Business booming, but market still immature

While the biz is booming in China, content theft is still translating into a major loss in revenues for Chinese films, leading biz figures said, and the market is primed for massive growth in coming years.

In China, box office receipts account for 90% of the total return on investment. That figure is just 30% in the U.S.; the remaining 70% comes from sales of copyrights to DVD companies, cable TV and networks.

“There is a huge revenue loss for Chinese films due to content theft, which has prevented China from developing a film industry value chain based on copyright trade,” said Mike Ellis, Asia-Pacific prexy of the Motion Picture Assn. of America.

While data from Screen Digest shows that China overtook Japan as the world’s second-biggest cinema market in terms of B.O. in the first quarter of the year, thanks to the breakneck growth of the nation’s film industry, its overwhelming reliance on box office showed both its huge potential and immaturity, according to industry experts.

Last year, China’s box office receipts grew 33.3% to 13.15 billion yuan ($2.08 billion), and the industry’s market value reached $2.73 billion.

“We have to develop ourselves on the assumption that piracy will exist and will exist for a long time,” said Hu Ming, VP of Huayi Brothers, China’s largest private TV and film producer.

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