Throughout 2009, commentators and insiders of the Taiwan film industry had expressed doubt about whether the spectacular NT$530 million (US$16.7 million) success of 2008's homemade mega-blockbuster, "Cape No. 7", was an anomaly, or how it might take years to see a repeat of such a boxoffice-smashing homegrown film.

Indeed, among the 27 Taiwanese films released domestically in 2009, the highest grossing one, "Hear Me," took NT$27 million (US$850,000); the top Chinese-language film was John Woo's second part epic "Red Cliff II", which took NT$140 million (US$4.4 million). In contrast, the year's Taiwan top grosser, the Hollywood import "Transformers: Revenge of the Fallen" raked in NT$570 million (US$17.9 million), more than doubling
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the Taiwan total of NT$220 million of "The Mummy: Tomb of the Dragon Emperor," the previous year's highest grossing Hollywood film in Taiwan. The stunning numbers of "Cape No. 7," which shattered boxoffice records at the time, seemed to be the exception that proved the rule.

Then, in February 2010, came "Monga."

The NT$70 million (US$2.2 million) gangster flick helmed by veteran Taiwanese television and filmmaker Doze Niu, produced by Niu's own Honto production, Taipei's Green Day Film and One Production, and repped by Distribution Workshop at this year's Filmart, took the Taiwan boxoffice by storm since its opening on Feb. 5, amidst a nationwide promotional blitz created by its Taiwan distributor Warner Bros. To date, the film has raked in NT$280 million (US$8.8 million) domestically, and is still going strong.

"'Monga' is a product of the many years of waiting and diligence of the Taiwanese film industry," said Doze Niu, director of the blockbuster, which revolved around the passionate brotherhood and struggles of a group of delinquent teens and their violent brush with gang culture, also featured in the 2010 Hong Kong International Film Festival lineup. "It shows that Taiwanese films still have the ability to move audiences; it means we can make films that tell our own stories, and that successful Taiwanese films aren't flashes in the pan."

Directors such as Niu believed that the emergence of commercial Taiwanese films that blend culture with strong local flavor that appeal to the local public is a result of the slow but steady revitalization of the Taiwan film industry, not just triggered by one or two blockbusters. "The success of 'Cape No. 7' might have looked like a miracle at the time, but it firmly proved that boxoffice triumphs are not only limited to Hollywood blockbusters," Niu said. "People nowadays tend to use 'Cape' to convince others that Taiwan film industry is reviving; that's wrong! It's only because the Taiwan film industry has been recovering that we saw such a film. It didn't came out of a vacuum. The revival has been in progress; it must be step by step. Thus the success of 'Cape' gave me the opportunity to make 'Monga'; likewise, if 'Monga' did well, then it would create opportunities for other directors."

"The Taiwanese audience is starving for local films that they can identity with," said veteran film producer and scholar Peggy Chiao, who has been one of the main driving forces behind the new Taiwanese cinema for the last 30 years. "What 'Cape No. 7', 'Hear Me' and now 'Monga' show us is that when audience feel they can deeply associate with the stories, they will support the films," Chiao said. Chiao produced two of the top 10 grossing domestic films in Taiwan last year, "Hear Me" and "Empire of Silver," as well as one of the Hong Kong International Film Festival opening films, "Like a Dream" by Hong Kong-raised director Clara Law. "Taiwanese films are regaining the public's affection," Chiao said.

Yet, subject matter and style aside, the marketing and distribution of both "Cape No. 7" and "Monga" revealed the reason for the success of both films was closely linked with that for the weakening of the market for Taiwanese films since the country's ascension to the WTO in 2002. Taiwanese filmmakers had long agonized about the stronghold Hollywood majors have on the island's exhibition and distribution networks; market share of local films plummeted to a historical low of 0.3% in 2003. While the drop was attributed to a decline in production of local product, the abolition of quotas for Hollywood imports was the other major factor.

Tellingly, the better-performed local films of recent years were mostly distributed by the Hollywood majors – the Buena Vista distributed "Cape No. 7" benefited vastly from good word-of-mouth, but it was the distributor's call to expand theatrical release from 40 cinemas to 65 when houses sold out day after day. The strong performance of "Monga," which also received public praise, was built up by a Hollywood style all-encompassing marketing campaign by Warner Bros. that began weeks before its Chinese New Year release. The film's record-breaking opening week numbers (for a domestic film) of NT$60 million (US$1.9 million) was a testament of the effectiveness of that strategy.

"Before filming of 'Monga' commenced, I received the support of Warner Bros. for a Chinese New Year release," said Niu, who based the length of the shoot and the budget accordingly on the projected grosses of the holiday slot, as well as decided the outline of marketing strategies with the Taiwan branch of Warner Bros. "From the beginning, we hope it would become an example of re-engineering the business process; it was not a coincidence," Niu said. "It was hard work but worthwhile. I hope to pass on this experience to other filmmakers."

A new formula thus has been proven.

Indeed, a full collaboration between local filmmakers and the American distributors that control the Taiwan marketplace would be the way for Taiwan film industry to go forward. The demand for locally relevant content has been reviving, but domestic products need the support of distribution networks. "The majors can actively engaged in the local Taiwan film industry and benefit from its growth, not by co-productions but distribution," said Chiao, who also pointed out that since the improving performances of local films in recent years, more local entrepreneurs are interested in investing in films, and "finding money has been relatively easier."

"Hear Me"

Since July 2008, the Taiwan film industry has been named as one of the prioritized sectors of creative industries under focus by the Taiwanese government, which will inject a total of NT$15 billion (US$47 million) from 2010 to 2014 into key sectors under the plan to push creative industries.

"The film industry is now seen as the engine that drives the Taiwan creative industries. The government and private enterprises are optimistic about the business opportunities of and influences of the film industry," said Frank JK Chen, director of the Taiwan Government Information Office, Motion Picture Affairs department. The GIO has been issuing grants to filmmakers since 1989; many of the recent hits were in fact subsidized, but the grants only count as a small percentage of the budget for the more ambitious commercial films.

To encourage commercially successful filmmakers, directors whose films obtained more than NT$20 million at the domestic office will receive a subsidy for their next films that accounts for 20% of the film's grosses. In 2009, "Cape No. 7" director Wei Te-sheng received NT$160 million (US$3.3 million) for his upcoming feature "Seediq Bale." While the maximum of the reward has now been set at NT$50 million, "Monga" helmer Niu would receive the amount as funding for his next film.

"To develop the industry, the key lies in funding and education,' Chen said. "When I went to France in 2008 with a Taiwan delegation to learn from their digital screening development, I was struck by how comprehensive the French government supports the country's film industry. Film education in France begins in primary schools, the education department subsidizes half of the cinema admissions for students. These policies are for Taiwan to emulate."

Never to overlook the deep pockets of youths, Taiwanese filmmakers are also focusing their attention on the power of new media and social networking sites on building a film's buzz.

"The Taiwan film industry is now in a completely new environment," said Chiao. "The young audience in Taiwan doesn't believe in hype, reviews or advertising. In the age of the internet, the success of the local films were built by good word-of-mouth, accumulating week by week. It had been the case for both 'Cape No. 7' and 'Hear Me.' That's why the first thing we have to do to market a film nowadays is to create websites, accounts in Facebook, Twitter and so on."

Chiao has been strengthening the online marketing for the four films she has coming out with this summer in Taiwan through her companies Arc Light Films and Trigram Films. The films are romantic comedy "Love You 10,000 Years," starring Taiwanese pop idol Vic Chou; "Tempest of First Love," a comedy about two high school students who found out the relationship of their respective parents and their efforts to sabotage it; "Me, 19," a dance and music drama set in a performing arts school by director Cheng Nai-feng; and a romantic flower-themed triptych tied-in with the 2010 Taipei International Flora Expo.