The coronavirus epidemic paralyzes and weakens the Chinese cinema sector, with consequences for productions from other countries, including the United States.
Postponed film releases, closed rooms, studios plagued by anxiety … In China, the coronavirus epidemic freezes an entire sector at the risk of weakening a market that has become crucial for Hollywood productions.
Friday, February 14, in the evening, in a trendy district of Beijing, not the shadow of a movie buff near the Megabox (eight screens): the cinema doors have been closed for almost a month “to avoid contagion” and no date is set for reopening. Most Chinese cinemas have been closed since January 24, victims of measures imposed to stem the epidemic of the new coronavirus – which in any case encourages the Chinese to stay at home.
The episode comes at the worst time: the long holidays of the Lunar New Year (fell this year on January 25) usually experience a peak in cinema attendance and many blockbusters come out on this occasion.
“In 2019, cinema revenues during New Year's holidays represented between 20% and 30% of total box office over the year, it's huge,” said Wilson Chow, sector expert for PwC, quoted by AFP. On the day of Lunar New Year in 2019, cinemas had earned $ 240 million, revenue fell this year to $ 300,000, he said.
The public group China Film Group Corporation had made 8% of its annual revenues last year during this vacation. With its cinemas closed and the postponed release of films it co-produces, the epidemic “will have a definite impact” on his results, he warned. Operators of more fragile rooms could put the key under the door if the closure is prolonged, fears Wilson Chow.
The prospects are also gloomy for the biggest chains, which are panicking from internet competition. Huanxi Media, a large studio, has decided to broadcast its highly anticipated comedy directly online Lost in Russia, rather than postponing its release. He teamed up with internet giant Bytedance, which paid him $ 90 million to offer the film on its Douyin and Toutiao platforms.
Several major movie chains – including Wanda, Bona, Dadi and Lumiere Pavilions – reacted furiously, threatening in a joint letter to boycott Huanxi's next films. For them, this precedent “amounts to deliberately destroying the film industry”. Other studios have postponed their releases sine die and many shoots are suspended or slowed down. Producer Wanda Film's title fell 25% in one month on the Shenzhen Stock Exchange.
Conversely, the online video platform iQiyi is on fire: it has advanced its film distribution program to meet the demand of Chinese confined to their homes.
Dark cinema attendance has exploded for a decade: ticket sales in China (which has more than 60,000 screens) totaled $ 9.2 billion last year, compared to 1.5 billion in 2010. China was therefore in on track to dethrone the United States in 2020 as the world's largest box office market. Hope ruined by the epidemic.
The shock wave is global: the vast Chinese market has become vital for Hollywood blockbusters – and a third of the revenue in China is generated by foreign films. Disney could hope to achieve colossal success in the spring with its new film Mulan, a 200 million dollar production recounting the adventures of a young Chinese girl disguised as a soldier. But the American giant, already affected by the closure of its amusement parks in Hong Kong and Shanghai, admitted ignoring when it could finally broadcast Mulan.
Another victim, the theater operator and distributor Imax Corp., based in Canada: his shortfall could exceed $ 60 million. He assured in a press release betting on film releases postponed later in 2020 and on a demand for entertainment “always high”.
It remains to be seen when the cinemas will finally be allowed to reopen … and if they do not remain permanently shunned by spectators traumatized by the epidemic.