December 11, 2011

China’s increasing focus on exporting its values could ironically spell opportunity for foreign filmmakers. Read on to learn how and why.

Back in 2008 the term “three afflictions” began appearing in the Chinese press to describe the major impediments that hampered China’s national strength during the past century. These were foreign aggression, poverty stemming from a weak economy, and the demonization of China by ‘hateful’ and ‘ignorant’ Western nations.

As the press stories told it, the first affliction was conquered by Mao Zedong when he unified China under the Chinese Communist Party (CCP) and expelled the last of the foreign occupiers, the Japanese. The second was thrown off when Deng Xiaoping declared “to get rich is glorious” and engineered the great Chinese economic miracle that continues to the present day.

With the first two afflictions licked, the CCP has now set its sights on tackling the third, which can be summed up as poor global public opinion. Government leaders are concerned that China’s negative image stands in the way of its international influence, and they’ve decided to do something about it.

A major party initiative to project China’s ‘soft power’—that is, its ability to shape global events by promoting its cultural values around the world—was announced in November by President Hu Jintao when he delivered a policy speech urging the country’s artists and writers to “get closer to the realities and lives of the masses, to uphold the spiritual torch of the Chinese nationality, and to produce a greater number of excellent works that live up to the history, the times, and the people.”

And then he said something that must have jolted every Chinese artist and intellectual: “Let all flowers bloom together and let hundreds of schools contend.” This statement directly echoed Chairman Mao’s famous 1957 statement “Let a hundred flowers bloom and a hundred schools of thought contend to promote progress in the arts and sciences and a flourishing socialist culture in our land.”

OK, enough history; what does all of this mean for filmmakers?

For one thing, it means money. Lots of it. Hu and his colleagues in the CCP are anxious that Western culture and values have gone global in a way that Chinese culture and values have not, so they are investing billions in the effort to export China’s own value system, building the world’s most modern soundstages, production facilities, post production houses, animation houses, and the like. ‘Soft power’ and the cultural means to promote it have been elevated to the highest level of strategic importance. This is tantamount to a war of words and ideas with the West.

But it takes more than artillery to win a war, it takes skilled personnel to operate the machinery. Winning minds takes the ability to generate creative ideas and the skills of persuasion, capabilities that the CCP sorely lacks. The post-1949 Communists have never before had to compete in the marketplace of ideas because in China they own and control the market.

To compete on the global stage China will need skills that it hasn’t needed before. Skills like story development and screenwriting for international audiences. Sophistication in marketing, advertising and distribution to successfully circulate movies to the far-flung corners of the globe. Above all, the ability to understand what makes international filmgoers tick: why they go to see the movies they do and why they don’t go to see Chinese movies.

These skills and capabilities aren’t going to magically appear inside China; they will almost certainly need to be imported. China’s top filmmakers—skilled directors like Zhang Yimou and Feng Xiaogang—have generated huge and loyal followings inside the country, but they do hardly any business outside. For instance, Feng’s recent Chinese blockbuster melodrama Aftershock, which racked up nearly $100 million in ticket sales in China, earned a paltry $62,962 from its release in the U.S.

More than either side realizes, China needs Hollywood. And for Hollywood’s legions of skilled but underemployed writers, directors, producers, rotoscopers, sound editors, marketers, distributors and other talents, this means money and opportunity. If you’re one of these talents, China has a shortage of your kind of expertise, and piles of cash to pay you for it.

Will seizing these opportunities mean selling out your values and becoming a mouthpiece (喉舌) of the Communist Party? Hardly. The past decade’s two greatest examples of films that successfully promoted Chinese culture were made by outsiders pursuing their own self-interest.

Crouching Tiger, Hidden Dragon, directed by Taiwan’s (!!!) Ang Lee, swept the world with beautiful and sensuous images of China, earning $200 million worldwide (nearly $300 million in 2011 dollars). And Dreamworks Animation’s Kung Fu Panda films have been highly praised by CCP members for their ability to entertain audiences both inside and outside China while remaining faithful to traditional Confucian values. The two Panda films have earned $1.3 billion in worldwide box office receipts, and  Dreamworks’ Chairman Jeffrey Katzenberg is in talks to set up a $2 billion joint venture to make films in China. Although Katzenberg and Lee have done a great deal of good for China, no one is accusing them of being Communist Party lackeys or sympathizers.

Foreign filmmakers have an additional advantage over their Chinese counterparts: freedom. Remember Hu Jintao’s exhortation to “let flowers bloom and hundreds of schools contend”? His intent must have been to send a chilling reminder to the Chinese that their ideas and artistic contributions are welcome only so long as they toe the line of political correctness and espouse the party’s message. When Mao Zedong launched the original “100 Flowers” campaign in 1957, he encouraged uninhibited public discourse to uncover a variety of views and solutions to national policy issues. After six weeks of this ‘experiment’ with freedom of expression, Mao swiftly repressed or executed those whose views offended him. While Chinese artists must be extremely cautious to avoid a similar fate, the worst that can happen to foreign filmmakers is that their projects will be rejected by the censors.

As David Bandurski put it in his recent New York Times article, “China’s ‘third affliction’ is a self-inflicted malady” that it cannot cure by diktat. “Governments in countries with cultural censorship may no longer fear criticism at the hands of their own country’s cultural work, but they must endure the ridicule of the whole world.” China’s best hope for improving its global image will be to enlist outsiders—storytelling mercenaries, or modern-day de Toquevilles, if you prefer—to shine a light on that nation’s best, brightest, and most universal values. If you’re a Hollywood filmmaker, there is no shame in telling stories that explore the wonders of China’s magnificent 5,000 year old culture. If you can make globally successful films while you’re at it, China and its leaders will thank you.

Robert Cain is a producer and entertainment industry consultant who has been doing business in China since 1987. He can be reached at rob@pacificbridgepics.com and at www.pacificbridgepics.com.

 originally Posted: Mon., Dec. 5, 2011, 2:00pm PT

http://www.variety.com/article/VR1118046739#.Tua0UDeUm_0.email

Hollywood has always been on the hunt for foreign financing, which seems to arrive in successive waves from different parts of the world over the years. Successive infusions of cash boosting the fortunes of studios and indies alike have recently come from Europe, the Middle East and India.This year’s craze appears to be coin from China, with showbiz execs having high hopes for partnerships with that large and growing market — but also harboring some misgivings.

While it’s true that the world’s most populous nation has a booming cinema sector, China has also erected an array of barriers to entry. Still, more Hollywood businesses have been planted in China than is generally realized.

Twentieth Century Fox has co-produced three Chinese-language films — all profitable — including 2010′s “Hot Summer Days,” a $2.25 million production with partner Huayi Bros. Media that grossed $22 million at China’s theatrical box office. And because it’s considered a Chinese production, “Hot Summer Days” was exempt from the country’s 20-title per year import quota that limits access for foreign films.

Sanford Panitch, president of Fox Intl. Productions, says in certain respects working under China’s rules is similar to working with a Hollywood studio in that producers face a multi-step approval process whose requirements are well known in advance.

“In some ways, it’s not so mysterious or Byzantine as people imagine,” Panitch says.

Relativity Media is a part owner of Chinese media outfit Sky Land, which in October announced English-language youth comedy co-production “21 and Over” wrapped production after shooting in both in Seattle and China.

“As long as you abide by their rules, the Chinese are generally very cooperative and helpful,” says Relativity Media CEO Ryan Kavanaugh. “They are not anti-company. That being said, they don’t want someone coming (into China) like it’s a free-for-all.”

One of the easiest avenues for access is to co-produce movies, because even if they are English-language pictures they are exempt from the quota that limits imports. With that in mind, Nu Image/Millennium Films is fashioning “Expendables 2″ as a Chinese co-production.

Specialist Hollywood ad agency Cimarron Group recently launched a Beijing office that now has several Chinese employees. Cimarron CEO Robert Farina says getting the permit to open the office required a lot of paperwork and was time consuming, but was straightforward. He adds that the high skill levels of job applicants impressed him, so finding qualified staff is not a problem, though some rank-and-file Chinese workers don’t yet have a grasp of global business techniques.

As for other media boots on the ground, Disney broke ground in April on a $4 billion resort and theme park in Shanghai with some funding coming from its Chinese partner. Meanwhile, Imax theaters are sprouting in China and other Hollywood movie outfits besides Fox and Relativity have dipped their toes in various TV and film co-production.

In fact, the MPAA screened a showcase of eight U.S./China film co-productions in November at a Washington, D.C.-area movie theater. Warner Bros.-based Legendary Pictures — which is 3.3% owned by China’s Orange Sky Golden Harvest Entertainment — made headlines in August when it established its Legendary East venture with Huayi Bros. Media.

Also, an elaborate Chinese version of the musical “Mamma Mia!” is being staged under license using local performers, and DreamWorks Animation is said to be actively scouting for executives for an animation production arm in China.

On the other hand, some Western companies entering China have experienced problems or retreated. Fakes of famous brands are an issue, with stores misappropriating signage from such companies as Apple and Disney. And recently the Chinese government ordered Lady Gaga songs removed from websites for “national cultural security.”

Yahoo is in a dispute over the sale of a valuable asset by its China venture and the Weinstein Co. got bad press over a rocky financing road for its co-production period drama movie “Shanghai.” In a pull-back, News Corp. recently agreed to sell its controlling interest in three TV channels and film library to a local entity.

The Office of the U.S. Trade Representative won a World Trade Organization ruling that China unfairly restricts access for copyrighted products including movies, TV programs and music, though China did not comply with rulings by a March deadline.

“The two governments are talking,” says Greg Frazier, exec VP of trade policy at the MPAA, “and we’ll see what happens … China is sort of a market unto itself.”

While cinema in China is booming, the MPAA notes that imported Hollywood films subject to the 20-film quota garner a meager 13% of box office under government rules, which is “the lowest ratio in the world.”

Other sources say China views the adverse WTO ruling as simply a starting point for negotiations. In any event, the world’s second-largest economy is far from timid about leveraging its clout and its economic power, which give it greater capability to arm-twist and push back than has been enjoyed by other emerging countries that Hollywood and Washington have faced in the past.

Still, that economic power also represents significant new opportunities for Hollywood, including a lively stock market that media companies can tap to raise financing by selling securities.

Moreover, China’s growing number of very wealthy individuals, who find returns offered by conventional banks meager, may someday emerge as yet another a potential source of film financing.

“There’s lots of appetite right now for film investment in China, but most of it is focused on financing Asian-language product with mostly regional appeal,” says Alan Cole-Ford, a former Paramount and MGM executive who is private multinational investor active in China. “Much but not all of the time, that’s what Chinese audiences really will pay to see.”