3D Finally Catches A Break

21 02 2012

And So Do The Studios

I don’t know if you’ve noticed, but the United States government (thank you Joe Biden) and the Chinese government (thank you Xi Jinping) have signed an agreement that allows more American/Hollywood made films to enter the Chinese distribution market.

And makers of big, stereoscopic blockbusters are to thrilled that I can hear their cheers all the way up at my house (which isn’t far from the studios, but still….).

So, what do I mean by this.

I’d be hard pressed to name more than three people over the age of 23 who really care enough about 3D to actually pay the extra money to go see a movie in stereoscopic. Hell, I don’t even think most of my students care that much about it.

Sure, it’s really cool to watch Jar Jar Binks coming straight at you but, honestly, do you know anyone who wasn’t a STAR WARS fan who went to see the re-release of Episode 1?  The second weekend boxoffice dropped off almost 65% from the first weekend.  Hell, it couldn’t even beat the Journey sequel in it’s second week. 3D probably didn’t bring in any more people than a 2D release of it would have.

Ultimately, 3D isn’t that big a selling point here in the U.S., especially when you add in the surcharges, and popcorn, and all of the red wine you’ll need to drink to get through it. And you may soon be charged extra for those fantastic 3D glasses!

In fact, I know more people who will avoid a movie in 3D (not just my wife, though she’s pretty vocal on this topic) because they don’t like the whole experience.  The glasses aren’t comfortable.  It hurts when I move my head around. I get tired more quickly.

Etcetera and etcetera.

So, it’s getting harder to justify the additional expense that a 3D movie costs in production and post production (a flawed white paper, from White Creek Productions, claims an increase of 18%, but fails to take into account the almost doubling of costs in the Digital Intermediate and VFX creation processes).  When COWBOYS & ALIENS investigated the additional costs, additional shooting and re-lensing time, and compared those costs to any added benefits in the storytelling they decided to shoot in 2D.

Now, I don’t want to add any noise to the pointless argument about whether 3D is a fad, or whether it is here to stay.  But I think that it’s fair to say that it’s worrying the hell out of the studios, which was just settling into the idea that they had the next new technology box office enticement, and one that was very difficult to pirate.

And then they got hit with the train that is box office reality.

Which gets me back to the news about China.

I’ve been to China several times.  The last time, in Beijing, I hung out for a few hours at one of the new facilities for posting stereoscopic films.  We chatted about all of the same things that I would chat about at a post facility here in Los Angeles.

In other words, they are just as forward tech savvy as we are here.  And they are doing some really cool things with 3D.  But they are expanding their 3D theaters rapidly — for major theatrical distribution as well as government and other uses. In fact, they’ve got more screens than they’ve got content.

Which is where the major studios come in.

We’d love to get deeper into the Chinese market, but they’ve got this pesky rule that they only take 20 non-Chinese films per year.  20 for the whole world.  That doesn’t leave much room for Mission Impossible, Transformers, Star Wars, and all of those pesky European films that most citizens of the world like to see. And China definitely would like to see their own industry expand.  That isn’t going to happen if Mission Impossible, Transformers, Star Wars, and all of those pesky European films that most citizens of the world like to see, are clogging up the cinemas.

So, they’re sticking to the 20 film limit.

Now, American movie companies have started to expand into the Chinese market by creating co-productions with Chinese companies.  Those films become Chinese films, and don’t fall under the 20 film rule. But American companies can only take 13% of the box office receipts out of China.

That’s a problem too.

So, the awesome news for American companies is that this new deal creates a separate category of films that are less prevalent in China right now — Imax and 3D films — and allows 14 more of them per year. Considering that most 3D films are from the major studios right now, this is a huge boon for them.  And, since the deal also raises the amount of money that the studios can take out of the country to 25%, there is now a huge incentive for American companies to create 3D films.

Only 3D films.

Considering that, according to that article in the New York Times, Chinese box office is now $2.1 billion and expected to more than double that by 2015, this is a great deal for the studios. 25% of a potential boxoffice of $300 or $400 million is $100 million dollars.  And they’ve got the territory sewn up. No pesky Weinstein Company films tripping over their release dates.

So the pressure to make a film in 3D just went up five-fold. If you’re looking at an additional $15 million to make a film in 3D, with an upside of $100 million, that’s pretty much a no brainer.  Take THAT Jon Favreau! Take that Chris Nolan!  We’re talking stereoscopic for your next films — at least if the studio that’s releasing them wants to get into the Chinese market. And, who doesn’t nowadays?

The New York Times says this is a boon for the makers of big budget sci-fi spectaculars.  They’re right, of course (can’t wait to see Baz Luhrman’s GREAT GATSBY in 3D, though.  No wait, I’m lying about that.), but the biggest winners in this are the major studios making those big budget spectaculars.  The mid-level and indie filmmakers are going to have to cede the Chinese market for now.

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2 responses to “3D Finally Catches A Break”

21 02 2012
Sex Mahoney (03:53:18) :

Hasn’t the international market been driving the increase in big budget productions for decades? I remember reading a William Goldman article over a decade ago where he argued that narrative nuance, intelligence, and creativity was being steamrolled by studios interested in appealing to non-English speaking audiences. To be fair, this was before he adapted Dreamcatcher.

21 02 2012
Norman (04:19:02) :

Yes, it has. About six or seven years ago, the ratio of foreign to domestic box office tipped in favor of the former.

But the important point here is not that studios want foreign coin, but that the foreign country (in this case, China) is making it easier for studios to get that coin, and harder for companies releasing smaller films.

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