Alibaba Pictures to Focus on Original Content Production, Unveils Surprise Works Unit

Alibaba Pictures has launched a new in-house film studio modeled on A24 and called “Surprise Works.” The company announced a large line-up of upcoming local projects, which it says herald a strategic shift more firmly towards original content production.

In the past, Alibaba Pictures cast itself in more of a complementary than primary role in local production, acting frequently as a joint financier and distributor. It is now seeking to focus more squarely on becoming a strong, standalone player in the original content space, creating works that it can then connect to the larger Alibaba group’s vast e-commerce ecosystem.

“In the future, we will strive to achieve diversified content… and create more high-quality works closely related to ‘me’ [the individual] and ‘now,’” said Li Jie, executive director of Alibaba Pictures Group, at a public presentation in Xiamen last week.

He cited Disney’s performance this year as an inspiration for the shift, saying that the rapid growth of paid subscribers to the Disney Plus streaming service in the platform’s first year “gives hope to the market.” Such growth was only possible because of the U.S. firm’s continued investment in content, on which it shelled out $1 billion just this year, he assessed.

While there has historically been a sharp divide in the Chinese film industry between theatrical and straight-to-streaming movies, it is rapidly melting away as the quality and profitability of ‘internet movies’ improve — a process catalyzed by the pandemic.

The number of internet movies produced each year in China used to vastly outnumber the number of theatrical ones. But things have since evened out. In 2019, China produced around 620 theatrical movies and 700 straight-to-streaming ones; this year, as the pandemic disrupted production, it produced only 286 of the former but 677 of the latter.

“In 2020, 10% of the content in the theatrical film market accounted for 45% of the year’s total box office. Meanwhile, nearly 60 internet movies saw earnings break $1.5 million (RMB10 million), with 15 that broke $3 million,” Li explained. “Whether in theatrical or internet movies, the trend is now that top content is king.”

In a recent commentary, the editor-in-chief of 36Kr, a Chinese news outlet and data company focused on the digital economy, assessed that Alibaba previously “was trying to be ‘the power plant fueling the film industry,’ constructing new foundations and infrastructure, making a large number of investments both up and down stream in the film industrial chain, including in Huayi Brothers and Enlight.”

But it has returned to a content-driven strategy following “internal difficulties coordinating content resources and integrating businesses” as well as “a failure to establish a chain of derivative products from their film and TV works, and to effectively integrate [their entertainment business] with their e-commerce resources,” he said.

Execs said that the new studio “Surprise Works” — whose Chinese name translates literally to “Possibility Creations” — is modeled on the U.S.’s A24, the independent entertainment firm specialized in distribution and production. It currently has a roster of 20 theatrical and straight-to-streaming films in the works, and seeks to release ten of them within the next three years. The average age of directors chosen so far is 30.

“If you were to summarize the new brand’s characteristics in just a few words, it’d be ‘new, sharp and interesting.’ The subject matter is unique, the perspective is young; it has warmth and brains,” said Liu Qingling, who heads the new venture. She explained that films will fall into three major content categories: “current youth” stories, “interesting lives,” and near-future sci-fi.

The first two categories are as vague in Chinese as they sound in English. The first is clearly barking up the tree of big box office hit “Better Days,” which paired popular young uber-stars Zhou Dongyu and Jackson Yee in a gritty film about schoolyard bullying. The second is appears to be a slightly more politically tinged category, seeking positive stories about a period of the country’s development that Chinese leader Xi Jinping has declared a “new era” in a ubiquitous propaganda catchphrase.

Liu further described the categories in terms that illuminate the priorities of Chinese content companies seeking to balance popular appeal, profitability and political correctness in one of the world’s most restrictive media environments.

“There is a big gap between generations nowadays; creators can not only cherish the memory of youth, but also go further and tell ‘youth stories’ that are currently ongoing. Lifestyles in the new era are constantly being reshaped; there are many ‘new lifestyle stories’ of people of different age groups that are worth exploring,” she said.

“The cultural confidence brought about by technological advancement makes this possibly one of the best times to tell Chinese sci-fi stories,” she added, noting that the studio will seek to create “credible, heart-warming” works of near-future sci-fi.

(Chinese censors previously frowned upon the genre and unofficially continue to ban plots containing time travel, but authorities recently elevated it above all others, calling on companies to make works that portray the country in a positive light as a technologically-advanced nation.)

Liu presented three upcoming “Surprise Works” films that exemplify the themes.

For the first, there’s road trip film “Striding Into the Wind,” the semi-autobiographical first feature from ambitious young Beijinger Wei Shujun about a recent college finding his way in the world which was selected for Cannes last spring. For the vague “interesting lives” category, she offered “The Girl With Nine Wigs” from director Li Zhi, an apparent remake of a 2013 German biographical film adapted from the memoir of a girl diagnosed with terminal cancer who uses nine wigs to live out nine different lives before she dies.

In soft sci-fi, there’s “Jasmine,” from 40-year-old Taiwanese director Chang Jung-Chi, who won the Golden Horse award for best new director in 2012 for his drama “Touch of the Light.” It’s about an introverted young girl who embarks on a courageous journey with a robot after her father disappears.

Other works under the new brand include a second film from Wei Shujun, as well as movies from slightly more established directors whose Chinese titles roughly translate to the following: “Crazy Workers” by screenwriter and actor Chen Yongxu, who wrote last year’s $58 million-grossing crime thriller “The Big Shot”; “When You Fall in Love With Someone” by Hu Jiahao, an assistant director on the 2015 rom-com sequel “Ex-Files 2”; “Daily Fantasy Guidebook” by Liang Dong, a writer-director who helmed the 2017 fantasy “The Door,” which grossed $3.8 million; “My Actress Girlfriend” by Jia Binqi, who’s previously written and directed a few rom-com web series.

Only one project was discernably attributable to a female director: “Goodbye Amidst Love,” the next feature from Teng Congcong, whose drama “Send Me To the Clouds” starring Yao Chen grossed $4.5 million last year.

Meanwhile, Alibaba Pictures also announced that it is “upgrading” what it calls its “Jin Cheng,” or “Golden Orange,” co-production plan launched back in Nov. 2018. That plan commited Alibaba to involvement in 20 films within five years, to be released during China’s four major holiday periods: Chinese New Year, the summer, National Day in October and the year’s end.

Li Lu, the exec overseeing the Jin Cheng plan, said that Alibaba will now shift its focus “from participation in content to the output of content…[and] from providing story materials and finding partners to being primary investors.” It will also schedule releases during more minor holidays: Valentine’s Day, the Tomb Sweeping festival, May Day, the Qixi festival, or Chinese Valentine’s Day, and the mid-Autumn festival.

So far, three films under the plan have achieved profitability and 15 others have entered development, said Li. Upcoming, previously announced titles include the Andy Lau-starring Hong Kong actioner “‘Shock Wave 2,” Chinese New Year titles “Assassin in Red” and another animated “Ne Zha” film, both set to release Feb. 12, and Ann Hui’s “Love After Love” (with Hehe Pictures and Blue Bird Films).

Other notable titles newly announced include: a comedy planning a Feb. 12 Chinese New Year whose title translates to “National Carnival,” directed by Peng Damo and Yan Fei, the duo behind “Hello Mr. Billionaire” and “Goodbye Mr. Loser”; “Mozart in Outer Space” from director Chen Sicheng of the “Detective Chinatown” franchise, scheduled July 2021; a new, still-unnamed film from popular writer-director Han Han (“Pegasus”); “Operation Diaoyu,” from young writer-director Shen Ao, whose drama “My Dear Liar” grossed $33.5 million last year; “Sunshine Pier,” about a woman from Qingdao who makes a life for herself and her two daughters in Hong Kong after she travels there to reconcile with her husband, only to find he’s divorcing her; a new animated film in the “White Snake” universe, and a breakdancing themed film.

In the reporting period of the six months ending on Sept. 30, Alibaba Pictures Group saw revenues decrease 38% year-on-year to $142 million (RMB927 million), in large part due to the “incomplete recovery of the film market amid the epidemic,” it said in its most recent financial report. It laid off 109 employees between March and the end of Sept., dropping employee numbers amongst the group and its subsidiaries to 1,025.

Since cinemas reopened in the wake of the pandemic, Alibaba Pictures has notably been involved in the world’s highest grossing film this year “The Eight Hundred” as a co-investor and distributor, the Oscar-winning Sam Mendes-directed “1917” as distributor, as well as low-budget romance “Love You Forever,” which became Qixi Festival dark horse box office winner with earnings of $77.3 million (RMB505 million), and the National Day patriotic film “Coffee or Tea?”

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