Behind the release of "Eight Hundred": Huayi wants to recover cash flow, small theaters pay 200,000 yuan for previews

In 2020, Chinese films have gone through a lot of trials and tribulations. The release of "Eight Hundred" brings hope to the industry, which is still in trouble. "The resumption rate of theaters is over 73%, and we are waiting for films like "Eight Hundred", "said a theater practitioner.

According to the Daily Economic News, on the evening of the 14th, as "The Eight Hundred" started its first round of previews, this tortuous film finally unveiled its mystery.

New release model

The final version of "Eight Hundred" presented to the audience is a 2D version with a running time of 147 minutes, which is 18 minutes shorter than the 165 minutes shown in the original material. The distribution has also been "changed". On August 11, Huayi's distribution company sent the distribution standards to major theaters.

It is understood that the criteria for selecting theaters for this release are:

The box office in 2019 is RMB 10 million (inclusive) or more, excluding service fees. For newly opened theaters without complete annual box office data, they are not included in the preview because it is impossible to calculate. For those that are not open for business, please remove them from the list.

The reporter of Daily Economic News learned from the cinema that Huayi has newly launched a buyout screening. Cinemas with annual revenue of less than 2 million yuan need to pay a fee of 200,000 yuan to advance screening of "Eight Hundred", which is equivalent to a "buyout". "Huayi wants to recover cash flow, but is also afraid that small and medium-sized, individual private cinemas will close down after showing the film." An industry insider analyzed. As you can imagine, this distribution model has encountered resistance from small cinemas.

For theaters that meet the screening standards, this is just an ordinary preview and there is no difference.

After the "restricted" preview, "The Eight Hundred" will start large-scale previews from August 17 to August 20, with the preview time from 19:30 to 20:30.

“The cinemas under the theater chain will report to the theater chain if they want to release films, and the theater chain will report to Huayi Brothers. We have reported all the cinemas that have opened, but have not received any notification yet,” said a theater operator.

The release of "Eight Hundred" gave the industry a shot of stimulant. "After the cinemas resumed work on July 20, I think "Eight Hundred" is the best film, which is a great thing for cinemas." Yin You, assistant marketing director of Pacific Film Management Company, told the reporter of "Daily Economic News". In his opinion, the symbolic significance of "Eight Hundred" is even "a work to save the market." "The box office will not be bad. I conservatively estimate it to be 1 billion yuan or more. The cast, war history, and scenes are all places that attract audiences."

Another industry insider also analyzed the reasons why "Eight Hundred" is so significant. "First, the subject matter is attractive. This is a big-budget film produced by a big company. It was highly anticipated in 2019. The delay in its release until now has also created a lot of buzz. Second, this is the first major commercial blockbuster since the outbreak of the epidemic at the beginning of the year, especially a domestic film. It will definitely be a huge boost to the entire movie market, and it is also a positive signal for the recovery of the box office and movie market."

Risks and opportunities

Whether "Eight Hundred" can be successful is not only related to whether the film industry can recover quickly, but also crucial to Huayi Brothers. Huayi Brothers' first quarter report of 2020 showed that the company's revenue was 229 million yuan, a year-on-year decrease of 61.38%; net profit was 143 million yuan, a year-on-year decrease of 52.64%. 2020 is crucial for Huayi Brothers. After two consecutive years of losses, Huayi Brothers is going to win the battle of "profit" this year.

"Unless word of mouth collapses, the performance of "Eight Hundred" will not be bad." An industry insider said, "Huayi has no choice, but releasing "Eight Hundred" at this time still has risks from the epidemic. Affected by the epidemic, many people are still afraid to go to the movies, and tickets during prime time are not selling well."

This view was also shared by Pacific Securities analyst Ni Shuang. "This is a multi-faceted game for Huayi. First, the company is under financial pressure. Second, this is a time when there is a strong demand but a lack of products. Then, if Huayi steps in to save the market at this time, it may win the approval of the management department."

The pressure of "Eight Hundred" on Huayi also comes from the high cost. "Eight Hundred" is the first commercial film in Asia shot with IMAX cameras. It is rumored that the production cost is as high as 500 million yuan, which means that the box office must be more than 1.5 billion yuan for "Eight Hundred" to break even.

Huayi Brothers stated in its financial report: Due to the high return on investment, great market impact, mature operating model and high success rate in the domestic market, commercial blockbusters have become the first choice for the company's film business.

In the view of an industry analyst, Huayi has long been tied to "blockbuster movies." "Only by making blockbuster movies can we achieve real-life entertainment. Real-life entertainment cannot be used for comedies and romances. The ancient costume fantasy films that we have been exploring before have not been successful in real-life entertainment. In short, in order to achieve real-life entertainment, Huayi must make big-budget films or period dramas with built-up scenes. If "Eight Hundred" becomes popular, it may help Huayi find a new direction."