China’s box office is becoming a multimillion-dollar headache for Hollywood studios as US-China relations show no improvement

When Godzilla vs. Kong opened with weekend sales of nearly US$70 million in China in March, it seemed the market would be a bright spot for Hollywood studios: most theatres were open, while US film-goers were still staying home because of the coronavirus.

But 2021 is turning into a disappointment for movie companies in China, which passed the US last year to become the world’s largest film market. US films have grabbed about 15 per cent of the box office, on par with pandemic-impaired sales in 2020 and far less than the 32 per cent they claimed in 2019, according to data compiled by Bloomberg from the Chinese ticketing service Maoyan Entertainment.

Rather than becoming a lifeline for Hollywood, China is turning into another headache, made worse by local politics, the pandemic and the country’s complicated relationship with the US. President Xi Jinping’s efforts to emphasise Chinese nationalism and tamp down anything perceived as too Western or immoral will complicate matters for US studios, possibly for years.

“That is going to make it increasingly more difficult for Hollywood blockbusters to find interest in China and if they do gain entry to have the same box-office popularity that they have had in the past,” said Stephen Saltzman, a lawyer with a number of film clients in China.

Seventeen US films have been released in China this year, down from 30 last year and 52 in 2019, according to Maoyan’s data. Some of the top-grossing US releases of the year, including Walt Disney Co.’s Black Widow and Warner Brothers’ Space Jam, have yet to receive premiere dates. It’s a big loss. In 2019 China accounted for $629 million in revenue for Disney’s Avengers: Endgame.