Huayu: Starting from joining the mainstream entertainment industry in 96

Chapter 418, Section 416: Open Scheme

May 1, 2002, Wednesday, International Workers' Day.

For ordinary people, this marks the beginning of a seven-day Golden Week holiday, a time for visiting relatives and friends, and traveling to relax.

However, for the Chinese film industry, this day was an unprecedented test and milestone.

The long-planned and forcefully implemented reform of the cinema chain system underwent its first nationwide "real-world test" on this day.

Thirty-one cinema chains, formed by the reorganization or alliance of existing film companies and screening units at various levels, with a total of 2672 effective screens, completed the connection and debugging of computer ticketing systems in most of them on this day. Like a carefully woven giant net, they covered a vast territory from core cities to economically strong provinces.

early morning.

The core business districts of major cities across the country, including Beijing, Shanghai, Guangzhou, Shenzhen, Chengdu, Hangzhou, Nanjing, Xi'an, and Shenyang.

At the entrances of modern multiplex cinemas such as "China Film Grand Cinema" and "Shanghai United Cinema," which have recently undergone upgrades or are entirely new, eye-catching banners have already been hung.

The electronic display screen scrolled the words "Celebrating the full implementation of the cinema chain system reform" and "Grand opening of the May Day Golden Week".

The air was filled with a mixture of anticipation, curiosity, and a little trepidation.

Unsurprisingly, the market's focus has been on the two films, which are very different in style but both carry special significance.

One is "The Lord of the Rings: The Fellowship of the Ring," a fantasy epic produced by New Line Cinema and directed by Peter Jackson, which has grossed nearly $8 million worldwide and won multiple Academy Awards.

As the first imported blockbuster to hit theaters nationwide during the Golden Week holiday after the reform of the cinema system, it symbolizes China's determination and attitude to open up the film market to the outside world. Its stunning audiovisual effects have been promoted as "the ultimate spectacle that can only be experienced in theaters".

On the other hand, there are works by directors under Shengying Media, including genre films directed by emerging directors such as Wu Yiyi and Zhang Yang.

These films represent the exploration of commercialization by local genre films, and also reflect Shengying Media's commitment to content diversity while supporting the construction of a large cinema chain.

The film schedule clearly reflects the market's expectations for different films.

Thanks to its global reputation and its status as the first revenue-sharing blockbuster, The Lord of the Rings: The Fellowship of the Ring achieved an overwhelming average screening rate of over 50% in theaters nationwide.

The giant poster, featuring Frodo holding the thorns and gazing at Mordor, together with the three-dimensional Middle-earth promotional standees inside the theater, creates an undeniable "blockbuster" aura.

However, a real problem poured cold water on this seemingly hot market expectation—ticket prices.

Based on negotiations between China Film Group and the distributor, and taking into account the investment in cinema hardware and operating costs, the ticket price for "The Lord of the Rings" was set at a level that ordinary wage earners would have to consider: 35 yuan for a regular screening, and as high as 60 yuan or even 100 yuan for some "special effects" screenings with upgraded sound systems and screens.

In contrast, domestic film tickets are much more affordable, generally costing around 15 yuan.

This price difference of more than double was a significant threshold in the Chinese consumer market in 2002.

35 yuan is equivalent to one to one and a half percent of the monthly income of many ordinary workers, enough for a family of three to have a meal at a decent restaurant.

For the vast number of potential viewers who are used to pirated VCDs costing only 5-8 yuan or even less, going to the cinema to watch a movie with a "known plot" requires sufficient reason and impulse.

Another, more deadly shadow is the already ubiquitous piracy.

Despite the significant efforts made by China Film Group and Shengyi Film Group in combating piracy of *The Lord of the Rings: The Fellowship of the Ring*, a major film released globally simultaneously (relatively), including multiple crackdowns by cultural enforcement agencies at the source and distribution channels, ensuring that pirated discs of acceptable quality were unlikely to appear on the market during its opening week and for an extended period, pirates had already completed the entire process of copying, pressing, and distributing copies of older films such as *Rush Hour 2* and *Tomb Raider*, which were released overseas as early as 2001 and only recently officially imported.

Pirated VCDs/DVDs of these films flooded various audio-visual stores and mobile stalls at an astonishing speed and at a low price (usually 5-10 yuan).

A widely circulated, somewhat bittersweet anecdote within the industry is that when "Rush Hour" was a box office hit in North America, New Line Cinema ambitiously sent specialists to China to cooperate with local authorities in a large-scale anti-piracy operation, hoping to preserve a portion of the market when the film was officially imported.

But when they witnessed firsthand the mountains of pirated Rush Hour 2 DVDs seized from a logistics hub in the south, the number of which was measured in "tens of millions," the blond, blue-eyed commissioner was stunned. After a long while, he murmured, "My God... This is not a market, this is an ocean."

Ultimately, this destruction operation, which was more symbolic than effective, came to a hasty end, and New Line Cinema completely abandoned its illusions of recouping costs in the Chinese market in the short term through traditional film distribution.

Since China's accession to the WTO, the pressure from international copyright holders has been increasing day by day.

The Motion Picture Association of America (MPAA) and its member companies have been unusually active in their offices in Beijing and Shanghai. They frequently visit the State Administration of Radio, Film and Television, the Ministry of Culture, the National Copyright Administration, and other relevant authorities, submitting lengthy infringement reports and holding various anti-piracy seminars and technology demonstrations, attempting to elevate the fight against piracy to an international level of "fulfilling WTO commitments and improving the investment environment."

These efforts were not entirely ineffective.

At least on the surface, major cities have intensified their crackdown on street vendors selling pirated CDs, and pirate stalls in some large audio-visual markets have become more discreet.

For new films currently in theaters, the fact that law enforcement agencies have been able to achieve "no large-scale piracy during the first week" is already a remarkable improvement.

However, the deeper problem is that the piracy industry chain is already deeply rooted in huge demand and complex local interests, and cannot be eradicated by a few meetings and a few campaign-style law enforcement actions.

For the average consumer, the choice between spending 5 yuan to watch all the world's blockbusters at home (with perhaps slightly lower picture quality but complete content) and spending 35 yuan to experience more than two hours of audiovisual spectacle in a movie theater is still clearly distinct, with the former being a more attractive option.

Combating piracy is a long and arduous journey.

The actual data was quickly fed back to the data centers of major cinema chains.

At 10 PM on May 1st, preliminary statistics on the first day's box office were compiled.

With its high screening share, "The Lord of the Rings: The Fellowship of the Ring" grossed 480 million yuan on its opening day, unsurprisingly taking the top spot at the box office.

This number would be impressive on any other day, but on the first day of the Golden Week holiday, which was filled with high hopes, it seemed like "much ado about nothing" given the massive number of 2672 screens across the country.

A closer look at the data reveals that its average occupancy rate is only around 35%, far from the expected full house.

The high ticket prices and widespread piracy of backstory materials acted like two invisible hands, hindering its box office performance.

In contrast, domestic genre films, whose screening rate hovered around 20%, unexpectedly became a minor surprise hit.

The box office on its opening day was 255 million yuan, and its occupancy rate surprisingly reached an astonishing 70%!

The affordable ticket price of 15 yuan attracted many viewers who were just there for the spectacle to enter the theater without hesitation.

This is a conspiracy.

Wang Sheng is promising future market returns; what does that have to do with the present?

(End of this chapter)