Asia Takes Center Stage at 37th American Film Market

With China and other Asian territories continuing to advance their local film industry, technology and build theatres at lightning speed, conversations about China’s film market were front and center at the AFM®, which was held November 2-9 in Santa Monica, CA. The largest gathering of industry professionals in North America, the AFM put a large spotlight on the territory hosting several panel discussions with leading industry experts both from China and those who are successfully making films for Chinese audiences. Hundreds of independent film producers, distributors, financiers, sales agents, writers, marketing executives, lawyers and others flocked to the sessions focused on Producing, Marketing & Distributing in China, Managing Production in Asia and Asian VOD to garner candid and timely insight into this lucrative, yet still mysterious, entertainment marketplace.

Even though the Chinese Box Office has slowed recently, China has over 200 cities with populations exceeding two million people. It is a market with tremendous growth and potential, especially when you consider that its film industry has really only developed over the last 10-15 years and, over the course of those years, has seen more than 30% growth annually. Yet, it is a market that still few outsiders know how to navigate. This is what film leaders from China and those working closely in Asian territories revealed at AFM 2016:

Bruno Wu, Founder/Co-Chairman and CEO of Sun Seven Stars Media Group Limited, who headlined the Producing in China panel shared his thoughts:

“We need a lot of help not only from Hollywood, Korea and the filmmaking communities globally, to help China understand the fundamentals. Producers need to have the right attitude – don’t believe you can take an American idea and make it work in China. You need a local partner and there’s no shortcut - be patient and have good material that works.”

“Rule number one, if you make a movie for the world, it’s a movie for the world. The fact is, if the movie works globally, it has a high probability working in China and visa-versa. If you want to make a movie for China, you have to use local talent – you have to use your local partner and figure out what works. Making a movie for China and having it be successful – that probability is low. That’s why I don’t try to become a global producer and instead I rely on the producers that have proven themselves to be commercially successful winners.”

“The odds of a non-Chinese producer leading a commercially successful movie in China is very low. It’s higher than hitting the jackpot, but its low.”

“In China, the slowdown is inevitable …but the Chinese movie industry is such a land of opportunity for American producers – other than China having a great market, it has a richness of local material and talent.”

“Third and fourth tier cities make up the bulk of the growth of box office in China. It’s the cheapest date. Movies are becoming affordable for Chinese youngsters …they go because of social media.”

Melanie Ansley, Producer and the Co-Executive Director of China Hollywood Society, shared advice for producers wishing to produce co-productions in China:

"You need a [co-producing] partner you can trust and get along with. Making a movie in China is really like a marriage – choose very, very carefully and make sure you get along with them. If you’re interested in making a movie in China, it’s really good to find people that you like and who understand China. Definitely someone who can explain that environment to you and help you navigate what’s going on.”

Chengsheng (Mike) Mao, CEO of UNI Pictures Culture & Media (Beijing), commented on popular genres and content limitations:

“China is into Sci-Fi movies, Kung-Fu movies and Adventure movies – they’re very popular genres in China, but in terms of a movie market we are taking much more of a free and open attitude. We don’t have a category in mind, but we do have limitations – too gory, too horrifying, too sexual. If you want to make a co-production you have to look into the relevant Chinese cooperative markets that have expertise as a partner.”

Luke Xiang, Vice President and Head of International at Bejing Weying Technology, shared stats and analysis on technology and ticket sales:

“In China, we are excited to see there’s a trend – in recent years the average age of moviegoers has gone down. For young people, you have to have the appetite to meet their attentions. They are relying on internet, their smartphones, so I see in China online ticketing and marketing is growing – we’re excited about this because it’s going to generate new ways of connecting users to content and use data to do more efficient marketing.”

“In China, the internet giants, they are very active and deeply engaged in the film industry – this is unique in China. It’s a driving force of the industry – they’re focused on users and data and they offer innovation in the industry.”

“There’s tremendous opportunity to grow in China; the average is now one ticket per capita while it’s 3.8 in the U.S. …technology advances are making it simple for moviegoers to purchase tickets online. We see more and more people using the ‘WeChat’ wallet to buy tickets; you can do it in 10 seconds. The China film industry is in a battle for young people’s time; the average age of Chinese moviegoers is now 24, down from 27 a few years ago.”

“We need to focus more on family movies; we do see a growing increase of demand for animated movies in China.”

William Feng, Head of Greater China, Vice President of Asia Pacific, Motion Picture Association, commented on ease of access to content and creation freedom online:

“China’s internet population has reached over 700 million and the majority of those users get their access through mobile phones. The reason they’re addicted to online content is because internet media in China enjoys the most freedom in terms of creating content.”

Maria Lo Orzelat, Founder/Producer at Studio Strada, gave insight into producing in China and the importance of the story:

“From a producers’ point of view, the next generation of filmmaking is already happening now.”

“Everyone is shooting digital now, and in Hong Kong (and Asia) the film crews are more adapted to the new technology available than in other countries. There is less of a learning curve or no curve at all. Crews will know what to do right away and everything is streamlined.”

“If you are an independent producer coming to Asia it is helpful to have a script, cast, HODs prepared before you arrive. You can feel very confident of finding a great AD in Hong Kong.”

“Asia has a rising middle class, new cinemas being built everyday (20 or more in China), so there is a huge marketing potential and lots of opportunity in the ancillary market, not just theatrical. There is a tremendous gap between theatrical and digital platforms so there is tremendous opportunity for your product.”

“No matter how much technology changes and systems improve, you always have to go back to your roots of being a filmmaker. We are storytellers and need to focus on telling a good story. Whether you shoot quickly or slowly, in digital or film, whether you are the past or future generation of filmmaking, you have to focus on the story.”

Fabio Lima, CEO of Sofa Digital, weighed in on the Asia’s digital market:

“Southeast Asia now is the Latin America of three years ago. Different small markets, the level of localization, subtitling, the social network… it’s the forecast of the future.”

“It takes time to educate and show people that you can monetize in different ways.”

“The millennials are more pro micro payment rather than subscription, especially with games and all the different apps. They know how the micro payment model works.”

Belsasar Lepe Co-Founder & SVP of Products & Solutions for Ooyala, commented on VOD growth and content in Asia:

“In 2011 we were looking at 2% revenue to online video. If you flash to now, we’re looking at 11%. In terms of projection over the next few years, this will grow to 22% from online video. You are still seeing the year over year growth.”

“Long form content (10 minutes or more) makes up for a majority of viewing on mobile devices. This means two things: when it comes time to consume content at home, [Asian] audiences are not choosing the big screen but the smaller screen, which is fascinating. The other thing is, when you look at the consumption for long form content, we noticed that it is consumed across multiple different sessions.”

“The net of it all is that you have a very captive audience, which means that there is a lot of means to expand.”

“There’s very much a space for independent content. We tend to see a lot of direct consumer plays, there’s a certain aggregation where these folks are teaming with content providers.”

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