"The Revenant," this year's best picture at the Oscars, was co-financed and co-distributed by Guangdong Alpha Group, a Chinese animation and entertainment firm. (Photo : REUTERS)
An animation and entertainment firm in south China's Guangdong Province rejoiced at the news of "The Revenant" winning the Oscars for directing, cinematography and best actor. It is a partner of the film’s production company, the New Regency Productions.
The Xinhua News Agency reported that Guangdong Alpha Group, the co-financier and co-distributor of the film, has established partnership with New Regency Productions, the film's production company in 2014, investing up to $60 million in three movies that New Regency would later produce, including "The Revenant."
"In return, Alpha receives a share of the global box-office takings. This partnership also increases our presence in the global film market," said Chen Derong, CEO of Alpha's interactive entertainment division.
According to the report, Chinese firms, including Alpha, are trying to get a share of the Hollywood film industry and increase their global presence through joint ventures, investments or buyouts.
"It is difficult to market Chinese films in Hollywood, but our investment could go first and pave the way," said Xiong Yuesheng, deputy general manager of the investment and management division of China's Hunan TV and Broadcast Intermediary Co. Ltd.
The report added that several Chinese companies do exactly what Xiong had suggested. In January, property and entertainment giant Dalian Wanda Group announced its acquisition of Hollywood film producer Legendary Entertainment for $3.5 billion, believed to be the largest overseas "cultural acquisition" by a Chinese company to date.
However, even before the acquisition, several Chinese cultural firms had already seen the opportunities, the report said.
Last September, China Media Capital (CMC) and Warner Bros. Entertainment announced a joint venture with Flagship Entertainment Group Ltd., to fund and develop Chinese and English-language movies for the international market.
Also last year, production company Huayi Brothers and STX Entertainment signed a deal to co-finance, co-produce and retain distribution rights of more than 18 films. The report said that Huayi will retain the copyright to the co-produced films.
"Investing in IP returns the most profits in the film industry. But it is unusual for Chinese firms to secure the copyright of Hollywood films," said Zhang Yijun, PR director of Huayi Brothers, adding that holding the copyright has made all the difference to their North American subsidiary.
Major Hollywood production companies are now looking at potential opportunities for cooperation offered in China, which has a varied pool of investors and a dynamic domestic film market.
As one of the fastest growing film markets in the world, China earned 44 billion yuan (around $6.7 billion) in box-office revenue last year, up 48.7 percent over 2014, while 1.26 billion people went to the cinema last year, a year-on-year increase of 51.08 percent.
China is expected to surpass the United States as the world's largest film market in 2017.
In 2015 alone, a total of 8,035 movie screens were installed in China at a rate of 22 screens every day. The screen count currently sits at 31,627.
"This means that China's ticket sales are too big for major Hollywood studios to ignore," said Zhang Huiyu, associate researcher with the Chinese National Academy of Arts.
Cinema also offers an opportunity to promote Chinese culture, which is a challenging task for the Chinese film industry, the report said.
Zhang said that Chinese film producers also expect to learn from Hollywood and make use of the film production, technology and marketing methods through co-production deals.
"Our final purpose is to create movies like 'Kung Fu Panda' by ourselves. The key will be finding a good Chinese story and telling it appropriately," Chen Derong, Alpha's CEO, said.
