall and fantasy L.O.R.D: Legend of Ravaging Dynasties, which stars China’s best-paid actress Fan Bingbing.
“When you look at Hong Kong, Macau and Taiwan, you will find their movie markets also fared worse in 2016,”said Han.
Market players blamed last year’s poor box office performance on the particularly high base created in 2015. At the time, a record number of viewers in China flocked to cinemas to take advantage of steep discounts offered by burgeoning mobile-ticketing platforms.
But many of these subsidies were phased out in 2016 as the ticket sellers had already gained their foothold in the market.
“By the end of 2016, up to 70 per cent of ticket subsidies faded out,”said Han.
A crackdown by the authorities on so-called “ghost screenings,” a tactic mainland film distributors adopted to fabricate ticket sales of blockbusters to create artificial hype around particular titles, also put a brake on the growth of the market, industry insiders believe.
To rejuvenate the box office, Beijing loosened its grip on the number of foreign titles allowed for release in China for the last quarter of 2016, fuelling speculation that it was counting on Hollywood to lure back filmgoers.
Hollywood productions dominated the list of China’s top grossers, with Walt Disney’s Zootopia, Legendary Pictures’ Warcraft and Marvel Studios’ Captain America: Civil War among the top five ranked films, collecting about 4.44 billion yuan from the world’s second largest movie market.
The stalled expansion at home has prompted film giants such as Dalian Wanda Group, owned by China’s richest man Wang Jianlin, to set their sights on Hollywood. Wang, who already owns the world’s largest theatre chain, in November bought Golden Globe awards producer Dick Clark Productions. Earlier, Alibaba’s studio offshoot agreed to team up with Steven Spielberg’s Amblin Partners to produce films.
After a gloomy 2016, some analysts are predicting a slightly more upbeat market in the coming year.
“This year we will see more exciting releases, such as The Fast and Furious 8, Transformers: The Last Knight as well as Pirates of the Caribbean,”said Nomura analyst Richard Huang. All of the titles he mentioned are Hollywood franchise series that have accumulated an enormous fan base in China.
Source: South China Morning Post by Celine Ge