Business / Industries

Net giants make inroads in movies

By Raymond Zhou (China Daily) Updated: 2015-06-17 07:07

Filmmakers insist they have retained their independence despite new investors

In an era of rapid change, it takes only a year for a whisper to grow into a chorus.

This time last year at the Shanghai International Film Festival, Yu Dong of Bona Film Group lamented that all filmmakers in China would eventually become subsidiaries of BAT-short for Baidu, Alibaba and Tencent, the country's triumvirate of Internet giants.

Indeed, this year's festival seems to have been taken over by these outsiders. At a forum called "Big Data: Empowering the Movie Industry", only one of the six panelists was a filmmaker. Xu Zheng, whose 2012 film Lost in Thailand broke the box-office record for a domestic release, is working on a follow-up feature, Lost in Hong Kong.

Alibaba, whose tentacles are all over the movie map, was one of the sponsors of the forum. Late last year, the e-commerce titan increased its stake in Huayi Brothers Media Corp to 8 percent, as did Tencent, making the two the film producer's second-largest shareholders. Early this year, Alibaba paid 2.4 billion yuan ($387 million) for 8.8 percent of Enlight Media, another major film studio, again taking the second-largest shareholder position.

The Internet behemoths have invested heavily in movie-related operations, including crowdfunding and ticketing, but they have yet to show stellar results for movie production.

Some, such as Youku Tudou-affiliated Heyi Pictures, have taken minority stakes in a few titles, but none of them have become runaway hits. Alibaba Pictures has many projects in the pipeline, and it needs a slew of solid winners to establish itself in the content business.

Wang Changtian, Enlight's CEO, said he does not feel he is working for Alibaba founder Jack Ma. "All of our products are designed to satisfy the need of the whole country, so we work for the Chinese film audience," he said.

Bona's Yu Dong, after announcing a 26-picture slate that aims for a total box office return of 10 billion yuan, said he is not ready to decide which Internet giant to work with. "When I hold firm to my own core competency and make good movies, I can fit in with the environment of any of them," he said.

Yu, who is taking his company private because its market capitalization-about 5 billion yuan-is a fraction of the Internet-affiliated rivals such as Huayi, at 79 billion yuan, or Englight, at 73 billion yuan, said that the market is treating his company unfairly for his nonaffiliation with technology leaders.

Meanwhile, Zhang Qiang, CEO of Alibaba Pictures, said he is reassessing the position of his company.

Instead of making it a traditional film production organization, it will use technology to "reshape the business and make it an entertainment company that spans the whole industry chain".

Liu Chunning, CEO of Alibaba Digital Entertainment Group, said: "The Internet raises efficiency with changing technologies while content remains the king. No matter how I hype technology, if I don't produce good movies, people won't go see them."

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