On Monday evening, Dalian Wanda Group Chairman Wang Jianlin made a speech, “Navigating Business in China,” to a large cross-section of Hollywood packed into the Los Angeles County of Museum of Art’s Bing Theatre. Was it intended to appear arrogant and critical of the Hollywood studios?
Wang (pronounced “Wong”) suggested that many people in Hollywood trying to do business in China don’t understand their potential partners. “There needs to be more Chinese elements in films,” he reminded. And he criticized the studios for making so many sequels.
In recent years, Hollywood’s capabilities for innovation are fading, possibly due to financial constraints or a number of other reasons. Many films are just sequels based on original intellectual properties. It isn’t unheard of to make 5 or 6 or even 9 or 20 sequels. Hollywood sometimes relies more on technology and visual factors, rather than a good story. Hollywood, which is famous for its storytelling, apparently isn’t as good as it used to be in telling stories, which has contributed to its films’ decreased success in the Chinese market in recent years. Those sequels night have worked before, but Chinese audiences are more sophisticated now. If you want to participate in the growing Chinese market, you must improve film quality and be a good storyteller.
Wow. It’s not like he’s wrong. And: He got applause!
Hollywood knows Wang and does business with him. However, when dealing with China it’s often hard to parse — especially through interpreters — what people really mean. (For Hollywood producers, waiting for Chinese money is like waiting for Godot.)
“Obviously Wanda is a great potential partner to anyone in entertainment globally,” said Lionsgate CEO Jon Feltheimer at the after-party, refusing to rock any boats. “We are all making movies for a global audience.”
Hollywood and China need each other, and they know it. However, China has a studio chairman who wields more power than the titans of Hollywood.
Wang is China’s wealthiest man; he told the New York Times that the movie business represents just one-eighth to a one-tenth of his overall empire. And he predicts that by 2018 China will become the number-one theatrical market, with anticipated growth of 15% per year. He thinks that in ten years, by 2026 China box office will reach $30 billion, which would represent 40%-50% of the global market share. As demonstrated in his presentation, China will meet (and swiftly far exceed) the 40,000 theaters in the U.S.
The audience paid attention. As attendance flatlines in the U.S., going forward many theaters may have to shut down. This trend could be exacerbated as studios neglect domestic exhibition partners by aiming product overseas. “Warcraft” is the perfect example of a movie targeted to China: It earned $45 million domestic, but $385 million foreign.
LACMA hosted Wanda because Wang gave $20 million to the Academy Museum; the night’s introductory speaker, Academy president Cheryl Boone Isaacs, said it will name their Film History wing Wanda.
And the city of Los Angeles is also eager to welcome Chinese visitors and investment to L.A., which sees more of both than any other U.S. city, according to Mayor Eric Garcetti. In his remarks, he said there was one flight a week between LAX and China in 1984; today there’s 50 flights and more to come, including directs to Qingdao, site of Wanda’s $5 billion, 408-acre new Qingdao Movie Metropolis.
What’s the Metropolis? The audience learned all about it in a stunning promo video narrated by Matt Damon, star of Wanda’s Zhang Yimou $150-million epic “The Great Wall” (the most expensive Chinese film ever made, which has been criticized more in the West than the East for his casting).
The Wanda Studios backlot will boast 148 acres with 15 soundstages by 2016, and 30 by 2017. It includes a marine world, costume house, equipment rentals, extras-hiring, facilities for post-production, and a huge heated and filtered exterior water tank. They’re offering a 40% cash rebate (if you play by their rules), a five-year, $750 million film and TV development fund, and a 10% tax rebate program.
Back in 2012, the government-owned China Film Group gave me a tour of their then-“state-of-the-art” studio outside of Beijing. I was wowed by its scale, but also struck by the empty, cavernous soundstages filled with outmoded 35mm hardware. (It was too expensive to shoot there, China film insiders informed me.) The Chinese government lavished $2 billion on this behemoth. And may have learned lessons from it.
After all, global conglomerate Wanda has its hands in everything from production (its latest buy is $1 billion for Dick Clark Productions, while Wanda-owned Thomas Tull’s Legendary plans to shoot the “Pacific Rim” sequel at Qingdao Movie Metropolis) through distribution (China’s Wuzhou Film) and Chinese and global exhibition (the Odeon and UCI Cinemas Group, Hoyts, and AMC), as well as malls and hotels. Wanda’s ambassador and conduit to Hollywood is producer and ex-AMPAS president Hawk Koch; with former New York Film Festival executive director Rose Kuo, they’ve been developing an international film festival in Qingdao.
At the afterparty, several China film experts said Wang is a businessman (he made clear politics should be left out of conversations between Hollywood and China) who leaned on Western expertise (including Pinewood Studios executives) when designing the Wanda Studio and the surrounding “metropolis” that includes housing, hotels, and shopping malls. Wanda wants Hollywood to shoot movies there, and is ready to help with passports, visas, customs and permits.
Will Hollywood go along for the ride?