My Speech at China Global Investment Summit

I. INTRODUCTION.

Ladies and Gentlemen, Esteemed Attendees of the China Global Investment Summit.

Good Afternoon.

I was asked to talk to you today about the relationship between Hollywood and China.  I have been marinating in one or the other, often both simultaneously, for my entire adult life.  And if there is one thing I can say, like a good movie, there’s never a dull moment.  And what is happening right now is a convergence of factors that is creating one of the most dramatic shifts in the history of entertainment. I am calling it nothing short of a revolution of culture.

II. WHAT IS HOLLYWOOD?

Hollywood is part reality and myth.  Reality.  Hollywood is a once very sleazy boulevard still replete with homeless, now comingling with tourists.  The district of Hollywood houses only ONE major film studio.

The myth.  It evokes anything larger-than-life, whether it be vulgar or glamorous.    For most, it is shorthand for the dominant player, globally, of the entertainment industry.  For almost 100 years, it has been seen as the maker of dreams that are delivered wholesale to countries all over the world.

III.  SIX U.S. ENTERTAINMENT COMPANIES ON FORTUNE 500 LIST

It is a huge industry, one of the US’s largest, with revenues of about $30 billion annually, and rising. All the major entertainment companies are on the Fortune 500 list.  But along with wielding tremendous economic power, these companies come to heavily influence the hearts and minds of audiences around the world.

No other country has ever come close to producing, financing, and marketing films and other content with the same impact of Hollywood. And yet, for the first time in its history, there is a formidable challenge to Hollywood’s place on the summit.

IV.  GLOBAL MOVIE MARKET

And that challenger, of course, is China.  How can that be you ask?  China’s current box office is only $2.7 billion, compared with the U.S.’s of $10.8 billion.

Ah, but look at the projections for the coming years.  Once you know China’s compound annual growth, you see that China’s box office is indeed scheduled to overtake Hollywood in about five years.

V.   MARKET OVERVIEW (SHOWING CHINA AND US TOGETHER)

VI.  COMPOUND ANNUAL GROWTH OF CHINA/US BOX OFFICE.

Now let’s go back in time a little to examine the history of China and Hollywood, including a little of my own personal history where relevant, to see how we got here.

VII. ANY ASIANS IN HOLLYWOOD?!

I myself first starting thinking a lot about Hollywood movies and television when living in China in the early 80’s.  Growing up in the United States as a daughter of Chinese students, I realized that I had never seen an Asian character of any real dimension on the big or little screen.  I subconsciously absorbed a message that we therefore were barred from public representation.  And yet in China, I got to experience our race come alive on screen, and with that, my whole perception of China and Chinese changed.  I was moved beyond words when I saw Chen Kaige’s first film, YELLOW EARTH.  It helped me see more poignancy, depth, tragedy, irony in Chinese lives.  I imagined that if I were affected in this way, so too might others.

So I made it my mission to bring Chinese films and other content to the West.  I ran a company in San Francisco that was named the representative of Chinese cinema in North America.  As I accompanied Chinese delegations and filmmakers to international film festivals, I witnessed one person after another “discover” China for the first time, and what they saw, human portraits, inevitably surprised and pleased them.  It gave them a completely different experience of China than could be gleaned from news outlets or books.  But only a handful of people in were interested.

VIII.  HOLLYWOOD FILMS TO CHINA/GREGORY PECK N CHINA

My next job was the reverse.  I was hired by the Hollywood studios to sell American films to China.  During this time, I brought over – and I mean literally hand carry 35 mm prints, which was the only way to deliver films back then – films as diverse as LOVE STORY, SPARTACUS, and ROMAN HOLIDAY.

When I accompanied Gregory Peck to China to screen a retrospective of his works, elderly officials came up to me with tears in their eyes and said they had not seen a real Hollywood movie since the days of Greta Garbo.

They said their view of America was shaped by these movies.  The myth of Hollywood was nowhere more alive than in China and I saw its cumulative effect.  Officially, America was not yet a good friend of China’s and yet, on an emotional level, people had an overwhelming sense of warmth and romance about the country because of the movies they had fallen in love with.

IX. EMPIRE OF THE SUN

My next experience, a mind-blowing one to a novice like myself, was when I was hired to be Steven Spielberg’s liaison in Shanghai for the shooting of EMPIRE OF THE SUN.  It was a movie of epic proportions, and back then, when you needed a crowd of 5,000 people, you actually had to recruit 5,000 people.  It was not yet possible to create those bodies on a computer.

And although China didn’t have the latest cameras or lights, the cinematographer could use the universal language of film to speak to his Chinese crew.  It also taught me that the magic of movie is the result of a series of many decisions made by filmmakers.  Anything was possible!  It was in Shanghai where my dream to be a film producer was born.

X.  THE LAST EMPEROR

Up north in Beijing, another great filmmaker was making another epic movie.  Bernardo Bertolucci’s THE LAST EMPEROR was being shot around the same time. These two films seemed to bode very well for the future of Hollywood-China cooperation.  But the next decade or two did not pan out the way many expected.

XI. KUNDUN, SEVEN YEARS IN TIBET, RED CORNER

There was a chill in relations, and what we saw instead was a series of films deemed not friendly to China such as KUNDUN, SEVEN YEARS IN TIBET, RED CORNER – and a punishing attitude toward the companies who made them.  1997 was a very bad year in Hollywood-China relations.

XII.  WHITE COUNTESS, PAINTED VEIL, CHILDREN OF HUANGSHI

Then came a spate of other co-productions, not as politically unfriendly, but just not very appealing to Chinese audiences, and as it turns out, Western audiences alike.  They were clearly the outgrowth of a Western mentality being imposed on a Chinese landscape.  It was not yet considered important to make films for the Chinese market.

XIII.  JOY LUCK CLUB

I like to think that the film I produced, JOY LUCK CLUB, which was partially shot in China, was an antidote to that.  It managed to be a Hollywood studio movie, but focused entirely on Chinese characters.  To this day, this project holds a unique profile in this respect, and has never been replicated

XIV. MISSION IMPOSSIBLE 3, MUMMY 3, IRON MAN 3

Years later, several studios wtih big international franchises chose to take advantage of Chinese locations to sort of “sinify” their movie, and possibly gain more Chinese viewers. They seem to like doing this on the third sequel, and it’s hard to say whether this “sinification” has served to boost the Chinese box office.

XV. FORBIDDEN KINGDOM, KARATE KID

Some films boasted strong action content, and especially if they had Jackie Chan, did quite well.

XVI.  MAN WITH THE IRON FISTS, MAN OF T’AI CHI

But other films that have similar descriptions failed, or are expected to.

XVI. SHANGHAI CALLING

With my own SHANGHAI CALLING, I experimented and found it was possible to appeal simultaneously to audiences in both America and China.  And that there is such a thing as cross-cultural humor.

XVII.  RED SORGHUM, JU DOU, RAISE THE RED LANTERN, TO LIVE

Meanwhile in China, the 90’s were producing some very interesting films that were getting tremendous critical attention and winning prizes at festivals – many were from the director Zhang Yimou and starred Gong Li.  In my mind it was a golden period for Chinese cinema where there was an awareness of, but not an enslavement to the market place.

This period also saw the first of Hollywood films being shown in China on a revenue-share basis.  Each year a handful of Hollywood films were being theatrically released in China.

But it was the beginning of this millennium, in 2001, that marked a strong turning point for China.

XVIII.  CROUCHING TIGER

I credit Ang Lee for being the catalyst for this.  The spectacular success of his CROUCHING TIGER, HIDDEN DRAGON, an indigenously Chinese film, was wholly unexpected.  With a worldwide box office of over $213 million, it was truly a game changer.  The North American box office alone was $128 million, a staggering number for any foreign-language film.

For China, where the film surprisingly did NOT in fact perform well, it was different kind of gift.  It gave Chinese filmmakers a distinct genre to latch onto.  Martial arts films are very much in the Chinese DNA, and yet fresh and appealing to worldwide audiences, especially in Asia.

XIX.  HERO and HOUSE OF FLYING DAGGERS

So much so that everyone had to at least try .  The once arthouse king, Zhang Yimou, made two – HERO and HOUSE OF FLYING DAGGERS.  These two films, to this day, are the only films by a mainland Chinese director that have truly broken through the North American and worldwide box office.  HERO opened number 1 in North America in August of 2004 in thousands of screens, and this after significant delays and long after it had opened in China.  Its North American gross was $53 million, and its worldwide gross was $177 million.  HOUSE OF FLYING DAGGERS is also impressive with a North American gross of $11 million and a worldwide gross of $81 million.

This genre of moviemaking helped sustained a growing box office in China for the next decade.

 

Naturally, part and parcel of the improved quality of films is the ability to keep pace with the demand.

Let’s talk a moment about theaters in China.

Back in the 80’s, when I was selling American studio films to China, lest the studios become too greedy about how much to charge, we were shown how the theatrical market was largely subsidized by the government.  There were barely a handful of proper ticket-selling movie theaters at all.  In the cities, films were most often screened in public auditoriums, and work units gave everyone a free ticket on a regular basis; in the countryside, films were projected onto a hanging sheet and people sat on both sides of it.  What did they sit on?  A brick. What did they pay? An egg.

We emphasized how important it was to create a destination for, and therefore a habit out of, moviegoing.  Just ten years ago, there were only less than 3,000 screens.  Compare that with the over 17,000 today, and that is an 800% increase!  Today theaters are being built at an average of 5-10 a day.   If there ever was a place to affirm the truism — if you build it, they will come – China is it.

As both domestic movies improved, and foreign movies were increasingly allowed in, the box office in China was becoming something of a phenomenon.

XX.  CHINA’S TOP GROSSING FILMS OF ALL-TIME

Hollywood started really noticing, about five years ago.  Perhaps because the 2008 Beijing Olympics put China on the cover of every magazine and newspaper.  But more likely, because China had crossed some notable thresholds.  Suddenly it was possible for a film to gross $100 million at the box office.  Suddenly China’s overall box office crossed $1 billion.

These are numbers to make people sit up.  For a long time, the number of Hollywood films that could enter China on a revenue share basis was very limited however.  Up until last year, that number was 10, and 20 overall for the world.  That would be only one or two films per studio a year.  The Motion Picture Association put tremendous pressure on the government, and through the WTO, to increase that number.

Last year, during Xi Jinping’s visit to the US, he announced that that number of imports could be raised from 10 to 24, and 34 films overall for the world.

This was a big jump and cause for celebration on one side of the Pacific, and strong lamentation on the other.  At panels during the Shanghai Film Festival last year, one after another Chinese filmmaker lamented the increase, declaring that Hollywood would be gobbling up the future of Chinese filmmakers.

But by the end of last year, another phenomenon occurred which was not wholly unexpected, but which caught people by surprise in its timing.  The big Christmas season which rolls into Chinese New Year revealed that several Chinese films, some with quite modest budgets, were outperforming gargantuan Hollywood films.

This trend continued past the big holiday season, lest it seem that it was simply a manipulation of release dates that caused this trend.

The surge of local films at the box office has continued through this year.  I, and those even closer to the ground than me, believe that the people have spoken.  Despite the fact that Hollywood special effects and razzle dazzle continue to impress, there is no substitute for films that speak to the heart and soul of the people.

XXI.  CHINESE TOP GROSSING FILMS

Here are the films that have shot to the top of the box office.  Almost all are from recent years.

XXII.  FINDING MR. RIGHT, ONE NIGHT SURPRISE

Quite a few contemporary romantic comedies, such as FINDING MR. RIGHT, costing mere millions, crossed the $100 million mark. FINDING MR. RIGHT is actually somewhat daring in its subject – a mistress gets pregnant and comes to the States to have the baby.

Pregnancy is also a theme in ONE NIGHT SURPRISE, a film I helped produce, about an unmarried woman who becomes pregnant but doesn’t know who the father is.  These are fairly racy topics for China, and they both did wonderful business.

XXII. JOURNEY TO THE WEST, CHINESE ZODIAC, LET THE BULLETS FLY

Several directors have taken to make wild and wooly action films, with a hybrid of Eastern and Western styles.  They have proven to be popular, especially if you have Stephen Chow, Jackie Chan, or Chow Yun-Fat, Ge You, and Jiang Wen all together.

XXIII.  PAINTED SKIN, DETECTIVE DEE

Period dramas with strong fantasy elements such as the PAINTED SKIN series, or the DETECTIVE DEE series have performed very well too.

XXIV.  LOST IN THAILAND

But sometimes it’s just a simple story, say about an odd couple stuck together abroad, as in LOST IN THAILAND, which has managed to outgross them all.

What does this mean?

For one, it means that the rest of the world is looking upon China with incredible envy.  People are turning out in droves for good films and mediocre ones too.  Furthermore, every generation, with a generation being only say 10 years, can constitute a significant audience.

XXV. SO YOUNG

The movie, SO YOUNG, about college life in the 90’s, meaning it was made for people born in the 70’s, did great business.

Previously, it was assumed that the 80’s kids dominate the box office.

XXVI.  TINY TIMES

Then with a movie like TINY TIMES, you see that it’s the 90’s kids who are going.  So every ten-year generation seems to bring in its own audience.

XXVII. VAST URBAN MIGRATION

What else can we say about the China market?  The country is undergoing a master plan to movie hundreds of millions of Chinese from the countryside to the cities.  This is a key part of the engine driving Chinese economic growth.  A growing middle class with increased spending power. 4th tier cities become 3rd tier, 3rd tier cities become 2nd tier, 2nd tier become 1st, and so on.  There is no sign of abatement here.

Finally the huge support at the top levels of government for theater building.   Look at these staggering figures for growth of screen numbers.  And nobody thinks that there is overbuilding.  If anything, the building can’t keep pace with demand.

XXVIII.  NUMBER OF CHINESE THEATERS/SCREENS

Add to this the vast number of new film studio and theme park projects; the vast purchases of equipment for post-production; the surge in animation houses; etc.  Despite the naysaying that is going on everywhere about the film industry – that digitization is killing the film business the way it has the music business; that movies alone cannot possibly survive, and that one needs strong ancillary markets to prop up films; that the only films that can survive at the theatrical level are gargantuan ones with massive special effects – China is bucking every trend.  It is the envy of all who are attached to a notion of traditional moviegoing.

I also think that one cannot underestimate the role of the digital revolution and social media.  For such a vast country as this, there is now suddenly a massive and instantaneous network of information flow.  The nation is bound together.  There is continuous and common dialogue flowing through Weibo and WeChat.  And this dialogue has helped movie marketing immensely.

This is the situation as it exists today.  Many of the same filmmakers who complained last year of perhaps not finding work this year, and who have pined for years to reach an international audience, are now content to satisfy a purely local audience. Trying to figure out those pesky Western audiences has just become too much trouble.

But the forward-looking companies are not resting on their laurels and see that they must still find a global strategy.  This is where Hollywood, producers like myself, and many writers and directors can/should be jumping in.

This is the dawn of a new era.  For the moment, and this moment may not last that long, there is room for us to share and teach effectively.

First of all, we need to share the tried and true “formulas” of excellent story structure.  This structure dates all the way back to thousands of years ago when Greek philosophers like Aristotle were writing about drama.  The powerful notions presented then are still adhered to to a surprising degree in moviemaking.   Audiences all over the world respond on a fundamental, visceral level.

What we can also share is strong character development — the psychological complexity, the deep yearnings and motivation of our conflicted protagonists that audiences love.  The Chinese tendency is to look at storybook characters as black and white symbols of virtue or vice, and not draw too much attention to their flaws and 50 shades of grey.

We can also share many technical aspects of production and post-production which have been honed over decades.  Special effects, animation, sound recording and sound mixing are not at the highest standards yet in China.  But these things can and are being taught.

At the same time, there are other things that I believe China can and must hang onto.   And if you take away just one thing from today’s talk, I hope it is this.

The points of view generally represented in Hollywood films are the result of decades of cultural dominance.  Assumptions are widely disseminated unchallenged.  In classic Hollywood movies, the good guy is always the white guy.  Always.  But there is absolutely nothing implicit in good or popular filmmaking to make this so.

All the co-productions that have come before have helped pave the way, but none has actually reached the full potential of what is possible. Because of the timely confluence of economic and social conditions – we can apply the advanced technical skills and budgets to make movies that are both truly Chinese, but truly appreciated the global audience.  Like the best of them, they can take people on breathless or breathtaking journeys, make people laugh and cry, portray characters who are lovable or relatable.  But they differ from traditional Hollywood movies in that they have Chinese characters, Chinese elements and locations, and perhaps most importantly,  a Chinese point of view.  This to me is radical.  This is what I mean by a true revolution of culture in the making.

The wor.  They may be from Chinese history, or novels, or everyday life.  They may take place in China or abroad.  But they speak to the universal human condition.

We’ve already seen several genres take off — action movies and romantic comedies primarily. There is room for others.  Why not big action/adventure films?  An Indiana Jones set in China?   Road movies, psychological thrillers, suspense thrillers, detective movies, and even good old dramas, the way Hollywood used to make.

In these movies that the world will see, the Chinese characters are not marginalized – they are not shady nor nefarious.  They are full-blooded and three-dimensional. I know it is possible.  We did it with JOY LUCK CLUB.  At the time, it seemed like a pipe dream to make a film with no stars and with an all Asian cast.

When I was producing a Chinese version of HIGH SCHOOL MUSICAL for Disney, one of their most beloved and profitable franchises, our Chinese partners said that given the lives of high school students in China, it would seem too preposterous to have them dancing and singing in the aisles.  Disney agreed to have the movie set in college instead. If you think this is a small thing, then you don’t know Disney’s very strict policies about its branding.  So studios are bending over backwards, and they will listen because they have to.

China’s economic growth is making it possible for China to be truly heard.  Therefore, I feel that something beautiful and profound is going on in the race to chase the Chinese consumer’s yuan.  It is forcing many, if not all, of the most powerful global companies that we saw on the Fortune 500 Chart, to really try and understand what make Chinese tick.  What are the cultural traditions and nuances that stimulate the Chinese mind, warm the Chinese heart, and elevate the Chinese spirit?

It allows me to feel I am a more complete human being because I do not have to subvert my sense of identity, but at the same time I can use the skills garnered from decades of working in Hollywood with some of the very best and brightest.  I can share my thoughts on Chinese philosophy, design, mannerisms, and they are absorbed by open ears, rather fall on deaf ones.

Yes, the economy has made China ultra relevant.  My wish, and my prediction is that at some point, who knows when, it will also become ultra cool.  My wish is that soon we will have more appealing, fun, surprising, bold, images coming out of China that counteract the negativity of the media.  And it will be because some of us will have figured out how to use the best of international techniques to drill down to the essence of the heart and soul of China for the big and little screen.

An assistant noticed that I have a set of calligraphy hanging in my living room that sums up what I am saying.

XXIX. Waishi zaohua, zhong de xinyuan.

外师造化,中得心源。

 Learn techniques from the outside, but preserve what’s in your heart.

Thank you for coming today. I enjoyed speaking with you.