Boxoffice-September.1997

INTERNATIONAL NEWS BRIEFS
PACIFIC OVERTURES
NOTES FROM THE PACIFIC RIM by Susan Lambert
LEAD STORY:
MAJORS INVESTIGATION ANNOUNCED AT INDIE'S CONFERENCE
SYDNEY— The National Association of Theater Owners (NATO) held an inaugural conference
June 17-18 for Australia's independent theatre owners in order to discuss issues specifically
appropriate to independents, particularly issues of film rental terms and better allocation of
distributors' publicity resources. Intended to augment the Australian Movie Convention, between 70
to 100 exhibitors reportedly attended the event, held in Bowral of southern New South Wales.
At the conference, the Australian Competition and Consumer Commission (ACCC). Australia's
antitrust watchdog, announced its investigation into the exhibition and distribution sectors of the film
industry. ACCC chairman Allan Asher said they were persuaded to investigate by the number of
complaints received. Main concerns are anti-competitive behavior by the major circuits—Hoyts,
Greater Union and Village Roadshow—and distributors—Village Roadshow Films (VRF, which
handles Warner Bros, and Disney releases). UIP (which handles Paramount, Universal and MOM
releases). Columbia TriStar and 20th Century Fox. Other concerns are the use of market strength to
create monopolization and barriers to new competitors, as well as collusion and consumer protection.
The ACCC also expressed concern that agency and joint-venture arrangements in film distribution
led to a manipulation of release dates to prevent opening-week competition among titles.
The common complain by the independents, many of whom feel they are being squeezed out of
the marketplace, is over inflexible film rental terms, unrealistic terms for second-run films and
minimum exhibition periods. Other complaints include a refusal by distributors to supply prints and
inconsistent treatment by distributors. The ACCC will seek to clarify if the complaints stem from
unlawful conduct on the companies' actions or a change in the economic structure of the industry.
Asher did note there was no real ticket pricing competition between the majors except when a major
was competing against an independent theatre and commented that when it is harder to enter into an
industry, it is easier for those in the market to behave in an anti-competitive way. He added, "If
sustainable, legitimate explanations are given, it's unlikely that a court will find them in breach of
the Trade Practices Act." The ACCC investigation is expected to take 10 weeks.
PIRATING PROTECTION
HONG KONG—Just before Hong Kong returned to Chinese
rule on midnight June 30th, the democratically elected legislature
hastily enacted copyright enforcement legislation, after a year of
lobbying by Hong Kong filmmakers for tougher criminal penalties
against pirateers and illegal importers of films, videos and music,
which are putting a big dent into the already ailing Hong Kong film
industry. Actor/filmmaker Jackie Chan led a protest march with
other Hong Kong film stars and directors to persuade the government
to push for harsher restrictions and better enforcement. The
new law makes it easier to investigate and prosecute copyright
infringement and calls for stricter penalties, ranging up to eight
years in prison and HK$500,000 (US$65,000) in fines. It remains
to be seen if the Chinese government, which this past year began a
crackdown on its own pirating problem, will abide by any of the
laws enacted by the previous government.
PHILIPPINES DEVELOP FILM BOARD
MANILA—Meanwhile, in the Philippines, industry leaders also
took their battle to the Senate, which drafted a bill for the creation
of a Film Development Board under the office of the President. The
board would be involved in boosting production of quality films
and increasing the strength of the local industry. Other functions
would include holding local and international film festivals, setting
up training programs and establishing various incentive programs
for quality Philippine films. The board would be comprised of the
heads of the Film Academy of the Philippines, Cultural Center of
the Philippines and Directors Guild of the Philippines along with
noted film director Carlos Signuon-Reyna.
CHINA'S FIRST
CINEMA CIRCUIT
BEUEMG—China Film,
the country's monopoly
film importer, has established
China's first national
cinema circuit,
comprising the top 300
cinemas in the country's
15 leading markets.
Called the Zhonghua
Theatres, the chain is
more an alliance than a
registered business and is
based on previous contractual
relationships between
China Film
Distribution and Exhibition
will be required to give the Chinese films at
Association and the
theatres over the release
of foreign blockbusters.
The circuit was formed
with the intention of providing
a guaranteed
forum for releasing domestic
product in conjunction
with foreign
films. The 300 theatres
will have first run of 12
"priority" Chinese films
and 10 Hollywood films
each year, and the theatres
least a seven-day
booking. The film that launched the Zhonghua alliance in June is
"The Opium War." A historical epic by director Xie Jin, "The
Opium War" is said to be the biggest-budgeted film in China's
history at 100 million yuan ($12.5 million) and is being jointly
distributed, in a profit-sharing distribution arrangement, by China
Film and the film's producer, Sichauam "Opium War" Film and
TV Production Corp. Ltd. In order to join the Zhonghua chain,
theatres had to meet an annual boxoffice total: In large cities,
theatres must have at least 1 million yuan ($125,000) in annual
revenue, and medium-size city theatres are required to have over
500,000 yuan ($62,500) in boxoffice totals.
In other news, the recently established Forbidden City Film Co.
announced that its first film, "Since the Days of Lei Feng," a
co-production with Beijing Youth Film Studio, has done exceptionally
well at the boxoffice. The story of China's cultural revolution
hero and his devotion to the cause of socialism has passed the 5
million yuan ($635,000) mark in Beijing alone. Forbidden City,
which started up April 9, is comprised of a venture among China's
second largest network, Beijing Television, its affiliate, Beijing
Television Arts Center, the Beijing Municipal Film Co. and Beijing
Cultural Audio-Visual Publishing.
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