The Chinese Film Market Magazine - Local Films: Annual Report 2013

Local Films: Annual Report 2013

Jan 26, 2026 CFM Spotlight 3

Even more bank loans, private equity and hot money enthusiastically flooded into the prospering Chinese film business in 2013. After the success of low budget films like Lost on Journey (Wai Man Yip, 2010), Love is Not Blind (Hua-Tao Teng, 2011) and Lost in Thailand (Xu Zheng, 2012), a certain delusion emerged that high returns can be expected from low cost pictures.

Despite the explosion of local films, one thing stayed the same in 2013: over 80% films did not make money. As insiders would say, many make a living by making films, but few can make profits. The Chinese film market is still rather immature and the toughest challenge the investors need to face is to assess the risk and profitability of a film project.

The niche market of horror films

Among top 10 local films with the highest input- output ratio, Mysterious Face is one of a kind: a $0.5 million investment, casting no film star or celebrity, ranks the 8th on this list with a profit margin of 684%, significantly exceeding that of American Dreams in China, although it had to face the direct competition with Colombiana and Man of Steel around mid-June.

The fact of this modest investment winning a huge profit is, somehow, not a surprise: there are not enough horror films to satisfy Chinese audience’s hunger for this genre. Meanwhile, Mysterious Face’s success is based on the rich experience of its director Zhao Xiaoxi, its production company Beijing Tongren Shidai Media and distributor Fujian Hengye Film Distribution in horror films.

Nevertheless, such a success can hardly be copied as Chinese horror films has its genetic deficiency. First of all, local horror film fans can only make do with those made in China because it is almost impossible to import foreign horror films. This can easily lead to a certain fatigue at some point.

Also, given this stable group of hungry audience, many filmmakers put too much focus on cost control and profit making so local horror films can sometimes be a real eyesore.

Although some intend to explore this niche market’s potential and build a brand, a lack of hands-on experience results in a disaster. For example, Redemption had a budget of $4.14 million but spent most of this amount in casting big stars like Liu Ye instead of investing in the script and special effects: it lost at least 2.5 million dollars.

Audiences curse such horror films yet have no better option but to buy tickets when the next local horror film hit the cinema. Good news for this loyal crowd is: China and South Korea are about to sign a film and television co-production pact in 2014 and local audience no longer need to consume a stream of horrible screams.

Bunshinsaba 2, a record-breaking horror film realized by rising Chinese investors and experienced Korean filmmakers, thrived upon a smart script and elaborate production. With a mere investment of $3.3 million, it raked in $13.3 million. With positive word-of-mouth, it has managed to establish China’s first horror film franchise. Its sequel, Bunshinsaba 3, will be released this July.

Director Byeong-ki Ahn’s adept execution is a perfect demonstration to his Chinese counterparts on Korean filmmakers’ strength in making genre films. Horror films aside, local romance and action films will also be challenged, once the China-South Korea co-production agreement is signed.

Costume dramas: despreately seeking new grand masters

Among the top 10 most profitable films in 2013, there is only one costume drama Journey to the West: Conquering the Demons. The rest are five romance films, two comedies and a local western film directed by Ning Hao who is best-known for his dark comedies. Among the 10 least profitable ones, six are costume dramas, with four action films: one fantasy, one romance, one modern story and one 3D disaster film.

While contemporary rom-coms are low-budget films (like the B.O. miracle Tiny Times, whose employment of new pop idols was half the battle), costume dramas featuring fantasy, action or disaster cost a fortune: costumes, make-up, special effects and settings all require a huge amount. However, investors are not reluctant to invest as these genres have solid local fan base.

The thing is, as the number of co-production goes up, the Chinese mainland audience can appreciate breathtaking special effects and blockbusters in various ways. Hollywood high-tech satisfies their longing for visual wonders and no such local big productions can distract them from Iron Man 3, Pacific Rim and Fast & Furious 6.

The best-developed film genre in China is martial arts (costume) films: from those made by Shaw Brothers in 1960s and 1970s to the new era of martial arts films led by Tsui Hark, such films display a universe of history, martial arts, love and special effects.

But this genre has been overused in recent years. After Crouching Tiger, Hidden Dragon‘s Oscar triumph, directors in mainland China and Hong Kong started to believe “what is national goes global”, so they exploit “the quintessence of the Chinese culture”. Nevertheless, such attempts made by directors like Zhang Yimou, Chen Kaige, Feng Xiaogang and John Woo somewhat failed at home one by one, and local audiences are not so excited about this genre as they used to be. The current shortage of new martial arts actors makes the situation even worse.

There are two exceptions, though.

Besides the Oscar nomination, Wong Kar-wai’s unconventional The Grandmaster became his most profitable film ever. This film also stands out as one of the most grounded martial arts films because Wong assiduously visited hermit kung fu masters all over China and one of his screenwriters Xu Haofeng is a grand master of the Chinese cultural heritage himself.

Tsui Hark’s magical fantasy Young Detective Dee: Rise of the Sea Dragon gained millions of profits in China though film critics expressed general disappointment. This detective franchise has also managed overseas distribution in countries like France, India, Russia and Korea. Tsui is now preparing to make the third film in this series.

Costume dramas and action films are supposed to be Chinese filmmakers’ competitive edge, but the younger directors’ collective defeat in 2013 is hardly acceptable. They tried too hard to please the audience but made few efforts to build a convincing universe.

Hong Kong and Taiwan filmmakers’ mainland expedition

Films made by commercial film directors like Hung Yan-yan, Herman Yau, Ronny Yu, Danny Pang and Oxide Pang brothers failed to make money in 2013.

Johnnie To’s highly acclaimed Drug War was equally robust at the box office. American Dreams in China was so popular in the mainland that its director Peter Chan becomes the perfect example when investors are referring to Hong Kong directors who have moved northward. The story of several aspiring young men’s friendship and entrepreneurship which later becomes bitter hostility is regarded as a local Social Network, but many a film goer could not believe it was made by the same director who created Comrades, Almost A Love Story and Perhaps Love.

Still, it is undeniable that Hong Kong TV dramas and Cantonese songs are on a decline in the mainland market. Cantonese style films and veteran Hong Kong stars are less attractive to a younger gen of audience. overwhelmed by Taiwanese idol dramas, Japanese and Korean pop songs, this film market, is in need of Hong Kong and Taiwan director : not their fame nor their style, but their absolute expertise and abundant filmmaking experience – especially in making big budget films or genre films.

New directors hoorayed in 2013 are mostly blessed by the audience’s nostalgic propensity. Among the most profitable modest budget films, the two Tiny Times films are tailored for those born after 1985 or even 1990; So Young is aiming at the 1980s generation while American Dreams in China the 1970s gen; Fake Fiction’s highlight of its protagonist Xu Zheng benefits from the success of Lost on Journey in 2010; Journey to the West: Conquering the Demons is sternly marked by local audience as the sequel of A Chinese Odyssey (Jeffrey Lau, 1995).

Nostalgia is the keyword on Chinese screens in 2013.

Four of the top 10 most profitable films (two Tiny Times, Fake Fiction and Mysterious Face scored less than 5.5 on China’s Rotten Tomatoes. When people put more focus on marketing but not production, films like Tiny Times and Personal Tailor thrived upon bottom-up marketing. Such a short-sighted behavior is like the Sword of Damocles over the Chinese film industry.

XU HAOFENG SAID IN AN INTERVIEW:

“IF LOCAL FILMMAKERS COPY HOLLYWOOD’S TECHNOLOGY AND SPECIAL EFFECTS BUT NEGLECT CHINA’S OWN TRADITIONS, SPIRITS AND VALUES,THEIR FILMS CAN LOOK LIKE AN ABSURD FARCE.”

XU IS A FILMMAKER AND HIS PREVIOUS TWO FILMS HAVE CROWNED HIM A NEW FORCE IN THE MARTIAL ARTS FILM ARENA.

Due to the annual quota, excellent low-budget rom-coms have never been imported in the past two decades, which partially explains the preeminent victory of Finding Mr. Right. The starry-eyed China and South Korea co-production A Wedding Invitation’s harvest of $33.1 million also reminds investors that low budget romance is a much-needed genre in China. Just think about the ongoing heated debate on Shengnv (a pejorative term to describe women who remain unmarried in their late twenties and beyond) and China’s growing gender imbalance.

The audience probably won’t buy another round of nostalgia in 2014. With little directing talent, shrewd writer Guo Jingming and professional actress Zhao Wei can hardly lead young filmmakers to rejuvenate Chinese films. But writer and racing driver Han Han’s recent announcement to make a road movie sounds a bit more than a new year’s resolution.

box office, local film, market share

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