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UPDATED: September 1, 2015 NO. 36 SEPTEMBER 3, 2015
The IP Boom
Given the recent clamorous success of big-screen adaptations, film producers are scrambling for the rights to adapt original work
By Tang Yuankai

A man walks past film posters at a cinema in Shenyang, Liaoning Province, on July 26. China's box office takings reached an all-time high that month, topping 1.31 billion yuan ($204 million) XINHUA

A zeal for adapting works from other mediums is sweeping China's film industry. An "IP film" refers to a film adapted from an original work protected by intellectual property (IP) rights. Film adaptations are nothing new in China. Previously, the majority of adaptations had their roots in masterpieces of classical literature, stage plays or older films.

With box office records being smashed by adaptations with alarming frequency, it seems Chinese filmmakers are trying to throw anything and everything toward the vortex of the big screen­­­—from best-selling novels and short stories to properties from rather less traditional realms such as jokes, animated shorts, toys, digital games and pop songs. Even dictionary entries and certain catchphrases are getting another potential day in the spotlight.

Box office success

The box office performance of recent film adaptations stands as testament to their market value. In April, The Left Ear, a movie adapted from an online novel that enjoys a huge Internet following grossed 200 million yuan ($31.2 million) in a mere three days. The film, produced with a modest budget of 60 million yuan ($9.36 million), has thus far fetched nearly 500 million yuan ($78 million).

Notably, several film adaptations were numbered among July's top 10 in ticket sales, including Monkey King: Hero is Back, which was adapted from Journey to the West, a well-known Chinese fantasy novel dating back to the 17th century. With a box office gross of 740 million yuan ($115 million) in the month, it is the highest-grossing animated movie ever in the Chinese market, eclipsing two other film adaptations released at around the same time, namely Tiny Times 4.0, which has its genesis in a series of popular novels, and Forever Young, which was based on a pop song. Tiny Times 4.0 earned more than 487 million yuan ($75.92 million) at the box office and Forever Young, more than 378 million yuan ($58.93 million).

Because film adaptations can yield quick returns, incomplete statistics show that scores of films and TV plays have been green-lit for shooting or release in the remainder of 2015 or into next year.

The box office success of homegrown films, in turn lent a hand by China's quota system for foreign movies, has been the primary force driving the recent boom in adaptations. It took only four years for China's box office earnings to nearly triple from 10 billion yuan ($1.56 billion) in 2010 to 29.64 billion yuan ($4.62 billion) in 2014. In the first half of this year, box office takings nationwide topped 10 billion yuan in only 94 days, 48 days earlier than last year.

Meanwhile, profit-hungry investors have swarmed film and TV production. Not ones to be left out, large Internet companies such as Baidu, Alibaba and Tencent, Letv and Youku have set up film and TV departments. Ten years ago, no more than 100 movie investors were in operation, whereas now, there exist more than 1,500, the majority of whom inhabit the private sphere.

Wooing creators

At present, the film industry is experiencing a shortage, not of investment, but rather of creative ideas. This is one of the reasons why film producers so frequently use adaptations as a recourse. During the Beijing International Film Festival in this April, many filmmakers mentioned the fierce race for adaptation rights.

Last November, the newly established Youzu Interactive Co. Ltd. captured public attention and was courted by investors owing to their success in securing the rights to adapt hit Chinese science-fiction novel The Three-Body Problem, the first in a trilogy. So far, more than 1 million copies of the trilogy have been sold. In 2014, an English-language translation of The Three-Body Problem was published in the United States, which won its author Liu Cixin the Hugo Award for Best Novel in August. Established in 1953, the Hugo Awards recognizes the best science-fiction and fantasy works published in English each year. Liu is the first Chinese writer to receive the honor.

Wang Zhonglei, President of Huayi Brothers Media Corp., a well-known private entertainment company in China, remarked that now adaptation rights for the top 100 most popular original works in China have been sold, but his company has of late optioned only a select few works.

Market tested

China's film producers compete with one another in a number of areas—ranging from jostling for box office takings to securing stars, famous directors, distribution channels and more recently, adaptation rights.

"To film companies, IP is the most valuable asset, just as what land is to property developers," said Zhang Zhiyuan, an expert in the area of online movies. He stressed that adaptation rights may even outstrip securing contracts with famous actors, actresses and directors in terms of priority.

"The biggest advantage of adapting established works is that it can lower investment risk," said Tong Zhilei, President of Chineseall.com, a Beijing-based digital publisher.

For example, according to Tong, top-ranking Internet novels are selected from a vast body of literature, as they have been given the stamp of approval by readers.

A book read by 1 million or even 10 million people must necessarily have commercial value, he said, adding that developing books into multimedia products can maximize the earning potential of creators' IP rights.

At present, large Internet portals compile various rankings of creative works. Industry experts say that the reliability of the rankings depends on the number of these portals' subscribed users, and rankings published on major platforms related to literary works indeed have reference value.

Filmmakers often select works of high commercial potential by looking directly to the numbers. The popularity of an original piece online can be computed from its respective click rate and search frequency. A work that is prospective for screen adaptation should have a sufficiently large fan base.

While the right to adapt an original work is a lucrative investment, it comes with an increasingly hefty price tag. Adaptation rights often cost in the region of millions of yuan. Moreover, no uniform standard exists to gauge the value of adaptation rights.

The cost of purchasing adaptation rights is now skyrocketing further. Compared with those charged when the first edition of The Three-Body Problem was published in 2006, prices for adaptation rights for science-fiction novels have grown more than tenfold.

"The key to success lies in the skills deployed in the adaptation process," said Zhang Yibai, a director with a proven track record of adapting original literary works into films. Creativity is also key to translating an original literary work onto the screen.

For Internet companies eyeing the lucrative film industry, adaptations offer a welcome shortcut. For a long time, the Internet has remained a viable channel for film distribution. Now, dissatisfied with serving only as distributors, such enterprises are eager to get into content production.

A little over three years ago, Tencent launched its online games, animation and literature platforms. In 2014, it set up a platform focusing on film adaptation.

Last year, Tencent's interactive entertainment business contributed more than half of the group's total revenue of 78.93 billion yuan ($12.31 billion), which exceeded China's total box office income of 29.64 billion yuan.

This April, in his remarks at the Beijing International Film Festival, Cheng Wu, Vice President of Tencent, said that Tencent, which is a relative newcomer to the film industry, aspires to develop what he called the "Internet plus film."

The essence of "Internet plus film" is still film, said Chen Yingjie, an executive in Tencent's department in charge of interactive film and copyright affairs. He added that in the meantime, Internet companies can engage users in interactive content creation while continuing to respect the rights of the creator.

Copyedited by Eric Daly

Comments to tangyuankai@bjreview.com

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