This second edition of Streamlined also focuses on China and Hong Kong, thanks to Covid outbreaks and as Filmart only wrapped yesterday, although there’s also a section on the Middle East. Streamlined will look further afield next week…
THE WEEK’S TOP STORIES…
1. CHINA CINEMA CLOSURES & WORSENING COVID OUTBREAK
Just as the US studios had finally managed to get a decent number of films dated in China, a series of Covid-19 outbreaks across the country have started shuttering cinemas again. Theatrical consultancy Artisan Gateway estimates that around 30% of China’s cinemas are currently closed nationwide, with the worst hit markets including Shanghai, Shenzhen, Jilin, Changchun and Hohhot.
The outbreaks have already impacted box office of Uncharted, which opened Monday (March 14) and as of Friday noon Beijing time had only grossed $6.4m (RMB40.6m), with Maoyan predicting a final tally of $13m. The Batman, which has just crossed $500m at the global box office, opened soft in China today (March 18) with $1.5m (RMB9.8m) by noon and a Maoyan forecast of $34m.
Other upcoming releases include Roland Emmerich’s Moonfall (March 25), Sony animation Hotel Transylvania: Transformania (April 3) and Warner Bros’ Fantastic Beasts: The Secrets Of Dumbledore (April 8).
China is currently logging around 3,000 cases daily, mostly the milder Omicron variant, and no deaths are being reported. But while the numbers are low compared to South Korea, it’s been enough for local authorities to impose lockdowns on tens of millions of people. “China’s zero Covid policy will restrict local movement generally, for example shelter in place and/or local district quarantines,” says Artisan Gateway’s Rance Pow.
In comparison, Hong Kong is logging around 20,000 infections and 200-300 deaths daily, the high death rate due to low vaccination rates amongst the elderly. China has higher vaccination rates across vulnerable groups, but hasn’t used the more effective mRNA vaccines.
Of course, if China fails to get the outbreaks under control, it could have much wider ramifications than local box office, potentially impacting global supply chains and financial markets. Chinese tech and entertainment stocks already crashed early this week due to a combination of Covid, Russia’s war in Ukraine (and China’s position within that) and on-going regulatory pressure on tech giants.
However, stocks shot up again on Wednesday after Vice Premier Liu He stepped in to say the government would roll out measures to steady capital markets. Whatever happens in coming weeks, it will be a bumpy ride.
2. IS BLOCKCHAIN READY TO GO MAINSTREAM?
Filmart, which wrapped yesterday (March 17), dedicated a whole day to exploration of blockchain, metaverse and NFTs, an area in which Hong Kong is developing some expertise, mostly through Yat Siu’s Animoca Brands, a blockchain gaming powerhouse that has a valuation of around $5bn.
Sebastien Borget, co-founder of The Sandbox, one of Animoca’s many blockchain investments, explained in a Filmart session how the platform enables users to build and monetise their own digital property, games and experiences in the metaverse, using NFTs and its native cryptocurrency Sand. Snoop Dogg, Deadmau5 and Hong Kong tycoon Adrian Cheng are already in.
Melody Hildebrandt, president of Fox Corp’s Blockchain Creative Labs, explained how NFTs, when done correctly, not only deepen fan engagement, but generate revenue for all participants in the ecosystem, across fans, artists and creators. And as creators get paid every time an NFT is traded on a secondary market, the remuneration has a long tail. “The most exciting thing about this tech for me is that fans can get closer to artists and artists can stay independent and control the creative process and survive,” said Hildebrant. This is not something you expect to hear from a Fox Corp subsidiary.
Leo Matchett, CEO of non-profit foundation Decentralized Pictures, gave an overview of the blockchain-powered talent discovery platform he is building with Roman Coppola and American Zoetrope’s Michael Musante. The platform, which goes public later this month, enables users to submit and review other people’s scripts and creative material, using its native token FilmCredits as an incentive mechanism.
Users can also enter contests devised by a range of industry partners, but voted on by the community, through which they can win investment or introductions to mentors, agents and distributors. “Hollywood is a very insular gatekeeper oriented business, so we theorised that a large diversified group of people can create more educated decisions than a small non-diversified group of people,” Matchett said.
The platform will be open to talent anywhere in the world, and material filmed in any language, but can only handle English-language submissions in the initial stages. “We want to discover new talent..there are great artists from countries that never get a shot because of their geographical proximity to Hollywood, or access to resources like financing or connections, so they can’t get their scripts in front of the right person,” Matchett continued. “Our goal is to solve what we call the ‘drinking from a firehose problem’ – most companies don’t accept unsolicited material.”
One of the biggest problems with blockchain is that few people outside the tech industry truly understand blockchain; the promises of greater transparency in accounting and collections have terrified the film industry; and the tech is still going through it scammy, speculative, bad press phase.
But understand it we must, that’s the conclusion I’ve come to after listening to both evangelists and detractors, because the potential benefits of borderless currency and a more equitable system of ownership and remuneration for the content industries are just too great.
While Bitcoin has been maligned for its energy consumption, most of the newer blockchains are working on greener consensus mechanisms. Regulations could eventually combat NFT theft and scams, in the same way that digital piracy evolved into a multibillion dollar streaming industry.
Hildebrandt acknowledged it’s still the wild west, and we need to be “highly skeptical until the protections catch up”, but the tech is “on the precipice of going mainstream” and “consumers are hungry for alternatives”.
My immediate reaction to Decentralized Pictures was that, even if you don’t win funding through the platform, the peer feedback could be invaluable, and an interesting alternative to international labs and workshops, which play an important role, but also tend to impose US & European industry formulas on local-language filmmaking.
I’m aware there are lots of “yes, buts” here and would love to hear your thoughts.
3. HAF AWARDS & FFFI UPDATES
Running concurrently with Filmart, Hong Kong Asia Film Financing Forum (HAF, March 14-16) announced its award winners and the five projects that will participate in the HAF Goes To Cannes programme (see winners here). HAF is one of four pan-Asian programmes under HKIFF Industry, the industry arm of Hong Kong International Film Festival, which has managed to consolidate and expand its activities despite the pandemic. During Filmart, HKIFF Industry also held Operation Greenlight, a joint programme with the Hong Kong Film Development Council (HKFDC), through which six Hong Kong projects selected from HKFDC’s First Feature Film Initiative (FFFI) were pitched.
Thanks to these various programmes, there are actually a healthy number of films from new Hong Kong filmmakers in various stages of development and production, despite the pandemic and political turbulence, although production schedules have been delayed. Indeed, it was fortunate that the Hong Kong government had already decided to ramp up support for the film industry before Covid hit, increasing funds to $128m (HK$1bn) across several schemes, including the expansion of the FFFI, which had already yielded critically-acclaimed films such as Still Human and My Prince Edward.
Films currently in post-production and funded through more recent rounds of the FFFI include Anastasia Tsang’s A Light Never Goes Out, starring Sylvia Chang as a widow trying to restore a Hong Kong icon; Gamer Girls, directed by Veronica Bassetto and Sophie Yang and produced by Jacqueline Liu; and Foster Love, directed by Ka Sing-fung and produced by Katherine Lee. HKFDC has also relaxed some requirements of the Film Production Financing Scheme and launched a programme under which established directors like Wong Kar Wai and Peter Ho-sun Chan are mentoring newcomers. Sadly though, there has been nothing close to this level of support for Hong Kong’s distribution and exhibition sectors.
4. GLOBAL BOX OFFICE RECOVERY
The Motion Picture Association (MPA) released its annual report on the global theatrical and home/mobile entertainment markets, which found that global revenues (excluding pay-TV) reached $99.7bn in 2021, an increase of 24% compared to 2020, and surpassing the 2019 total. But while theatrical rebounded last year, the growth was mostly driven by streaming which accounted for 72% of total revenues compared to 46% in 2019. Breaking out a few figures:
- Global box office reached $21.3bn last year (compared to $12bn in 2020 and $42.2bn in 2019), with US/Canada taking $4.5bn or 21% of the total, and international accounting for 79% with $16.8bn.
- Asia Pacific box office increased by 89% to reach $10.9bn (EMEA was up by 52% year-on-year to $5bn). However, most of that growth was driven by China, which hit $7.3bn in 2021 compared to $3bn in 2020. Asia Pacific’s home/mobile entertainment market grew by 17% in 2021 to reach $18bn.
- While China was the top box office territory outside US/Canada, six other Asia Pacific territories made the international top 20 last year – Japan, South Korea, India, Australia, Taiwan and Hong Kong – while Indonesia dropped out of the top 20 chart. United Arab Emirates (UAE), currently the biggest territory in the Middle East, also made the top 20. The full report can be found here.
5. MIDDLE EAST FESTIVAL CIRCUIT RAMPS UP
Despite the loss of Dubai and Abu Dhabi, the festival circuit in the Middle East (or the Middle West as Streamlined likes to call it) is one of the world’s liveliest. This week, Marrakech International Film Festival announced it will return this year (November 11-19), hopefully as a physical event, after being cancelled in 2020 and 2021. During those two pandemic years, the festival’s industry platform, Atlas Workshops, was held online.
Meanwhile, Egypt’s Ministry of Culture announced that Mohamed Hefzy is stepping down as president of Cairo International Film Festival (CIFF), which is no surprise as he always said he’d only stay with the festival a few years before returning to producing through his Cairo-based Film Clinic. He ended up staying for four years, during which time he revamped the event and managed to hold two physical editions during the pandemic. He also managed to produce the Arabic adaptation of Perfect Strangers, Mohamed Diab’s Amira and Hany Abu Assad’s Huda’s Salon. He is passing the CIFF reins to actor Hussein Fahmy, who ran the festival from 1998 to 2001.
CIFF got some competition last year when Saudi Arabia’s Red Sea International Film Festival (RSIFF) held its inaugural edition in the same December slot (the two festivals ended up running back-to-back from late November to mid-December). RSIFF announced this week the 12 projects that have been selected for its Red Sea Lodge project and talent development programme.
Not to be outdone, Egypt’s El Gouna Film Festival (scheduled for October 13-21, 2022) announced a partnership with O West, part of the Orascom development in west Cairo, for a year-round series of activities in the Egyptian capital, including screenings, workshops and masterclasses. It would be wonderful to see this level of festival activity replicated in South Asia or Southeast Asia, two regions which have struggled to maintain a consistent festival circuit, but then sometimes you can have too much of a good thing.
IN OTHER NEWS…
- E-Vision, owned by e& (the telco previously known as Etisalat Group), and Abu Dhabi-based investment company ADQ are acquiring a majority stake of around 57% in streaming service Starzplay Arabia, which has around two million subscribers across the Middle East and North Africa. Current majority shareholder Starz, and its parent company Lionsgate, will maintain agreements for supplying content to the streamer. The transaction remains subject to regulatory approvals.
- Chinese social media site Douban has run foul of internet watchdog, the Cyberspace Administration of China (CAC), which announced on Tuesday that it was visiting the company to rectify “serious online chaos”. The platform, which has around 200 million registered users, focuses on movies, music and books and is known for relatively liberal discussions. It’s also a key platform for marketing movies, both local and foreign, and gauging audience reaction.
- Former Amazon Prime Video India content chief Vijay Subramaniam has launched an independent venture, 29SeptemberWorks, to develop and produce multi-platform content for the Indian market, with a focus on South India. Headquartered in Bangalore, with offices in Chennai and Kochi, the company has already started work on a slate of Malayalam and Tamil-language feature films and series in the Tamil and Kannada languages.
- Chinese streamer iQiyi announced two additional Chinese-language originals from Taiwan – Lesson In Love, starring Edward Chen (Your Name Engraved Herein), and fantasy comedy Oh No! Here Comes Trouble, starring Tseng Jing-hua, Vivian Sung and Peng Cian. The streamer’s first Thai original, KinnPorsche The Series La Forte, launches on its international platform on April 2.
- Cannes Film Festival has added TikTok as an official partner, in a move it said would give the short video platform’s users “an inside look at the festival” and help Cannes “reach new audiences”. The deal includes a global short film competition with three winners receiving a trip to Cannes and a cash prize. Cannes has a complicated relationship with social media, so slo-mo hair flips on the red carpet are probably not going to become a thing.
WHAT I’M READING…
- Screen International Asia Editor Jean Noh interviewed a trio of Asian theatrical film buyers ahead of Filmart, who explained how they’ve adapted their business to deal with the double whammy of Covid and the growth of streaming. Full article can be found here. It’s an inspiring read..
- India’s The Print had a thoughtful piece about the impact global streamers are having on independent filmmaking in India. Are they breaking new talent or just a new bunch of gatekeepers?