China Shuts Down All Cinemas, Again

Over the past two weeks, hundreds of movie theaters in the country had begun to reopen. No reason for the policy reversal was given, but insiders believe the government is worried about a potential second wave of coronavirus infections.

China's film regulators has slammed the brakes on plans to gradually reopen the country's cinemas.

Over 600 movie theaters across China were given the green light to reopen their doors over the past week, but Beijing's Film Bureau put out a notice late Friday ordering all theaters to go back into shutdown.

No official explanation for the sudden reversal was provided. Industry insiders instantly began speculating that the government was worried about a potential second wave of coronavirus infections.

The decision comes as a shock given the signals authorities had been sending as recently as a day ago. On Thursday, Shanghai's municipal government announced that 205 of the city's movie theaters had received permission to resume business on Saturday. Earlier in the week, China Film Group, the dominant state-backed distributor, unveiled a plan to let cinemas rerelease past blockbusters to help lure customers back into seats. The scheme was to entail both local hits, such as Wolf Warrior 2 and The Wandering Earth, and Hollywood-made product, such as the full Avengers franchise and last year's Oscar best picture winner, Green Book.

The phased reopening of China's vast network of 70,000 movie screens had promised a rare bright spot on the global distribution map, given that cinemas are shuttered in virtually every other major market around the globe, including North America, Europe, Japan and elsewhere. Beijing's decision to reclose — or stay closed — was met with dismay by stakeholders throughout the Chinese industry.

"This second closure will not be a one- or two-week issue," an executive at a major exhibition company told The Hollywood Reporter, asking not to be named because of the sensitivity of commenting on government policy related to the coronavirus. "They are going to be even more cautious when they attempt to reopen again — and this will set us back a long time."

Many production and distribution executives were frustrated for their own reasons. Regulators have been discouraging — in effect, ordering — studios not to sell their unreleased feature films to local streaming services, saying that they must hold back the titles to aid in the eventual reboot of the country's theatrical exhibition infrastructure.

"We're not allowed to go online with our films and we can't go to cinemas because they are again closed, so it's like there is no exit," said an executive at one of the country's top distribution companies. "They have to present a new policy and let us release some of our movies online, otherwise many of our film companies are going to go out of business."

In recent days, data from Beijing health authorities has suggested that domestic transmission of the coronavirus has been contained. Nearly all new cases have come from travelers and residents returning from overseas. On Thursday, China halted most incoming flights and imposed a blanket ban on the entry of all foreigners, even those with work permits. Authorities said the aggressive actions were taken to prevent China from succumbing to a second outbreak.

Shares in Imax, which has more than 700 giant-screen theaters in China — roughly half of its global network — fell by $1.11, or nearly 11 percent, to $9.14 in morning trading on Friday. Imax had been anticipating an imminent reopening of screens in China, along with the rest of the country's exhibition infrastructure.