You will be redirected back to your article in seconds

AFM: Hype, Hope and Business as Usual with China as Part of the New Normal

Deals steady, rather than spectacular. Money flowing into co-prods and property too

The Great Wall of Chinese money has not exactly washed away the American Film Market this week. Rather, it has seeped into every conversation and every deal permutation.

Chinese companies are attending the AFM in record numbers, according to market organizers. Certainly every restaurant and every Loews elevator seems to be 50% occupied by mainland Chinese.

But instead of making a quick grab for any title that moved, the Chinese are becoming more discerning and more multi-faceted.

“Everyone is here, that’s certainly true. A lot of top producers have been in town with all the U.S.-China events this week, but so far the buying action has been nothing unusual,” said Leslie Chen, IM Global China executive.

Trade may pick up by Monday, when more deals are expected to close. The deal of reference for several players may be the expected sale of Lionsgate’s Johnny Depp project “Mortdecai.”

Not only is Depp a big draw for Chinese audiences, Lionsgate has strong China connections and has the option to co-distribute in China if it does not get the price and terms it seeks. However, Lionsgate sources say they expect to complete a “Mortdecai” sales deal by the end of the market.

“Chinese buyers are now talking more about the quality of the project than the number of distribution slots,” said Gary Hamilton, CEO of production-sales group Arclight Films. “It is really important to them that this is a global project, rather than something niche. The first three questions they ask are: ‘Who is in it?’ ‘Who is distributing in the States’ and ‘What’s the budget?’”

David U. Lee of independent Chinese distributor Leeding Media says that the boost to the market that some sellers anticipated from last year’s change to the import quotas — from 20 to 34 — has now peaked.

“The last market was overhyped. Prices are now flat or up only slightly, the big acceleration may be over,” said Lee. “Actually the increase in quotas has made our (independently sourced) films less competitive. That’s because we now have 14 more studio-level pictures per year coming into the country against us.”

A slowdown or reality check may be a welcome change as the Chinese distribution scene is still very far from being a free market — there’s the quota restrictions on the number of revenue-sharing films that can be imported, censorship that is liberalizing only slowly and direct government intervention in the releasing calendar designed to favor local films.

Still, the Chinese theatrical market has become simply too big to ignore. By the end of September, box office had equalled last year’s 12-month total of $2.7 billion, putting it on course for a full year total worth $3.2 billion.

“In one significant way things are changing. Many of the Chinese firms here at AFM seem as interested in co-production as they do in outright acquisition,” said Ying Ye, Hamilton’s partner in Arclight’s specialty Asian label, Easternlight. “We have licensed our John Cusack movie ‘Reclaim’ but we will do ‘Priority Run’ as a co-production. It is in pre-production with Donnie Yen set and a U.S. actor yet to be cast.”

The Chinese partner is likely to have a say in who gets cast. Arclight/Easternlight already have Nicolas Cage actioner “Outcast” and thriller “The Nest 3D,” which is in development, structured as Chinese co-ventures.

Still other insiders point out that filmmaking and buying is only part of the reason the Chinese are in L.A. “It’s the money business, not the movie business,” says one. “Many Chinese still have strong reasons to want to get money offshore and out of China.”

Michael J. Werner, chairman of Fortissimo Films, said, “What are the Chinese buying? Properties in Beverly Hills.”

After the show-stopping announcements by Chinese property and film group Wanda — last year it paid $2.3 billion for North American theater chain AMC, and in September this year called up a dozen Hollywood A-listers to celebrate its new studio facility-cum-yacht brokerage — China has become a more frequent port of call for U.S. movie companies.

“Actually we don’t expect much buying here at AFM, all the big sales companies now will travel to China and speak directly to the distributors,” said another source.

That’s true of Lionsgate, Arclight and IM Global, which now all have China offices. They will be joined by Universal Pictures, which this week also announced it would set up permanently in Beijing.

More Film

  • Editorial use only. No book cover

    'Crazy Rich Asians,' 'Late Show With Stephen Colbert' Win Publicity Campaign Awards

    Hollywood publicists have selected “Crazy Rich Asians” as the top movie publicity campaign for 2018 and “The Late Show With Stephen Colbert” as the best television campaign. Warner Bros.’ “Crazy Rich Asians” topped the campaigns for Disney’s “Black Panther,” Fox’s “Bohemian Rhapsody,” Paramount’s “A Quiet Place,” Sony’s “Spider-Man: Into the Spider-Verse,” and Universal’s “Halloween” for [...]

  • How the 'Rich Eisen Show' Mixes

    How the 'Rich Eisen Show' Mixes Sports and Showbiz in a Entertaining Mix

    Walking through the El Segundo studio where veteran sportscaster Rich Eisen tapes his daily “Rich Eisen Show,” the sheer density of sports memorabilia is overwhelming — everything from game balls to jerseys, gear, autographs and uncountable photos are crammed onto every inch of wall and desk space. But step into Eisen’s dressing room, and the [...]

  • Tessa Thompson Nnamdi Asomugha

    Tessa Thompson and Nnamdi Asomugha to Star in 'Sylvie'

    Tessa Thompson and Nnamdi Asomugha are set to star in the feature film “Sylvie.” Eugene Ashe has written the screenplay and will direct with production currently underway. The film is described as a love story set in the cool jazz era of New York City in the late 1950’s/early 1960’s. Sylvie (played by Thompson) meets aspiring [...]

  • Night Fury dragon Toothless and Hiccup

    Box Office: 'How to Train Your Dragon 3' Soaring to $50 Million-Plus Launch

    “How to Train Your Dragon: The Hidden World” is soaring toward a $53 million launch weekend at 4,259 North American locations, early estimates showed on Friday. That estimate is well above Universal’s forecast in the $40 million range at 4,259 sites — and ahead of its predecessors, 2010’s “How to Train Your Dragon,” which made [...]

  • Actors With Disabilities Deserve a Hollywood

    Dreaming of a Hollywood Ending for Actors With Disabilities (Guest Column)

    Picture a world in which an actor with a disability wins an Academy Award. Sadly, that storyline remains no more than a Hollywood fantasy. In recent years, the #OscarsSoWhite trending hashtag campaign has shed light on the lack of diversity in the movie industry. Yet ahead of this year’s Oscars on Feb. 24, society’s definition [...]

  • Clark Gable III

    Clark Gable's Grandson, Who Hosted 'Cheaters,' Found Dead at 30

    Clark Gable’s grandson, Clark Gable III, died on Friday morning at Texas Health Presbyterian Hospital in Dallas, Variety confirmed with the Dallas County Medical Examiner’s Office. He was 30. “It’s is with an extremely heavy heart we say goodbye to my beautiful son Clark,” his mother wrote on Instagram. “He passed this morning. I will always [...]

  • You Were Never Really Here If

    Film Independent's Spirit Awards Fly the Flag for Indie Film

    As the 2018 awards season marches slowly into its final days, only a handful of honors remain undistributed after some of the most volatile and contentious campaigns in years. Front-runners have come and gone in one major category after the next, as each guild and critics group announced different winners than its predecessors, demolishing expectations [...]

More From Our Brands

Access exclusive content