Hollywood see the Chinese film market a rising star
By Jin Liwang (New York Times)
Updated: 2005-07-04 11:32

Snow White and the seven ... monks? Like the rest of American industry, Hollywood has seen the future, and it is China.

A film crew works on the set of the James Ivory movie "The White Countess" in Shanghai in November.

Some of the biggest movie studios are now scrambling onto the mainland and planning to invest more than $150 million over the next few years in China's burgeoning film industry.

Walt Disney Pictures may even spend part of its legacy, with a plan for what some people involved say is a live-action martial-arts remake of "Snow White" that would be shot in China and replace the dwarves with Shaolin monks.

The director is expected to be Yuen Woo-Ping, the Chinese director and choreographer who arranged the fight scenes for Quentin Tarantino's "Kill Bill" series, as well as "Kung Fu Hustle" and the "Matrix" movies.

Other studios intent on China include Sony's Columbia Tristar Pictures unit, which is already producing and financing feature films here.

Time-Warner's Warner Brothers studio recently formed joint ventures to make films in China. And Merchant Ivory Productions' latest film, "The White Countess," set in 1930's Shanghai and starring Ralph Fiennes, was filmed on location here last year.

Faye Wong plays Wang Jing Wen in the 2004 film "2046," directed by Wong Kar Wai.

A few weeks ago, Harvey Weinstein, the co-founder of Miramax Films and one of Hollywood's biggest producers, told a gathering at the Shanghai International Film Festival that the company he will run once he leaves Disney's Miramax will also produce and finance feature films in China.

Drawn by China's fast-growing economy, inexpensive film production sites and its increasingly popular martial arts and feature films - most notably "Crouching Tiger, Hidden Dragon" in 2000 - Western studios are stepping up their presence here and looking to eventually turn China into a major film production base.

"China is going to grow, so a lot of companies want to come in here and produce films," said Li Chow, the general manager of Columbia Tristar Film Distributors, a division of Sony Pictures Entertainment. "Chinese films have done well internationally, ever since 'Crouching Tiger' came out. So this is a trend."

The moves come as Hollywood officials are still fighting to get their own American-made movies shown here.

And they are also putting greater pressure on the Chinese government to crack down on rampant film and DVD piracy, which costs Hollywood millions of dollars every year.

But Hollywood executives also say they are making plans to produce and invest in movies with a Chinese theme or Chinese language movies that could later be exported to the rest of the world. And American studios are laying the foundation to produce movies solely for China's domestic film market.

China's box office receipts are still small compared with ticket sales in the United States, where box office revenues were a record $9.4 billion in 2004, according to Exhibitor Relations.

But analysts here say affluent Chinese are becoming avid movie-goers, particularly in big cities like Beijing, Guangzhou and Shanghai. The domestic market is expected to grow to $1.2 billion by 2007, from about $500 million in 2004, according to China E-Capital, a private investment bank in Beijing.

Hollywood is also coming here to tap into China's growing television, Internet, gaming and mobile phone markets, which producers see as new and potentially lucrative outlets.

A few weeks ago, Warner Brothers Online announced that it would team with Tom Online, an online and wireless service based in Beijing, to distribute Warner Brothers film content on the Internet and to mobile phone users across China.

Perhaps more significantly, Hollywood executives recognize that China now has a collection of talented film directors who are breaking box office records at home and selling well overseas.

Over the last year, for instance, two movies from the acclaimed director Zhang Yimou - "Hero" and "House of Flying Daggers" - have together grossed more than $190 million outside China.

And this year's "Kung Fu Hustle," a comedy produced by the Hong Kong actor and director Stephen Chow, has already pulled in more than $54 million overseas.

The biggest Chinese language hit so far was Ang Lee's "Crouching Tiger, Hidden Dragon," which in 2000 introduced American audiences to the Chinese actress Zhang Ziyi and went on to earn $128 million, making it the highest-grossing foreign language film ever shown in the United States.

But Chinese directors are doing far more than martial arts pictures these days. Chen Kaige ("Farewell My Concubine"), Feng Xiaogang ("Cell Phone") and Wong Kar Wai ("In the Mood for Love") are considered established storytellers who can appeal to broad audiences.

"We now have a group of world-class actors and directors," said Ren Zhonglun, president of the Shanghai Film Group, which produces movies and has also formed a joint venture to operate cinemas in this country with Time-Warner. "These people can attract investment from all over the world."

Disney's "Snow White" remake, which is still in development and subject to change, will be in English. But the Hollywood studios hope to produce a mix of Chinese and English-language films.

"There are going to be a lot of American films with a Chinese component," said Dede Nickerson, a producer who has handled Miramax's Asia operations for the last four years.

So far, Sony Pictures' Columbia TriStar film division is probably the most aggressive Western film company operating in China.

It has already financed, produced and distributed Chinese-language films that include "Kung Fu Hustle," and "House of Flying Daggers" and the "Road Home."

In August, the company will release Wong Kar Wai's latest film, "2046," a Chinese-language feature starring Zhang Ziyi, in the United States.

TriStar is also planning to finance a Chinese-language sequel to "Kung Fu Hustle."

Time-Warner is investing in China as well. Through various joint ventures, the company is putting money into more than 70 cinemas around the country in preparation for a potential theater-going boom.

And its Warner Brothers unit has said it will form a partnership with the state-owned China Film Group of Beijing and the privately owned Hengdian Group, one of China's largest film companies, to co-produce mostly Chinese language movies here. One advantage in forming such a venture is that any film produced in China is exempt from the country's quota of 20 foreign films a year.

Then there is the powerful producing tandem, Harvey and Bob Weinstein, the brothers who founded Miramax Films.

Last month, at the Cannes Film Festival, the Weinsteins said that their new business, the Weinstein Company, had already acquired the distribution rights to Chen Kaige's next film, "The Promise," which at $35 million is one of the most expensive Chinese language films yet made in China. The Weinsteins and the IDG New Media Fund, an investment vehicle controlled by the giant technology publisher, the International Data Group, purchased the North American, England, Australia and South African distribution rights to the film, which is expected to be released in December.

It is not Mr. Weinstein's first foray into China. During his time at Miramax, Mr. Weinstein signed deals that brought Chinese language films to the United States, including "Farewell My Concubine," "Chungking Express" and "Hero."

And Miramax produced Quentin Tarantino's "Kill Bill" series, much of which was shot in Beijing, as well as the forthcoming "The Great Raid," which was also shot largely in China.

In June, Harvey Weinstein appeared at the Shanghai International Film Festival with a group of financial advisors from Goldman Sachs and a team from IDG Films. The group is believed to be looking to produce or acquire the rights to additional Chinese films.

"This can be a major production base," said Steven Squillante, a former Miramax executive and independent producer who is now a partner at IDG Films. "L.A. has doubled for everywhere in the world. And so can China. They have high-quality crews, stunt men and good facilities. Backlots are backlots, and sound stages are sound stages. And the construction costs are manageable."

Hugo Shong, a senior vice president at IDG who grew up in China and invests heavily in technology companies here, recently set up the company's New Media Fund with $150 million in startup capital. IDG also formed a film and content production unit, and hired several film executives including Mr. Squillante and David Lee, a former Sony executive.

Perhaps the most telling sign of the movie world's interest in this country has been the appearance of a Chinese language version of Variety magazine, published here by IDG, and the opening of a new Beijing bureau of The Hollywood Reporter.

"Why am I here?" Jonathan S. Landreth, the new Beijing bureau chief of the Hollywood Reporter, asked rhetorically. "Because everyone else in Hollywood is."

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