China's film sector shows no signs of slowing


BEIJING -- Chinese film producers made a record number of films in 2007, distributors earned record revenues, and the Chinese titles garnered a record number of awards at international film festivals.

China produced 402 movies in 2007, up 21.8% from 330 movies in 2006, according to

statistics from the State Administration of Radio Film and Television.

"The Chinese movie industry is on its way to rapidly changing from a state-run system to a business system," SARFT vice chairman Zhao Shi said in a statement.

Boxoffice revenues hit 3.3 billion yuan ($472.4 million) last year, up 27% from 2.6 billion yuan in 2006, the agency reported. Of that, 1.8 billion yuan was from locally made films, which took a 54% share. This was the fifth year in a row that domestically produced films outearned foreign productions.

Some of this is due to regulatory controls, however, since the Chinese government sets limits on how many foreign firms are allowed to be distributed in China each year.

Meanwhile, 208 Chinese films attended 97 international film festivals last year, with 29 films recognized with awards at 19 festivals.

According to a report conducted by the Institute of Philosophy Chinese Academy of Social Science and Shanghai Jiao Tong University, China ranked third globally in the number of films produced last year, after the U.S. and India.

However, China ranked first in the percentage growth of boxoffice revenues last year, according to the report, though it ranked 11th in total revenues.

"Foreign films and big-budget co-productions continue to experience better- than-anticipated numbers," says Jay Rothstein,

producer and founder of Shanghai-based China Venture Films. "China's expanded middle class equals better opportunity for profitability."

China Venture Films has been active in China for five years. Rothstein says his company received government approval to distribute its current film, "Milk & Fashion," but he didn't anticipate approval challenges for an upcoming feature, "Distance Runners."

"We already have a third feature in development," Rothstein says. "There is opportunity -- it's just that in order to be successful, film companies need to think with a different creative mind-set."

According to the state-owned China Film Group, growth in China's boxoffice revenue was enjoyed primarily by the largest cinemas and cinema chains. There were eight cinema chains that saw more than 100 million yuan ($14.3 million) in boxoffice revenues in 2007, the same as in 2006. Additionally, five cinema chains reported over 300 million yuan in revenues, up from just one in 2006. Those five chains -- Shanghai Lianhe, Beijing New Film Assn., Beijing Wanda, China Film South and China Film Steller -- had a total of 1.6 billion yuan in revenues, accounting for almost half of the entire market.

However, the boxoffice of other second-rank cinemas and cinema chains didn't see much growth last year, according to the China Film Group, and competition between cinemas, especially between small- and medium-sized cinemas, has been heating up.

According to SARFT statistics, 102 new cinemas opened last year, adding 493 new screens, with an average of 1.4 screens added daily. On the list of top 50 cinemas in

boxoffice revenues, new names appeared on the list every month, the regulator reports.