Dialogue: Paul Hanneman & Tomas Jegeus
Paul Hanneman, left, and Tomas JegeusAs anticipation mounts for director Tim Story's "Fantastic Four: Rise of the Silver Surfer," Marvel Studios' comic-book heroes can once again rely on the global superpowers of Paul Hanneman and Tomas Jegeus. Since April 2005, the co-presidents of 20th Century Fox International and their teams have fanned the winds of publicity for the studio's films in every corner of the world. Hanneman's first post was at Fox in Panama in 1990, and stints in Australia, South Korea and Japan followed. He built the studio's Asia Pacific division in Hong Kong, before joining the Los Angeles headquarters in 2002. Three years later, Fox International received the CineAsia 2005 Achievement in Distribution Award. Swedish native Jegeus also started with Fox in 1990, joining the London office after making a career for himself in advertising in his homeland with Svensk Filmindustri. He began working with Hanneman in Hong Kong in 1998, a position he held through 2002, when he left to serve as executive vp marketing at United International Pictures in London until 2004. He returned to Fox in 2005. Recently, Hanneman and Jegeus spoke with Andreas Fuchs for The Hollywood Reporter and Film Journal International about the challenges facing the international distribution community at the moment and what territories around the globe seem to be enjoying the most growth.
The Hollywood Reporter/Film Journal International: What's the most important challenge facing international distribution?
Paul Hanneman: The most important challenge, and at the same time biggest opportunity, is the conversion to the digital presentation format. With so many 3-D movies coming out and the need to continue to differentiate the theatrical experience from that of home entertainment, we feel digital cinema is our top priority. Piracy remains a huge challenge for us, and we continue to work hard through the MPA and local organizations to fight what has become a constant battle.
THR/FJI: Please comment on the recent actions taken by exhibitors in the U.K. and Germany, where they pulled films from theaters when they were faced with shortened DVD release windows.
Tomas Jegeus: We consider the situation to have been blown out of proportion in terms of distributor/exhibitor relations. Having said that, the one group that truly suffered from the exhibitor retaliation of pulling films was the consumers in those markets who were refused the opportunity to experience our blockbusters "Night at the Museum" and "Eragon" on the big screen.
THR/FJI : How would you describe the general state of theatrical film exhibition in Europe and the world today?
Jegeus: There is always a downside to too much consolidation -- now less than 40% of international exhibitors own more than 80% of total sites.
Hanneman: Clearly some exhibitors are more passionate about their core business than others, and this can be seen in the quality of theaters and services. Without naming territories and circuits, we believe there is opportunity for improvement in many circuits around the world. That being said, there are examples of incredible multiplexes in every market.
THR/FJI: What are some of the key markets in terms of opportunities and challenges?
Jegeus: Opportunities continue to emerge in markets with developing cinema infrastructure, where new complexes can resurrect lapsed audiences and bring entirely new audiences to the cinema.
Hanneman: Russia, with receipts for 2006 up 36% from the previous year -- the market continues to explode. With the Fox operation under manager Michael Schlicht firmly in place today, we have seen tremendous growth in revenue from Russia, with an increase of 259% to $25 million from calendar year '05 to '06.
Jegeus: However, Russia continues to present a challenge as a piracy hub exporting pirated product into other global markets like the U.S. and China.
Hanneman: China is also growing. Despite the frustrating annual film quota allowing only 20 films from the U.S. into the country, the market continues its upward trend, with a 30% increase in boxoffice and a 12% increase in admissions in 2006. Our hope is that over time the market will open completely and we will be able to manage our releases in China. In the meantime, our representative Luke Xiang has worked hard to book a record five Fox films per year over the past several years, and corresponding revenue from '05 to '06 rose 114%.
Jegeus: Korea is also exciting because the market overall continues to expand. Not only did boxoffice grosses cross the $1 billion mark for the first time in 2006 (an increase of 24% from the previous year), admissions also hit an all-time high with 161 million tickets sold. Our managing director Jay Shim posted another terrific calendar year, with a revenue increase of 50% for 2006.