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Warner Brothers marches into China's cinema market
2004/01/18
Warner Brothers on Saturday signed an agreement with China's Wanda Group to create 30 Warner Wanda International Cinemas, bringing more movie-going opportunities and options to people across China.

According to the agreement, Wanda Group, a well-known Chinese real estate company, will invest in the building of the 30 multiplex cinemas, while Warner Bros. will provide overall technical, operational and management services. The Multiplex cinemas will use the brand names of both Warner Bros. and Wanda Group.

The first of the 30 multiplex cinemas is already set to open Sunday in north China's
Tianjin Municipality, while another 29 will finish construction during the coming three to four years in the municipalities of Beijing, Shanghai, north China's major cities of Harbin, Dalian and Shenyang and central China's cities of Wuhan and Zhengzhou.

Millard Ochs, chief executive of Warner Brothers International Cinemas, told Xinhua that "China's cinema market is young and full of opportunities," adding that Warner intends to further invest in China and help nurture China's cinema industry.

China issued new rules in December 2003 allowing foreign investors to hold an up to 75 percent stake in joint venture cinemas in seven of China's largest cities, which took effect on Jan. 1 this year.

Zhang Pimin, vice director of the Film Bureau under the State Administration of Radio, Film and Television, said the new regulation makes China a more attractive place for foreign cinema giants and the coming of Warner Bros. is just a prelude of the foreign inflow in China's movie market.

China currently suffers poor cinema conditions. The whole country only has 35 cinema groups, including more than 1,200 cinemas and about 2,000 screens, which means every 650,000 Chinese have merely one screen. In a sharp contrast, the
United States has more than 30,000 cinemas.

Experts said the great lack of cinemas means some home-produced movies have no chance to be shown to the public. Besides, the facilities of most Chinese cinemas are poor, making some Chinese prefer to watch VCDs and DVDs at home.

China's annual film revenue in 2003 was one billion yuan (about120.4 million US dollars), half of which was earned by foreign films. The domestic movie masterpiece "Hero" recorded box office sales of 250 million yuan, while dozens of other home-produced movies earned a combined 250 million yuan. And some local movies had no opportunity to be shown at all.

"If there were enough cinemas to show films, the enthusiasm of local film makers would surely be sparked and therefore, the local film industry will be pushed forward," said Zhang.

Previously, Warner Brothers, the world's movie giant, also inked a framework agreement with Guangzhou Performance Co. to build cinemas in south China.

Xing Yan, a public relations officer of Hua Xing Cinema, the most luxury cinema in the capital Beijing, personally believed that the foreign capital influx into China's cinema market will erode the interests of local cinemas.

But Zhang said the government only allowed joint ventures to exist in the country's film industry, but still banned foreign companies from solely investing in cinema construction. This policy somewhat protected local cinema operators.
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