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Chinese Animation Gets Annecy Fest Tribute as Country’s Toon Biz Heats Up

The Annecy Intl. Animation Film Festival (June 12-17) will this year honor China, featuring a program of modern and historical Chinese shorts and features and hosting a delegation led by China Media Capital. The timing of the tribute is apt, coming at a potential inflection point for the Chinese industry, as the first output emerges from a pack of newly formed feature animation ventures.

Despite China’s ongoing transition from outsourcing destination to original creator over the past decade, when domestic live-action films accelerated into box office overdrive in 2012, the storytelling deficiencies, low production values and childish content that characterized much of China’s animation in the manufacturing years, still lingered.

For ambitious studios and creators, though, solving the quality issues and winning over a skeptical audience was merely a speed bump in the road to riches. A burgeoning middle class, mushrooming theaters, digital platforms and theme parks, a highly integrated e-commerce ecosystem and a dearth of domestic IP were presenting unprecedented opportunities to create, distribute and monetize content.

The animation earthquake that many had anticipated struck in the late summer of 2015. First, “Monster Hunt,” a live action-animation hybrid, shattered box office records to become China’s all-time highest-grossing film, shortly followed by the “Monkey King: Hero Returns,” which became easily the most successful full CG Chinese feature in history, reaping 956 million yuan ($139 million).

Some had seen it coming, most notably DreamWorks Animation, which in 2012 set up a joint venture with three Chinese investment partners to form Oriental DreamWorks in Shanghai. Following the twin blockbusters of 2015, dozens more hopefuls jumped into the feature animation fray. Some were already in and around the business, including CG outsourcing company Original Force, visual effects house Base FX and live-action studio Huayi Bros., while others such as internet behemoth Tencent stepped over from different industries altogether. To inject experience and expertise, many of the main players have set up development studios in L.A. and installed Hollywood creatives, producers and executives.

Yet success for the crop of nascent studios is by no means inevitable.

Investors have rushed in, looking for unrealistically quick returns, often lacking the stomach for the time and expense that producing quality animated features requires.

The best studios in China are equipped to compete in technical skill and technology, and labor remains relatively inexpensive. Yet storytelling talent remains in short supply, a hangover from a manufacturing past and inadequate education system. Though the shortfall may eventually be remedied by a coming generation of internationally educated Chinese artists who will have better quality projects on which to gain experience, for now many of the main players are developing stories in Hollywood.

Most of the current players say they are seeking to make “global films” that will equally appeal to American and Chinese audiences. The strategy may also be about offsetting the risk of shooting squarely for the risky, crowded Chinese market, where theater ticket sales have slowed and audience tastes remain as diverse, amorphous and unpredictable as ever.

Any films that do succeed internationally will represent a trailblazing achievement for a Chinese film. Then again, if any genre can make the breakthrough, it’s animation. Border-transcending films including “Zootopia” and “Kung Fu Panda” may be from Hollywood, but clearly demonstrate the potential in neutral, non-human characters, localized lip sync and universal themes.

Finding a universally appealing story is easier said than done though, especially one built around Chinese themes. What might appeal to Chinese audiences is often inaccessible for international ones, while trying to be something to everyone can easily alienate viewers on both sides — see “The Great Wall.” Domestic audiences are similarly unimpressed by gratuitous Chinese elements that play no meaningful role in the story.

With many of the new batch of films being developed in Hollywood, to what degree they are Chinese is open for discussion. Aficionados hoping to glimpse a distinctly Chinese identity will probably need to be patient. The next three years will be largely about testing the business model, separating the genuine creators from the gold diggers, and seeing what reacts with the market. The successes may well set the benchmark for what follows.

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