China adds cinemas to the ever-growing list of metrics that show it has overtaken the US
An aggressive build out has put the mainland ahead of the US in terms of cinema screens just as box office sales in China show signs of contraction for the first time in a decade
China is poised to overtake the US as home to the world’s biggest number of cinema screens, boosted by unprecedented theatre building spree, according to a recent study.
There are on average 27 cinema screening rooms completed each day across China this year, compared to 22 last year, according to a report by London-based market researcher IHS Markit.
Meanwhile, the country’s movie market growth took a sudden hit this year with a significant slowdown -- easing from a staggering 48 per cent expansion in ticket sales in 2015 to a muted 4.7 per cent for the first 10 months of this year, figures from industry consultancy Entgroup showed.
Propelled by a five-year movie market boom that helped China’s box office takings swell at an average annual rate of 34 per cent over the last a few years, Chinese conglomerates led by Dalian Wanda Group have stepped up their cinema building spree.
The property-to-entertainment business empire controlled by China’s richest man Wang Jianlin now runs the biggest theatre exhibitor chain in Asia, and is on track to become the world’s largest after its US subsidiary AMC Entertainment’s takeover of European cinema giant Odeon & UCI Cinemas.
By the end of September, China has 39,194 cinema screens, according to September data, up from 6,000 in 2011.
According to the SCMP calculations, China has added a further 1,269 cinemas since September, bringing its cinema count to 40,463, putting it on track to overtake the estimated 40,475 screens in the US in the next 24 hours.
“The rate that China has been building cinema screens is very high,”said David Hancock, director of film and cinema analysis at IHS Technology. “In the first nine months of this year, China added just over 7,500 new cinema screens, continuing a trend seen over the past few years. China has been building cinema screens at a rate of over 10 a day for the past five years, rising to 27 a day this year.”
China’s film authorities recently loosened its grip on the number of foreign titles allowed for releases in China for the rest of the year, fuelling speculation that it attempted to count on Hollywood to lure back movie goers and prop up the sluggish box office market.
Analysts have scaled down their projections for the cinema industry this year amid an unexpected downturn in box office sales, including a 15 per cent drop in ticket sales during a national week-long holiday in October, reflecting the first decline in more than a decade. The drop in ticket sales was partly attributed to a lack of popular films on offer. As a result, shares of mainland-listed studios such as Wanda Cinema Line and Huayi Brothers Media were knocked lower. Wanda Cinema Line’s Shenzhen-listed shares have tumbled 35 per cent so far this year.
Meanwhile, the country’s film titans have sought to reassure investors that the relatively low penetration of movie-going activity in China still spells huge growth potential, as they scrambled to snap up cinema assets in China and team up with studios in Hollywood.
Last last month, Emperor Group, Hong Kong media magnate Albert Yeung Sau-shing’s entertainment group, said it will open more cinemas in two of China’s most heavily populated metropolitan areas of Chongqing and Chengdu.
In his latest public appearance in Hollywood, Wanda’s Wang predicted the country’s movie market will grow at an annual rate of 15 per cent over the coming decade.
“Based on this projection,” he said, “by 2026 China’s box office will reach US$30 billion, accounting for 40-50 per cent of the global market share.”