China to cut Hollywood releases amid US-China trade tensions
What's the story
In a major shift, Chinese regulators have revealed plans to cut down the number of Hollywood films released in China.
The decision, announced on Thursday, comes as a response to US President Donald Trump's tariff policies and has ignited debates on how geopolitical tensions can impact box office returns.
China has traditionally kept a quota system releasing at least 34 foreign films, mostly Hollywood titles, every year.
Adjustment impact
China's quota system for Hollywood films under scrutiny
As of now, the quota system permits 25% revenue share with foreign films. However, authorities have yet to clarify how much this number will drop or how long these restrictions will last.
From what it appears, a major shift is coming, with China also giving preference to releases from other countries to meet local demand for international cinema.
This could affect Hollywood films' box office haul in China.
Film release
Marvel's 'Thunderbolts' may face challenges in China
Marvel Studios's highly anticipated movie, Thunderbolts, has got a China release date—April 30, two days before its US opening.
But this guarantee may be worth less than it seems due to the possibility of being under scrutiny, facing backlash, or facing organized boycotts from local exhibitors or audiences.
The movie will wrap up Phase Five of the Marvel Cinematic Universe and stars Florence Pugh, Sebastian Stan, David Harbour, and Julia Louis-Dreyfus.
Market significance
China's influence on global box office performance
As one of the world's largest movie markets, China is a critical territory for Hollywood studios. A lukewarm reception in China could hurt the global revenue projections of a film.
Marvel's Avengers: Endgame and Avengers: Infinity War are two of the studio's most popular movies in China, earning $595 million and $334 million, respectively.
Other popular Hollywood movies in China include DC's Aquaman, The Fate of the Furious, and Furious 7.
Future uncertainty
Hollywood's dominance in China at risk
As Hollywood studios keep a watch on the changing trade dynamics, one question looms large: Will creative diplomacy win, or is the era of Hollywood's dominance in China over?
The answer to this could have major consequences for the future of Hollywood films in China.
As per reports, major Hollywood banners like Walt Disney, Warner Bros. Discovery, and Sony Pictures Entertainment earn more than half of their theatrical revenue from overseas audiences, with China being a big player.