People line up to buy tickets at a cinema in Xuchang, Henan Province. (Photo : www.chinadaily.com.cn)
Cinema business in China has been transformed by the expansion of Internet companies that brought changes to the industry, the Beijing Daily reported.
The report cited the recent transformation of Capital Cinema's Financial Street branch in Beijing into a "smart movie theater," which enabled moviegoers to book tickets using their mobile devices that can be read by a machine at the cinema, thereby saving the need for ticketing staff.
According to the report, the theater also introduced a first-if-its-kind system for the refund and exchange of tickets, although an industry insider said that allowing ticket refunds and changes shows that cinema operators are losing.
According to the report, movie ticket sales in China jumped 48 percent year-on-year to 20 billion yuan ($3.1 billion) in the first half of the year. But 42.8 percent of the sales were among the top 500 cinemas in the country, which have a total number of 5,400 cinemas.
This means that each of the other 4,900 cinemas earned only about 1 million yuan ($157,000) on average during the six-month period, the report added.
The industry insider said that movie theaters cannot make a profit with such a small income. He added that the daily sale of discounted tickets on promotional sites does not help to build a long-term customer base. However, it is welcome news that cinemas are willing to pay more attention to services, he said.
The report said that the changes seen in China's cinema industry may be connected to the involvement of Internet companies such as Alibaba and Baidu.
Guangdong Yueke Software Engineering, acquired by Alibaba's Ali Pictures in April, is reportedly behind Capital Cinema's recent "smart theater" initiative.
Yueke, which offers online and mobile ticketing service, also provides services for movie theaters to upgrade the information technology systems to improve efficiency.
Alibaba said that theaters can also attract online buyers of movie-related products.
On the other hand, search engine Baidu acquired a stake in cinema chain operator SMI Holdings in June, with plans to test several Internet products via the movie theaters.
