China recently surpassed the United States to become the world’s biggest movie market by ticket sales for the first time. China recorded box-office revenue of US$1.99 billion from January to October, topping US sales of $1.94 billion.
This gap is expected to widen further by year-end as most Hollywood blockbuster releases, such as Marvel’s Black Widow and the James Bond film No Time to Die, have been postponed to next year due to the impact of the Covid-19 pandemic.
While China was expected to take pole position in global ticket sales, the pandemic accelerated its ascent. Due to China’s effective control of outbreak on a domestic level, most of its movie theatres are currently operating at 75% capacity compared with 25-50% in the US. Even in Thailand, where cinemas have opened almost all of their screens, average attendance is still just 25-30% of normal turnout.
The pandemic has undeniably changed the global movie industry. Both Chinese and US theatrical markets are facing similar challenges in maintaining their position as they have to compete with other forms of entertainment, such as streaming services, for which demand has skyrocketed during lockdowns. This trend likely to continue given the recent disruption in movie releases.
In China, two local films — Enter the Fat Dragon and Lost in Russia — that were initially set to open during the Spring Festival holiday last February, in the middle of the Covid lockdown, premiered online instead. The release of two films on a streaming platform instead of in cinemas caused widespread dismay among Chinese film industry executives, who feared it might permanently change how people watch major releases.
Chinese authorities have responded to those concerns by announcing a plan to strictly manage the requirements for the “theatrical window” — a period of time when movies must be screened in cinemas before they are allowed to be shown elsewhere.
Similarly in the US, Warner Bros has taken the controversial decision to start debuting its new movies such as Wonder Woman 1984 on the HBO Max streaming service and in cinemas simultaneously next year. The movies will be available on HBO Max for just 30 days, after which they will leave the platform and continue playing in cinemas. This move immediately sent shares of cinema chains into a tailspin.
Whether or not China can maintain its lead in the global box office beyond this year remains to be seen. However, we can be sure that as the race intensifies, we can expect competition between the silver screen and streaming services to reach a new level.