Imax Sees Double-Dating Dent Chinese Box Office
The giant screen exhibitor predicts the forces of economic growth will win out and reduce the number of Hollywood tentpoles debuting simultaneously in that fast-growing Asian market.
TORONTO -- Imax has enjoyed impressive fortune in China in recent years, expanding its theater network and seeing a WTO agreement with that giant market get more of its movies in front of local cinemagoers.
But a decision last year by Chinese authorities to have Hollywood movies double-date at the local multiplex reduced Imax’s per-screen averages during the last three months of the year, compared to first-half 2012 levels, as Imax released its Q4 results on Thursday.
And the prospect of still more cannibalization of Hollywood box office through forced simultaneous debuts is only adding to uncertainty over whether China's film policy to promote market share for local films versus foreign market share is a one-off or a long-term trend.
China’s yo-yoing Hollywood film release strategy saw Sam Mendes’ Skyfall debut in that market on its own, as will Peter Jackson’s The Hobbit: An Unexpected Journey when that tentpole rolls out this Friday.
Imax CEO Richard Gelfond told The Hollywood Reporter on Thursday that forecasting the future is difficult because dueling constituencies in the Chinese government want to foster more homegrown films, or get more people out to shopping malls to see movies to stimulate economic activity.
And still more bureaucrats want more shopping malls and theaters to be built, he added.
But Gelfond predicted concerns for economic growth will eventually prevail and give Hollywood movies more breathing room in China.
“I just believe that over time the forces for economic growth and the growth in entertainment are going to win out over the forces that are trying to protect the Chinese film industry and its share of box office,” he said.
Strong Chinese runs for Hollywood titles is key for Imax because the Toronto-based exhibitor has bet heavily on that Asian market.
Looking to satisfy soaring Chinese demand for 3D movies, Imax last year signed a deal with Wanda Cinemas, the country’s largest theater chain, to build and install 75 giant screens in movie theaters.
Imax is also hedging that bet by releasing more local films on its screens in China.
The giant exhibitor released Journey to the West: Conquering the Demons by Hong Kong comedy director Stephen Chow in select Chinese theaters Feb. 10, and has so far grossed $7 million in China, or a per-screen average of $70,000.
Imax on Thursday told financial analysts during a conference call that it plans to release six Chinese local-language films in that market this year.