Chapter 602: The Opponents Were Too Weak

Just as Bona was undergoing privatization, the films and TV shows in Bona's rights library were also successively landing in Chang'e Video's content library—this was an agreement signed earlier.

All the films and TV shows in Bona's rights library were put on Chang'e Video.

To be fair, Bona's rights library had accumulated a large number of excellent Hong Kong films and quality blockbusters.

For example, The Silent War series, The Warlords, Red Cliff, Flying Swords of Dragon Gate, The Grandmaster, The Last Tycoon, Flash Point, A Simple Life, From Vegas to Macau, Bodyguards and Assassins, The Taking of Tiger Mountain, Changjiang Qihao, and so on.

There were over a hundred such films, big and small, and most were familiar titles that could be watched over and over.

After all, from 2000 to now, under Zuoshandiao's leadership, domestic films and TV had been producing blockbusters and fine works one after another.

Not like the past few years, when all sorts of messy little-sketch films and variety-show films could enter the hall and rake in high box office.

Back then, although the box office wasn't much, the production and quality of films were higher than now; there were plenty of bad films back then too, but the atmosphere was still decent.

Looking at the film and TV rights Bona had accumulated over the years, you can see how deeply Bona was tied to the Hong Kong side—basically propped up by Hong Kong films.

If someone else were running Bona, they would surely lose that Hong Kong share; even Fang Hong running it wouldn't work, reborn or not.

Because he doesn't have the kind of relationship network Yu Pangzi has, nor the energy to copy every Hong Kong film—and even if he did, those people could still make new ones.

Those great Hong Kong directors still have that ability.

Yu Pangzi had over a decade of accumulated personal ties, over a decade of business ties, squeezing out even local enterprises like Emperor.

In fact, Yu Pangzi was very good at socializing; he had great relationships with Hong Kong film people.

This part of the relationship-based society, Fang Hong couldn't handle—he relies on forceful measures, but Hong Kong isn't a place where forceful measures work; there's a gap, and they have their own preferences and choices.

Not only couldn't he handle it, no one could—Huayi, such a big player, didn't have the face in Hong Kong film circles that Bona did.

Put it this way: if Bona hadn't taken the wrong path with its US listing and had financing difficulties, plus the delay of returning to A-shares for decades...

If the two had listed on A-shares in '09 and '10 respectively, Bona would surely have pulled ahead of Huayi.

Bona lost nearly a decade or more!

Although Bona relied on Hong Kong film people, it never put all its eggs in one basket—instead it cooperated with directors in a diversified way.

Huayi only has Feng Kuzi; without Feng Kuzi it immediately falls apart. That's why Bona isn't something just anyone can run.

Of course Bona didn't only invest in and produce Hong Kong films—Neidi films got a lot of investment too, like Peacock, The Sun Also Rises, and so on.

It's just that investments, production, and distribution were carried out through many different branch companies—Bona has a lot of branch companies.

Yutu doesn't have Bona's kind of accumulation and historical depth—after all, it's only been five or six years since 2010.

These rights from Bona were all put on Chang'e Video, either through distribution or as exclusives.

The reason some could only be distributed is that certain film and TV rights aren't solely held by Bona—China Film Group or other companies also own them, so they could only be distributed to Chang'e Video.

These works would also be opened up to Bilibili for clipping, and to Douyin for short-video secondary creation.

After the exclusive rights Bona had with other platforms expired, they wouldn't be distributed to third parties—Chang'e Video would have them exclusively, of course for a price.

Competition between video platforms now is competition over exclusives, competition over quality content—and that'll be the case going forward too. If I have something you don't, users will be drawn over here, squeezing the others to death.

Platforms like Sohu, Baofeng, pptv, once all the rage, were slowly squeezed to death just like that—inadequate funding, over-investment easily leading to broken capital chains.

LeEco, Baofeng went downhill because of broken capital chains. Not investing, under the current rights-regulation environment, means insufficient content and user loss—also a slow death.

So doing this without money is a death spiral!

Later Youku went downhill the same way. After Youku was acquired by Alibaba, some bright spark decided Youku's losses were because it paid creators too much.

So they made sweeping reforms—nearly zeroed out Youku's playback revenue, doubled pre-roll ads to 1 minute 30 seconds, forcing users to subscribe.

UC was also killed off after Alibaba people intervened—otherwise Toutiao wouldn't have had a chance at all.

It's all because the opponents were too weak—nothing to be done!

The consolidation of over a hundred film and TV rights from Bona, all poured into Chang'e Video's content library, not only shook the film and TV circle but also caused some reshuffling in the video platform landscape.

Smaller video platforms would see their content shrink and survival grow harder—effectively forcing them out.

And quality content concentrating at the top is itself a kind of survival of the fittest, a major reshuffle. Fang Hong just accelerated the reshuffle ahead of time.

It also pushed Alibaba, Tencent, and Baidu to increase investment in film and TV rights content—after all, Chang'e Video, with the Principal's layout, was coming on strong.

Now Chang'e Video, with the full support of Yutu and Bona and the influx of massive quality content, had surpassed 150 million monthly active users, putting enormous pressure on them.

After all, there's only so many users—if they go to someone else's platform, theirs shrink.

And Chang'e Video had at least over a dozen web dramas filling in every month—no worry about retaining users.

This was thanks to Fang Hong's earlier web drama conference, the novel rights acquisition plan, and the opening of rights to all film and TV companies after acquiring Shengda Literature.

Now Chang'e Video and Yutu cooperated with nearly a hundred small and mid-sized film and TV companies.

Cooperated with Phoenix Linkage on Psychological Crime!

Cooperated with Huanrui and Enlight on The Lost Tomb!

Cooperated with Ciwen on Darker 2!

Cooperated with Leyan on Go Princess Go!

Of course there were self-produced ones too, like Battle Through the Heavens, Super Teacher, and so on.

There were also many cases where others bought the rights and produced them themselves, with no cooperation with anyone.

Yutu and Chang'e definitely couldn't produce that much on their own—not enough capital, not enough organizational ability—so they could only cooperate on a large scale with those small and mid-sized film and TV companies.

All these moves were Fang Hong doing his utmost to help long-form video hold its ground in this competition.

After all, he didn't have BAT-level capital strength, so he relied on strategy.

That's why Jack Ma and Tony Ma always kept an eye on the Principal, treating him as their number-one enemy in entertainment. Say what you will, the Principal really has ideas, and his vision is far-reaching.

He doesn't care about momentary losses and gains!

You know, several segments of Chang'e Technology are operating at a loss—all to seize market share.

Besides the moves on the film and TV rights library, Bona Cinemas would also team up with Yutu's cinemas to form the Crystal United Cinema chain.

Of course the cinemas still belonged to Bona—only the brand and scheduling were unified. Yutu already had 63 cinemas and 651 screens.

Plus Bona's 30 cinemas and 250 screens!

Crystal United Cinema has, through franchises or self-built, a total of 93 theaters with 901 screens nationwide; with a scale like this, it has gained some confidence.

Mainly because Bona's high-end theaters joined in, giving Crystal United Cinema some scale.

However, Jade Rabbit's moves haven't stopped — it has set its sights on Shimao Circuit and Orange Sky Golden Harvest, the former estimated at 1 billion, the latter at 3 billion.

That means at least 4 billion must be put up to acquire these two theater chains; if acquired, Crystal United Cinema could break into the top ten and gain further confidence.

And these two — the former has been targeted by Wanda, the latter by Dadi; if Jade Rabbit wants them, it'll take some effort, but it's ultimately just a matter of money.

Jade Rabbit has money now. After stripping out all the messy taxes and marketing costs, Gravity's share is roughly 1.8 billion, around 257 million USD.

Back then, with the global Propaganda Department, they agreed with Universal on a fifty-fifty split; their marketing costs are expensive — USD-denominated expenses easily run into the hundreds of millions.

But this is only net box office revenue. Other rights income — home DVD and Blu-ray, plus TV rights — is around 320 million; streaming rights are higher, around 70 million USD; total 490 million.

Merchandise licensing, theme parks, music rights — we'll just ignore those.

Just rights and box office revenue already exceeds 2.6 billion. Overseas money really is easier to earn — no wonder the country has always encouraged exports.

Plus Big Hero 6's box office and the like — these don't need to be counted; they've all been poured into the Animation Department for further expansion and production.

Merchandise licensing is the big earner — revenue around 500 million USD, but Universal still needs to take its cut; they also earn around 500 million USD.

In other words, this animated film alone brought in about 1 billion USD in merchandise revenue.

Not counting other film/TV rights and box office, Jade Rabbit now has completely sufficient cash flow to support theater acquisitions.

And still has surplus to renovate and upgrade all its theaters.

This is the inevitable result of Fang Hong burning through so many years on Jade Rabbit — finally bearing fruit.

Also, Jade Rabbit's Animation Department has another film, Minions, coming out this year in July — it's been in production for many years with heavy investment.

Recently, The Conjuring 2, produced by the Zhong family and distributed by Warner, took in 322 million USD at the global box office.

Since it's an IP Movie, making money is inevitable — The Conjuring Series already has a fixed audience base.

This film's net box office revenue is roughly 80 million USD; 10 million USD went to Yu Xian, the other 70 million was deposited into Liu Tianxian's account.

The previous 259 million USD has to be filled in — wedding, mortgage, household expenses and the like, she's been acting as the financial housekeeper handling the spending.

Now Jade Rabbit no longer needs the Zhong family to transfuse blood; it's just that Chang'e Technology is having some financial difficulties.

But it doesn't matter — Tencent's competing product All People Super God has updated to a brand-new version, adding PVE and character-raising systems.

Having lost its MOBA characteristics and gone live with pay-to-win hooks, players are full of complaints; those who had originally drifted away are slowly returning, and livestream and tournament buzz are rising again.

Whether revenue can climb depends on summer break — that's when students are on vacation.

(End of chapter)