The Mythical Ark: Adventures in Love & Happiness (2013), the fifth movie based on Chinese children's favorite animation series Pleasant Goat and Big Wolf, has turned out to be a big high-tech production full of adventures, environmentalism, love and friendship. In this sense, James Bond blockbuster Skyfall should have had a more appropriate name "Mother, Love Me Once Again", whose fantastic scenes succeed in telling only a simple and childish story.

However, it's a pity that few Chinese films can create "superheroes" like the ones churned out by Hollywood at regular intervals.

Worse, Chinese films' share of domestic box office returns fell below 50 percent for the first time in nine years in 2012. State Administration of Radio Film and Television figures show that domestic movies accounted for 47.6 percent of the box office last year, down from 53.6 percent in 2011. Although the increase in the quota of foreign films in 2011 is partly to blame for the drop, the basic reason is the weak competitiveness of Chinese films.

True, Lost in Thailand, a low-budget film, has set a new box office record for a Chinese film, taking 1.26 billion yuan ($202.48 million) since its release in December 2012. But the film has succeeded probably because it is the only light-hearted film being screened during the Chinese holiday season.

China's growing appetite for films is the result of people's growing purchasing power rather than a reflection of the competitiveness of Chinese films. China is now the third-largest film producer in the world. It is ranked second in terms of box office size and the number of screens. The box office has increased by 31 percent a year and the number of screens by 22 percent since reforms were introduced in the film industry.

Last year, Chinese companies made 893 films, an increase of 13 percent year-on-year, and the box office returns were about 17 billion yuan ($2.73 billion), up 30 percent year-on-year. According to Ernst & Young, China will overtake the United States as the world's biggest film market in 2020.

Besides the growing size of its market, the Chinese film industry is becoming increasingly globalized. Foreign capital is showing more interest in the Chinese film industry. For example, many foreign film companies are eager to set up co-production projects with Chinese corporations. Marvel Entertainment, a division of The Walt Disney Company, teamed up with DMG Entertainment to co-produce Iron Man 3, while other Hollywood companies are investing directly in the industry. In August, for instance, DreamWorks announced it would set up "Oriental DreamWorks" with three Chinese media groups.

Chinese film companies are also looking overseas to boost their position in the global market. In May, Dalian Wanda Corporation took over AMC Entertainment for $2.6 billion to become the world's largest cinema chain. And in September, a joint venture led by Beijing Galloping Horse America in partnership with India's Reliance MediaWorks acquired the visual effects business and production company of US-based Digital Domain.

But rapid expansion does not necessarily mean strong competitiveness, and Chinese films are still struggling to find an audience overseas. In 2012, the overseas sales revenue of Chinese films was about 1 billion yuan, half of 2011 and one-third of 2010. In the North American market, China Lion distributed more than 10 Chinese films but collected only 1.67 million yuan at the box office.

Compared with the entertainment industry in the US, one of the few American industries with a positive trade surplus, the Chinese film industry is still in the nascent stage and much more needs to be done to boost its competitiveness.

According to Peng Kan, research and development director of Beijing-based consultation company Legend Media, more creative content and a comprehensive support mechanism are needed to improve the quality of Chinese films in the next 10 years. Only quality Chinese films with universal values can compete with Hollywood productions, and even then they will need sophisticated distribution and marketing strategies, especially overseas, to support them.

"If we focus all our attention on films immediately, there has to be direct competition among local movies, which will mean a smaller audience. So we should first foster foreign audiences' interest in Chinese films and culture," Peng says.

One strategy he suggests is using new media. The South Korean song, Gangnam Style, became popular worldwide thanks to YouTube and Twitter. Inspired by its success, the South Korean Film Library uploaded 50 South Korean movies with English subtitles on YouTube for a global audience to watch for free.

Perhaps Confucius Institutes can work with Chinese films being screened abroad in the same way that Goethe Institutes promote German films and Alliance Francaise raises awareness of French films by holding regular film shows and discussions for audiences overseas.

But in the end, the Chinese film industry should depend on quality movies to make money at the box office.

The author is a journalist with China Daily. Email: zhujin@chinadaily.com.cn

(China Daily 01/31/2013 page9)