China’s film industry projects commercial tragedy

U.S. actor Tom Cruise arrives at the premiere of ‘Top Gun: Maverick’ in London, Britain May 19, 2022. REUTERS/Henry Nicholls/File Photo – RC2JAU99W2A7

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HONG KONG, June 8 (Reuters Breakingviews) – Audiences are demanding a script rewrite for Chinese cinema. The closures have pushed movie ticket sales to a Low for 10 years during the recent Dragon Boat Festival holiday weekend. While the country overtook the United States in 2020 to become the largest theater market in the world, this outperformance was only relative. In absolute terms, the market is throwing rotten tomatoes on the Chinese big screen.

The country continues to aggressively add new theaters – a statistic that once excited Hollywood bigwigs looking for more venues for big-screen blockbusters. The question is whether Chinese citizens will return to fill the seats. The current deep crisis will be temporary. But future growth may be limited; Beijing’s gospel of hysterical Covid-19 hygiene could inadvertently keep viewers out of cinemas for a generation.

It’s worth remembering that life in Chinese cities was generally normal in 2021, but onlookers remained conservative. Last year’s sales were 26% lower than 2019, and 2022 is sure to be much worse. Likewise, domestic film and movie companies like Huayi Tencent Entertainment (0419.HK) and Wanda Film (002739.SZ) were stock market hounds before the pandemic hit. Hong Kong-listed IMAX China (1970.HK), which peaked at HK$60 per share in 2015, has fallen to HK$9.

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Hollywood, which has consistently bowed to the Chinese Communist Party in hopes of better market access and less onerous revenue-sharing demands, may finally be running out of patience. A 2019 trailer for “Top Gun: Maverick,” for example, removed the Taiwanese flag patch from Tom Cruises’ iconic pilot jacket from the first film. But in the final version, Paramount Pictures Studio re-launched the patch, likely dooming any chance of getting a Chinese release. Executives may not care. After all, the sequel could be the first Tom Cruise vehicle to earn over $1 billion, and it will reach that number without any help from China. Worse than a tragedy, the country’s once thrilling theatrical plot is beginning to annoy investors in the audience.

Chinese studios and theater chains have underperformed for years

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BACKGROUND NEWS

Box office sales at cinemas in China during the Dragon Boat Festival holiday weekend that kicked off on June 2 hit their lowest level in 10 years, national entertainment website Maoyan reported.

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Editing by Antony Currie and Katrina Hamlin

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