How to thumka the Dragon

China seems unable to resist Bollywood movies of triumph against all odds. Billions of rupees in ticket collections is proof

Say Mishu to the average Chinese movie watcher and chances are you will get a broad smile. Over the past four years, that is how they have come to address actor Aamir Khan. While he continues to remain among the most bankable stars in Bollywood, Aamir is no stranger to China. Starting with 3 Idiots and later with PK and Dangal, he has endeared himself to the audience there and they can’t seem to get enough of him.

Mishu incidentally is a combination of ‘Mi’, short for ‘Aamir’, and ‘shu’, a shortened version of ‘shu-hu’ or uncle in Chinese. From late 2011, when the 3 Idiots team led by Rajkumar Hirani and Vidhu Vinod Chopra tasted blood in China, there has been no stopping the Bollywood juggernaut here. Of the Rs.30 billion that it earned overseas in 2018, Rs.18 billion (or 60%) came only from China. The biggest hit in 2018 was Secret Superstar followed by Bajrangi Bhaijaan. 

It is a market as large as India, in terms of population, but is less heterogeneous. With a large share of it being youngsters, there is an insatiable appetite for high-quality entertainment. A few filmmakers have understood this and smartly profited from it; but only a few. Just three Hindi films were released between 2016 and 2017 and 10 were screened last year. Those who took the bet raked in money. For example, box-office collections for Hindi Medium, Secret Superstar and Dangal in China were well in excess of their domestic income (see: Smart moves).

India may have its differences with China, but there is no dispute whatsoever in the Bollywood story.

Getting It Right

Serendipity and the Bollywood story in China have been inseparable. When 3 Idiots was released in India in 2009, it was declared the biggest hit of the year and remained so for a couple of years after. While the cast and crew were revelling in its success, what went unnoticed was Hong Kong-based producer and distributor Edko Films’ decision to acquire the distribution rights for Hong Kong and China. Till then, Hindi cinema’s largest markets outside home were the UK and US, with their significant Asian population. 

Edko is a prominent name in Southeast Asia and, in its 60 year existence, has released films such as Brokeback Mountain and Lust, Caution, a period drama film. The rights for 3 Idiots went for an estimated $100,000 or Rs.4.6 million then. The release was a full two years after it hit the theatres in India. Quietly, the film, dubbed in Chinese, grossed $1.5 million in Hong Kong and $2 million in China. Not huge numbers but enough for the folks in Bollywood to sit up and take notice. 

News had already trickled in that a large part of the success that 3 Idiots had seen was on account of China’s students being overworked in a brutal education system, no different from India. Siddharth Roy Kapur, founder of Roy Kapur Films and former managing director of The Walt Disney Company India, says PK with a theme of God and godmen struck the right chord in China too, a country where blind faith is a well-established norm. With a theme running high on human emotions and women at the centre of it, again a key resonating factor in the country, it hit the jackpot at the box office after its mid-2015 release — PK made over Rs.1.30 billion. In India, released in December 2014, it had made Rs.3.40 billion.

There was also strategy at play. Disney got Wang Baoqiang, China’s superstar, to dub Aamir’s voice for the film. “Having a China-specific approach is essential and though Aamir was already a star there, using the local talent for dubbing worked out really well,” says Kapur.

It was a success and it was as though a dam burst. Many producers began flooding the market with movies and, not surprisingly, some burnt their fingers too. What worked in India need not guarantee success in the new market. Bahubali – The Beginning, a blockbuster in India was released in China in 2016, a year after its India release, and grossed only $1 million (Rs.70 million) compared to over Rs.5 billion just in India. Even its sequel, which made its way to the theatres last year, made $10 million (Rs.650 million), while domestically it made over Rs.10 billion.

According to Kapur, there is no dearth of big epics made into films in China and that genre, therefore, is unlikely to make the cut. The Great Wall and The Monkey King are some instances. Besides, the appetite for action is more than satisfied by what Hollywood dishes out. “You have a winner if your story has a human touch,” he says. 

Nothing though prepared Disney for the success they saw with Dangal. On a domestic box office collection of Rs.5 billion, it grossed Rs.13 billion in China. That was in May 2017, five months after India. At the end of its run, it made more money than Black Panther, an American superhero film which made $105 million or Rs.7 billion approximately. 

Women in sports is a big story in China, with the country always be-ing a star performer at the Olympics. Unfortunately, the success of women sportspersons tends to get overshadowed by that of the men. Dangal dwelt on that and, therefore, its success was not entirely unexpected, according to Kapur. “Mak-ing more than 10x PK was, however, not a part of our plan.”

Another story that would find resonance — of a woman struggling to speak English, the Sridevi-starrer English Vinglish — is set to be released in China by Eros International. The production house is also repositioning its hits to find a common ground — Bajirao Mastani will be promoted as a love story, rather than an Indian epic. Kumar Ahuja, president (business development), Eros International, thinks nothing can undermine the importance of the right content (in China it is more about content that is relevant) and that’s really the difference between success and failure. 

“You just have to go with content that has universal appeal,” says Bhushan Kumar, chairman of T-Series. “You will get into trouble when you move away from that”. Their production, Hindi Medium, around the effort of a couple to give their daughter the best education, did business worth Rs.2.7 billion in China last year. In India, it had made Rs.680 million. The Chinese market also gives a better reach: “We released it in 8,000 screens, when one rarely gets more than 500 in the US or UK,” he says. Even Hollywood films have hauled in money thanks to this — Transformers: Age of Extinction, a 2014 release, made $320 million in China whereas it made only $245 million in the US.

China’s infrastructure works to its advantage. Much as India holds a place of pride for producing the most number of films each year (almost 1,800 in 2018), its 9,600 screens pale in comparison to the 55,000+ that China has. Interestingly, this is in a country where the film story started only at the turn of the century. Till then, regulations did not allow for more than 20 foreign films to be released each year. 

Content and storylines aside, the Chinese market is not immune to star dust. Dangal increased Aamir’s equity in China and that generated a surprise hit. A year after it was released came the Secret Superstar, in which he played a cameo. The relatively small production made Rs.7.65 billion in 2018; it was the biggest hit of the year! Secret Superstar’s worldwide distribution rights were sold to Zee Studios. Shariq Patel, CEO, Zee Studios, chuckles about the film having made only Rs.650 million in India. “Our association with Aamir obviously helped,” he says. “In other parts of the world, it has been difficult to get a non-Indian diaspora to watch a Hindi film. That is not the case in China,” he points out. 

All of this adds to a fantastic opportunity, but the challenge is the quota system in China, which allows only for that many films to be released each year — there is no official number but the approval process gets delayed leaving producers to bide their time. It pays to work with a local partner, who can expedite the process.

The Many Slices

There is red tape to be dealt with and splitting of profits, which makes it difficult to get it right with the financials. Of the total box-office collection, 25% goes to the government by way of tax and an equal proportion to the state-owned China Film Group Corporation. The remaining 50% is meant to be equally split between the distributor and exhibitor, though that is not always the case. Compare this to India, where no more than 12% gets deducted as GST for tickets up to Rs.100 and 18% beyond that. The rest gets divided between the producer, distributor and exhibitor. The producer sells the rights to the distributor, who then splits the theatre collection with the exhibitor: first week 50:50, next week 40:60 and the third week 30:70. 

Ajit Andhare, chief operating officer of Viacom18 Motion Pictures, is not deterred by the relatively small share in revenue in China. The distributor there gets 25% of the proceeds, half of which is given to the Indian counterpart. Andhare, who is hoping to release Drishyam and Padmaavat in the dragon country, says the slice of the cake is huge and that’s what matters. “The approach is to grow the market and we have seen how it has moved from 3 Idiots to Dangal,” he insists. Patel speaks of the opportunity in having a co-production approach, something his company is seriously considering. Besides, the partner, by having his skin in the game, will gain from pushing for the release of the film.

For now, no producer outside China is allowed to release the film on his own; the distribution rights are bought for a licence fee (rights for an average Hindi film is sold for around $0.5 million) from an Indian producer, who also later gets his share of the profits. The distributor in China would have the necessary clout in the local market, when it comes to getting screens or with the promotion of the film. Of the 50-odd film distributors in China, six or seven control the market.

Marketing a film in China is as expensive as it is in India, says Ahuja. It will set you back by $2.5 to $4 million depending on how big the movie is. Last March, his company distributed Bajrangi Bhaijaan in China. The Salman Khan-starrer made Rs.3 billion there (compared to Rs.3.2 billion in India) and catapulted the young girl Harshaali Malhotra to overnight stardom. If Salman promoted the film in India, it was Malhotra all the way in China, with the star not turning up at all. The promotional campaign ran for 20 to 25 days across mediums. “We released the film across 2,500 screens during the first three days and then increased it to 6,000,” says Ahuja. 

Vivek Krishnani, managing director of Sony Pictures Entertainment India, says, “Marketing and distribution costs are high in China due to the latitude of the country and that makes it necessary to choose the right content and partner for the market.” His company has had two releases so far – Padman and 102 Not Out (said to have made $10 million and $4 million respectively).

Brave New World

While a film’s success is helped by its theme touching the right chord in China, Indian producers are now pushing the envelope. Take Andhadhun, a thriller, which Andhare calls a “genre breaker.” The decision to release it was aided by the success of The Invisible Guest, again in the same genre. The film made $26 million and was recently released in Hindi as Badla. According to him, Andhadhun in China will initially release in 5,000 screens. “In India, even the biggest release will be at best across 3,000 screens.”

Krishnani believes in being selective about the content released in this new market, rather than inundating it with everything. “The latter will create fatigue and, if content is not good, we would only be turning the audience away,” he says. 

Zee’s Patel says, “The focus for the moment is to make a good film. If that is done, business will follow as a natural consequence.” History has shown it can be done.