HONG KONG — There is a clear sense that many Chinese companies are in a hurry to get somewhere fast. They covet the status and kudos that comes with global recognition, even if it is not the most logical or financially viable thing to do.
This is true not only of many businesses but also execs in the Middle Kingdom, and not just China’s relatively young — yet already huge — film industry. But when you are already China’s richest man and own more offices and shopping malls than you can possibly visit in a year, as is the case with Wanda group’s Wang Jianlin, taking on the film industry makes as much sense as any other expansion plan. And Wang would not be the first Chinese businessman to have his eye on an Oscar statuette.
So can Wang make a credible case for the $4.9 billion Qingdao Oriental Movie Metropolis that he unveiled this weekend in an over-the-top ceremony attended by Hollywood and Chinese heavyweights? Is it just another stepping stone into Hollywood?
The facility is to be built in a scenic former German colony on the coast where the film industry currently does not have much of a presence. So the Metropolis will have all the advantages and disadvantages of being a greenfield site.
Wanda plans to endow it with 20 soundstages, including a a permanent underwater facility as well as backlots reflecting different Chinese, Middle Eastern and European settings.
Certainly the Chinese film industry is growing fast and last year produced more than 700 feature movies, as well as tens of thousands of hours of TV drama. But China and the Asian region are not exactly short of studio facilities.
China already has one of the world’s largest studio complexes at Hengdian, a few hours outside Shanghai, and one of the most modern at Huairou, with 16 new stages just outside Beijing. New studio complexes have been mooted by other high-profile entrepreneurs at Tianjin and Wuxi. (Southeast Asia is putting together a studio cluster involving the new Pinewood Iskandar lot at the southern tip of Malaysia, a new stage in the already-developed Singapore and studios in Batam, Indonesia, only a short boat-ride away from Singapore.)
Earlier last week, the Guangzhou Times warned that China is already oversupplied with studios — it estimated that there nearly 1,000 — and that most run at a loss because not enough local films use them. It quoted consultants and a Beijing U professor saying that the route to profitability for most Chinese studios is through tourism and property development.
Wanda seems ready to exploit tourism and property development — a theme park is part of the Qingdao Metropolis blueprint (Wanda is already producing footage for its “dark rides”), as is a yacht facility and a permanent automobile exhibit. Both pander perfectly to nouveau riche Chinese aspirational tastes. And Wang is going to house his paying guests in no less than seven hotels.
Given his real estate track record, it seems likely that Wang will be able to make a profit from the Qingdao development. But there is still something a little hollow and pointless if the stages stand idle and dark.
That may be where the 30-odd agreements with producers and talent agencies, reportedly including CAA, WME, UTA and ICM, come in handy. Those pacts promise to bring 30 foreign films and 100 local Chinese films per year to the new complex.
Chinese companies have an unfortunate habit of announcing deals before they are signed, or even agreed on, but Wang has the credibility that some other wannabe film moguls do not. Wanda’s $2.6 billion acquisition of AMC Theaters last year was considered overpriced and baffled many at the time, but it may prove to be a valuable calling card. Wang, who was in the Chinese military for over a decade, has proved that he has the money and the political clout to move that kind of money out of the country. Wanda may well claw back some of its outlay if a mooted IPO of AMC goes ahead.
That business and political savvy clearly appeals to Wang’s coterie of new best friends – Harvey Weinstein and Rob Friedman were in attendance this weekend in Qingdao, as was Cheryl Boone Isaacs, president of the Academy of Motion Picture Arts and Sciences, and UTA chief executive officer Jeremy Zimmer.
It will be interesting to see if Wang will use his political capital to do the slow, hard work of improving the conditions for filmmaking in China, and making China a real contender for foreign shoots. That may require painstaking lobbying of government over issues like co-productions rules, production subsidies, China’s script approval system and film release classification. Or whether Wang will simply act like so much other monied businessmen before him and take the easy route of buying a Hollywood studio.