China prices skyrocket at AFM
Asking prices for Chinese rights to US product are going through the roof at this year’s AFM, due to the influx of mainland Chinese buyers hungry for 3D action titles and star-driven films.
Chinese distributors say Lionsgate is asking $8m for Chinese rights to Wally Pfister’s Transcendence, set to star Johnny Depp, while Nu Image is asking a whopping $15m for Expendables 3.
These prices put China on a par with Japan, and are based on the performance of films such as Expendables 2, which grossed $53m in China. But buyers say China is not the new Japan.
The market’s infrastructure is still in the early stages of development and censorship and import quotas remain a problem, despite the expansion of the revenue-sharing quota to 34 films a year. If a film doesn’t clear censorship, Chinese buyers risk losing their MG, and these days fewer sellers are willing to include a censorship clause.
“Sellers are basing their prices on the Chinese box office for Expendables 2 - but that film was an exceptional case. The point is whether you have the government behind you,” says Media Asia’s Benny Lim, who buys for Hong Kong and China. China’s Le Vision Pictures invested equity in Expendables 2, spent heavily on marketing and worked closely with local authorities on the film’s release.
Lily Jiang, vice president of acquisitions for China’s Bona Film Group, says some films are now being priced at $3m for Chinese rights, but the average is around $1m. “A few years ago it was only $100,000. But it’s difficult to get a quota slot, especially now there are so many buyers in the market.”
According to AFM organisers, there are 13 Chinese buyers attending the market for the first time this year, including Desen International, Leeding Media, Perfect World and online giant Youku.