3D fails to lift Hollywood box office take
By Matthew Garrahan in Los Angeles
Published: January 3 2011 19:56 | Last updated: January 3 2011 20:34
The great 3D film revolution is failing to live up to its initial promise with US cinema attendance falling close to 10 per cent in 2010 and end-of-year movies failing to lift the gloom.
The key summer period, when Hollywood studios release their biggest films of the year, was the lowest attended in a decade, according to Hollywood.com.
Hollywood studios have embraced 3D technology because it allows them to charge a higher ticket price. But the lower attendance points to consumer fatigue, said Richard Greenfield, an analyst at BTIG Research.
Several 3D films flopped at the box office in 2010. “The US consumer is becoming increasingly less interested in 3D movies,” Mr Greenfield wrote in a recent note. “While the horror and gross-out comedy genres may benefit from 3D (think Saw 3D or Jackass 3D), the vast majority of 3D movies this year have been disappointing at best.”
Total 2010 box-office takings slipped 2.6 per cent from $10.6bn to $10.3bn.
But attendance fell by 8.1 per cent, which is a concern for an industry already worried about competition from other forms of entertainment, such as video games, online social networking and television.
Although plenty of films performed well in 2010, notably Warner Brothers’ Inception, released in 2D, and Walt Disney’s 3D Toy Story 3 and Alice in Wonderland, plenty of others underwhelmed.
Cats and Dogs: The Revenge of Kitty Galore was one of the year’s biggest 3D flops. Gulliver’s Travels, a 3D adventure comedy starring Jack Black, underperformed on its Christmas release in the US, although the film has yet to be released in several international markets.
Disney’s Tron: Legacy, which was also released in 3D, had a modest opening weekend performance, in spite of an enormous marketing campaign.
The next 12 months could be more promising for Hollywood. “We believe attendance is likely to rebound in 2011 and benefit from a strong summer film slate with plenty of sequels and franchise hits,” wrote Anthony DiClemente, an analyst with Barclays Capital, in a research note.
Films in the pipeline this year include Pirates of the Caribbean 4, Transformers 3 and Cars 2.
However, the studios may have to re-think their 3D strategy and limit the technology to genuine blockbusters, rather than view it as a panacea for poor films, says Mr Greenfield.
“The movie industry should reduce the number of 3D movies it has planned or at least substantially scale back the upcharge as they are simply charging way too much for poor content,” he says.
Silver screen strikes gold in China
By Kathrin Hille in Beijing
Published: January 3 2011 17:40 | Last updated: January 3 2011 17:40
|Here’s looking at you: a China audience takes in the 3D film ‘Avatar’. The country is adding three screens a day, the fastest growth of any cinema market|
The holiday season in the west may be over but for the Chinese film industry party time has begun.
The film, starring Chow Yun Fat, earned Rmb453m in its first two weeks when it came out at the end of December, and it continues to sell well.
Film companies expect the hunger for entertainment of China’s growing middle class as well as heavy investment in new cinemas to continue to fuel expansion for years.
China has 5,000 screens, about one-eighth of the US. But the country adds new cinemas at the pace of three screens a day, faster than any other market.
“It will be the world’s largest cinema industry in 10 years or less,” says Tony Adamson, marketing head for DLP, the digital cinema technology arm of Texas Instruments.
“China could have as many as 100,000 screens and it would not be over-screened.”
International companies are piling in.
Imax has raised the number of cinemas planned in China by 15 to 96, and Lotte Cinemas of South Korea is planning to build 30 theatres in the country this year.
The lion’s share of the growth is in smaller cities, some of which do not have any cinemas.
Zhang Baoquan, president of Antaeus Group, a real estate conglomerate which is expanding into film, says he expects cinema construction to spread like wildfire in areas outside the main cities, driven by urbanisation and the increasing availability of digital projection.
“In the US only one-third of all screens are digital so far, but I expect China to be 100 per cent digital by the end of 2011,” Mr Zhang says.
While converting existing cinemas requires sizeable investment, there is no additional cost to equip a new cinema for digital projection.
“The increase in screens raises the average revenues per movie, so you can spend more per film – hire better directors, get better scripts, have better special effects,” says Jiang Yanming, one of China’s leading visual effects producers.
“We will be making better movies.”
Recent releases would suggest that this is happening, at least as far as ticket receipts are concerned.
In 2009, China saw its first locally produced horror film, Painted Skin.
Last year, the country’s audiences were treated to a Chinese “chick flick”, Go Lala Go, a Hollywoodesque romance about a Beijing office girl. It made Rmb124.5m.
Fox released its first Chinese-language movie, Hot Summer Days, which it co-produced with Huayi Brothers, China’s largest studio. The romantic comedy made Rmb125.8m.
“These firsts are indicative of the opportunity,” says Sanford Panitch, president of Fox International Productions.
“For a long time, most Chinese films tended to be period, and now you’re seeing more commercially minded films, clearly in response to a growing middle class audience.”
But there remains a barrier to foreign filmmakers.
The Chinese government, which keeps the industry under strict control in the name of protecting public morals and Chinese culture, has an annual quota of 20 foreign films for distribution by two state-owned companies.
The World Trade Organisation ruled last year that China was breaking its 2001 WTO entry terms and that this restriction must be changed.
However, few in the industry expect the government to take meaningful action to open up the market further, so the only way in for foreign film companies is through co-production with Chinese partners.
The films will continue to be censored for sex and violence because China does not have a film ratings system. They may also be banned for political reasons.
Zhang Xun, president of China Film Cooperation Corporation, the state outlet which supervises co-productions, says CFCC rejected a script from Taiwan about a policeman with mafia ties.
She says: “We absolutely do not encourage such films. The institutions of the state are a force for good in any country. We do not hope to describe China’s police as that ugly. We hope that justice can defeat evil.”
CFCC interfered in Yip Man, a kung fu drama set under Japanese occupation in the 1940s.
“The unity and power of the Chinese when the Japanese invaded – none of that appeared in the original script,” Ms Zhang says.
Some foreign studios find such interference too much to swallow. Joint productions are growing more slowly than the market. According to CFCC, it received 75 applications in 2009 and 90 last year.
Copyright The Financial Times Limited 2011.