How the global box office is changing Hollywood

As global cinema audiences grow, their appetite for US movies is having a profound effect on the way that Hollywood films are being made, reports Tom Brook.

Hollywood is like an octopus with tentacles extending across the globe. For decades most of its sustenance came from domestic ticket sales within the United States but in recent years, overseas markets, particularly China and Russia, have become increasingly important.

According to recent figures from the Motion Picture Association of America (MPAA) almost 70 per cent of the studios’ annual revenue from box office now comes from international markets.

Speak to anyone in the film industry in Los Angeles and they will tell you that the growth in global box office is bringing about fundamental change in Hollywood.

Most notably, potential overseas ticket sales nowadays determine whether or not a studio executive gives the go-ahead to a movie. David Hancock, Head of Film and Cinema at IHS Screen Digest, says: “If it’s a larger budget production that’s meant to go abroad then really the overseas revenues will be the dominant factor in that decision.”

In fact, the Hollywood studio staple has for a while been the big budget extravaganza that will sell overseas. Content has been shaped accordingly. As David Hancock notes: “They’re making films that have fairly universal ideas and themes, they’re not really culturally specific.” A good example might be the recently released action film Fast & Furious 6 which has already hauled in almost twice as much revenue overseas as it has in the US.

To the dismay of some moviegoers, little effort is being made to deliver sophisticated storytelling with these international blockbusters. That’s not totally surprising given that the subtleties of dialogue could easily get lost on non-English speaking audiences relying on subtitles. The movies are crafted mainly to provoke a visceral – as opposed to intellectual – response.

The increased importance of the international marketplace is also affecting casting. Actors are being chosen according to whether or not they will resonate with audiences in targeted markets. David Hancock says: “You have Chinese actors coming to American films, you have Korean, Australian actors being slotted into a role for a film. That’s largely because these markets are important.”

Although the global appetite for Hollywood movies is growing it’s stronger in some parts of the world than others. China and Russia are both big expanding markets. According to the MPAA, Chinese box office revenues grew by an astonishing 36% last year to make it the world’s second biggest movie market after the US. An Ernst & Young report predicts that the US domestic market will be eclipsed by China in 2020.

Although China imposes a quota on the number of US films that can be shown in its cinemas, Hollywood has been busy adapting to the needs of the Chinese moviegoer.

US film critic Matt Singer has noted: “With China, Iron Man 3 had extra scenes and extra characters who were barely in – or not in at all – the American version. If you saw the film at a movie theatre in China you had this extra subplot that involved Chinese characters.”

In fact American film companies are so eager not to lose access to Chinese markets they will go to extraordinary lengths not to offend. When word filtered through that the Hollywood invasion thriller Red Dawn – released last year – was going to feature Chinese villains there was strong criticism in the Chinese media. In an unprecedented move the villains were then digitally removed in post-production and replaced by North Koreans.

Clearly, Hollywood has to tread carefully. It can’t afford to reinforce old stereotypes if it wants to make money in the international marketplace. “Movies have to be made as sensitively as possible so as to not offend any particular country,” says Matt Singer.

After Earth producer Caleeb Pinkett sees the challenge in positive terms: “You have to start taking in other cultures and things that they value and how they view the world and incorporate that into your storytelling.”

Despite the studios’ desire to peddle their wares internationally, there are certain genres that pose a challenge – particularly comedy.  As Matt Singer notes: “Very talky comedies don’t tend to translate, the humour is particularly American and it doesn’t necessarily play well in Asia or in parts of Europe.” 

One bonus of the growing international market is that it’s become a big safety net for Hollywood movies which fail domestically. There are countless examples of a picture stumbling at the US box office but doing well in global markets. Last year’s sci-fi war film Battleship – starring Liam Neeson and Rihanna – only generated $65m in ticket sales within the US but brought in an impressive $237m overseas. The global marketplace is bringing profitability to pictures that would sink if they were relying just on the domestic box office.

As more countries around the world turn to Hollywood blockbusters for entertainment, the influence of these movies in shaping views of America, especially among young people, cannot be overlooked. Hollywood films seeking an international audience are a form of soft diplomacy through which America presents itself to the rest of the world. They peddle American concepts of success, romance and heroism through stories of individual triumph in the face of adversity, tales of redemption and fantastic battles of good versus evil. They also often reflect the darker side of contemporary American life with their violence and portrayal of cultural anxieties.

If Hollywood’s movies are conveying US values to the rest of the world then a consequence of the increased reliance on overseas audiences is that certain American narratives are being omitted. The stories of African Americans, never well served by Hollywood at the best of times, have often had to struggle to find an audience in the international marketplace. But there is a counter-argument that points out that studio blockbusters are only one form of moviemaking – and that there’s an independent film distribution system which can funnel very different and diverse American stories to global audiences.

Commercially, Hollywood’s reliance on overseas markets has been a major success.  Catering increasingly to international audiences may have its disadvantages, but the global marketplace is keeping the Hollywood studios pulsating with life. In uncertain economic times the American movie is retaining its primacy as one of the country’s most robust exports.