SYDNEY The China Film Group wants to release Hollywood pics on a much wider basis — potentially on thousands of screens — than the current 300-400.
But there’s a catch: China Film’s plan would mean U.S. pictures playing in cinemas whose ticket sales aren’t monitored. That would create the potential for understating grosses, which is why the U.S. studios aren’t immediately jumping at the offer.
The country’s sole film importer and the dominant national distrib (with upstart Hua Xia the only competitor), China Film is proposing to create a secondary, or sub-run, circuit where Hollywood films would unspool after playing at firstrun locations.
China Film hasn’t specified how many additional screens would be involved, but the market has 20,000 screens, so if the U.S. majors agree, their releases could conceivably expand to thousands of cinemas.
But none of these sites has computer links with China Film to feed in B.O. receipts, unlike firstrun venues. Hence U.S. distribs have reacted cautiously to the proposal.
“Structuring a commercial arrangement to exploit the second-run halls would be complicated and would take time,” says one studio rep, who doubts any major will strike a deal for quite a while.
Says another exec, “We have more control and protection with the current situation. If we allow our films to go out on more screens, we would not know (for sure) how much they grossed and whether we were getting our share.”
Typically, the majors get a B.O. split of around 13%-15%. Late last year, the studios pressed China Film to bump up their cut to at least 18%. Notably, China Film has not responded to that plea.
Some U.S. execs believe it’s preferable to keep pushing for higher rentals and for an increase in the unofficial annual quota of 20 revenue-sharing titles than to acquiesce to the sub-run proposal.
“The Lord of the Rings: The Return of the King” has grossed $10 million in China, the highest-earning U.S. title for some years.
Distribs are planning to submit a raft of films for Beijing’s approval, including “Spider-Man 2” (which Sony hopes will be cleared for July 1 to tie in with the global day-and-date launch), “Van Helsing,” “50 First Dates,” “Collateral,” “Troy” “The Day After Tomorrow” and “The Chronicles of Riddick.”