China's Moviegoers Trading Up From Hollywood Explosions To Homegrown Humor

Wang Lei and Liu Jie elbowed their way to their seats in the dimly lit Beijing movie theater, juggling bags of popcorn and 3D glasses. Though they had arrived early, the lavish new theater in the city’s World Trade Center was rapidly filling up.

The two were there for the opening-day screening of the new Johnny Depp sci-fi thriller "Transcendence," a movie that has bombed in the United States but has found an appreciative -- and large -- audience in China.

“I’ve been a Johnny Depp fan since the 'Pirates [of the Carribbean'] movies,” Wang said over the phone. “He’s always been quirky and bold, but I’m excited to see him in a role that is more serious than what I’m used to.”

The movie’s China opening earned $11.4 million, outdoing its $11.2 million U.S. opening and making it the largest among 27 markets by far. As such, it illustrates a new moviegoing and movie-marketing paradigm in which China’s audiences occupy center stage. Millions of Chinese have more expendable income than ever before, and their movie tastes are evolving in ways that present opportunities and challenges to Hollywood, government censors and the domestic filmmaking industry.

Wang’s love of Hollywood movies began in a familiar way, through his childhood fascination with glamorous characters acting out epic dramas -- in his case, Leonardo Dicaprio and Kate Winslet in "Titanic." There was an exotic appeal for Wang, a 25-year-old in the advertising business who lives in Beijing, where the government strictly controls which films are made and exerts a great deal of control over their content.

“Hollywood movies are what made me like movies,” he said. “It’s a culture so easy to buy in to. It’s cheap, it’s fun, it’s constant, and now China is at the center of it.”

In the years since "Titanic," China has caught the attention of Hollywood filmmakers in a big way. Chinese moviegoers now represent a huge and expanding market, with ticket sales that increased 27 percent to $3.6 billion last year over 2012. China is now the second-largest movie market in the world, after the United States.

Hollywood is using its position as the world’s leading film industry to make lifelong viewers out of the Chinese, capitalizing on cult followings of American action stars like Tom Cruise and Nicolas Cage and blockbuster franchises to keep audiences coming back for more. Hollywood has met with some resistance from Chinese authorities who insist on controlling foreign cultural influences, but as Victor Lee, a Chinese film producer with more than 30 years of industry experience, noted, “Big-budget films such as "Titanic," "Avatar" and "Transformers," to name a few, are responsible for Chinese moviegoing culture ... These films had the power to pull in first-time moviegoers.”

'Titanic' Was Just the Tip of the Iceberg

Hollywood resonates throughout modern Chinese culture. In hotel elevators and grocery stores, overplayed movie anthems such as Celine Dion’s “My Heart Will Go On” -- which is synonymous with "Titanic" -- are frequently heard, often to the annoyance of tourists but prompting Chinese listeners to hum or sing along.

"Titanic" made its theatrical debut in China in 1998, a year after its U.S. release, and its popularity there gave Hollywood a first tantalizing taste of box office success from the new and lucrative Chinese audience. The movie garnered a record-breaking $44 million in Chinese box office sales, and the popularity of the 3D re-release in 2013 was likewise a stunning success. “It already had everything -- the drama, history, beautiful people, and now it was remastered to be even more visually breathtaking,” as Wang gushed.

Between the premiere of "Titanic" and its re-release, Hollywood built a large fan base of theatergoers for dozens of other movies, bolstered by China’s breakneck economic growth and resulting increase in expendable income for the Chinese. According to data compiled by Ernst & Young, the average per capita disposable income more than tripled in China between 2000 and 2011, from $760 to $3,438, with media and entertainment being one of the largest areas of spending. In 2011 alone, the Chinese spent $547 billion on entertainment and recreation.

There is nothing like half a trillion dollars to catch Hollywood’s eye. Almost overnight, Beijing became Asia’s Hollywood outpost, making itself an essential stop on the star-studded international press tours, which in Asia once included only Tokyo and Hong Kong. In a two-week span in late March, Beijing rolled out their red carpets for the stars of three opening movies: "Transcendence" and box office hits "Captain America" and "The Amazing Spider-Man 2."

As the market has expanded, new theaters have been built across China, capitalizing on new fans and others such as Wang and who are by now deep into Hollywood mythology.

“I began going to the movies regularly when I was about 13 years old,” Wang said. “One of the biggest memories for me was waiting in line to see the newest "Star Wars" movie, 'Revenge of the Sith,' when it came out in 2005. I was standing in line with other huge fans. People were wearing T-shirts and costumes. I’d never seen anything like it!”

By then, Wang had become an omnivorous cinephile. “I watched all the big movies that came out: 'Harry Potter,' 'Mission Impossible,' 'Avatar,' 'Transformers.' Even the big animated ones like 'Kungfu Panda' and the 'Ice Age' movies,” he said.

Many of the biggest box office hits in China have been family-friendly animated films and action movies, perhaps because the focus on visual entertainment in those films, rather than dialogue or complex plotting, is what translates best. And Hollywood has manipulated the relationship to its advantage, luring Chinese audiences with such ploys as casting Chinese actors, such as domestic starlet Fan Bingbing in "Iron Man 3," or locating a movie’s production setting to Shanghai instead of the originally pitched city of Paris, as in the movie "Looper."

Hollywood has also taken animation and CGI to a level that Chinese filmmakers still can’t match. Half of China’s top 10 highest grossing movies are American blockbusters, and in the No. 1 spot is 2009’s "Avatar," which has earned 1.39 billion yuan, or more than $223 million. Other titles on the list include "Iron Man 3," "Titanic" and the newly released superhero flick, "Captain America: The Winter Soldier," which broke into the top 10 with astonishing speed.

Battling Hollywood’s Superheroes

While caped crusaders and dialogue-light action flicks still dominate the Chinese box office, there is growing demand for more nuanced content. Chinese audiences have become smarter and more discerning as they have gained greater movie exposure, with broader interests and higher expectations.

Movies based on literature, such as the critically acclaimed "Life of Pi" and "The Great Gatsby," and even films like the critically lambasted "Transcendence" push boundaries of what is popular, confronting faith, status and mild cultural controversy. “I’m not going to lie, I’ll probably still see every Marvel or DC superhero movie there will ever be, but movies without crazy effects and more focus on plot and character development also interest me,” Wang says.

As in other markets, Hollywood has been slow to move away from tried-and-true winners, which are typically heavy on special effects and explosions. But "Transcendence" showed that what works -- or, alternatively, what fails miserably -- in the West is not always the best indicator of what will satisfy China’s huge audience.

The Communist Party’s Cutting Room Floor

Finding the sweet spot in Chinese moviegoing is complicated by resistance from Chinese propaganda bureaucrats and censorship. Chinese authorities still have overarching influence over which films get a Chinese release, and despite a relaxed quota on foreign films that has opened the door to up to 44 foreign movies a year, the country’s fickle censorship bureau (the State Administration for Radio, Film and Television, or SARFT) is recalcitrant by nature.

SARFT is the country’s only rating system, which means that everything that makes it to the theater must be suitable for all ages -- a major limitation for Hollywood in that it likely eliminates any content with nudity, adult language or adult topics. Seven of the 10 movies that open this weekend in the U.S. probably would not be considered in China because of their R ratings.

That, together with the huge profit potential and evolving audience interests, is giving China’s domestic film industry a potential advantage over American studios, and most expect homegrown talent to continue exploring and exploiting that market. “Chinese people want to see movies about what’s happening in their society and their lives -- what they can relate to,” Dede Nickerson, Sony Entertainment’s head of production and development in China, observed at the Asia Society’s U.S.-China Film Summit in Southern California.

The most popular Chinese-made films, which increasingly rival Hollywood releases in box office performance, are stripped-down personal tales of modern Chinese life, Dickerson noted. According to Variety, in 2013, ticket sales for locally made Chinese films increased 144 percent to $1.12 billion, while imported films experienced a 21 percent drop to $670 million.

Nickerson pointed to the China-made box office hit "Lost in Thailand," a pithy comedy about an inventor in search of his company’s biggest stakeholder, which focuses on issues the average Chinese person can relate to, including social climbing and financial ambition. Unlike "Titanic," "Lost in Thailand" succeeds with Chinese audiences without relying on CGI or big-budget action scenes. And it had no trouble passing the censors.

Liu said he welcomes the increased offerings the evolution of Chinese audiences brings.

“It’s getting a little tired,” he said of the blockbuster mentality that characterized the early decades of China’s love affair with Hollywood movies. “There will come a time when we outgrow these movies, and I feel like I’m not the only one who thinks that.”