SYDNEY — Some U.S. majors are moving fast to take up China’s revolutionary offer of buying films on commercial terms.
China Film Export & Import Corp., which controls all imports, has recently reversed the long-held policy of buying Hollywood and other foreign films for a low, flat fee and aims to release at least 10 new pictures this year, sharing revenues with suppliers (Variety, March 21-27).
“We could release our first film in China within six weeks of signing a deal, and we might be very close to that,” said Columbia TriStar Intl. exec VP Tony Manne.
Manne expects to start modestly by playingfilms in perhaps 10 key cities using a total of 100 prints, and gradually widening the net.
“Over the next two or three years, I think we will see major results in China ,” said Manne.
Manne says the terms are being negotiated. Variety reported that the Chinese agency is bargaining to keep 60% of the distributors’ gross, with 40% going to the foreign distrib or producer.
A rep for another major estimates his studio could collect $ 3 million to $ 5 million a year out of China: hefty sums compared with the old flat fee of $ 30, 000-$ 50,000 per title.
Converting the Chinese currency unit renminbi into dollars won’t be a problem , according to U.S. distribs. Although the renminbi is not fully convertible, currency swaps are easily facilitated by foreign exchange centers, they say. One distrib knows a currency dealer in China who handles $ 5 million every working day.
Cinema attendance plunged in China last year, blamed on widespread piracy and the fact that audiences have to wait four to five years for U.S. films.
So, given new releases, rising living standards in the south and in coastal regions and the prospect that U.S. exhibs will soon begin building cinemas in China, probably with local partners, the B.O. can only grow.
Warner Bros. is still studying how and when to enter China, according to one source who says the studio wants to control the distribution of its films in that market. It remains to be seen whether China Film will relax its iron grip on distribution sufficiently to allow WB to do so.