Cash of the Titans

Will Chinese money ruin the Hollywood flicks you love?


The love affair between Hollywood and China has been a longer one than you might think. The courtship began in 1985, shortly after the country opened up, when Universal, Paramount and MGM sent Chinese-American ‘ambassador’ Janet Yang to Beijing. Yang, who’d brought previously unknown Chinese titles such as Chen Kaige’s Yellow Earth to US arthouse cinemas, managed to sell the first American studio movies to China since 1949.

Yang has since worked with the likes of Steven Spielberg and Oliver Stone, and helped produce titles such as The People vs Larry Flynt. She recalls how ‘valuable’ films such as Star Wars and Jaws were held back in favour of made-for-TV flicks and ’60s classics such as Spartacus. ‘The Chinese people were so culturally isolated. They wouldn’t have known what to do with Stars Wars,’ she says. ‘It would have blown their minds.’ But the aim was never to rush in with blockbusters. ‘It was the promise of what would come. There wasn’t any real money to be made.’

Today, China appears to have made good on that promise. Despite rampant film piracy, business in cinemas is booming. To keep up with demand, seven new screens go up every day, and while US domestic box-office receipts fell from 66.2 billion RMB in 2010 to 64.5 billion RMB last year, China’s grew 30 percent in the same period to 13 billion RMB. At this rate, it will overtake America before 2020.

With such startling trends, it’s no surprise that many Hollywood studios are looking to Chinese audiences and investment. ‘It’s all about financing,’ says Jamie Lai, who previously negotiated US-Sino co-productions alongside renowned exec Teddy Zee and now heads the business department of Beijing visual effects studio Base FX. ‘The global recession really impacted Hollywood. Here there’s an optimism for movies that is lacking in Hollywood right now – and the money to back them.’

It’s a thought echoed by visual-effects art director Ron Gress, whose credits include I Am Legend. ‘At first, I came to China because of the novelty,’ Gress admits. ‘Now I see the job opportunities are much better; I have more responsibility and I make more money.’

In many ways, the two countries’ industries complement each other perfectly. ‘China has the market, the money and the cheap labour force; it has fresh locations and new stories. Hollywood has the movie stars and expertise in writing and special effects,’ says Yang.

This month’s Beijing International Film Festival is a perfect example of such co-operation. Big-name directors such as James Cameron and studios such as Working Title (Four Weddings and a Funeral) have been invited to walk the red carpet and take part in its forums. Two decades ago, they might have found it hard to fit such events into their diaries. Now, they can’t afford not to. ‘Hollywood used to sit back and call the shots,’ says Yang. ‘Now China is in that position and people have to step out of Hollywood.’

While China has been a running theme in Yang’s work for decades – from her 1993 hit The Joy Luck Club to 2007 drama Dark Matter (pictured) with Meryl Streep and Liu Ye – she worries that many of the recent American arrivals are less interested in cultural exchange. ‘It’s a drag that everybody is so focused on the money, but that’s the reality at this stage,’ she says, warning it could have a damaging effect: ‘I don’t want Hollywood to get a horrible reputation because the most shyster-y people are coming here, panning for gold.’

And China isn’t quite the goldmine it appears to be. Last year, only a quota of 20 foreign films were allowed in on a revenue-sharing basis. These films did phenomenally well in 2011, accounting for the top four highest-grossing hits and almost half of China’s box-office revenue. But their success didn’t translate into huge bucks for American studios, which only got a 13-17.5 percent cut of sales. Of the 1.1 billion RMB made by Transformers 3: Dark of the Moon in China (no small sum: it made 2.2 billion RMB in the US), Paramount Pictures took home less than 190 million RMB. As of Xi Jinping’s US visit in February, this cut has been raised to 25 percent and an additional 14 Imax or 3D-enabled films have been added to the quota. But with this quota and revenue share unlikely to be raised again anytime soon, Hollywood must find additional ways to make cash.

One method is product placement, as seen with the incongruous appearances of Lenovo and Shuhua Milk in Transformers 3. Another is to circumvent the quota by foregoing ticket revenue and selling for a one-time fee. These fees are normally limited to a paltry few million yuan, despite the fact that such films can, like The Expendables, go on to make several hundred million yuan at the Chinese box office – which is why most studios only offer movies considered well past their sell-by date.

For Hollywood, then, the ideal solution is to co-produce: this bypasses the import quota and all but guarantees a release – which, unlike foreign films, can be timed during lucrative holiday slots. Better still, foreign studios can collect revenue of up to 40 percent.

But co-productions must also be submitted to China’s censorship committee. The foreign studio has no direct contact with this department, which simply gives a green or red light, and so it is left to the Chinese studio to advise their foreign partners on what they think will or won’t pass.

‘For High School Musical: China (pictured), they worried whether the government might think we were portraying the rich girl as an aspirational character,’ explains Yang. ‘In [the soon-to-be-released] Shanghai Calling, our partners said there was an issue about the way we covered piracy in the plotline. It’s guesswork for everybody and you can drive yourself crazy.’

If self-censorship wasn’t bad enough, there’s also the problem of blacklisting. ‘Aside from the script, certain directors and actors are not welcome because of what they’ve filmed or because they’ve been outspoken on certain issues,’ says Yang. ‘They’d think twice about Christian Bale,’ she adds, in reference to his much-publicised visit to the prominent civil rights activist Chen Guangcheng in Linyi.

In the 1950s, scores of American filmmakers were blacklisted by the Motion Picture Association of America for being ‘communist’; now they risk being blacklisted for offending China’s communist government. ‘But,’ points out Yang, ‘people have the chance to come back. Jean-Jacques Annaud [director of Seven Years in Tibet] was rehabilitated after making a statement to the effect that Tibet is an inalienable part of China.’

But it’s not just individuals at risk. After Disney distributed Martin Scorsese’s Dalai Lama biopic, Kundun, in 1997, the Chinese government suspended negotiations on Shanghai Disneyland. Only now, over a decade later, has construction begun on the park.

Since the release of Kundun and Seven Years in Tibet, a climate of fear has spread, in which studios no longer dare offend. MGM’s as-yet unreleased remake of war film Red Dawn, in which China originally played the aggressor, was due out in 2010. In the first reediting of its kind, MGM decided to recast North Korea as the baddy, which meant digitally erasing Chinese flags and altering the dialogue of already-shot scenes. Mission Impossible III’s 2006 release in China was likewise delayed when local censors objected to the inclusion of Shanghai street scenes showing washing hanging out to dry.

And they aren’t just concerned about airing China’s dirty linen in public. In recent action hits Iron Man 2 and Mission Impossible: Ghost Protocol, all references to the villains’ Russian ethnicity were bizarrely muted. When even the most innocuous summer blockbuster isn’t safe from alteration, who knows what influence China will have on future Hollywood films?

But Yang prefers to focus on the positive implications of Hollywood’s increased business with China, saying it will encourage fairer depictions of the country: ‘Until now, China has not figured in Hollywood movies. Or if it has, only in an unappealing or stereotyped way.’

The ultimate outcome remains uncertain. But one thing’s for sure: as long as the PRC has cash in its pocket, it will have an impact. Hollywood has always been a mistress to money.

For details about the Beijing International Film Festival, see movie news.
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