CinemaCon, the annual exhibitor convention, is under way in Las Vegas, as studios show their summer reels in hopes of reviving theater owners' flagging spirits during a prolonged box office downturn. Anthony D'Alessandro reports:
The majors studios banged the drum for the international box office Monday at CinemaCon, while Paramount’s promotional reel served as a defibrillator for those exhibitors deadened by the lackluster B.O. to date. Clearly, the studio is on a roll.Paramount stoked CinemaCon attendees last night at Caesars Palace’s 4,000-seat Colosseum in Las Vegas with its presentation. The offerings: eight minutes of Steven Spielberg UFO homage Super 8 (June 10) complete with director J.J. Abrams introduction (A.P. interviews him here) as well as clips from Thor, November’s Shrek spinoff Puss and Boots and Kung Fu Panda 2.
Paramount's Rob Moore was on hand to introduce the reel along with DreamWorks Animation CEO Jeffrey Katzenberg and the films’ stars, i.e. a crooning Jack Black from Kung Fu and Thor topliner Chris Hemsworth. "This movie kicks so much butt," Black told the packed hall, "that's there's going to be a national butt shortage when this movie is unleashed on theaters."
According to Variety, Katzenberg predicted: “I couldn’t be more confident that the summer of 2011 will go down in history as the biggest ever.” It’s possible. Similar to last year, Paramount boasts a tentpole heavy slate that could overshoot the $780 million haul it raked in last summer.
Fanboys will have no problem shelling out to see Thor and Transformers: Dark of the Moon in 3-D, but will families? Apparently, Katzenberg’s rule of thumb is that when one of his animated titles skews toward adults, which the first Kung Fu Panda did with 25-34 males, there’s nothing to worry about. He’s hoping that Kung Fu Panda 2 can outdo Megamind, which may recoup its $130-million production cost only after global returns are counted ($319.5 million).
CHINA AS SAVIOR
With the domestic B.O. souring since last summer, the majors’ reliance on foreign, which repped 67% of last year’s global $31.8 billion hauls, is more vital than ever. Films which are paling stateside are actually overperforming abroad, i.e. I Am Number Four ($53.5 million domestic, $70 million foreign), Gulliver’s Travels ($42.7 million domestic, $173 million foreign) and the The Tourist ($67.6 million, $203.5 million).
Hollywood’s dominance abroad can be attributed to the majors’ skill in handling each film on a territory-by-territory basis. Disney International, for example, employs locals rather than parachuting in Yanks to lay down outsider law. Jason Reed, Disney International’s exec VP and general manager told Variety: “You never really understand how a territory works until you’re on the ground talking with the local filmmakers.”
However, two CinemaCon panels, with such execs as Paramount Int’l president Andrew Cripps, Warner Bros. Int’l Cinemas president Millard Ochs and WB International exec vp Richard Fox, concurred that the studios have their eyes on the prize: China. In five to 10 years, that market could outpace the U.S. as the biggest B.O. territory in the world. Last year, the U.S. domestic B.O. grossed $10.6 billion.
As the world’s second largest economy, China’s film industry has been experiencing its "French New Wave" since the millennium, producing lavish productions (i.e. John Woo’s 2008 $80-million battle epic Red Cliff) for export and building a cinema infrastructure for both local and Hollywood product that has driven B.O. to a record $1.5 billion last year (+61% vs. 2009). Fox’s Avatar became the country’s top-grossing film with $204 million generated during the calendar year. The country has everything a studio dreams of: an avid moviegoing population, a strong currency, and 6,500 screens, which are increasingly digital.
The country stays in the dark ages economically due to its 20-films annual quota on Hollywood and foreign film imports; a crimp which has built a black market of pirated U.S. films since its implementation in 1994. For the Chinese, the quota had both cultural and economic objectives: it preserved local production and secondly, it remitted royalties out of China for the first time.
In addition, the U.S. studios only earn 17% of a film’s Chinese box office while the government takes another 30-40% cut. Recently China missed the WTO’s March 19 deadline to lift its current restrictions on foreign copyrighted goods (inclusive of DVD, music and films) making Ochs exclaim yesterday in his CinemaCon keynote speech, “How quickly China becomes the number two market and eventually the number one market is up to the government.”
In my interview last night from his Hong Kong office, Fortissimo Films Chairman Michael Werner, who specializes in selling Chinese titles around the world, had a more upbeat view than the concerned U.S. based international executives about the future of China: “As the total marketplace expands (in China), there is clearly a need for more films to satisfy the needs and demands of the cinemas and the audience. It’s known that China has been working on a plan to relax the quotas and given the recent expiration of the WTO agreement, combined with the economic interests of the local cinemas and distributors, it’s likely that the Film Bureau will proceed to modify the quota system in the near future.”
An open door policy in China won’t come without further strings:
As Screen reported last year, the country is touchy about sexual content and even more agitated by supposed heretical political films, specifically those where China is concerned. Ang Lee’s Lust, Caution was depleted of its sex scenes, giving it a general audience rating in the country. Ironically, such measures made China that film’s highest-grossing territory with a B.O. of $17 million (25% of its global $67 million haul). The political headache is more a concern for the country’s local auteurs. As Screen details, actress Tang Wei was blacklisted in the country for her character’s unpatriotic demeanor in Lust, Caution: She failed to turn in her collaborator lover to the authorities.
However, the vibe coming out of CinemaCon seemed to indicate that studio executives are willing to contend with China’s demands for edited content-- as long as more of their films get splashed on screens.