China Opens the Door for More Foreign Films
More Chinese moviegoers will be sporting 3D glasses, thanks to a new diplomatic deal raising the quota of foreign films to be released in China.
The agreement worked out between Vice President Joe Biden and his Chinese counterpart, Xi Jinping, ups the number of 3D and large-screen IMAX films from 20 to 34 and allows foreign film companies to take a 25 percent box office cut, nearly double the current 13 percent. Most of the foreign films seen in China are American.
"This agreement with China will make it easier than ever before for U.S. studios and independent filmmakers to reach the fast-growing Chinese audience, supporting thousands of American jobs in and around the film industry," Biden said in a White House statement last week. "At the same time, Chinese audiences will have access to more of the finest films made anywhere in the world."
Though the 20-film quota still technically stands, the addition of 14 films in the special 3D category bumps it up significantly.
Last year, Chinese box office revenue exceeded $2.1 billion, much of it from 3D titles, and is expected to reach $5 billion by 2015.
The U.S. movie industry has complained for years about China's tight restrictions on the number of foreign films allowed into the country each year. Movie execs say the strict limitations encourage the demand for pirated DVDs that are still widely available in China, despite the closure of many Chinese piracy websites.
The deal between the two VPs resolves a dispute dating back to 2009, when the World Trade Organization agreed with the United States in its claim that China's limits on movie distribution fees violated international trade laws.
In a related development last week, DreamWorks Animation announced a joint venture with China Media Capital and two other Chinese companies to establish a China-focused family entertainment company, Oriental DreamWorks.
"In addition to content creation, the joint venture will pursue business opportunities in the areas of live entertainment, theme parks, mobile, online, interactive games and consumer products," DreamWorks Animation said in a statement.
