China 2014 in Review: Hollywood Strikes Deals, Alibaba Goes Public

One of the biggest entertainment stories of 2014 in China was the stock market listing of e-commerce giant Alibaba, whose founder and executive chairman Jack Ma described his firm as “the world’s biggest entertainment company.”

Meanwhile, Transformers: Age of Extinction stormed the world’s second-largest film market and set records.

Ahead of the launches of a couple of late-year blockbusters, box-office revenue in China was on track to exceed $4.5 billion for 2014, up around one-third from 2013, and could possibly hit $5 billion.

After Hollywood movies notched a 60 percent increase in revenue for the year, Hollywood’s appetite for all things China is likely to remain voracious in 2015 and beyond. Here is THR‘s look at some of the big industry stories of 2014:

Chinese Tech Firms Went on a U.S. Shopping Spree

Chinese online video players including Tencent, Alibaba, Youku Tudou, Baidu’s iQiyi and online video firm Sohu.com, splashed more and more cash in 2014 on Hollywood content.

One of the biggest deals of the year was between HBO and Tencent. It was designed to make HBO TV shows and movies available on a broad basis in China for the first time.

Meanwhile, Alibaba struck a deal with Lionsgate to bring the Twilight saga and other films to China, while The Simpsons made their way over the Great Wall for the first time via a Fox deal with Sohu.

Also, iQiyi inked a $300 million partnership with smartphone maker Xiaomi to buy TV shows and movies.

But New Rules Might Make Showing Content Tougher

A question mark remains whether China’s efforts to tighten censorship of online content will confound efforts to bring such content as The Newsroom, Boardwalk Empire and Band of Brothers to China.

Guidelines from the State General Administration of Press, Publication, Radio, Film and Television (SAPPRFT) cover scenes of one-night stands, extramarital affairs, partner-swapping, flirtation, rape, incest, necrophilia, prostitution, sexual perversion and masturbation.

In September, China’s broadcasting regulator said it must approve all foreign TV shows before they can be posted on video sites and that sites must pull unapproved shows by early next year. Some industryites reckoned it could delay the availability of TV shows by six months and open the way for piracy.

Alibaba Goes Public

Alibaba’s record-breaking U.S. stock market listing on Sept. 19 was the biggest ever and gave the company a market value of roughly $225 billion.

The e-commerce giant in 2014 also worked on its plan to become a global player in the entertainment industry. It bought its own film company early in the year, installed the second-in-command from China Film Group, Zhang Qiang, as its head, and started looking around for targets in Hollywood and China, including Lionsgate.

Chairman Jack Ma went to Hollywood and was wooed furiously by the biggest names in the business.

Transformers: Age of Extinction Rocked China’s World

Michael Bay‘s robot tentpole did around $320 million worth of box office in China, a new record for a film in the country.

The Paramount movie did much to ensure success in China, shooting scenes in Beijing, Hong Kong and elsewhere and lining up a cast of Chinese stars, including Li Bingbing. It included propaganda messages about the Chinese government, and even featured stars drinking Chinese Red Bull in the middle of the desert in America.

The film crossed over and became a pop cultural phenomenon in China, with toys, clothing, food and drink all clamoring to be associated with Optimus Prime and his merry band of mechanoids. One of the most peculiar stories to emerge in the country in 2014 was a group of Chinese farmers who had given up their day jobs to build giant Transformers of their own. 

Hollywood Forged Closer Links

Former Warner Bros. top executive Jeff Robinov‘s Studio 8 signed the most eye-catching deal of 2014 in China when it secured around $200 million from Chinese conglomerate Fosun and a further $50 million from Sony, which has a five-year deal to release its movies and has signed up to distribute up to six films worldwide annually. The Fosun money is believed to be the largest Chinese investment to date in U.S. film production.

In November, The Walt Disney Co. and Shanghai Media Group agreed to expand their existing partnership to include the co-production of films and the development of TV shows.

Meanwhile, Jeff Shell, chairman of Universal Filmed Entertainment, said China was more exciting a market than it was a difficult one as he officially launched NBCUniversal’s Beijing office, which will be run by veteran Hollywood studio executive Jo Yan. The company also is building a multibillion-dollar Universal theme park in the suburbs of Beijing.

Brett Ratner, who directed the Jackie Chan–Chris Tucker Rush Hour films, signed deals to work on projects for Chinese movie screens, TV sets and stages, including an investment fund formed with Warner Bros. Entertainment, advertising and marketing firm WPP, Chinese entertainment and investment firm CMC Capital Partners, and local media company Shanghai Media Group.

And Vice Versa

Alibaba sent Harvard-educated former talk-show host Zhang Wei to Los Angeles to open an office, while real estate giant Wanda, which owns AMC Entertainment, forked out $1.2 billion for the Robinsons-May department store site at 9900 Wilshire Blvd. in Beverly Hills for the headquarters of its U.S. entertainment business.

Wanda chief Wang Jianlin said his aim was “to make China’s Wanda a world-known brand like Walmart, IBM and Google.”

And LeVision Pictures said it would coordinate its assault on the U.S. market with an office in L.A. and kicked off its Hollywood campaign with a $200 million film fund to make blockbusters.

The Old Guard Stepped Down

In March, the head of China Film Group, Han Sanping, retired as president of the mighty state-owned colossus China Film Group Corporation.

He handed the reins over to deputy chairman La Peikang and Zhang Qiang, who subsequently quit to join Alibaba’s film unit. Han’s tenure at China Film Group saw the industry transformed from a small propaganda movie-focused sector into the world’s second-largest film market.

Oliver Stone Took Aim at the Chinese Film Industry

Veteran director Oliver Stone caused an uproar at the Beijing Film Festival when he said that no true co-production was possible until filmmakers in China address chairman Mao Zedong‘s controversial legacy.

“Mao Zedong has been lionized in dozens and dozens of Chinese films, but never criticized. It’s about time,” he said. “You got to make a movie about Mao, about the Cultural Revolution. You do that, you open up, you stir the waters and you allow true creativity to emerge in this country. That would be the basis of real co-production.” Some in China responded by telling Stone to mind his own business.

And President Xi Jinping Said Art Must Serve the People

Art must serve socialism and the people, Xi Jinping told an audience that included entertainment industry figures, and must not bear “the stench of money” nor be “slaves to the market.”

“Socialist culture and art is, in essence, the culture and art of the people,” the president said. The comments were a reminder that China is still a communist country, despite appearances.

China Launched a Crackdown on Drugs, Prostitution

The Chinese government in 2014 started to heavily enforce a morality code among celebrities who take drugs or visit prostitutes.

With President Xi’s comments ringing in people’s ears, the media watchdog ordered TV networks to ban “tainted” stars who have used drugs or visited prostitutes from TV and other media outlets, after a flurry of big names in the entertainment industry were nabbed in drug and vice busts during the year.

They included Golden Bear-winning director Wang Quan’an who was arrested for “paying for sex,” while Jaycee Chan, son of veteran Hong Kong action star Jackie Chan, was busted smoking marijuana at a foot massage parlor in Beijing.

Black Coal, Thin Ice won the Golden Bear

A big boost for independent cinema in China came early in 2014 when Diao Yinan’s offbeat contemporary film noir Black Coal, Thin Ice won the Golden Bear at the Berlin Film Festival. And an even bigger boost came when the following month, the Film Bureau said that it had passed the movie for release in China. It made $16.5 million at the box office, a hefty haul for art house fare in China.

Another Berlinale favorite, Lou Ye, also scored success later in the year, sweeping the Golden Horse awards with his movie Blind Massage.

Big-name Stars Visited China

Studios noticed how Chinese audiences reward those stars who make the effort to come to China to promote a movie with serious box-office revenue, so a raft of big names came to China during the year to promote their films.

In a flurry of hugs, tales of tattoos and surreal quips to promote the sci-fi thriller Transcendence, Johnny Depp made his first trip to China.

Hugh Jackman and Peter Dinklage went to China for X-Men: Days of Future Past, while Andrew Garfield, Jamie Foxx and Emma Stone went for The Amazing Spider-Man 2.

Chris Evans, Scarlett Johansson and Samuel L Jackson traveled to Beijing to promote Captain America: The Winter Soldier, and Angelina Jolie was in Shanghai for Maleficent.

Meanwhile, Megan Fox braved pollution for a promotional visit to the Chinese capital for the launch of Teenage Mutant Ninja Turtles, with William Fichtner, producers Brad Fuller and Andrew Form, and Paramount vice chairman Rob Moore.

And Zhang Yimou Took on the Great Wall
Director Zhang Yimou, who made classics such as House of Flying Daggers and Raise the Red Lantern, unveiled in 2014 that he would direct Great Wall, a $135 million fantasy epic about mysterious reasons behind the construction of the Great Wall of China.

The movie is a co-production between a number of Chinese studios and Legendary’s Asian unit, Legendary East, and is being seen as a template both for co-productions between Hollywood and China and a symbol of how China can be a great revenue source for independent studios.

Twitter: @cliffordcoonan