China's Invading Hollywood! Now, Relax
Wang Jianlin, China's richest man, has been on a Hollywood shopping spree. As chief executive of the Wanda Group, he's acquired Legendary Entertainment, producer of "Jurassic Park," and is in talks to pay $1 billion for Dick Clark Productions, producer of the Golden Globes and other live television events. An earlier purchase, AMC Entertainment, recently announced plans to buy Carmike Cinema, which would create the world's biggest theater chain.
When Wang arrives in Hollywood for a highly anticipated visit later this month, he'll have even bigger game in sight: one of the Big Six Hollywood studios that control as much as 85 percent of U.S. and Canadian box office revenue. If successful, he'll be the first Chinese national to own one.
That's aroused worries that Wang and other aspiring Chinese movie moguls may restrict creative freedoms and spread Chinese propaganda in the U.S. and beyond. Last month, 16 members of Congress wrote to the Government Accountability Office asking it to reconsider how foreign investments in the U.S. are reviewed. Since then, the chairman of the House Intelligence Committee has added his signature to the letter. Wanda's entertainment acquisitions were on the list of worries: "Should the definition of national security be broadened to address concerns about propaganda and control of the media and ‘soft power’ institutions?" the group asked.
At home, it's true, China operates one of the world's most formidable propaganda and censorship programs, and tycoons like Wang have succeeded in part because of their willingness to play by its rules. China's Communist Party has long embraced the idea that the role of art is to advance its interests. In October 2014, President Xi Jinping made that commitment explicit in a speech in which he called on Chinese painters, writers and filmmakers to "fully implement the Party's art policy."
Every Chinese artist knows what red lines shouldn't be crossed; the idea of Tibetan or Taiwanese independence is off-limits, for instance, as are topics that call into question the canonical history of the Communist Party. More recently, the government has added a few specific bans, including one barring television programming that promotes "Western lifestyles."
The idea that Wang might be able to export Communist dogma to Hollywood, however, seems fanciful. The most successful Chinese movies tend to be harmless melodramas and martial arts films. So far, this year's biggest box office success is a comedy about a mermaid assassin who falls in love with the greedy real estate developer she was sent to kill. On those rare occasions when Chinese filmmakers dabble in propaganda, the films have invariably failed (unless propped up by box office fraud).
Indeed, even on their home turf, Chinese films are no competition for Hollywood, which accounted for nearly 40 percent of China's box office receipts in 2015 despite rampant piracy and strict limits on the number of foreign films. Wang has openly acknowledged that part of his goal is to obtain U.S. technology and know-how in order to improve Chinese filmmaking. He has little incentive to transform a U.S. studio into a facsimile of its Chinese peers.
A bigger concern is self-censorship. In recent years, Hollywood studios have become adept at making -- or at least, editing -- films that can get past China's censors. Some have gone further and rewritten storylines that might raise hackles in Beijing, as when MGM decided to change Chinese villains into North Korean ones in a clumsy 2011 remake of "Red Dawn." A Chinese-owned studio would no doubt be at least as conscientious about the Party's sensitivities, if not more so.
Fortunately, the impact would probably be limited. Since the 1940s, Hollywood's studio system has given way to a blossoming of independent production companies, distribution channels and exhibition formats that give an independent-minded filmmaker many options. A Wang-owned studio could still pass on controversial projects, of course. But shareholders and audiences would look askance if management repeatedly missed out on successful films, and at least some filmmakers and talents would look elsewhere if Wanda developed a reputation for asserting a political agenda. Meanwhile, the proliferation of production houses -- not just indies, but major companies such as Amazon and Netflix -- means that U.S. viewers aren't likely to be starved for choice.
In theory, Wanda could use its power as the owner of AMC to ensure that large numbers of U.S. cinemas are stocked only with politically acceptable films. But the Justice Department's antitrust lawyers have required AMC to sell off theaters for competition reasons in the past, and the proposed Carmike acquisition - currently under investigation - may inspire them to do so again.
Meanwhile, under a landmark Supreme Court antitrust ruling in 1948, Hollywood studios were required to divest themselves of their theater-chain holdings and stop forcing independent theaters to book their films. Even if Wanda acquires a major studio, that decision - and a zealous Justice Department - ensures that it won't be able to force propaganda down the throats of American audiences that are probably home watching American-owned Netflix, anyway.
Americans have plenty of reasons to be wary of China's expanding influence. But at a time of expanding entertainment options, fear that China might be taking over the local multiplex is overheated and outdated. Taste, technology and ambition will ensure that there is always something else to watch.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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