Chapter 200: The Rise of a New Independent Film Kingdom
On movie box office websites like BOX, the top 10 global box office films of 2002 were led by “The Lord of the Rings: The Two Towers,” a New Line Cinema production that boasted an impressive $925 million; second was Warner Bros.’ “Harry Potter and the Chamber of Secrets” with $878 million, and third was Sony/Columbia’s “Spider-Man” with $821 million, marking the three films that year to gross over $800 million worldwide.
Fifth was 20th Century Fox/Lucasfilm’s “Star Wars: Episode II” with $649 million, eighth was Sony/Columbia’s “Men in ck 2” with $401 million, ninth was MGM’s “Die Another Day” with $400 million, and tenth was IFC Films’ “My Big Fat Greek Wedding” with $368 million.
The fourth, sixth, and seventh spots were all taken by the same independent filmpany, described by Fortune Magazine as an “explosively expanding” me Film.
Following the Golden Globe Awards and the announcement of the Oscar nominations, “District 9” re-opened in fewer than 100 theaters in North America, scraping up some missed box office revenue; earlier in the year, it also made its way onto the big screens in maind China.
Despite the prevalence of both clear and unclear pirated versions of “District 9” on the Inte, where street vendors were selling them for 5 yuan each and deals like “buy ‘District 9’ and get ‘Juno’ for free” or “Get ‘The Hangover’ + ‘Paranormal Activity,’ for a scream!” weremon, and some even copied a “Wang Yang Movie Collection” also for 5 yuan.
However, under the allure of “Chinese-American Wonder Director,” “Widely Acimed Worldwide,” “Special Effects Blockbuster,” and Wang Yang’s own poprity, “District 9,” with some “non-impactful on viewing experience” bloody scenes cut by the State Administration of Press, Publication, Radio, Film, and Television, managed to garner a fine $10 million in maind China. “Spider-Man” made $4.983 million, and Zhang Yimou’s “Hero” made $30 million.
Therefore, “District 9” has now raised its North American box office to $330 million and global box office to $765 million, ranking it fourth on the overall list for 2002. In Movie Weekly’s “Top 10 Films of the Year” list published in January, it was said: “Many people will hate the ‘Magical Yang,’ it is bound to be a sci-fi benchmark that will be referred to for decades into the future when discussing bothmercial and artistic values, it’s that kind of film.”
Year-end Top 10 Films lists are essential for many magazines, including Entertainment Weekly, Empire, Vanity Fair, TIME, etc., and also in newspapers by well-known film critics, such as Roger Ebert of the Chicago Sun-Times, all featuring “District 9.”
“The Hangover,” with a North American box office of $320 million and a global revenue of $617 million, ranked sixth overall in 2002, as the highest-grossingedy film of the year and the highest-grossing R-ratededy film in history; “Ice Age,” with a global take of $476 million, ranked seventh as the highest-grossing CG animated film of the year.
“The ticket office miracle of ‘District 9’ can be attributed to the creative new viral marketing, whether it’s viral websites, campaigns, or posters and three-dimensional posters, all have be the new trend in the movie industry. ‘Superman Returns’ hasunched a viral website, ‘The Incredible Hulk’ hasunched a viral website too… The novelty for the fans is rapidly decreasing.” — Los Angeles Times.<div>
“In 2002, Hollywood discovered two gold mines: the massive sess of ‘Spider-Man’ led many filmpanies to refocus on superhero movies, signaling theing era of big CGI effects productions; facing ‘My Big Fat Greek Wedding’s’ $5 million budget and $368 million global box office, and ‘The Hangover’s’ $25 million budget and $617 million global box office, many independentpanies saw hope, and majorpanies saw a way to reduce investment risks, with six R-ratededies already scheduled for a big release in 2003.” — Empire Magazine.
In the top 10 box office films of 2002, major studios and independentpanies each had five films, with me Film producing three of thetter; among the North American total box office of $9.25 billion from January 1 to December 31, Sony/Columbia ranked first with $1.407 billion and a 15.2% market share, Disney’s distribution brand Buena Vista had 12%, Warner Bros. had 10.7%, Universal had 8.5%, and me Film ranked fifth with a total of $810 million and an 8.7% market share.
Following Fox’s 8.5% share, another independent filmpany, New Line, ranked seventh with 10 movies grossing a total of $771 million and a market share of 8.3%. Next came Paramount, which released 19 films and held 7.4% of the market share, and then in ninth ce, another independentpany, DreamWorks, captured 5.1% with seven films. In tenth ce was MGM, which released 19 films and held a 4% market share.
If we only look at the year 2002, me Film has already be the leader among all independent filmpanies. Indeed, it may still have shorings, but undoubtedly, it has been rapidly growing and growing…
In the scenic Santa Monica, a bright executive meeting room at the me headquarters buzzed with activity as a board meeting unfolded. Company executives in suits filled the seats on both sides of the table, with Wang Yang, dressed in a ck suit, taking his ce at the head of the table as the chairman. Looking at the financial reports and figures, he felt no surprise whatsoever.
The me Group currently consists of five main parts: FF Company, FM Company, me Home Entertainment, Blue Sky Studios, and Image Engine. Blue Sky Studios and Image Engine do not contribute much profit, as most of the investment costs go to the sries of the special effects technicians and animators. At the same time, the I&B Department needs to develop new technologies, which means that the parentpany has to pour money into them. This is precisely why manypanies can’t afford to support animation and special effectspanies.
The group’s primary business is still the film market, with FF producing high-cost, high-quality films they have confidence in, FM handling mid-to-low-budget films, and Home Entertainment in charge of television business. The business strategy is divided into two parts, “theatrical release films” and “home video market,” with the former generating box office and various post-release peripheral ie, and thetter relying on rentals, copyright taxes, pay-per-view, and other smaller markets, as part of their “Film Library” n.
“Sweetheart” with a global box office of $170 million, “Ice Age,” “District 9,” “The Hangover”… “Mr. Hughes” with $160 million… DVD, original soundtracks, copyrights… allocating $175 million for Blue Sky Studios to produce “Ice Age 2,” “Kung Fu Panda,” “Prison Break”‘s 22 episodes with a production cost of $30 million, “Furious” with a production cost of $60 million, “The Hangover 2,” with a production cost of $50 million, “MIT-21-TEAM,” with a production cost of $25 million…
“Hmm…” Wang Yang studied the list of ie and expenses. Thepany naturally had to pay taxes and administrative expenses, and they had also distributed dividends to shareholders at the beginning of the year. Now, thepany’s ount had over $384.5 million in liquid cash, while his personal ount had over $301 million. Previously, he had invested $100 million to establish a charity fund, managed by a dedicated team without a specific target group, but mainly focusing on out-of-school children worldwide and sudden disasters.
Obviously, me Group’s cash was not limited to the $384.5 million. The value of the studios, worth $100 million, all subsidiary assets and business, and the movies in production… The entire group’s value was estimated to be around $1 billion, and it was debt-free and not publicly listed.
However, today’s meeting was not about financial reporting; otherwise, Wang Yang would not have “specially” returned from Las Vegas. After half a month of shooting, the crew hadpleted their work in Boston and moved to the gambling city of Las Vegas for nearly a week of filming. It was now March, and Wang Yang hade back because thepany was finalizing a major purchase, waiting for his final decision.
It wasn’t the acquisition of the women’s website iVige—that project was still under negotiation. This time, the target of the acquisition was Artisan Entertainment, for $160 million US dors.
“With just our approval, we can acquire Artisan Company’s film library of over 6,000 titles,” Mark nt said excitedly from the chief seat on the left, looking at his smiling colleagues and Wang Yang before adding emphatically, “6,000 titles! Adding to our own 2,500, that’s 8,500 titles! Warner Brothers only has 1,400, Universal 4,000…”
In recent years, me Film had consistently adhered to the Film Library n, buying film rights from all over the world, which naturally included Chinese films from maind China, Hong Kong, and Taiwan. Last year’s “Infernal Affairs,” which was hailed as the film to “save the market,” had its overseas rights owned by me, including the adaptation rights.
“With these 6,000 films, we’re estimated to generate $200-300 million cash annually from the ‘home video market,''” said Mark nt, pausing for a moment with a sense of achievement in his eyes, and continued with a smile, “This sum is enough to cover all of thepany’s day-to-day operations.”
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With a library of 6,000 films, it’s like the Super Mushroom in “Super Mario” or the fruit in “Pac-Man” — once consumed, the film library n would quickly get on the right track… Wang Yang gazed at the “Artisan Films” documents in his hands, vaguely recalling the situation from 5 years ago when he took a deep breath and walked confidently into the doors of Artisan, Nicole Kidman, Stephen Thomas…
“Let’s buy it,” Wang Yang nodded and scanned the crowd before stating, “Let’s purchase it.”
Although this was expected, the chairman wouldn’t have agreed to initiate the acquisition n otherwise, but the boardroom still erupted in excited apuse, and everyone cheered andughed. Mark Strong, who had proposed the n, was particrly pleased andughed heartily, saying, “This is insane! Ourpany’s development just sped up by 5 years!” Wang Yang raised his hands and shouted, “The rocket hasunched, everyone hold tight, Let’s-GO!”<div>
After signing the contract, the acquisition payment of $160 million could be immediately transferred toplete the purchase, and the remaining $224.5 million in me Movies’ ount was more than sufficient for this year’s release n. The independently operating FM Company nned to release 4 major films this year, including “Saw,” which caught attention at the Sundance Film Festival earlier in the year and would be released in April. FF is currently set to release three films: “MIT-21-TEAM” at the end of July during the summer slot, “Step Up” in the slower month of October, and “The Devil Wears Prada” during the Christmas season.
During this time, Lauren Weisberger, the author of “The Devil Wears Prada,” had already reached an agreement with me to sell the adaptation rights, and me Movies immediately started production preparations. It was first announced that the lead role of Andrea would be yed by Jessica Alba; now there was widespread media spection that Wang Yang would personally adapt and direct it, although me’s officials had not yet responded.
This was also a marketing tactic: let the market specte first, generate curiosity and interest among movie fans, and only then officially announce something that’s 99% certain to attract more attention than if they’did it all out at the beginning.
After the meeting ended, the executives left the boardroom with smiles, and Wang Yang headed towards the chairman’s office, while saying to Mark Strong beside him, “Mark, I’m nning to start my own musicbel. You know a TV station always needs music, MVs, and stuff. It can even coborate with me Movies’ original soundtrack business.” He said,ughing, “Robert Downey Jr. has a pretty good voice; I told him, I’d produce his album.”<div>
Mark Strong knew he meant starting it on his own, unrted to me’s finances; besides, to a person worth over a billion dors, owning a musicbel was nothing extraordinary. Many film and sports celebrities owned their musicbels and signed artists, typically only coborating withrgerpanies for distribution. Having nothing to persuade or suggest, Mark responded with a jest, “Yang, you could release an album yourself. You sing very well; the sales would definitely be good!”
“Me? Singing off-tune could be quite entertaining, right?” Wang Yang replied with an enthusiastic look, then immediately waved his hand dismissively, saying, “Maybe not now, I’m too swamped.”
“To be honest, boss, I truly wish you could make 12 films a year,” Mark Strong said with a covetous look, chuckling, “One every month, then we wouldn’t have to consider this issue. Once the foundational phase of our film library n isplete, we can think about increasing production.”
Wang Yang, reflecting on this, knew increasing output meant the snowball would roll faster but also meant higher risks and the beginning of financing and borrowing. He pondered and said, “Regardless, I do not agree with borrowing money to increase production when we’re financially healthy; it’s not wise. We are already moving quickly; what’s most important is to stand firm and not fall back or copse.”n/?/vel/b//jn dot c//om
“I never said to borrow money for filmmaking; the interest rates are too high now, and the return on investment is hard to guarantee,” responded Mark Strong with a shrug. Wang Yang hummed in agreement. Why is borrowing money bad? DreamWorks had always relied heavily on financing to produce movies, with gains and losses but umting debts. From what he remembered, eventually, it would be acquired by Paramount. Appropriate financing can elerate the pace, but over-reliance would only dig your own grave.
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Mark seemed to have thought of this as well, and he continued, “However, borrowing money could allow us to continue acquiring and merging, speeding up the expansion of our film library. The risk involved in this project isn’t high.”
“Let’s talk about itter, one step at a time. We haven’t acquired Artisan Entertainment just yet,” Wang Yang turned to look at the CEO. Thepany’s rapid development these past few years was linked not only to blockbuster films but also to the hard work of the senior management. He smiled as he shared the n he had long considered, “Mark, by the end of this year, I’m nning to adjust thepany’s equity. Everyone will receive a reward.”
“Oh… what a pleasant surprise!” Mark nt immediately grinned with wide eyes. No one disliked rewards—it was invigorating! He eximed with excitement, “It looks like this Christmas will be full of surprises!”
Wang Yang firmly patted his shoulder and said with augh, “This isn’t a Christmas gift. By the way, do you really think I sing well?…”
A couple of dayster, a fresh piece of business news from the movie industry was served hot: me Filmpleted the acquisition of Artisan Entertainment for 160 million US Dors! Just like the previous acquisition of A-PIX, this was a total purchase—me acquired everything about Artisan, not excluding even a broken chair from thepany headquarters.
me Film announced that it would cut and reorganize the original staff of Artisan Company, integrating them into me’s business operations; also, Artisan’s films would no longer carry the “Artisan” brand name and would uniformly be rebranded as “me.”
This was not a bailout-style capital injection and restructuring but an asset swallow. Many business media were puzzled—injecting capital into a brokenpany was evidently worthless, so what was the point in swallowing it up? me Film naturally offered no exnation, as this was a trade secret, only to be revealed when the market stabilized; now, countlesspetitors were specting about the thoughts of me Film and the enigmatic Wang Yang.<div>
Actually, with some deduction, the answer was easy to arrive at: me definitely wasn’t after the office chairs; what they coveted were the copyrights to those more than 6000 films. However, there was a stark reality—nearly all of those were “junk movies”! The highest-grossing film from Artisan Company was “Veggie Baby Adventures,” a CG animated film released in October 2002. Made with a 14 million dor budget, it had garnered only 25 million in global box office revenue.
Was me Film not satisfied with “Ice Age”? Buying over 6000 films that had virtually no market value, was it just for the sake of appearances?
Regardless, me Film’stest acquisition once again showed the media and the public its relentless stride and ambition. Based on past experiences, they had every reason to believe that this was yet another sessful purchase for me; they had every reason to believe that a new kingdom of independent cinema was on the rise.
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PS: Wow, thank you everyone for your blessings! Thank you so much!