China fuels record global box-office revenue in 2014
A surge of ticket sales in China sent Hollywood’s box office to a new high last year, even though theater revenue at home slumped.
Global box-office revenue climbed to $36.4 billion, according to an annual report Wednesday from the Motion Picture Assn. of America. And much of the growth came from one country: China.
The world’s most populous nation saw its box-office revenue jump 34% to a staggering $4.8 billion last year, making it the first foreign market to cross the $4-billion threshold.
That growth was fueled largely by Hollywood action, fantasy and sci-fi films such as “Transformers: Age of Extinction,” the top-grossing film ever in mainland China, as well as “Interstellar” and “Need for Speed.” Some Hollywood movies did more business in China than they did in North America.
The figures attest to China’s rising importance to major studios, which compete heavily to secure coveted releases for their movies in a market that is rapidly catching up to the U.S.
Chinese developers such as Dalian Wanda Group, owner of U.S. theater chain AMC Entertainment, have been building theaters at a breakneck pace across China to accommodate a growing middle-class population with more money to spend on entertainment. Chinese Internet giants such as Alibaba Group Holding Ltd. also are investing in film production.
At the same time, China has been more willing in recent years to let Hollywood grab a larger share of its vast box office by easing its strict quotas on foreign movies.
The shifts have transformed China into the largest international market for Hollywood films, surging ahead of longtime markets such as Japan, France, Britain and India, each of which had $2 billion or less in film revenue last year, according to the MPAA.
“It’s become a very important market for major studios,” said Ken Kleinberg, a Los Angeles entertainment industry who has several clients with business in China. “It’s on the verge of becoming the largest motion picture market in the world.”
China’s growing appetite for American movies comes at a welcome time for the industry, which is coming off a bleak year at home.
Soaring ticket sales in China and other foreign markets, which accounted for nearly three-quarters of all ticket sales in 2014, more than offset the 5% drop, to $10.4 billion, in the U.S. and Canada last year.
China fueled a 12% increase ticket sales throughout Asia Pacific last year. Box-office revenue rose just 2% in Latin America and dropped 3% in Europe, the Middle East and Africa.
“More people than ever before around the world are going to their local cinemas to see movies made by filmmakers in the United States and all around the globe,” MPAA Chairman Chris Dodd said. “This is not just an American story of success, but a worldwide story about the value of craft, creativity and the importance of a story well told.”
In other positive signs, the number of films released by MPAA member studios increased for the first time in five years, reaching 136 last year.
Among the top-grossing films worldwide last year were “Guardians of the Galaxy,” “Captain America: The Winter Soldier,” “The Lego Movie” and “Transformers: Age of Extinction.”
But the MPAA’s report included some worrisome signs for the industry.
Admissions to theaters in the U.S. and Canada dropped 6% to 1.27 billion tickets sold, continuing a long-term slide in domestic attendance as theaters face more competition from Netflix Inc. and other entertainment options in the home.
Frequent moviegoers who go to the cinema once a month or more continue to drive the movie industry. But total tickets purchased by frequent, occasional and infrequent moviegoers all decreased last year from 2013, the MPAA found.
Additionally, while the share of tickets sold to customers 40 to 59 years old were at all-time highs, fewer tickets were sold to younger customers 18 to 39 years old.
Average ticket prices increased 4 cents to $8.17, though the MPAA suggested that did not dampen attendance.
“A movie still provides the most affordable entertainment option, costing under $40 for a family of four,” the trade group said in its report.
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