China Daily : East side story: Rise of Asia’s film industry

East side story: Rise of Asia’s film industry

Speakers and organizers at the China Daily Asia Leadership Roundtable event on ‘Challenges, Opportunities and Partnership for Asia’s Film Industry’ at the Hong Kong Convention and Exhibition Centre on March 20. (Photos by Edmond Tang / China Daily)
Asia’s film industry is developing rapidly. Box-office revenues are rising fast while the number and quality of films coming out of various national film industries has increased substantially in recent years.
This evolution was the focus of the China Daily Asia Leadership Roundtable on the “Challenges, Opportunities and Partnership for Asia’s Film Industry” held on the sidelines of the Hong Kong International Film & TV Market (FILMART) at the Hong Kong Convention and Exhibition Centre on March 20.
“As Asia continues to enjoy sustained economic growth, more and more people, particularly the youth, choose to go to the cinema as part of their lifestyle,” said Zhou Li, publisher and editor-in-chief at China Daily Asia Pacific. “Movies are one of the best arms of soft power. More and more governments realize this and are pushing it forcefully.”
For the time being though, Hollywood is the dominant force in the global film industry. Last year North America, the largest film market in the world, earned $10.8 billion in box-office sales.
The Chinese mainland has also emerged as a giant market and revenues in 2012 jumped more than 30 percent from the previous year to $2.69 billion. However, about half of that — $1.38 billion — went to foreign films. Still, growth is visible. Every day, four new movie screens come up somewhere in China.
The markets in Japan and South Korea are also growing fast. Hong Kong, despite its small size, has evolved as a hub. Great films are being made in Thailand, Taiwan and the Philippines. Other countries around the region are also stepping up their participation in the industry.
“We are all witnessing the rise of Asia’s film industry,” said Jenny Koo, director of service promotion at the Hong Kong Trade Development Council (HKTDC). The HKTDC organized FILMART, which has been held annually for 17 years. Some 710 exhibitors participated in the largest film market event in Asia.
“The success of Hong Kong-(Chinese) mainland co-productions is a good example of how we can work together,” Koo said.
Co-productions accounted for the majority of the top 10 box-office hits on the mainland.

One hurdle that only a handful of Asian films have managed to overcome is attracting audiences from different cultural backgrounds, which would help raise revenues.
In China, for example, targeted revenues are still low, said Crucindo Hung Cho-sing, managing director at Delon International Film.
“Why can America earn a lot of money but China cannot?” asked Hung. “It is very hard for us to compete in the international market.”
The income of Hong Kong films is often not enough to cover costs. The same is often true on the mainland. In the first half of 2012, only seven of the over 140 movies made on the mainland broke even or were profitable.
“And we have to produce very large movies to compete with American movies,” said Hung. “There is still a very large discrepancy between Chinese films and American films.”
Increasing revenues would be a sure way of improving quality.
As revenues rise, so do budgets and production values, said William Pfeiffer, CEO of the Hong Kong-based feature film company Dragongate Entertainment.
“I would not have guessed that Chinese films would have crossed the $200 million mark in revenue (so quickly),” said Pfeiffer. “In fact, two films have crossed it.”
Part of the challenge for the industry is to overcome complex regulatory environments that affect distribution and content. It is difficult to put in place cooperative ventures to produce content that appeals to audiences across borders. Ongoing concerns over intellectual property protection also make it harder to attract investment.
“A key solution is partnerships,” Pfeiffer said. “What is required for a good partnership is trust.”
Still, there are opportunities to reach beyond national borders, like taking Asian ideas and projects to the English-speaking world and vice-versa.
“You are taking the best of all these cultures and doing something that works internationally,” said Pfeiffer.
One place that has managed to leverage joint ventures into a thriving film industry is Hong Kong, where growth is rapid, said Wilfred Wong Ying-wai, chairman of The Hong Kong International Film Festival Society.
“The world’s focus is on Asia today. It is not just Hong Kong … Hong Kong is too small (but) it is a hub for Asia,” said Wong. “The trend is unlikely to change. Asia’s box-office accounts for about a third of the world’s box-office.”
The Hong Kong International Film Festival, for example, has been held annually for 37 years and has showcased some of the most famous filmmakers from Hong Kong, the Chinese mainland and other parts of Asia.
“The challenge is really the diverse culture and tastes within Asia,” said Wong. “When you talk about Asia, you are not talking about one country or one culture.”
Wong believes the movie industry has the potential to cater to all of these diverse tastes. If Hollywood can do it, why not Asian film industries?
The challenge is not so much in the potential or ability of the individuals involved in the business but rather in the lack of an industrial system, which is what makes Hollywood so powerful.
“There is no lack of opportunity,” said Wong.
Leveraging this opportunity may require working through the regulatory environment and understanding that a movie means entertainment, said Zhang Yuan, a film director in China.
“We need rules in the film industry so that we can compete with others,” he added.
“We need to see a total change of the system of entertainment and film and TV,” said Fred Wang Cheung Yue, chairman of the Salon Films Group. “Unless you change the whole system and update it, your film and TV industry is still running in the stone age.”
Creativity has been a key factor behind the success of Hollywood. Another important factor has been technology and the creative use of financing.
“They have been constantly upgrading themselves,” said Wang. “They have also used the financial system.”
Distributing a film globally may cost $50 million to $70 million. No other film industry in the world has the resources to distribute films worldwide on that scale. Films in Asia have budgets that are a tenth the size of just the distribution budget of a US blockbuster, added Wang.
This does not mean that there isn’t potential. China has shown in a myriad of examples that it has the potential to grow almost any industry.
“Aviation and telecom have good organizations worldwide,” said Wang. Groups like International Air Transport Association, for example, can help the industry grow.
“We need to make a total change. Forget the other places and start with Hong Kong. Hong Kong has all the ingredients if you have the courage.”
“China ranks number two in the world,” said Song Dai, chairman and general manager of Sil-Metropole Organisation. “But today, facing the momentum of the Hollywood film industry, the industries on the Chinese mainland and in Asia are facing (great) pressure.”
Recent agreements have opened the door to more foreign films in China, partly due to the country’s participation in the World Trade Organization. But it is not just China. Industries elsewhere — like South Korea and India — are also under pressure.
Alternative forms of marketing, using the Internet and new media, are emerging.
“There is still room for us to improve,” said Song. “Especially when we are facing Hollywood, such a mature film industry.”
Source: http://www.chinadailyapac.com/article/east-side-story-rise-asias-film-industry
China Daily Hong Kong Edition PDF version available at: www.cdroundtable.com/pdf/20130322-P18-19-HK.pdf
China Daily Asia Weekly PDF version available at: www.cdroundtable.com/pdf/20130322-P12-13-AW.pdf