China's Vice President Xi Jinping finally relented after a day of talks with U.S. Vice President Joe Biden, agreeing to allow Hollywood to send more films than ever to the most populace nation on Earth.
For 20 years, China's government has only allowed 20 non-Chinese films to be released annually, with distributors reaping a measly 13 percent. But under a new agreement, China will permit an additional 14 films--they must be in 3D or IMAX--and distributors will take home 25 percent. The average for foreign distribution in other nation's around the globe is 30 percent.
“This is a very big deal,” said Chris Dodd, chairman of the Motion Picture Association of America, in an interview with The Wrap. “The industry has been living with the numbers in terms of percentages and quotas for 20 years... It begged for a conclusion.”
The changes come a year after the World Trade Organization told China they needed to loosen their restrictions on foreign film. These new rules will be up for review in five years.
This is great news for Hollywood studios. There were $2.1 billion in movie tickets sold last year in China, with that number expected to jump to $5 billion by 2015, according to The New York Times. Hollywood's access to the giant pool of cash has now jumped 70 percent, and their take has jumped of each dollar has jumped 92 percent.
The downside--there is always a downside--is that this new deal will further encourage Hollywood to make films in 3D or IMAX just because they'll make more money, not because they necessarily benefit the film.
IMAX and 3D are great advancements that when down properly make for a far richer and more immersive film experience, but they can also seriously detract from a film. We're very much looking forward to Ben Affelck's Iran Hostage Crisis thriller, "Argo," but the idea that there would be any incentive to convert it to 3D makes is a downer.
The Independent Film & Television Alliance seems to think that indies will benefit greatly from this new deal, as well.
"For Independents, this agreement is momentous,” http://www.hollywoodreporter.com/news/white-house-china-films-joe-biden-xi-jinping-mpaa-292500www.hollywoodreporter.com/news/white-house-china-films-joe-biden-xi-jinping-mpaa-292500. “Our sector has been unable to benefit fully from the existing revenue-sharing importation quotas and has had limited avenues through which to distribute. For the first time, through this Agreement, there is a promise of creating a commercial foundation that will allow independent producers to participate more fully in the Chinese marketplace.”
It's unclear how exactly this will benefits indies, but if Prewitt's happy, we're happy.