In recent years, the conflict between Netflix and Hollywood traditional film companies has been raging, and China filmmakers have been watching from the other side, thinking that this streaming media war will not come soon.
"When the wind blows, it wrinkles a pool of spring water." Things change suddenly. On the 24th, the movie Lost in Russia suddenly decided that it will be released on the Internet alone from the beginning of the New Year’s Day, and it is free to watch.
Seven films were withdrawn from the archives.
Lost in Russia transfers the headline platform.
This is the first time in China’s history that the Spring Festival movie premiered online, and the pattern of China’s film circle suddenly changed.
In the Spring Festival of 2018, the number of people watching movies exceeded 140 million, contributing 9.5% of the box office with only 1.9% of the days in the whole year. Watching movies has become a "New Year custom" during the Spring Festival holiday. In 2019, the growth rate of box office in the Spring Festival slowed down, with a box office of 5.905 billion yuan, an increase of only 2.2% compared with 2018. However, the scheduled box office still accounts for 9.2% of the total box office in the whole year, maintaining a high level. This year’s Spring Festival is expected to be about 7 billion yuan, but it has been hit by the epidemic "black swan" and all seven films have been withdrawn.
Desperate, Lost in Russia broke the routine and met everyone on the first day of New Year’s Day (January 25th), but the meeting place was changed from cinema to mobile phone and smart TV. The film said that from 0: 00 on January 25th, Lost in Russia directed by Xú Zhēng will be on the platform of headline department — — Tik Tok, Today’s Headlines, Watermelon Video, and Happy Premiere are shown. Search for "Sorry Mom" to watch the whole movie.
The move was warmly welcomed by netizens, but the cinema was surprised: the online screening in Lost in Russia meant that the cinema was completely abandoned.
Pay 630 million yuan
ByteDance’s industrial matrix is stronger
However, the cooperation between Huanxi Media, the main producer in Lost in Russia, and ByteDance has really reached a "win-win". According to the announcement issued by Huanxi Media, the main producer in Lost in Russia, Huanxi Media will cooperate with ByteDance, the parent company of headline department, and ByteDance will pay at least 630 million yuan.
After the news was announced, Joy Media’s share price rose sharply on that day, with a current increase of over 43% and a market value of nearly HK$ 2 billion. ByteDance, the headline department, gained huge traffic with "at least 630 million", and its industrial matrix was more complete, from short video to long video, and it won the favor of heavyweight films at once. The traffic and the number of members that iQiyi, Tencent and Youku have cultivated for long video content for so many years are facing segmentation.
According to the content of the agreement, Huanxi’s future works will be transported in large quantities to the products of the headline department to enrich its content reserves; In ByteDance, an independent entrance is set up for the Happy Premiere platform for diversion in today’s headlines, watermelon videos and other platforms. In addition, the two parties will jointly contribute to the production and purchase of new media copyrights of film and television content, jointly build cinema channels, and jointly build a "premiere" streaming media platform.
There is still a share after selling the money.
Lost in Russia, this deal is worth it.
With the cooperation between the two sides, Lost in Russia has not only gained long-term benefits, but also saved the income of the Spring Festival stalls. According to the film accounting model, all film revenues are paid with a special business tax of 3.3% and a special fund of 5% for the film industry. The remaining 91.7% is considered as the "divisible box office" of a movie. After that, about 57% of cinemas and cinemas are retained, and the remaining 40%-43% is attributed to the "net box office income" of film producers and distributors. In this way, the box office receipts recovered by the producers are about 33% of the total box office, that is to say, for a film with a final box office of 100 million, the box office receipts are about 33 million.
Today, the filmmakers in Lost in Russia have directly earned 630 million yuan, which is equivalent to 1.9 billion yuan at the box office when it was released in the cinema. It should be said that this is a profitable business. After all, its opponents are Leap, who is quite popular with the audience, and Tang Tan 3, who knows the laws of business types.
According to another algorithm, Lost in Russia also won completely. Before the film was released, Huanxi, a subsidiary of Huanxi, reached a guaranteed agreement with Hengdian Film Co., Ltd. on Lost in Russia. Hengdian Film Co., Ltd., the issuer of the guaranteed agreement, paid 600 million yuan to Huanxi Media in installments, corresponding to a box office of 2.4 billion yuan. When the box office exceeded 2.4 billion yuan, the excess box office net income was divided into 35% and 65%.
For Lost in Russia, 2.4 billion is not an easy thing — — Last year’s Spring Festival movies were similar in size to Lost in Russia’s, with 2.2 billion Crazy Aliens and 1.7 billion Flying Life. Now, Lost in Russia has sold 630 million yuan to ByteDance, and it can also participate in the profit sharing.
Lost in Russia may be a special case, or it may be the butterfly that changed the whole film pattern in China, although a large number of content companies still need to show their works in cinemas. However, from this, it is also possible for streaming media to enter the film industry track and achieve overtaking in corners.
News observation
Why did this move anger the national cinema?
The controversy caused by Lost in Russia continued to ferment. After the Zhejiang film industry issued a statement condemning "embarrassing mom’s behavior", from the afternoon of 24th to the evening, Beijing Xinhua Dadi Cinema Line Co., Ltd., Beijing Kyushu Zhongyuan Digital Cinema Line Co., Ltd. and 23 cinema line companies from Sichuan, Guangzhou and Hunan submitted urgent requests to the Marketing Department of the State Film Bureau. In the request for instructions, the cinema company once again stated that Lost in Russia’s free broadcast on the Internet was an act of breaking industry rules.
"As a cinema movie, Lost in Russia bypassed the traditional cinema, temporarily changed to online premiere and was free of charge, which means that the current film release window period has been shattered, which is inconsistent with the payment model cultivated by the industry for many years. The trampling and deliberate destruction of the current China film industry and distribution mechanism will play a destructive leading role." Cinema hopes to stop the free Internet premiere in Lost in Russia, conduct hearings and demonstrations in the industry, ban all kinds of "zero window period" screening modes outside cinemas, clarify the window period boundary between various screening terminals and cinema screening content, and improve the industry standard system.
In the request, the cinemas also said that in view of Lost in Russia’s current behavior, they would boycott the films produced by Joy Media and Xú Zhēng to a certain extent, and even reserve the right to sue for the losses caused by Joy Media’s violation of the Film Distribution and Projection Contract and unilaterally changing Lost in Russia for free Internet premiere without authorization. Earlier, in response to Lost in Russia’s decision to broadcast on the Internet, the film industry in Zhejiang Province issued a statement on the evening of 24th, saying that the national cinemas had invested a considerable amount of money for the Lost in Russia screening, and this "Lost in Russia act" brought great losses to the national cinemas. Text/reporter Xiao Yang
