U.S., Asian exhibs rush into China

Loews Cineplex, Megabox open offices in Beijing

SYDNEY — Warner Bros., the sole Western company that’s building cinemas in China, may soon face competition from a multiplicity of U.S. and Asian players.

Loews Cineplex and its Korean exhib partner Megabox have opened an office in Beijing, as has Korean entertainment powerhouse CJ Entertainment. After closing its cinema in Shanghai, Hong Kong’s Golden Harvest is renewing its interest in China, opening a 12-screen this month in Shenzen.

Hong Kong-based Edko, which has one cinema in Beijing, has hired Shanghai-based consultant Rance Pow to scout for further theater acquisitions on the mainland. And Pow says Korean exhib Lotte and several Japanese groups are looking at creating circuits in China.

“I think we will see explosive growth of screens in the next few years,” says Pow, whose firm, Artisan Gateway, advises exhibs, distribs, producers and property developers on how to enter or expand their businesses in China.

“Warner was the catalyst, and now we’re seeing a renewed interest from various companies,” adds Pow, who spearheaded U.S. exhib AMC’s operations in Asia from 1995-2000. “The secondary markets (outside key cities such as Beijing and Shanghai) offer the most opportunities for screen development.”

Ripe potential

Pow surveyed distribs and exhibs in the southern city of Guangzhou, which had about 75 screens before the addition of 12 screens at several locations. “Grosses in that city jumped by 75% year-on-year,” he says.

Loews, which has had a consultant spotting opportunities in China for the past two years, has declined to reveal its plans for that territory.

Pow is heartened to see WB commit to co-producing films in China via Warner China Film, following Sony’s launch of Columbia Pictures Asia. He hopes these ventures will “pave the way for an improvement in the quality of local films.”

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