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China Film Marketing Firms Must Adapt to Internet Age, Says Huayi’s Jerry Ye

Huayi Brothers Pictures CEO and media group VP Jerry Ye made no mention Sunday of the abrupt cancellation of the premiere of his firm’s highly anticipated war epic, “The Eight Hundred,” which was set to be the Shanghai Intl. Film Festival’s opening film the night before.

Instead, Ye looked to the future at a panel on big studio film production, warning of the “subversive changes” the Internet is bringing to the Chinese film market. New online practices will wipe out 50% to 60% of existing publicity and distribution firms within years if they don’t “follow the trend” and learn to adapt, he predicted.

“Unlike the steady North America market, the Chinese market moves much faster. Chinese e-commerce has developed rapidly, with online ticketing platforms making up 90% of China [movie ticket] sales, meaning that our audience reach depends on the online platforms,” Ye said. The challenge is that users interact with different platforms in very different ways, meaning that “their behaviors are increasingly fragmented, and their entertainment habits constantly in flux.”

“I think this will have a real disruptive impact within five years, bringing about a fundamental change” to film publicity and distribution, he said. “One of the early slogans of e-commerce was that its existence cuts out the middleman, and it’s the same nowadays for film.”

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Yet China’s fast-paced Internet entertainment ecosystem also brings opportunities. “Our market is more vibrant than the North America market because in China, the core group of those who watch movies in theaters is the same as those who watch movies online. These are two totally separate crowds in the U.S. This can be a very powerful force.”

One of the most important players in Chinese film marketing these days is Alibaba Pictures, an offshoot of e-commerce giant Alibaba. The subsidiary operates as a producer-financier, distributor and marketing services provider. And its Tao Piao Piao unit is one of China’s two largest online ticketing vendors. Earlier in the day, Fan Luyuan, head of Alibaba Pictures, described his company as a “service company to small and medium enterprises.”

Wanda Media GM Jiang Wei said producers needed to do more to improve their own work in order to meet increasingly sophisticated audience demands and ensure that the Chinese film industry’s market growth doesn’t outpace its abilities.

“The film market has grown along with the growing number of viewers,  so your investment returns perhaps look great as well, and people are quite pleased with that,” Jiang said. “But on many basic issues we’re still very far behind. We have to improve a lot of production-related elements, whether that’s screenwriting, production processes, technical know-how or technological developments in order to keep up with the market’s development. This is what I’m going to be paying the most attention to in the next three to five years.”

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