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CJ Entertainment CEO Jeong Tae-Sung has a track record in markets around the world that any Hollywood studio — not to mention Netflix or Amazon — would envy.
But the pillar of Jeong’s international strategy is producing highly localized films for individual territories, in contrast to the more familiar tentpole-fits-all approach of the Hollywood majors.
CJ’s most successful proof of concept came with Miss Granny, a 2014 dramedy about a woman in her 70s who magically finds herself in the body of her 20-year-old self. The original film earned $55 million in Korea, before being remade as 20 Once Again in China, where it took in $54 million. It was then remade again as Sweet 20 in Vietnam, where it set a then-all-time box-office record of $4.4 million (it was made for a fraction of that). Successful versions soon followed in Japan, Thailand and Indonesia, with more remakes underway for Turkey, North America and Latin America. Jeong is now plotting a rapid escalation of CJ’s local-language output. At a press conference in Seoul in October, he revealed that the studio will produce more than 20 titles in 10 languages in the next three years. It also has 10 English-language original films under development for eventual release in North America and around the world.
Much of CJ’s success in this space to date can probably be attributed to its chief executive’s deeply cosmopolitan background. The 53-year-old married father of three grew up in Korea, got a bachelor’s degree at UCLA and a master’s at China’s prestigious Peking University; and he is fluent in five languages — Korean, Chinese, Japanese, English and Spanish. As a student in the U.S., he mastered Spanish while managing local bars and restaurants, and when he moved to Beijing, he met a Japanese study-abroad student who would become his wife. The Hollywood Reporter spoke with Jeong about what goes into CJ’s Midas touch for localized movies, what it will take for Netflix to gain traction in Korea and how to strategize for the growing China market when Beijing regulators hold all of the cards.
What inspired CJ to make such an aggressive outward strategic push?
We opened our first offices in L.A. and Beijing about 10 years ago, and our current expansion is the culmination of a long-term vision to become more international. But as the market needs became more urgent, we began speeding this strategy up. The Korean film market expanded phenomenally over the past many years. The average Korean sees about 4.2 films per year; in the U.S., per capita moviegoing is about 3.6. South Korea is already the most film-loving major market in the world. But it’s not increasing anymore — box-office growth and moviegoing rates both have gone flat. Our market is saturated. And demographics are working against us: The birthrate in Korea is low, and the population is projected to shrink. Clearly, the only way for our company to continue to grow is to go overseas. Many of the regions we have targeted — China, Southeast Asia — are high-growth markets.
How have you gone about getting such a strong foothold in these markets? It’s something Netflix and Amazon might be very eager to emulate.
First of all, successful local production entails a serious commitment. We were the first to open a foreign production office in Vietnam to make local films. Then we launched the first major joint venture in Thailand [with Major Cineplex, the country’s dominant local exhibitor], the first foreign production office in Indonesia and now one in Turkey, too. We didn’t just send teams to do some co-productions; we’ve opened physical offices as legal local business entities. And that’s not easy to do in some of these countries. Legally, you have to go through a lot of complicated government approval and licensing. But it shows our commitment. And now we have dedicated teams working very hard on developing localized content in these markets, communicating closely with our experienced development team in Seoul.
And what can you tell us about your approach to localized storytelling, or the content itself?
We’re pursuing various strategies. There are some CJ titles that we can remake in many different languages, in many different markets, because the story lends itself to that. There are other titles that will only work in one market. In either case, we take local cultural differences very seriously, and we make no assumptions. What we picked as a first project was Miss Granny, because it has a very universal concept: A grandmother wants to be young again, and she gets a chance to chase the dream she was forced to give up when she had kids. Everyone wants to be young again, and everyone has a dream they wish they could go back and fully pursue. This film worked in China, so we took it to Vietnam, then Japan, Thailand and Indonesia. Now we’re making one for Turkey, with Mexico next. So it’s traveled to many different countries, but we really localize. Sometimes we keep it very similar to the original concept; other times we totally change the story or lead character. It really depends.
What’s the strategy for the 10 English-language films that you are developing? Clearly, there’s an expectation that these will travel more.
Again, it depends. For our English-language remakes, we are more interested in packaging and selling them to — or partnering with — a U.S. studio. [CJ pacted with Tyler Perry to co-produce an English version of Miss Granny and has a deal with Ratpac to remake its hit Korean comedy Sunny.] But the vision for our original English-language films is more in line with Snowpiercer [the 2014 Bong Joon Ho dystopian film earned $59.8 million in South Korea, $22.4 million internationally and $4.6 million in North America]. With that film, we were able to recoup all of our investment from the domestic Korean market, and then everywhere else was a bonus. That’s a great model for us. So, for all of the original English-language films we are developing, they’re meant to be global movies. So yes, they need to get some kind of distribution in the U.S. — but we picked the projects because we know they will do well in our home market, or other international territories. You’re in a dangerous place if you need to win both your home market and the U.S. to be a success. It’s too rare to build a business model around. We plan to make one or two of these global English-language films per year. And we’re confident that we can recoup the budget without the U.S.
As an observer, sometime partner and occasional rival, how do you assess how Netflix has performed in South Korea so far?
Well, Netflix has been here a few years, but we have very strong IPTV [internet protocol television] players, which millions are already watching for a very low price. The consumption habit for IPTV has been established for a long time, and people in Korea are very comfortable with it. Netflix is still foreign and quite expensive. The market situation is very different from the U.S. Korean consumers weren’t already paying $50 to $100 to watch cable — they pay about $10 to $15 for a cable package here. So Netflix’s price is not as competitive here. Unless they come up with a lot more original Korean content — a very big supply of attractive stuff — I think it’s going to be difficult to entice Koreans to sign up.
Beijing’s de facto ban on Korean content has forced you to hit pause on producing and releasing original productions in China (regulators have blocked the release of Korean films in China since late 2015, in geopolitical retaliation against Seoul’s decision to install a U.S.-made missile system on the Korean Peninsula). How do you plan for a market that’s so valuable but governed by forces that are completely beyond your control?
Well, it happened all of a sudden, and it’s going to take some time for things to move back in the other direction. So what are we doing? We’re developing great Chinese scripts and projects. We kept our offices in Beijing and Shanghai open, and we have our development team working hard. All of the other big Korean companies closed their offices and came home. But we’re looking more to the future and staying optimistic. No one knows how long it will last, but we’re hoping things come back to normal in two to three years.
SOUTH KOREA: 4 HOT TITLES ON OFFER AT AFM
A potential big-budget fantasy franchise, high-end crime thrillers and political intrigue involving North Korean defectors will tempt international buyers
By Lee Hyo-won
Along With the Gods: The Two Worlds
DIRECTED BY Kim Yong-hwa
STARRING Ha Jung- woo, Cha Tae-hyun, Ju Ji-hoon, Lee Jung-jae
SALES Lotte Entertainment
Korea’s first film project to be conceived as a franchise from the beginning, the two-part feature was simultaneously shot with the first title, Along With the Gods: The Two Worlds, due in locals theaters this winter, before the second one, Along With the Gods: The Last 49 Days, is released in summer 2018. Based on the smash-hit “webtoon” (comic strips published online) of the same name, the fantasy film follows the afterlife journey of a firefighter who dies unexpectedly. Three “afterlife guardians” guide him to the underworld, but to reincarnate, he must pass seven trials over a period of 49 days in order to prove that he has led a pure human life.
DIRECTED BY Jang Chang-won
STARRING Hyun Bin, Yoo Ji-tae
A con man is reported dead after making away with a massive amount of money, but a corrupt prosecutor, who had been complicit in the scam, believes he is still alive. When another man comes forth seeking personal revenge against the missing man, the two team up to track down the culprit. The project combines the star wattage of Hyun (Confidential Assignment) and Yoo, who is best known as the villain of Park Chan-wook’s Oldboy.
1987: When the Day Comes
DIRECTED BY Jang Joon-hwan
STARRING Ha Jung-woo, Kim Tae-ri
SALES CJ Entertainment Jang’s 1987: When the Day Comes is the latest among South Korean titles spotlighting the 1980s, a tumultuous period when the Asian country was making a rapid transition into a democracy. The film looks at a 1987 event when, under iron-fisted military rule, the brutal interrogation and death of a college student led ordinary citizens to rise up and demand justice. The film has drawn strong interest at home for bringing together some of Korea’s biggest household names, including Ha and Kim, who previously appeared together in Park Chan-wook’s Cannes competition entry The Handmaiden.
DIRECTED BY Park Hoon-jung
STARRING Jang Dong- gun, Lee Jong-suk, Kim Myung-min, Park Heui- soon, Peter Stormare
Crime films have been on the rise in South Korea, and this co-production with Warner Bros gives the well worn genre an extra layer of complexity by introducing yet another timely element: North Korea. Boasting a who’s who of local A-listers, V.I.P. chronicles how the CIA and South Korea’s National Intelligence Service conspire to vacilitate the defection of Kim Gwang-il, the son of a high-ranking Pyongyang official, in hopes of retrieving intel about the North Korean regime.
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