HAS ZHANG YUAN gone soft? The Sixth Generation mainland director was once the scourge of China's censorious Film Bureau. Hard-hitting underground films such as the gritty Beijing Bastards and the gay-themed East Palace, West Palace upset the authorities so much they banned anyone from working with him. Two of Zhang's recent films, however, not only received an official thumbs-up, but were box office hits in China. Why is the one-time enfant terrible of Chinese films now making commercial movies? Ten years ago, a director would probably have said the change was due to the intricacies of Chinese film-industry politics. But times have changed. Zhang says his new direction has been forced on him by the free market. Legally distributed American blockbusters are proving so popular in China that they're destroying the local film industry, he says. The only way to fight back is to put any notions of artistic creation aside and make commercial films that will entice viewers back to the cinemas to watch Chinese movies. 'Right now, Chinese filmmakers are in a miserable situation,' he says. 'The Chinese film industry is under enormous pressure. If we don't come up with a way to get Chinese audiences back into cinemas to watch Chinese films, the local film industry is going to collapse.' Zhang, who is normally cheerful, seems depressed by the prospects. Three things are getting him down. 'First, there is a lot of pressure on us from American films, as they now dominate the Chinese film market,' he says. 'Then, there are the problems caused by the enormous amount of pirated copies in circulation. The government isn't really doing all that it should to combat the pirates. Thirdly, there's the complicated system of getting films approved. Even though they made changes at the start of the year, it's still a complex system, and it doesn't make it any easier for us to produce films.' Zhang has never been much of a supporter of the domestic film industry, although his prison drama, Seventeen Years, was an official project. But he's savvy enough to realise that, once the audiences desert local films, it will be difficult to win them back. Zhang says he's worried that once audiences get a taste for what he calls the noise and nonsense of US blockbusters, they'll quietly lose interest in anything else. This was the reason behind his Fatal Attraction-style drama, I Love You, and his thriller, Green Tea. 'I think that my last two films have made my attitude to the problems very clear,' he says. 'I Love You did very well at the box office in China, and held second place in the year-end release chart. It was a low budget film, but I was pleased with it, and it did well. The box office for Green Tea was also very good. I'm certainly trying to bring back domestic audiences to Chinese cinema.' In the US, the distinction between art and commerce has become muddled. But Zhang is clear about the crossover: there isn't any. 'I think there's absolutely no relationship between artistic films and commercial films,' he says. 'They are entirely different things. In fact, I think that they're opposites. If, as a film director, you want to improve the box office appeal of local films in China, it means that you have to put aside the ideals you have about filmmaking. You have to make what the market wants, not something you feel is artistically valid.' During the late 80s and 90s, Chinese filmmakers were stymied by censorship. They envied the freedom of overseas filmmakers. Now, they're freer to make what they want in China. But, as every American independent filmmaker knows, few investors want to put up the money for artistic projects. Zhang feels that he and his contemporaries misjudged the power of market forces. 'China is a bit like America as far as independent films are concerned,' he says. 'We're freer to make the films that we want to make. But Chinese producers will only give us money to make films that will make them money. So, we're freer in some ways, but not others. The old Marxist theories still hold true for both China and America, it seems.' What's more, the film culture that once inspired Chinese filmmakers has now become a foe, Zhang says. 'The relationship between Chinese intellectuals and American and European culture has become very ambiguous,' he says. 'When we looked at western culture 10 years ago, we thought it represented the spirit of freedom. It was the embodiment of freedom. It represented a freedom that we wanted. But that's all changed now. Today, American films and western culture are just a tremendous force coming straight towards us. We filmmakers have to protect ourselves from it - otherwise it will destroy us.' Even though Zhang admits his last two films were commercial, he says he learned something from making them. In the past, he often took a documentary, social-realist approach in his feature films. Now, he has become interested in pure fiction. 'Some viewers who liked my earlier films were very much against Green Tea,' he says. 'It's the complete opposite to anything I've done before. It's not about the real Beijing. It's more a reflection of a state of mind. I've always set out to capture reality in my films, but I never felt that I had succeeded in capturing real life. But now I'm using fiction, and I feel that I am finally able to show the world as I see it. It's a paradox.' Zhang's latest film, Jiang Jie, is an even more daring attempt to create a stylised world. It's a remake of a Cultural Revolution opera that adheres to the communist aesthetic, but uses modern techniques to give it a colourful and crisp look. One unexpected by-product of the free market is that it's broken down the distinctions between 'generations' of filmmakers. Commercial works by Chen Kaige, Zhang, and young directors such as Diao Yinan have a lot in common. Each has to conform to the logic of the box office. 'We used to all be very different,' says Zhang. 'We all used to face different problems, as the way we worked was so different.' He suddenly looks grim. 'Now, all filmmakers face the same problem. Chinese films are losing ground at the box office, and it's affecting us all. We're all walking down the same road. And at the end of that road lies death.'