IMAX to open 75 theatres in China
IMAX Corp. announced plans Thursday to open 75 more theatres in China within four years in partnership with Wanda Cinemas, the country's largest theatre operator, underscoring the Chinese movie industry's rapid expansion.
IMAX, known for its large format film technology, has 45 theatres open in greater China. Based on the industry's fast growth, it expects to have 300 theatres operating in the country by 2016, which could involve partnerships with operators other than Wanda.
There was no disclosure of the monetary value of the expansion plans and profit-sharing deal signed in Beijing.
CEO Richard Gelfond said China is the company's fastest growing market, and the deal means Wanda will be the single largest operator of IMAX theatres outside the United States.
"Last year, we experienced record growth at IMAX ... Nowhere was our growth more evident than in China," said Gelfond, who added the company's 2010 box office revenues in China were 286 million yuan ($44 million), a 10-fold jump from the previous year.
Part of that stemmed from the conversion of Aftershock, a Chinese movie about the 1976 Tangshan quake, into IMAX format. That epic became China's highest-grossing movie.
Gelfond said the company plans to do conversions of two upcoming movies, the patriotic "Founding of a Party," and Hong Kong director John Woo's Flying Tigers.
China's fledgling movie industry remains relatively small compared to more developed markets like the United States. The North American box office totalled $10.6 billion in 2009, according to the Motion Picture Association of America.
However, expansion plans are rapidly under way. China's Film Bureau said in a recent report that the country added 313 movie theatres and 1,533 new screens last year, for a total of just over 6,200 screens. The Chinese government has said it expects 20,000 screens in operation by 2015.
Wang Jianlin, chairman of the Wanda Group, said the partnership "will prove to be significant for China's general movie industry.
"Today's strategic co-operation between our two companies is very important. With Wanda providing the facilities and IMAX providing the technology ... more and more of the Chinese public will get the opportunity to experience this."
China's emerging middle class is showing a newfound enthusiasm for cinema. Last year's blockbuster 3-D epic "Avatar," which also played on IMAX screens in China, drew enormous crowds willing to wait up to six hours in line for relatively pricey tickets.
Hollywood's ability to make inroads in the Chinese market comes in spite of a quota system. The Chinese government shares revenue for only 20 foreign movie imports a year — a formula that effectively limits the country to 20 foreign films per year.
Gelfond said the current limitations on foreign movies are unlikely to pose a problem since the movies usually screened by IMAX are Hollywood blockbusters that typically have no problem being allowed into China. In addition, the company intends to convert more Chinese films into IMAX format, he said.
In the long run, Gelfond said he is optimistic that China will allow more foreign films into the marketplace.
"As the cinema industry grows in China, and there's more screens and investment going on, my own personal belief is that more foreign films will be allowed into China, not only from the U.S. but elsewhere."