China’s iQIYI Streaming Service Bows First Theatrical Feature Film

China’s online media giant iQIYI announced that Spycies, a family-friendly animated film, will launch in theaters across China on Jan. 11, with subsequent releases slated in Europe, North America and Southeast Asia.

Spycies revolves around a complex action-adventure between “Spy Cat” Vladimir and “Hacker Mouse” Hector set in a modern animal kingdom.

The production team reportedly created and produced more than 40 species, over 90 animal characters, and more than 60 scenes. The movie features endangered animals such as white rhinos and snow leopards, nationally protected animals such as lorises, and extinct animals such as mammoths.

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The design of distinctive fur animations for each species in the movie was based on research of the animals’ actual physical characteristics including fur pattern, material, length, and density.

“With the superb animation effects, exciting storyline and family-friendly themes, this film will undoubtedly succeed in delighting parents and children alike,” Ya Ning, president of iQIYI Pictures, said in a statement.

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In 2018, Spycies was nominated by the Cannes International Film Festival’s “Annecy Goes Cannes” unit based on the Annecy International Animated Film Festival’s judging panel recommendation. Leveraging its premium IP across multiple entertainment formats, iQIYI is developing merchandise such as mystery toy boxes, steam eye masks, luggage cases, and snacks around the Spycies brand.

Cinedigm Acquires Stake in Chinese Entertainment Company

Home entertainment distributor Cinedigm has signed a stock purchase to acquire about 29% of Chinese entertainment company Starrise Media Holdings Limited. In exchange for the stake, Cinedigm is giving a total of 54,850,103 shares of Class A Common Stock worth about $44.5 million. The company expects to close the acquisition in the first quarter.

Cinedigm, which is majority-owned by Hong Kong based investment firm Bison Holding Co., says the deal would help its presence and leverage in both the Chinese and North American markets.

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“These are the two biggest entertainment markets in the world,” Chris McGurk, CEO of Cinedigm, said in a statement. “Following the close of this transaction, Cinedigm will be uniquely well positioned to grow our content distribution and OTT streaming businesses in both key territories.”

The company expects to obtain the approval of the acquisition by a majority stockholders, in addition to any regulatory issues — the latter no small matter in today’s hyper-charged trade environment between the Trump Administration and China.

“This proposed transaction is a strong additional measure of support for Cinedigm by Bison Capital, our largest shareholder,” said CEO Gary Loffredo. “We look forward to working with Bison to identify additional opportunities to build our business, particularly in the fast growing AVOD OTT streaming segment as well as further strengthening our balance sheet.”

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Cinedigm has already been working with Bison to develop strategies and forge partnerships to release entertainment content and develop OTT channels in China while, reciprocally, releasing Chinese content and new OTT channels in North America, such as the recently launched Chinese language content channel, Bambu.

In calendar year 2018, Starrise reported about $139 million in total revenue and gross profit of $31 million, a 97% increase from 2017 revenue and 196% increase in gross profit. In the first half of calendar year 2019, the Starrise reported revenue of about $67 million and gross profit of $19 million, a 11% increase in revenue and 104% increase in gross profit.

Starrise’s film/TV business segment mainly invests in film, television and other short-form content. It distributes film content theatrically and to all key media platforms in China and is committed to significantly growing its investment in entertainment content for the rapidly expanding Chinese theatrical and digital marketplaces.

Recent prominent film investments by Starrise include The Wandering Earth, one of the most successful Chinese films ever released, generating almost $700 million at the box office in China in 2019 and The Grandmaster of Kung Fu, a successful Internet-released action movie.

Warner Partners with Chinese-Owned TikTok for Movie Marketing

Despite criticism by some U.S. lawmakers calling Chinese-owned social media platform TikTok a national security threat, Warner Bros. has partnered with the short-form video site to promote a new movie.

In a first for the studio and TikTok, Warner is streaming the global trailer debut for new movie, In the Heights, which fuses Lin-Manuel Miranda’s music and lyrics with Jon M. Chu’s direction about the Washington Heights neighborhood in New York.

The film is slated for worldwide release on June 24, 2020, and in the U.S. on June 26. TikTok’s partnership with the studio represents major validation for the site’s mobile videos with hundreds of millions of users.

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The trailer launched Dec. 12 on TikTok with users receiving a first-of-its-kind push notification, “Check out the new trailer for In The Heights!” driving global users across 30 countries to view the trailer.

“People around the world are going to TikTok every day to celebrate their creativity, culture and music,” Andrew Hotz, EVP of worldwide digital marketing, said in a statement. “I couldn’t think of a better platform to launch the trailer.”

Some lawmakers in Congress think otherwise. The U.S. Treasury Dept. is reportedly investigating whether TikTok censors content negative to the Chinese government.

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Sen. Marco Rubio (R-Fla.) earlier this year sent a letter to the Treasury asking for a review of the site after he claimed it streamed scant coverage of pro-democracy protests in Hong Kong.

Other lawmakers contend TikTok — like Facebook and YouTube — is vulnerable to foreign influence akin to Russia’s attempts to influence the 2016 U.S. election via social media platforms.

TikTok says its content is stored in U.S.-based servers and not subject to Chinese government regulation.

WWE Partners with TikTok

World Wrestling Entertainment (WWE) has partnered with TikTok, marketing select wrestlers to the social networking service owned by ByteDance, a Beijing-based company founded in 2012.

WWE is making 30 of its wrestlers available on TikTok, including Stone Cold Steve Austin, The Undertaker, Ultimate Warrior, Becky Lynch, John Cena and Sasha Banks. The branded wrestlers’ onstage themes and music are embedded within TikTok’s library of music artists.

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“We are thrilled to be launching this partnership which offers a new level of engagement with WWE content by enabling the TikTok community to create their own shareable stories tied to WWE‘s world renowned Superstars,” Jayar Donlan, EVP of advanced media, said in a statement.

TikTok’s Mayan Scharf hopes the partnership captures the “passion and thrill” of wrestling on social media.

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“We’re looking forward to bringing the excitement of the WWE experience to TikTok’s global community,” Scharf said.

‘Big Trouble in Little China’ Collector’s Edition Blu-ray Coming Dec. 3 From Scream Factory

Indie home entertainment distributor Shout! Factory’s horror imprint, Scream Factory, is bringing director John Carpenter’s 1986 cult classic Big Trouble in Little China back to Blu-ray in a big way Dec. 3 with a new collector’s edition and a number of packaging options for fans.

Kurt Russell stars as tough-talking truck driver Jack Burton, who gets pulled into a supernatural adventure to rescue his best friend’s fiancée from a dangerous, magical world beneath San Francisco’s Chinatown. The cast also includes Kim Cattrall, James Hong and Dennis Dun.

Scream Factory’s two-disc Blu-ray set includes a trove of new bonus material.

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The first disc will include the film with a new audio commentary by producer Larry Franco, a new commentary by special effects artist Steve Johnson moderated by filmmaker Anthony C. Ferrante, and the legacy commentary with Carpenter and Russell from previous home video releases. An isolated score track also will be available. The disc also includes previously released material such as deleted and extended scenes, an extended ending, a vintage audio interview with John Carpenter, electronic press kit interviews and profiles, theatrical trailers, TV spots, a gag reel, a music video and photo galleries.

The second disc will include a vintage featurette and an interview with visual effects artist Richard Edlund from previous disc releases; interviews with Carpenter, Russell, Franco, director of photography Dean Cundey and stuntman Jeff Imada; and hours of new interviews, including actors Dun, Hong, Donald Li, Carter Wong, Peter Kwong and Al Leong, writers W.D. Richter and Gary Goldman, associate producer/martial arts choreographer James Lew, The Coupe De Ville’s member Nick Castle, second unit director/The Coupe De Ville’s member Tommy Lee Wallace, and movie poster artist Drew Struzan.

The Shout! Factory store at ShoutFactory.com is offering fans five different special offers for preorders of the title.

One is the collector’s edition Blu-ray with an exclusive 18-inch x 24-inch rolled poster of the new cover art by Laz Marquez.

‘Big Trouble in Little China’ Steelbook

The second is the collector’s edition in limited-edition Steelbook packaging.

The third is the Steelbook with an exclusive 28.5-inch x 16.5-inch rolled lithograph of the new Steelbook artwork by Nat Marsh, and a 7-inch green vinyl record by Sacred Bones, featuring music composed by John Carpenter and recorded by him, Cody Carpenter and Daniel Davies, with a slipcase with new art by frequent Carpenter collaborator Chris Bilheimer. Limited to 2,500 copies, the A-side includes the 2017 version of the main theme, “Porkchop Express (Big Trouble in Little China),” and the B-side contains a never-before-released recording of “The Alley War,” recorded in 2019.

The fourth bundle includes the Blu-ray with slipcover, rolled poster and green vinyl album.

The fifth option includes both the standard and Steelbook Blu-rays of the collector’s edition, the artwork posters for both editions, and the limited-edition record.

Preorders of the collector’s edition or Steelbook bundled with a purple vinyl variant of the 7-inch record are available from Sacredbonesrecords.com.

‘Bumblebee’ Movie Ups Hasbro Q3 Entertainment Revenue; Expects to Close eOne Acquisition in Current Quarter

Hasbro Oct. 22 reported a 20% increase in entertainment, licensing and digital segment revenue to $115.8 million compared to $96.8 million in the previous-year period.

Increased revenue was driven by Magic: The Gathering Arena and Paramount Pictures’ Bumblebee film revenue, partially offset by lower digital streaming revenue for Hasbro television programming.

Hasbro owns the rights to the “Transformers,” “G.I. Joe,” “Dungeons & Dragons” and “Micronauts” brands on which Paramount bases much of its theatrical slate.

Netflix is reportedly on board to produce the “Magic” feature film after a previous deal with 20th Century Fox never materialized.

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Entertainment, licensing and digital segment operating profit decreased 21% to $24.6 million versus $37.1 million in 2018. The decline was the result of several factors, including higher operating profit margin in Q3 2018, due to the multi-year digital streaming agreement for Hasbro television programming.

Separately, CEO Brian Goldner said he expects to close Hasbro’s $4.3 billion acquisition of Canadian-based eOne in the current quarter.

“The strategic opportunity to bring onboard the brands, capabilities and talent from eOne is compelling to our long-term prospects as a leading global play and entertainment company and we look forward to sharing more about our plans after the close,” Goldner said in a statement.

Universal Pictures Home Entertainment and eOne in March signed a multiyear, multi-territory distribution agreement whereby UPHE will serve as the home entertainment distributor of eOne’s content across both transactional physical and digital formats.

Finally, Goldner said ongoing proposed government tariffs on Chinese manufactured goods would negatively impact product shipments and retailers entering the key winter holiday season.

CFO Deborah Thomas said the company experienced higher shipping and warehousing expenses as a result of the disruption and shift of retailer order patterns from proposed tariffs.

“Hasbro’s global teams are executing within a dynamic trade environment that is impacting the timing of revenues, driving incremental expenses and putting upward pressure on our underlying tax rate,” Thomas said.

Net revenue for the third quarter was $1.58 billion versus $1.57 billion in 2018. Net income was nearly $213 million compared to income of $264 million last year.

Report: India, China to Buttress Global Pay-TV Market as U.S. Declines

Pay-TV home entertainment may be in decline in the United States and Europe, but surges in India and China will help the medium top more than 1 billion subscribers through 2024, according to new data from Digital TV Research.

The London-based company said India and China — the world’s most populous countries — will add 26 million and 19 million pay-TV subs, respectively.

The U.S., formerly the No. 1 pay-TV market, will lose 14.4 million subs during the period — a decline of more than 16%.

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Indeed, China and India will account for more than 50% of global pay-TV subs with 356 million and 184 million, respectively.

“We have updated our forecasts based on June 2019 reports,” Simon Murray, principal analyst at Digital TV Research, said in a statement. “The U.S. is the world’s worst performer — with no uplift expected over the next five years. Other countries will experience a slowdown — or even some small declines in subscriber numbers — but no other country will match the gloomy projections for the U.S.”

The lone silver lining is online TV. Spurred by standalone services such as Sling TV, AT&T TV, PlayStation Vue, Hulu with TV and YouTube TV, online TV will add more than 100 million subs through 2024, reaching a global sub count of 357 million and 20% market share — up from 15% in 2018.

 

 

China, U.S. Account for Majority Global SVOD Subscriptions

No wonder Netflix wants to enter the Chinese market.

The quasi Communist country topped the U.S. in gross subscription video-on-demand users in 2018, according to new data from Digital TV Research.

China added nearly 60 million SVOD subs compared to 27 million subs in the U.S. India nearly doubled its subscription base.

Netflix does not operate independently in China, partnering instead with iQiyi to distribute select programming.

Gross SVOD subs increased by 139 million in 2018 to 508 million – or up by 38%. The net subscriber count rose by 83 million in 2018 to reach 357 million – up by 31%.

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DTV Research said the average SVOD subscriber paid for 1.43 subscriptions by end-2018 — up from 1.05 in 2010.

“China and the U.S. together accounted for 63% of the global total in 2018,” Simon Murray, principal analyst at DTV Research, said in a statement.

Eight countries had more than 10 million SVOD subs by end-2018 – collectively providing 80% of the global total.

Gross SVOD subs represented 30.5% of TV households by end-2018. The proportion of net SVOD subscribers was 21.4% – meaning that more than 20% of the world’s TV households had at least one SVOD subscription by end-2018.

SVOD became the largest OTT revenue source in 2014 when it overtook ad-supported VOD. SVOD market share reached 53% in 2018. SVOD revenue increased by $11 billion in 2018 to $36 billion – up by 44% from 2017. AVOD revenue increased by $5 billion to $22 billion.

“The U.S. added $6.5 billion in revenue in 2018, with China up by $3.6 billion,” Murray said. “Therefore, the U.S. and China were together responsible for more than half the world’s additional revenue in 2018.”

Best Buy, Roku, Apple Shares Rebound Following Tariff Delay

Shares of Best Buy, Roku, Apple and other consumer electronics retailers/manufactures rebounded after President Trump delayed until Dec. 15 a proposed new 10% tariff on cellphones, laptop computers, video game consoles and other goods manufactured in China.

The tariff on $300 billion worth of products, which Trump announced Aug. 1 as part of ongoing trade tensions with the world’s No. 2 economic power, would have been on top of an existing 25% tariff Trump previously imposed on $250 billion worth of other Chinese goods.

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The delay came after intense lobbying efforts in the nation’s capital convinced administration officials the new tariff could have serious implications to the U.S. economy entering the fourth quarter.

“Just in case they might have an impact on people … what we’ve done is we’ve delayed it so they won’t be relevant for the Christmas shopping season,” Trump told reporters on Aug. 13.

The news was welcomed by Wall Street, which saw shares of Best Buy, Apple and Roku rise 6.5%, 4% and 1%, respectively.

Roku is one of the largest manufacturer of Internet-connected televisions, with many originating from China.

But to the Consumer Technology Association trade group, delaying proposed tariffs only prolongs market uncertainty and impacts consumers 401(K) pension or retirement accounts, among other issues.

“Retaliatory tariffs are bad economic policy in the short and long term,” Gary Shapiro, CEO of the CTA, said in a statement. “The administration’s legally dubious trade war is compromising America’s global leadership.”

Previously-announced tariffs starting Sep. 1 will affect $52 billion in consumer technology products, and the tariffs starting Dec. 15 will affect $115 billion in products. Since July 2018, Section 301 tariffs on China have cost the consumer tech industry over $10 billion, including $1 billion on 5G-related products, according to the CTA.

“Tariffs are taxes,” Shapiro said. “The Chinese government doesn’t pay for them – Americans bear the burden. And next month, we’ll begin to pay more for some of our favorite tech devices – including TVs, smart speakers and desktop computers. The administration should permanently remove these harmful tariffs and find another way to hold China accountable for its unfair trading practices.”

Ampere: It’s Still a YouTube/Netflix Video World

Google-owned YouTube and Netflix remain the top sources for online video and subscription VOD, according to new data from Ampere Analysis.

The London-based research firm found that 63% of survey respondents streamed a video on YouTube in the past month, followed by 39% doing the same on Netflix and 27% on Facebook.

The survey is based on 41,000 online respondents across 20 markets conducted in the first quarter (ended March 31).

Ampere found YouTube ranked the No. 1 source for online video consumption in every region worldwide except the United Kingdom (BBC iPlayer) and China (iQiYi).

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Indeed, more than 60% of respondents in France and Japan watched YouTube, while less than 50% of respondents in the U.K. did so.

As expected, SVOD consumption is highest in the United States – birthplace to Netflix, Amazon Prime Video and Hulu.

Notably, American tech platform – Facebook – continues to lose video views – down 5% to 23% of respondents since the third quarter of 2016. YouTube fell 4% to 66%, while Netflix increased 15% to 37% of respondents.

“YouTube’s global dominance in this space is evident in its monthly usage,” Minal Modha, consumer research lead at Ampere, said in a statement. “The differences in viewing between the U.S. and Europe in relation to catch-up and SVOD services is interesting because it shows that SVOD providers will have to work harder in Europe to grow their [market] share as they take on traditional TV channels’ catch-up services. This could be through their catalogue, price-points or communications strategy.”