Global City

The emergence of the Chinese film market during COVID-19

As theaters begin to open to the public after months of lockdown, the global film industry is turning to Chinese audiences for revenue.

The North American box office has been the leading film market for decades. However, the rise of the Chinese film industry in recent years has increasingly made it a leading candidate to overtake the North American market and dominate the global film industry in the coming decades. Though this may seem far off into the future and hard to picture, the COVID-19 pandemic has increased the potential for this scenario.

As most movie theaters around the world continue to remain closed for public health and safety reasons, China’s containment of the virus upon reporting over 40 days with no local cases gives it a unique opportunity to become the new global center for the film industry.

Months after the start of the pandemic and aggressive lockdown policies allegedly successfully containing the spread of the virus, the Chinese film industry is now receiving a kick start, as theaters begin to reopen. This unique opportunity is giving many films an opportunity to capitalize on outreach toward larger Chinese audiences.

Even before the emergence of the COVID-19 pandemic, the Chinese film industry garnered international attention for its rapid growth in revenue. According to a report from the India China America Institute, China’s domestic box office share as a proportion of the international box office grew from 1% in 2005 to nearly 20% in 2016. PriceWaterhouseCoopers’s report on China Entertainment & Media Outlook also acknowledged the “very brisk rate” at which the Chinese film industry had been expanding before the pandemic, with a cited 9.1% growth in box office revenue in 2018, compared to the previous year.

Signs of a rapidly growing Chinese film and media industry before the COVID-19 pandemic can also be seen in their expansion into the streaming economy. According to USC Annenberg School of Communication professor David Craig, an expert on the Chinese media industry, streaming services are an important marker of expansion.

“China is moving aggressively to push out their streaming services… in South East Asia and other parts of the world,” Craig said.

After the COVID-19 outbreak hit China, government officials enacted strict lockdown measurements aimed at containing the virus, leading to significant revenue losses for major Chinese studios such as Wanda Films, who reported a year-on-year decrease of 73.93% in revenue in the first half of 2020. This proved temporary, however, as the effectiveness of containment measures imposed by the Chinese government allowed most Chinese theaters to reopen at a half capacity on July 20.

“I was incredibly excited because it had been so long since I’ve gone to the theater to watch a movie,” said Kristina Liu, a freshman majoring in communication from China. “Some of the lighting, sound, and atmosphere in movie theaters just can’t compare to your own home.”

Liu is one of many Chinese movie-goers who have returned to Chinese theaters. Theater reopenings across the country generated a box office total of $530 million USD within 43 days.

Liu discussed some of the safety precautions mandated by the government and theaters nationwide as part of the reopening process.

“Before we enter the theater, we are asked to show our health codes and receive a temperature check, and mask-wearing is also mandated inside,” she said.

For citizens in China, the reopening process with strict precautions to ensure health and safety is a reflection of the nation’s effective results in containing the virus, however, for the rest of the world, reopening theaters for audiences is still far from becoming reality. While Chinese theaters have commenced operations, much of the world continues to grapple with the COVID-19 pandemic in ways China is not. Last week, the world officially recorded its 1 millionth death from COVID-19, and countries like the U.S. continue to face challenges with reopening.

Two major films, in particular, have capitalized on this opportunity to reach greater Chinese audiences and have found success in doing so. The first film taking advantage of this renewed opportunity is The Eight Hundred, a war film detailing the historical battle between eight hundred soldiers fighting “under siege from a warehouse in the middle of the Shanghai battlefield, completely surrounded by the Japanese army” in 1937. The film has made it as a blockbuster hit in the post-COVID Chinese film market, surpassing $400 million USD in box office on Sept. 18.

“The Eight Hundred is ultimately about a nation and its people coming together during a time of unprecedented crisis,” Director Guan Hu said in a press release from CMC Pictures. “It’s a universal story that has a renewed relevance in these current times.”

The second film to find success in the post-COVID Chinese market is Tenet, a science-fiction film directed by Christopher Nolan about a global espionage mission to save the world from war in a space transcending real time. Delayed three times due to the pandemic, the film finally received its wide release in China, and internationally on Sept. 4th, generating over $200 million USD in box office revenues by Sept. 14th.

In a promotional video before its release in China, Nolan said that the film’s cast and crew were “extremely excited about showing it to Chinese audiences,” highlighting the importance of reaching the Chinese market for a film produced on an expensive budget of over $250 million USD.

The release of both The Eight Hundred and Tenet amid a global pandemic was a proven risk and had the potential to be financially detrimental at a time when many movie-goers around the world remain unable to enjoy going to the theater in person theaters. However, the containment of the virus through strict lockdown policies, contact tracing, and the enactment of health security codes has allowed Chinese movie-goers to return to the theater at an earlier time than their American counterparts. In doing so, Chinese film audiences have been catapulted to a position of significant importance for both domestic and western films aiming to be released during this time.

Speaking on the future of the Chinese film market in the aftermath of the pandemic, Stanley Rosen, a specialist on Chinese politics, film and society, and professor of political science, said that as a result of the pandemic, there will be increased significance of the Chinese film market for the global film industry.

“The trend [shows] a greater share of the [global] box office for Chinese films and a smaller share for Hollywood,” Rosen said.

The future of the film industry is uncertain as the pandemic approaches 2021. However, the Chinese film industry, particularly at a time of isolation and lockdown in many parts of the world, will continue to garner attention going forward.