Hollywood entertainment industry is funded by the Chinese. The amount of funding by the Chinese is higher than the amount Americans are investing in it.
The Beijing-based Wanda Group’s record-breaking deal in January to buy US film studio Legendary Pictures finally confirmed the long-heralded emergence of the world’s second biggest box office as a major player in Tinseltown.
The $3.5 billion agreement is the largest-ever cultural takeover by China, with US studios keen to capitalize on its burgeoning cinema market at a time when Beijing is pushing entertainment as a source of “soft power.”
Legendary, the maker of “Jurassic World,” “Godzilla” and the latest Batman trilogy, has grossed more than $11 billion worldwide since it was founded in 2005, mostly with the kind of big-budget blockbusters popular with Chinese audiences.
“It’s a win-win situation… because the China market is really incredibly taking off and Hollywood has a real interest in that,” Stanley Rosen, a political science professor at the University of Southern California said.
It is an arrangement that benefits both sides financially, with movies becoming increasingly expensive to produce but the Chinese hungry for Western-made films.
But China, which has yet to make a global hit, is also buying expertise.
“Hollywood has what China lacks, which is storytelling ability, marketing, distribution,” Rosen revealed.
Wanda owner Wang Jianlin, who burst into the international spotlight in 2012 by buying US cinema chain AMC Entertainment for $2.6 billion, says the Legendary deal makes his company the highest revenue-generating movie unit in the world.
It also gives future Legendary films direct access to China’s booming market, which has become crucial to foreign filmmakers, with North American ticket sales stagnant.
PricewaterhouseCoopers has projected China’s box office to rise from $4.3 billion in 2014 to $8.9 billion in 2019, meaning it would outstrip the US within two years.