The country's booming box office, which hit $8.59 billion in 2017, once was exclusively dominated by Hollywood tentpoles and local blockbusters, but filmmaking from various corners of the world — including India, Southeast Asia and Europe — in shapes and sizes far outside the tentpole mold, such as prestige drama or local art-house films, have begun to connect with mainstream Chinese moviegoers. Still, some genres remain conspicuously underrepresented — perhaps none more so than horror.

Now, Hollywood's premium purveyor of the form, Jason Blum, is looking to fill the void. Blum touched down at the Shanghai International Film Festival on June 18 to unveil an ambitious partnership between his Blumhouse Productions and Donald Tang's growing entertainment firm Tang Media Partners to produce Chinese-language horror-thrillers targeting the Middle Kingdom's growing ranks of moviegoers.

The producer, who has revitalized U.S. genre filmmaking by squeezing high production values out of micro budgets (think Get Out, The Gift and Paranormal Activity), sees big potential in transposing his system onto China's burgeoning market.

"We're going to take our low-budget model and apply it in China, with Donald Tang's help to navigate the regulatory and cultural landscape," Blum says. "Genre movies in China are still really kind of in the ghetto, so if we can elevate the quality, I believe there will be strong demand for them."

Blum and Tang face one obvious and substantial obstacle, however: censorship. Chinese regulators frown on, and typically outright forbid, most of the horror-moviemaking tool kit: gore, ghosts, menacing violence and the supernatural. Blum says he's cognizant of the constraints and finds the challenge inspiring: "We've built a business on working in super-strict parameters because of low budgets. So, whatever the rules, we're going to work within them and try to make a scary movie. And I actually think the movies could be better as a result of it — because it's going to force us to do new things."

Tang stresses that his team will work closely with Blumhouse in the development of the Chiense scripts, and that the partners won't attempt anything that the regulators forbid.

"If you look at past examples of Jason's work, there are scary movies, but many also make you think," Tang says. "We believe this genre can be really impactful but also have positive social messages for the Chinese audience."

The partners say they are surveying contemporary and classic Chinese literature, games and other storytelling forms for IP that might work as winning genre adaptations in the Blumhouse vein. To keep costs down, they also plan to shoot their Chinese projects in Los Angeles using Blum's team and systems.

"There's no reason you can't shoot a Chinese film in the U.S., Australia or Japan," says Tang, "People don't do it because it's usually more expensive; but in this case it's cheaper, which is very unusual but compelling."

Blum concedes that hiring well-known Chinese talent on the cheap, with the promise of backend, could prove the biggest initial challenge to his usual approach, particuarly given that the cost of casting in China has soared in recent years.

"We've paid a lot of U.S. talent a lot of money over the years, so people kind of know that they can work for no money up front, but still get a very big check if the movie works," he explains. "We have no track record here, so it's like starting over again. But we're not going to break our rules — we've done it before, and I believe we can do it again."

This story first appeared in the June 20 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.