China's Tightening Censorship Is Making a Bad Box Office Year Even Worse

As Chinese president Xi Jinping's government tightens its grip on media and entertainment, at least half a dozen local movies have been blocked from release, despite a downturn at the country's box office.

Censorship by Chinese authorities is making the country's box office downturn even worse.

The Chinese theatrical market is experiencing its biggest slump in more than a decade, but Beijing's film regulators are making it very clear that they have other priorities.

Just this week, two high-profile Chinese films were pulled ahead of their planned summer release due to censorship issues. On Monday, July 15, martial arts movie The Hidden Sword announced that it was scrapping its Friday release because of unspecified "market reasons." On Tuesday, it emerged that the buzzed-about buddy comedy The Last Wish, set to bow on Thursday, had also been cancelled. Vague "production reasons" was the only explanation given.

Beijing's real motivations for pulling the films remain mysterious. There is speculation that The Hidden Sword — the 1930s-set story of a military officer who leads Chinese soldiers armed only with swords into battle against a Japanese attack on the Great Wall — caused offense because the film's heroes are fighting on behalf of the Republic of China, not Mao Zedong's Communist revolutionaries.

The Last Wish, the latest project from Chinese hitmaker Tian Yusheng, whose comedy franchise The Ex-Files has earned more than $400 million locally, was apparently too off-color for the censors. The coming-of-age comedy about a young man with a terminal disease desperate to lose his virginity before he dies had already attracted attention in June when the government ordered a change in its Chinese title from A Great Wish to A Tiny Little Wish. Regulators apparently felt that the Chinese word for "great" (weida), which is often used in weighty propagandistic political contexts, was inappropriate for parody in a ribald sex comedy. The censors now appear to have decided the film itself was beyond the pale.

Late July and early August have traditionally been a special period in the Chinese film calendar. Regulators traditionally hold back Hollywood film imports to give local Chinese titles an uncontested run at the summer blockbuster season. Within the local industry, the window has come to be known as "domestic movie protection month."

But this year, in a baffling reversal, China has been cracking down on its own movies. Roughly half a dozen high-profile Chinese titles have been blocked from release because of last-minute censorship actions. Hollywood's politically neutral summer popcorn fare, meanwhile, continues to be welcomed into the market untouched.

China's censors never publicly acknowledge nor reveal the rationale behind their decisions. Instead, their determinations are communicated privately to local studios, which, constrained from revealing the truth of their plight to the public, deploy such phrases — "technical issues," "production problems" or "market reasons" — as euphemisms.

Chinese president Xi Jingping's regime has tightened control over the country's cultural industries this year in anticipation of the politically sensitive 70th anniversary of the People’s Republic in October. Many of the local films set for release in the latter half of 2019 will be hero epics glorifying Chinese national achievements under Communist Party rule.

Last year, the Chinese Communist Party's propaganda department assumed direct oversight of the country's film industry, taking over censorship and regulation powers from SARFT, the government body that had overseen cultural and media regulation for a generation. While under the auspices of the Beijing government, SARFT, unlike the propaganda department, was not an official part of the Communist Party. At the time, many warned the move signaled more censorship and more politicization to come, something that now appears to be playing out.

This all comes as China's movie market is experiencing an unprecedented slump. As of Monday, China's total box office for the year was down 4.9 percent compared to the same period in 2018 — the deepest decline in the past decade, a period during which the market instead has grown by an average of more than 20 percent per year. Various forces have weighed on the country's theatrical film sector — not least among them surging digital video adoption and a slowdown in the overall economy (China's GDP grew by 6.2 percent in the first half of 2019, the lowest rate in more than 25 years) — but the government's increasingly draconian control over content has certainly played a role.

Near the start of the year, Zhang Yimou and Feng Xiaogang, arguably China's two most esteemed directors, both had their latest films shelved because of government pressure. Zhang's much anticipated period drama One Second was abruptly pulled from the Berlin International Film Festival in February because of its setting during the politically sensitive Cultural Revolution period. Feng's commercially bankable romantic comedy sequel Cell Phone 2, meanwhile, never saw release during the market's Chinese New Year box office bonanza because of its involvement in a tax evasion scandal targeting its star, Fan Bingbing. Whether either film will ever be released is unclear.

The censorship crackdown, naturally, has battered the bottom lines of several unlucky local film companies — none more so than Huayi Brothers Media, China's longest-running private studio. The company was the lead financier of Feng's shelved Cell Phone 2, and last month its $80 million war epic The Eight Hundred was also pulled shortly before release, for obscure political reasons similar to those that derailed The Hidden Sword. The company also was a major co-financier of The Last Wish — meaning its three most important recent movies, all of which are finished and were widely anticipated by the Chinese public, have gone unreleased.

Over the weekend, Huayi Brothers reported that it expects to lose about $47.5 million (330 million RMB) in the first half of 2019, following a net loss of approximately $160 million last year. The company was forced to borrow $103 million in working capital from Jack Ma's Alibaba Pictures Group in January.