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Chinese film industry longs to be back in business

Coronavirus upsurge means cinemas are no closer to screening movies

CHICAGO -- After anxiously waiting nearly five months, theaters in China did not get the exciting news they had been hoping for in mid-June but a devastating announcement instead: An instruction from Beijing's city officials suggested that cinemas, KTV karaoke clubs and other enclosed places of recreation should remain shut until further notice.

There had been a flash of good news on May 8, when the State Council of China issued an instruction that allowed theaters to reopen with precautions such as reservations and a limited audience, but many theaters were still waiting for local governments to give the green light to open.

"It's definitely making me anxious, but I haven't thought about changing my job at the moment," says Zhang Meng, who worked at a theater in Xining, Qinghai Province, before it had to close. Even in low-risk regions like Qinghai, theaters have been closed for more than five months since January.

As the capital, Beijing's instruction sends a message to the rest of the country: Going to the movies is unlikely to happen soon.

In 2019, the Chinese box office generated $9.2 billion in revenue, making it the second-largest film market in the world. This year, thanks to the coronavirus pandemic, the industry there suffered a significant loss as movie premieres scheduled for the Spring Festival, a golden period for ticket sales, were canceled en masse.

People watch the Hollywood movie "Titanic" in 3D in Taiyuan, Shanxi Province, in 2012. The Chinese box office generated $9.2 billion in revenue in 2019, making it the second-largest film market in the world.   © Reuters

The uncertainty over whether theaters will reopen casts a shadow over the theatrical releases of the Chinese productions and Hollywood blockbusters that had been aiming to launch in China's summer, starting late June.

The Chinese box office in the first quarter of 2020 shrank 88% compared with last year, and 42% of theaters in second- and third-tier cities in China believe "they're on the edge of going out of business," according to a report by the China Film Association. Reopening was crucial for film companies and theaters, but now their last hope for an imminent one is gone.

Jia Zhangke, the director of "Xiao Wu" and "Platform," posted on social media that film industry workers had an urgent need to get back to work soon. He noted that some theater companies were losing as much as $140,000 a day.

One alternative for movies to find an audience and minimize their losses is online distribution, but a program coordinator at a film distribution company in Beijing, who was not authorized to speak to the media, says that it is not an ideal choice for films that had a marketing plan for theatrical release.

"We've done a couple of marketing plans for these films and they were just waiting for the theaters to reopen," she says. "These local productions had spent a lot on planning to promote them in theaters; turning to the streaming platforms would be a huge loss for them."

Streaming platforms are a better fit for foreign films with low marketing and distribution budgets for the Chinese market, she says. "Movies like 'Little Women' decided to go online because they had premiered abroad a long time ago, and there's less interest among the Chinese audience to see it in the cinema as piracy had spread it everywhere on the internet," she says.

The live-action Disney film "Mulan" was expected to be a blockbuster in China, but the outbreak forced the company to postpone its planned March release. (Screen grab from YouTube) 

Even if cinema comes back, the China Film Association study suggested that half of the theaters surveyed would need three to six months for their revenue to return to pre-pandemic levels; 37% believed it would take more than six months.

Many theaters have said their return may involve layoffs or furloughs for them to fully recover. The Ministry of Finance and the China Film Administration introduced a series of financial incentives, including a year without value-added taxes, to help theaters survive the pandemic. But whether theaters can make it through depends on box office performance after reopening.

This in turn depends on how well theaters adapt to the new era. In a May survey conducted by Capital Cinema, a company that owns five theaters in Beijing and Tianjin, 69% of people considered sanitation their biggest concern, and more than half of those surveyed hoped to see a limited number of viewers at one screening.

Nevertheless, audiences are eager to be back in theaters. In a study released during lockdown by Maoyan, one of the leading ticket sales platforms in China, more than half of those surveyed expressed an interest in going to the cinema when it was reopened and one-third had an "urge to see a movie in the theater as soon as possible."

A man sprays disinfectant outside a closed cinema at a shopping mall in Beijing on Feb. 3.   © Reuters

With countries such as Germany and Japan reopening their theaters in late May, China is surprisingly hesitant about allowing them to be back in business. Film industry workers in China are still waiting for the silver lining after the clouds. In sorrow and desperation, Deep Focus, a Chinese film publication and online platform for movie fans, wrote: "No one had ever imagined that, one day, cinema would be so close to vanishing."

Like many of her co-workers, Zhang was cheerful about the news and ready to be back at work, but the sudden outbreak of new coronavirus cases reported from Xinfadi market in Beijing drastically changed the situation throughout the country. "I relocated to Xining in January, but soon the theater closed and I've been out of work since then," she says. "I just hope everything gets better soon."

Reopening, for everyone from directors and actors to distributors and theater workers like Zhang, seems like a faraway dream.

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