Perfect Village Boss on How Hollywood and China Can Collaborate More Successfully

'Shadow' set photography by Xiaoyan Bai; Courtesy of Perfect Village Entertainment
Zhang Yimou's 'Shadow' (inset: Ellen Eliasoph)

Ahead of the Shanghai International Film Festival, Ellen Eliasoph, the first studio exec to work in China, talks the market's evolution and why it's a "relief" the U.S. dealmaking frenzy is over.

Few U.S. film executives' ties to China run as deep as those of Ellen Eliasoph. Fluent in Mandarin, she originally came to China in the 1980s as a member of the first group of American students invited to study in the country after the normalization of diplomatic relations with the U.S. After a distinguished international law career, she became the first Hollywood exec to be based in China when she helped establish Warner Bros.' Beijing office in 1993. She later moved to Village Roadshow, where she oversaw the production of nine Chinese films, including Stephen Chow's 2013 blockbuster, Journey to the West.

At last year's Shanghai International Film Festival, Village Roadshow announced that it would be folding its Chinese operations into an innovative joint venture with Endeavor and Chinese heavyweight Perfect World Pictures (best known for its $500 million slate investment at Universal). Rebranded Perfect Village Entertainment and headed by Eliasoph, the Beijing- and Hong Kong-based company is plowing ahead with its first slate of releases, including Zhang Yimou's return to the historical martial arts epic, Shadow; hacker action comedy Reborn; and Hong Kong courtroom thriller Guilt by Design.

Ahead of the 2018 Shanghai fest, THR spoke with the veteran executive about her remarkable entry into the Chinese business and the industry trends that will be on the minds of film figures from East and West during the nine-day event.

Unlike most U.S. film execs based in Beijing, your experience in China far precedes the country's box-office boom era. What was your first visit to China like?

Well, I was very fortunate to make that first trip. Shortly after the United States and China officially normalized relations in the late 1980s, the U.S. government put together an organization called the "Committee for Scholarly Communications with the People's Republic of China." They sent out invitations to students who were in graduate school, saying that if you are already fluent in Chinese and can function in a higher education environment, you could apply to be part of this special first group of students to visit Beijing. I had studied Chinese so I applied from Yale Law School where I was studying, and I was very lucky to be selected. We entered mainland China by train from Hong Kong, because there weren't even many commercial airline flights yet. We left from the neon lights, urban noise and sprawl of capitalist Hong Kong and slipped across the border into this dark, silent continent. As far as you could see it was just endless farmland, and for miles and miles. Even the sound architecture of that experience was just crazy — you go from this ultra-modern metropolis to this curious place where the only thing you hear for hours and hours is the clacking of the wheels of the train. It was just a mind-blowing transition.

What an experience.

Absolutely. I mean, we were all scholars of Chinese and it was like we had been studying Latin and could suddenly go to ancient Rome. We had become deeply interested in Chinese during a period when the U.S. and China didn't have any diplomatic relations, so actually going to China was this unimaginable thing. Then, all of a sudden, bam: China is the future and we could go there and speak to people and explore the country. We spent a year studying at Beijing University, but we were also granted permission to travel all around. We went to places where no one had ever seen a foreigner before — places of deep historical significance where no American had ever visited. I later married one of the other students in our group. It was really the most amazing, transformational experience you could imagine.  

What was the scene like when you established the original Warner Bros. office in China in 1993?

It was an exciting time, because everything was a first. We were the first studio to be on the ground liaising with China Film Group on the import of Hollywood films. We were the first studio to be investing in the design and construction of multiplex cinemas; the first to release a movie in IMAX in China; and the first to have a joint venture production company in China. It was just this cascading of opportunities. And we were able to make some good movies with China Film Group. Looking back at it now, many of the people we worked with became some of China's biggest stars. We did Crazy Stone, directed by Ning Hao. It was a small film, but it became a very important movie for China, because it was the first black comedy about ordinary, down-to-earth people — it really shifted the expectations for what a Chinese film could be, and whose stories were worthy of telling. Its stars, Xu Zheng and Huang Bo, are two of the biggest actors in China now. Even then, you could see that the Chinese film industry was just going to burst out. At Warner Bros., it really came from the top down: from Bob Daly and Terry Semel all the way to everyone working in their different divisions. Everyone saw it as the future. The Chinese have always loved movies. 

You could really foresee the growth trajectory, way back then?

Well, I don't think anyone quite expected China to go from 300 movie screens in 1993 to nearly 60,000 just 25 years later. But we knew that the market would explode once the infrastructure and disposable income were there. And not only because of the huge population size. The thing that has never, ever changed about Chinese people is that they love something they call "re nao." It literally means "hot and noisy," but it's basically the idea that everything is more fun as a group activity. They love to gather in places and have shared experiences. I think this is why Chinese people are never going to prefer to sit at home watching streaming movies, no matter how big their screen is or how good their sound system is. There's something about the shared experience that Chinese people won't want to give up, and I think that's fantastic.

You've been attending the Shanghai festival longer than most. What's your assessment of it?

It's the most professionally managed festival in China. They've had a very good interface with Hollywood and Europe and the rest of Asia for many years now. The only thing that's a little problematic about any festival in China is that winning an award doesn't automatically translate into being able to release your movie in China. It's a nice honor, but it would be helpful for foreign winners if it also delivered a boost to the economics of their movies.

China's biggest blockbusters now outperform imported Hollywood films by a pretty wide margin (For example: Bona Film Group's Operation Red Sea earned $575 million compared to Avengers: Infinity War's $370 million in China). Despite this potential upside, the U.S. studios have made very little progress in producing localized Chinese-language films. Why do you think that is? What should they be doing differently?

The explosive growth of the China market is not only growth in screencount and box office, but it's also in the volume of Chinese films being produced. This has resulted in a huge oversupply of local films looking to secure a release in a country that is still vastly under-screened. The competition is brutal, irrespective of whether you are a domestic or foreign producer, and the only thing any producer can do in this situation is take a deep breath and dig in for the long term, with continuity of management and operations. For a foreign studio, it is particularly important that the long-term China vision and strategy are formulated and led by the highest levels of senior management — there is no other way to ensure that the inevitable short-term misses and setbacks don’t derail the enterprise before it has found its footing. It is also essential that in seeking to enter the marketplace, a foreign studio takes the time needed to patiently identify and build relationships with collaborators — both creative and corporate — it can partner with for the long term. These are the things we are doing at Perfect Village.

What do you think is behind the recent slip in the performance of Hollywood tentpoles in the Chinese marketplace?

There are many factors. One is that the things that are edgy, new and fresh in Hollywood, like Deadpool or some of the horror titles, often can't get imported into China. And some of the themes that are exciting vis-a-vis what Americans care about — such as cultural diversity and the challenges women face — don't resonate as strongly with the Chinese audience right now. If it's entertaining, they'll go watch it, but if it's not they won't. Those aren't their domestic concerns. They are grappling with their own interests and issues, which tend to be entirely different.

Are there other ways that Hollywood studios could regain traction in China? What's your take on the official co-production model, for example? We've seen a few cycles of expectation and disappointment by now — along with just a few modest successes.

I've never really believed in co-productions. I just don't believe that there are enough films that will work in both markets. When we identify and start developing projects, we know from the very beginning what market they're for. Most of what we've done at Perfect Village to date, and most of what we did at Village Roadshow Pictures Asia, was squarely aimed at the Chinese domestic marketplace. There are some true stories involving foreigners in China that could be told really well, but there's like five of them, and I've seen so many scripts for each of these but none has ever been made into a successful movie. There's Flying Tigers, the experience of the Jews in Shanghai during WWII, Doolittle's Raid, and Red Star Over China with Edgar Snow going to meet Mao, etc. Western producers discover these stories and think, "Oh wow, that should be great for a co-production,” because it involves Westerners' experiences in China during dramatic moments. But people in China, the actual moviegoing audience, they don't really care all that much about these limited episodes involving the experience of foreigners in China. And why should they? In the true sweep of their history and culture, there's almost nothing that any foreigner has ever done that fundamentally changed China.

So what is the Chinese audience most moved by right now?

China's history is part of the history of humanity, but what the Chinese are currently focused on is China itself. It's the power of China and the glories of their past — bringing that back so that everyone in China can feel proud again, and the rest of the world respects China. You see this reflected in some of the themes of movies that have done really well recently. The country isn't in the kind of phase where they want to fit themselves into the history of human civilization. They want to be reminded that they are unique in history of human civilization. And you know what? That's fine, because maybe they are. They had 2,000 years of being one of the dominant civilizations on the planet, and then this blip that they experienced starting from the end of the Qing Dynasty and coming into the present. It's only like 200 years. It's just a blip. Now they're working through that, and I would say they are getting there.  

At the recent Beijing film festival, Perfect Village partnered with Bill Kong's Edko Films and Huaxia to form the A.R.T. Project, which will finance 15 Chinese art house films during the next five years. What made you feel the time was right for such a venture?

There's a new art house film circuit in China, and people are actually coming out to watch these kinds of films. The first release on China's art house circuit was actually Three Billboards Outside Ebbing, Missouri, and it did quite well ($10.2 million). There's an amazing diversification going on in the Chinese market. We feel very fortunate that this moment has arrived, but we're also cognizant of the fact that for every Black Coal, Thin Ice ($16.5 million) or Paths of the Soul ($15.4 million), there are at least 20 other art films that die. So it's a developmental opportunity. But it's still absolutely worth doing, because even if on an individual basis some of these movies don't perform, by working with these trailblazing young Chinese directors, you might be building ties with the great Chinese filmmakers of the next generation. You could be working with the person who's going to become the next Clint Eastwood. Who knows?

How do you think the ongoing negotiations over China's film import quota will play out?

In this era where there's a trade war one day and no trade war the next, I don't think it would be smart to even hazard an opinion, frankly. The Hollywood film quota is a speck on this mountain of issues between the U.S. and China on trade. Having helped import the first Hollywood movie to China [1993's The Fugitive] and having observed the relationship for years, I can just say that there are always ebbs and flows. But as long as China keeps building movie screens at the current rate, everything is going to work out just fine.

The China-Hollywood dealmaking frenzy has died down. Is it over?

I don't think Hollywood is all that interested in China anymore, which is a relief, in a way. So much of that investment turned out to be illusory. It was more like the old Japanese wave of Hollywood investment than a phase in a cycle. Now that things have settled down and normalized, we can return to the more fulfilling business of simply telling good stories.

A version of this story first appeared in the June 13 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.