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Film and theater industry has for a long time not attained its full potential in the China. Nonetheless, the exponential growth in this industry in the last few years has attracted many foreign and local players. Increases in income levels as well as the improvement in film technologies are some of the main factors that have resulted in this sudden rise. With the increase in the overall size of the entertainment industry in China, some of the local companies have started to explore international markets in order to increase their profits and get an international presence.
Media, commerce, and government have had an astonishing interaction in China. Chinese Communist Party has a significant role in ensuring the media portrays the government in a positive manner. On the flip side, there is also a need to deregulate this industry and allow for commercialization of the entertainment industry.[1] Outrightly, this has been a challenging task for all players. Nonetheless, the government has liberalized the media industry in since 2003, albeit with a few regulations meant to empower local film industries while limiting the participation of foreign film companies.[2]
China Film Market
Chinese film market has been enjoying a steady growth which has attracted many foreign and local film investors. In the past, specifically from between 1979 and 1994, Chinese films were mainly propaganda films meant to promote the ideals of the government.[3] In effect, this led to a decline in this market by nearly 79%. In order to rectify this adverse situation, the government started to liberalize the film industry in 1994.[4] In particular, the Chinese government allowed its first importation of a US foreign film, The Fugitive from Warner Bros Studio. The Fugitive was an instant hit and it earned nearly $3 million in China. Better still, it marked the recovery of the Chinese film industry. Accordingly, the Chinese theaters began steadily importing foreign movies with at least ten been shown every year between 1995 and 2000.[5]
Currently, the Chinese film industry is enjoying some of its best times in history. Film market has been growing steadily, rising from a high of $2.8 billion in 2012 to an impressive $4.8 billion in 2014. On the same note, the film industry shows no sign of slowing down. For example, the first eight months sale of movie tickets in 2015 surpassed the total sales for 2014. Riding on a high wave of increased demand from the country’s expanding middle class, the Chinese film industry is expected to overtake US box office by 2018. China’s par capital income rose from less than $1000 to over $7500 between 1990 and 2014. Basically, this is nearly eight times rise in just 14years. Consequently, this rise in incomes has led to an increased spending on luxury goods and trips to the cinemas. In essence, this figure corresponds to the countries demand for goods and services.[6] For example, in 2007 the country’s retail sales were $1.4 trillion. However, by 2014 this figure had shot to $3.5 trillion.
With the exponential growth in the entertainment industry, China is increasingly formulating ways to modernize its domestic film industry. Notably, this cooperation is intended to increase the country’s cinematic skills. Importantly, the knowledge of American film culture will enable China to produce internationally accepted movies. To better understand the American cinematography, Chinese companies are entering into coproduction with their American counterparts.[7] In effect, they are getting relevant skills on how to shoot high-quality movies while giving the American companies an opportunity to venture into the lucrative Chinese film industry.
Government Policy
            Notably, the Chinese government policy has directly influenced the entertainment industry. Actually, it only after the abolishment of most laws that used to gag the participants in that the film industry has had shown tremendous growth. As a political tool and a means of influencing the society’s morals, the Chinese government has a significant interest in understanding the ongoing in this industry.[8]
Noteworthy, China’s lucrative film industry is almost overtaking the US. Notably, the growth rate in Chinese film industry was 34% in the year 2015. If this trend continues, China is expected to overtake the US as the leading consumer of films by 2020. On a positive note, the government has lessened laws that restricted foreign company’s participation in this industry. In order for a foreign firm to sell its movies in China, it must circumvent the countries tight protectionist policies through coproduction or comply with the rigorous requirements of the State
Administration of Press, Publication, Radio, Film, and Television (SAPPRFT).
Coproduction
Coproduction is the easiest and most popular method that foreign companies use when entering the Chinese film industry. Movies produced in this manner are not treated as foreign. In effect, they are able to bypass the 34-film limit. In addition, the foreign owners are able to earn 43% commission instead of 25% of all the total revenues. In general, for a movie to be considered as a coproduction, it must cover at least a third of its time in China. Moreover, it must portray China in a positive manner and be produced in partnership with a Chinese film company.[9] On a positive note, the proliferation of foreign films through this manner enables the exchange of filmmaking technology. Similarly, it enables the integration of the foreign film into the Chinese market. In basic, Chinese companies are able to learn how to use sophisticated filming machines while the US and other foreign films are integrated into the Chinese market.
The State Administration of Press, Publication, Radio, Film, and Television (SAPPRFT)
SAPPRFT is charged with the duty of regulating all foreign and local Chinese films. SAPPRFT has 37 members who include academics, filmmakers, and government representatives. According to SAPPRFT regulations, films must comply with Chinese Constitution.[10] In addition, since films do not have a rating score, they must be fitting for all family viewers. Briefly, due to the presence of so many organization members and the vagueness of the laws governing SAPPRFT, it is always a daunting task for movies to get approval through this means. Accordingly, most foreign producers prefer using coproduction route.
Media Market
Appeasing the Chinese Audience
In order for foreign films to penetrate the Chinese film market, they must appease both the Chinese audience and the regulators. To appease the Chinese audience, the filmmakers have to depict sceneries that the Chinese audiences like. Moreover, they must also portray Chinese cultures in a positive manner. In light of this, most foreign companies modify their films to meet these conditions. For example, the movie Looper was collaboration with China DMG Entertainment on condition that a scene that was to be cast in Paris be done in Shanghai. Further, Chinese star actor Xu Qing featured in the film to attract local film enthusiasts. In effect, the movie went to rake over $20 million in China alone. Similarly,  Iron Man 3  was co-produced with DMG Entertainment and featured two prominent Chinese actors Fan Bingbing and Wang Xueqi. Moreover, it featured scenes of Chinese products such as Chinese milk. Notably, these changes were made to court Chinese audience.
Appeasing the Regulators
Appeasing to film regulators is a common practice in Chine. In essence, the film regulators act as a guide to what is morally acceptable. In addition, due to the size of the market and the regulation on films, most foreign films producers have to comply with these rules. Even co-produced movies are usually carefully scrutinized by SAPPRFT, and it is extremely difficult to determine the regulatory rulings.[11] For example, in the screening of Mission: Impossible 3 the producers had to omit a section showing clothes drying on a clothesline in Shanghai because it was not a positive portray of the sign. Moreover, since the Chinese film regulations are vague, it is difficult to interpret what they really require. For example, the movie Men in Black 3 was forced to cut a scene where civilians’ memories are recalled. In essence, this section was viewed as an incitement against the country’s internet censorship policies. Evidently, despite the importance of these sections, the film producers had to appease the regulators and comply with their regulations.[12]
Internet Business Models
Diversification is one of the main competitive business models that Chinese entertainment industry has undertaken. Although the film industry is a main feature in the entertainment industry, other forms of entertainment have also been similar tremendous growth and present vast opportunities for players in this industry. Noteworthy, they include online gaming, internet video streaming, and internationalization of videos. Baidu, the Chinese internet provider is the main driver in this industry.  Iqyi film platform provides the company with an opportunity to showcase films and television programs. In effect, this leads to increased traffic for the company. Importantly, internet films have a wider reach and allow for active audience interactions. Active interactions occur by condensing, paraphrasing, or deleting parts of the content.[13] Notably, this strategy is effective in getting a closer audience appeal.
Internationalization of Chinese Films
Hero, the 2012 hit film directed by Zhang Yimou is one of the most prominent films from mainland China that has managed to have a global presence. Zhang’s ability to produce a culturally rich and technically sophisticated film was one of the primary drivers that led to this movie been popular among Western and Eastern movie enthusiasts. Culture, cinema skills, social, and political values are some of the factors that affect China’s ability to produce globally accepted films. In light of this, it is important to evaluate and rectify some of the barriers to Chinese films going global.[14]
Cultural and Artistic Barriers
Three primary factors which are intertwined primarily influence the manner in which Chinese films are accepted in foreign markets. Moreover, these issues are part and parcel of the Chinese people. Consequently, they Chinese cannot modify their way of life which makes their films have difficulty when trying to penetrate international markets.
Cultural Discounts
Cultural discounts interfere with the way viewers of a different culture interact and understand a foreign film. Chinese films are characterized by long dialogues and pauses, a feature which is uncommon in Western films. Notably, these cultural differences make it difficult for foreign viewers to follow and understand these films.[15] For example, in the 2011 Chinese blockbuster The Flowers, Zhang Yimou the director, had to produce the film in a manner that would almost fit the taste of Western audience by reducing the length of conversations. Nevertheless, the film was still characterized with silences and stills.
Humor
Humor in the Chinese social setting is slightly different from that of Western cultures. From a Chinese perspective, humor in films is mainly generated through dialogue, and use of varying dialect. In this case, the audience has to have a deep understanding of the language and context been discussed. On the contrary, Western films humor is always a mixture of actions which are matched with little communication. For example, in Mr. Bean, the comedy is largely based on the performance of silly scenes by “Mr. Bean,” while in the Chinese film Flying Bullets, the audience has to understand the conversation in the film and the settings of the movie which is a messy Northern Warlords era.
History
Understanding the history in which the movie is set is a pertinent issue in understanding and enjoying Chinese films. Moreover, the audience must also understand the Chinese culture. For example, the film Aftershock was a hit film in China and made over $78.6 million in just two weeks of screening in China. Nevertheless, it was unpopular even to neighboring countries such as Malaysia, Singapore, and South Korea. Aftershock is based on a story of a family reunion after the terrible earthquake in Tangshan, Hebei in 1976 in which more than 2.4 million people died.[16] Evidently, these memories are deeply held by Chinese but are unknown to most foreigners. Furthermore, in a scene in the film, a woman decides that her son should be saved instead of the daughter. In order to understand and enjoy this film, the audiences must know Chinese history and understand their culture.[17]
Economic Factors
            Noteworthy, for a film to penetrate the international market there is a need for a proper distribution channel. By and large, the lack of a distribution channel has made the efforts of Chinese films to reach global audience futile. To overcome this obstacle, the Chinese government uses two films distribution channels, the state-run China Film Export and Import Corporation and the China Lion Entertainment. Notably, the China Film Export and Import Corporation which is controlled by the China Film Group Corporation while the China Lion Entertainment is a Sino-Australian joint venture that was established in 2010.[18]  In addition, private Chinese investors such as the Huayi Bros and Shanghai Film Group have entered into partnerships with foreign companies to sell their films in overseas markets.
Political Factor
Due to the excessive government interference in movie production, and the desire for movies to portray a positive image of China, the Chinese films are usually low quality in terms of content and realism. For example, the Chinese film Flowers of War had some false scenery that led to its fall from grace.[19] Notably, the film denied the occurrence of Nanking massacre and the commercial interest of the movie producers. In particular, denying of the Nanking massacre aimed at not portraying the Chinese government negatively. Basically, the discovery of these shortfalls was one of the primary reasons for the failure of the film to attract international audiences. Consequently, Chinese movie makers have a hard time trying to satisfy both the Chinese government and the public.[20]
Animation Film Industry
Cultural and social values of the Chinese create a great distinction between the manner in which their animation films are done when compared to those in the US and Europe. Noteworthy, in Chinese animations, characters cannot be “pigeonholed” or “discriminated” from a filming approach due to their physiognomy and somatic characteristics. Indeed, popular Western animation films normally “humanize” characters such as Mickey Mouse, the panda, the lion or the zebra. Conversely, traditional Chinese films see this feature as discriminating and a form of racism.[21] Due to the varying film set up for Chinese animation movies, they have difficulty in entering the international market.
In brief, this literature review gives important insight on the developments of the Chinese film industry. Importantly, it looks at both the opportunities and challenges present in this industry. Evidently, the rise in income levels in China has led to a sharp and steady increase in demand for movies. Moreover, the government liberalization of this industry has led to tits exponential growth. Nevertheless, there are still challenges in this industry especially in the internationalization of the Chinese films. Consequently, the government and private investors should actively formulate ways of developing internationally acceptable movies while still safeguarding the Chinese cultural pride and heritage.
 
 
 
Bibliography
Berry, Chris. Chinese Films in Focus: 25 New Takes Perspectives on Chinese Cinema, 56-210 London: British Film Institute, 2004.
Clark, Paul. “The Chinese Cultural Revolution a History Chinese Cinema Culture and Politics Since 1949.” Filming for Television.” Film Quarterly 43 no.3 (1990): 54-57.
Crane, Diana, “Cultural Globalization and the Dominance of the American Film Industry: Cultural Policies, National Film Industries, and Transnational Film,” International Journal of Cultural Policy 20 no.14 (2014): 365-382.
Donald, S., Keane, M., and Hong, Y. Media in China: Consumption, Content and Crisis, 27-202. Abingdon, UK: Routledge, 2002.
Keane, Michael. Creative Industries in China: Art, Design and Media, 23-118. Hoboken, NJ: John Wiley and Sons Inc., 2007.
Keane, Michael, and Moran, Albert. Television Across Asia: TV Industries, Programme Formats and Globalisation (Routledgecurzon Media, Culture and Social Change in Asia), 43-119. Abingdon, UK: Routledge. 2009.
Lv, Yuyong, & Li, Min, “On the New Features of Online Film and TV Subtitle Translation in China,” International Journal of English Linguistics 5 no.6 (2015): 1-6.
Su, Wendy, “To Be or Not To Be? China’s Cultural Policy and Counterhegemony Strategy Toward Global Hollywood From 1994 to 2000,” Journal of International and Intercultural Communication 2 no.1 (2010): 38-58.
Su, Wendy, “Resisting Cultural Imperialism, or Welcoming Cultural Globalization? China’s Extensive Debate on Hollywood Cinema From 1994 to 2007,” Asian Journal of Communication 21, no.2 (2011): 186-201.
Yecies, B., Shim, A., and Goldsmith, B. “Digital Intermediary: Korean Transnational Cinema,” Media International Australia 14 no. 141 (2011): 137-145.
Zhang, Z., De Masi, V., and Negro, G. “To Live or To Die – The Struggle of Chinese Film Productions Going Global.” 2012. Accessed June 18th 2016. http://www.chinamediaobs.org/sites/www.chinamediaobs.org/files/media/to_live_or_to_die_the_struggle_of_chinese_film_productions.pdf
Zhao, Yuezhi. Communication in China: Political Economy, Power and Conflict. Lanham, 34-123. Marylamd: Rowman & Littlefield Publishers, 2008.
Zhao, Yuezhi. Media, Market, and Democracy in China: Between the Party Line and the Bottom Line, 24-118. Urbana: University of Illinois Press, 2009.
 
[1] Zhao, Yuezhi. Communication in China: Political Economy, Power and Conflict. Lanham. (Marylamd: Rowman & Littlefield Publishers), 2008, 34-123.
 
[2] Berry, Chris. Chinese Films in Focus: 25 New Takes Perspectives on Chinese Cinema (London: British Film Institute, 2004), 56-210
[3] Clark, Paul. “The Chinese Cultural Revolution a History Chinese Cinema Culture and Politics Since 1949.” Filming for Television.” Film Quarterly 43 no.3 (1990): 54-57.
 
[4] Su, Wendy, “To Be or Not To Be? China’s Cultural Policy and Counterhegemony Strategy Toward Global Hollywood From 1994 to 2000,” Journal of International and Intercultural Communication 2 no.1 (2010): 38-58.
[5] Ibid. 38-54
[6] Crane, Diana, “Cultural Globalization and the Dominance of the American Film Industry: Cultural Policies, National Film Industries, and Transnational Film,” International Journal of Cultural Policy 20 no.14 (2014): 365-382.
[7] Yecies, B., Shim, A., and Goldsmith, B. “Digital Intermediary: Korean Transnational Cinema,” Media International Australia 14 no. 141 (2011): 137-145.
[8] Donald, S., Keane, M., and Hong, Y. Media in China: Consumption, Content and Crisis. (Abingdon, UK: Routledge, 2002), 27-202.
 
[9] Keane, Michael, and Moran, Albert. Television Across Asia: TV Industries, Programme Formats and Globalisation (Routledgecurzon Media, Culture and Social Change in Asia.) (Abingdon, UK: Routledge), 2009, 59-117.
 
[10] Ibid. 89-107.
[11] Keane, Michael, and Moran, Albert. Television Across Asia: TV Industries, Programme Formats and Globalisation (Routledgecurzon Media, Culture and Social Change in Asia). (Abingdon, UK: Routledge), 2009, 43-119.
 
[12] Donald, S., Keane, M., and Hong, Y. Media in China: Consumption, Content and Crisis. (Abingdon, UK: Routledge), 2002, 89-176.
 
[13] Lv, Yuyong, & Li, Min, “On the New Features of Online Film and TV Subtitle Translation in China,” International Journal of English Linguistics 5 no.6 (2015): 1-6.
 
[14] Su, Wendy, “Resisting Cultural Imperialism, or Welcoming Cultural Globalization? China’s Extensive Debate on Hollywood Cinema From 1994 to 2007,” Asian Journal of Communication 21, no.2 (2011): 186-201.
 
[15] Crane, Diana, “Cultural Globalization and the Dominance of the American Film Industry: Cultural Policies, National Film Industries, and Transnational Film,” International Journal of Cultural Policy 20 no.14 (2014): 365-382.
 
[16] Zhang, Z., De Masi, V., and Negro, G. “To Live or To Die – The Struggle of Chinese Film Productions Going Global.” 2012. Accessed June 18th 2016. http://www.chinamediaobs.org/sites/www.chinamediaobs.org/files/media/to_live_or_to_die_the_struggle_of_chinese_film_productions.pdf
 
[17] Ibid.
[18] Su, Wendy, “Resisting Cultural Imperialism, or Welcoming Cultural Globalization? China’s Extensive Debate on Hollywood Cinema From 1994 to 2007,” Asian Journal of Communication 21, no.2 (2011): 186-201.
 
[19] Zhang, Z., De Masi, V., and Negro, G. “To Live or To Die – The Struggle of Chinese Film Productions Going Global.” 2012. Accessed June 18th 2016. http://www.chinamediaobs.org/sites/www.chinamediaobs.org/files/media/to_live_or_to_die_the_struggle_of_chinese_film_productions.pdf
 
[20] Zhao, Yuezhi. Media, Market, and Democracy in China: Between the Party Line and the Bottom Line. (Urbana: University of Illinois Press) 2009, 24-118
 
[21] Keane, Michael. Creative Industries in China: Art, Design and Media. (Hoboken, NJ: John Wiley and Sons Inc.) 2007, 23-118.