The Growth of the Chinese Movie Theater Industry
Sun, April 18, 2021

The Growth of the Chinese Movie Theater Industry

The Chinese movie theater industry is growing, and it’s growing fast. Over the course of 12 years, from 2005 to 2016, the industry has grown 4.8 percent / Photo by: M S via Flickr

 

The Chinese movie theater industry is growing, and it’s growing fast. Over the course of 12 years, from 2005 to 2016, the industry has grown 4.8 percent. It’s growing fast enough that Televisory, a website providing unparalleled industry intelligence and in-depth focus on operation aspects, reports that it’s now considered the movie theater industry that’s outperforming “each of the industries in different parts of the world.” 

So, what led to the boom of the Chinese movie theater industry? 

Growth in the Middle Class

It’s possible that China is benefiting from the growing middle class in China who are more able to buy movie tickets. Combine this with the fact that China has no qualms releasing movies that may or may not sell. China has also been doing a good job trying to get these middle-class members of their society out of their apartments and houses and into the great outdoors. 

Other than cinema, the average Chinese citizen today would usually enjoy other outdoor forms of entertainment. Sure, streaming a show in the comfort of your own home is amazing, but the public has also grown to love events and places like theme parks, live performances, music festivals, sports events, and everything in between. 

Having a public with enough disposable income means that China can also up the prices of their movie tickets to try and boost sales incrementally over the years. Back in 2006, the price of a movie ticket in China was $3.48 a person; now it’s $5.36 a pop since 2016. This is a rise of more than 54 percent. 

There was a lull in the growth, however, Televisory points out, and it was from 2013 to 2016. Even though China started producing more and more B-movies over the years, the stagnation during this three-year period was because of the shift to tier 3 and tier 4 cities where there were people with “low spending power and affluence.” Not to mention toward the second half of 2016, there weren’t as many movies produced, so visiting rates decreased. 

It’s possible that China is benefiting from the growing middle class in China who are more able to buy movie tickets / Photo by: Huangdan2060 via Wikimedia Commons

 

If China wants to continue on this path--which they probably will--Televisory states that they have to match up to their screen count to the United States, where movies are a thriving business. IHS Markit, a London-based market researcher, writes, “Moreover, China only has 23 screens per million population as compared to 125 per million in the United States.”

The good news is, there is still a continued investment in the industry, so it’s likely that the growth will only be compounded in the following years. 

Internationally, the Chinese movie theater industry is also making headway, as the South China Morning Post reports that the global cinema box office sales, which reached a record high of US$40.6 billion in 2017, was driven by the Chinese movie industry. Global movie sales for China reached a staggering US$7.9 billion in 2017. 

Because of this, former US Assistant Secretary of State Charles Rivkin is convinced that China is on its way to becoming “the largest film market in short order,” owing to the fact that China had pinpointed its weak points and are now adding “about 25 screens a day.” 

The Dark Side

No matter how positive this all sounds, there are still issues that need to be fixed for an authentic Chinese movie experience. How does “authentic” factor in in this conversation, you might ask? It factors in the movie theater industry talk because of the fact that Chinese movie theaters may just be cheating their way to the top on occasion. 

According to a report by British news source BBC, the Chinese may have been making headlines for breaking records steadily, but the system is still riddled with a few problems. In this case, Chinese film critic and industry observer Raymond Zhou said that the odd interplay between the growth of Chinese cinema and the cheating aspect of it lies in the involvement of investors whose idea of boosting stock prices is to produce a film regardless of whether it is good or not. 

This explains the sudden barrage of B-rated movies coming out of China, and why they remain popular and sold out despite them not being truly popular. Now, what needs to be said here is that movie appreciation is purely subjective and that people can like or hate creative things if they feel that way. The difference in this situation is that these investors don’t really care about that. And why would they? They have enough money to spare to buy out a whole cinema with their own money and pretend the movie is doing well in terms of sales. 

No matter how positive this all sounds, there are still issues that need to be fixed for an authentic Chinese movie experience / Photo by: Huandy618 via Wikimedia Commons

 

This leads to fake box office results. From a financial standpoint, it probably costs less to produce a movie on the fly and buy out certain theater houses than it is actually following a path to boost stock prices the more traditional way. 

Chinese authorities are already getting clued in on these practices, though, which is a good thing if the real storytellers and committed Chinese filmmakers are to well and truly thrive. 

Recently, regulators have been picking up on the practice and have been watching vigilantly.