This week Imax hosted a glitzy press conference to celebrate the premiere of director Zhang Yimou’s new release Coming Home. The film, produced by Le Vision Pictures and Wanda Cinema, will be shown at Imax’s from today. But the collaboration has many scratching their heads. Isn’t Imax technology better suited for blockbuster dramas and special effects extravaganzas?
To which, Imax has a ready riposte. “In addition to action-packed and dazzling special-effect stories, Imax can also heighten the delicate performances and sensitive atmosphere in drama films. Take Coming Home… The subtle performances by Gong Li and Chen Daoming are even more worthy of Imax’s superb technology to bring them to life,” says Chen Jiande, the firm’s China head, who was also at the press conference.
The truth is that Imax needs more films – even if they are dramas – to sustain its growth in China, which is now its second-largest market. Last year China accounted for 20% of its revenues, up 25.7%. In the US sales dropped in the same period.
Imax says it will also show director Jiang Wen’s new drama Gone With The Bullets.
“Our strategy in China is we’re going to continue to invest in the Imax versions of Chinese blockbusters… We look at the [titles] and if we think it’s a blockbuster – if it will look good in Imax, if it’s an action or major drama film – then we’ll want to be part of it,” Don Savant, managing director for Imax Asia-Pacific, told the Hollywood Reporter.
The spread of Imax screens in China has been “slow” in CBN’s view. The newspaper notes that only 137 Imax theatres have been built since the company entered the China market in 2001. China’s ‘homegrown’ large screen technology Dmax, which directly competes with Imax, has opened more than 30 screens in just two years.
Late last month Imax sold a 20% stake in its Chinese subsidiary to investment fund China Media Capital and the local private equity firm FountainVest Partners. The two investors will pay around $40 million each for 10% stakes. Richard Gelfond, Imax’s chief executive, emphasised that the new partnership would help to fuel its expansion plans and strengthen relationships with local governments.
“At this juncture, it makes sense to bring in Chinese investors to help us better address local market dynamics and further optimise our business in China,” Gelfond says, adding China is an “enormously complex market”.
Another of Imax’s challenges is that it needs multiplex cinemas as partners. Many are located in malls, which means winning over property developers.
That explains why the company was so eager to ink a deal with Dalian Wanda. Imax announced last year that it will be working with Wanda Cinema, backed by the property developer Dalian Wanda, to build 210 giant-format theatres by 2021. Wanda already runs 82 Imax theatres in its shopping malls, making it easily the technology’s biggest local backer.
“A few years ago China’s film industry wasn’t as vibrant as it is today so a lot of Imax cinemas were in reality losing money,” an industry insider told Economic Weekly. “Wanda, however, owns its own property, so it can put up the investment [for Imax].”
Meanwhile, Imax reckons that there is plenty of untapped audience potential. So far, it accounts for no more than 1% of total cinema screens in the country. But it already contributes 10% of total ticket revenues, says Gelfond, due to the higher admission prices.
The company is also seeking to expand beyond first-tier cities as spending power grows in second- and third-tier locations. It also has aspirations to get into Chinese living rooms with plans to sell home theatre units made in partnership with TCL Multimedia.
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