Alibaba Pictures, somewhat hidden in the Pasadena Playhouse Plaza, presents itself with a modesty at odds with Tinseltown’s tendency for hyperbole. In fact, relatively little fanfare accompanied the arrival of this film unit of China’s multinational technology behemoth, Alibaba Group (ranked among the world’s 10 most valuable and successful brands by the brand equity database BrandZ for the first time this year). Alibaba Pictures opened up shop in a 22,000-square-foot office in Pasadena in 2016.
Since its landing in metro Hollywood, Alibaba Pictures has been working on a handful of deals, investing in a few film productions and distributions, and keeping, at least by in-your-face American standards, a rather low profile. The Pasadena office didn’t respond to interview requests.
But in an interview with Pasadena-based East West Bank, Alibaba Pictures President Wei Zhang describes the client company’s mission here. “We see ourselves as a platform company,” she said. “Our goal in entertainment is not just to make a few movies. We’re not here to create another traditional movie studio…We are a new movie infrastructure company with Internet DNA; we use technology, data and our ecosystem to bring more efficiency and transparency to the filmmaking process.” Zhang describes her goal as growing Alibaba’s role as a gateway between Hollywood and China by developing appropriate content for Chinese movie audiences. And those audiences are expected to grow into the world’s largest, in light of China’s 1.4 billion population. Alibaba Pictures’ parent company has been reshaping the Chinese entertainment industry with an aggressive acquisition strategy since 2014.
Formed in 1999, Alibaba is the brainchild of one of China’s most beloved businessmen — Jack Ma. He’s been called the Steve Jobs of China because of his business savvy, his inspirational leadership and his intimate understanding of the American and Hollywood cultures. An e-commerce company at its core, Alibaba leverages entertainment ventures (film production investments, movie and live events ticketing apps, video-streaming platforms, mobile content browsers and others) to cross-promote interests in a multifaceted business ecosystem.
For example, Alibaba invested in Amblin Partner’s 2017 film A Dog’s Purpose (starring Dennis Quaid and Josh Gad) and helmed marketing the flick in China. Overall, the movie raked in only $64 million in the U.S., but it made $88 million in China with the help of Alibaba’s online movie ticketing app, Tao Piao Piao — in China more than 80 percent of movie tickets are bought online using apps.
From its Pasadena offices, Alibaba continues the Amblin partnership with the sequel, A Dog’s Journey, slated for a May 2019 release. Alibaba’s other successful movie investments include big-budget action flicks such as Dunkirk, Teenage Mutant Ninja Turtles: Out of the Shadows, Star Trek Beyond and Mission Impossible — Fallout.
Earlier this year, Alibaba Pictures announced it was partnering with STX Entertainment on the Robert Zemeckis–produced Steel Soldiers, an original sci-fi action movie set in a futuristic world where humans and androids battle side-by-side. Also this year, Alibaba threw its hat into the ring with other studios (21st Century Fox, Disney, NBCUniversal, etc.) to fund Jeffrey Katzenberg’s streaming video startup, NewTV, which is creating short content for small screens.
For the younger set, Alibaba is producing a full-length adaption of the hit children’s TV series Peppa Pig, based on a beloved series of animated characters that premiered in the U.K. in 2004. (The movie will be a combination of animation and live action.) It’s scheduled to be released during Chinese New Year 2019, which will usher in the Year of (what else?) the Pig.
So what can we make of this Chinese entertainment company that invests in American big-action films, heartwarming family flicks and charming children’s fare?
“I predict that Alibaba will be a good neighbor and a good company in the Southland, but I don’t think it will be a game-changer for the Southland,” says Tom Nunan, an international cinema expert, lecturer at UCLA’s School of Theatre, Film and Television and partner in Bulls’ Eye Entertainment, a mid-size independent film and television production company.
Nunan remembers the ChinaHollywood lovefest of a few years ago that seized the imagination of producers, financiers and investors, eager to partner up with a new foreign market, foreign talent and foreign money. The hope was that such a move would herald development of a China-L.A. synergy, especially since Northern California — with its emerging technology in software and AI — has had a longstanding relationship with Beijing.
In 2015, leading Chinese investment and entertainment companies, such as Fosun International, LeTV, Dalian Wanda and, of course, Alibaba, were all going Hollywood; Wanda had just bought the AMC Theatre chain, and the STX production company was doing a deal with China’s Huayi Brothers Media Group. “All of us in entertainment had stars in our eyes, thinking, Wow! China’s investment in us will pump up the volume in Hollywood financially, content-wise, across the board,” Nunan continues. “We have all sobered up since then.”
Indeed, part of the sobering reality is that the Chinese government limits and restricts the type of entertainment that can be distributed. China doesn’t have a motion picture rating system; all films must be approved by Chinese censors who officially promote Confucian morality, political stability and social harmony. For all practical purposes, these are PG films — which are the least frequently produced films in Hollywood.
“Think of it this way: The Chinese government is acting the way the FCC acted in the ’70s,” explains Nunan. “They are really, really, really strict about the kind of content they want their citizenry to be exposed to. Also, don’t forget, there is no free Internet in China. Very few countries in the world restrict the freedom to surf the web. That’s not to say you can’t do business with China. There are opportunities, but it can be complicated.”
It addition to content, since 1994 Beijing has been restricting the number of American films that can be shown in Chinese theaters. The quota started at 10, increasing to 34 films per year in 2012 with the proviso that at least 14 be in 3D or IMAX format.
Of course, Hollywood would like to raise that quota, writes Michael Dresden at ChinaLawBlog.com. “But the on-again, off-again U.S.– China trade war has thrown those negotiations for a loop and effectively given China the ability to take whatever position it likes, from slapping a huge tariff on all U.S. films to conceding on all of Hollywood’s deal points,” Dresden writes. “But China is in no hurry to agree to anything. Why should it be? They’re fine with the status quo.”
Still, China’s Alibaba is here in the Southland to be a player, and it’s also a
resource for filmmakers and studios here, contends Nunan. Of course, setting up shop in Pasadena may have surprised many, considering that the prime entertainment hubs are in Burbank, Hollywood or the West Side. Says Nunan: “I think the strategy of the move was to announce that ‘We are a Chinese company. Most of the influential Chinese folk live right here in the Pasadena area and this is where we feel most comfortable.’ It’s wonderful that they are unabashedly embracing the neighborhood. Why shouldn’t Alibaba reward them by locating here? This is where their heartbeat is.”