“We have waited for the right time”
Contents distribution company
Next Entertainment World (N.E.W.)’s
Samuel H. KIM is the Korean President of HUACE&NEW, a joint investment corporation set up by N.E.W. and Chinese entertainment company, Huace Media Group. Huace Media Group is the leading visual contents production company that pushes out more than 1,000 TV dramas per year in China. The company has been branching out to film production, investment and distribution since 2013.
Both companies joined forces in 2014 when Huace made an investment deal of KRW 53.6 billion (approx. USD 45.52 million) with N.E.W. which set the first example for a Korean film company to receive Chinese investment. As a joint corporation with equal shares from both companies, HUACE&NEW signals the Korean film industry’s full-fledged step into the Chinese market.
How did you get to establish the Korean-Chinese joint corporation, HUACE&NEW?
It was rather a result of the two companies’ needs that met in the middle than that of a specific trigger. Huace Media Group was looking for a Korean partner for contents development and expansion. As for N.E.W., we had our minds on moving into the Chinese market. Then about a year ago, Huace approached us first for an investment deal.
It’s an unprecedented case for investment and distribution companies in Korea and China to co-establish a corporation.
I guess it’s like a match made in heaven. It wasn’t only our matching needs but also our similarity that we’re both contents production companies that made it easier to create a joint corporation. Both N.E.W. and Huace Media started out and have grown up with content production, and it makes us different from Wanda cinema that started as a private property development company or e-commerce-based Alibaba Group. Because our origins and course of development are similar, we share a deep understanding when discussing or deciding certain agendas.
Despite the mutual understanding that you mentioned, it must have been difficult to collaborate with a foreign company that operates on a different cultural mindset and system.
Our conditions and goals were simple: Let’s make something work while working with them in China. And we united for that goal. Thus, we haven’t experienced any friction so far. Of course, this doesn’t mean the entire process went smoothly all the time, but working with a local partner would be as bumpy. As for the difference in the operation and legal systems, we aren’t experiencing that much difficulty in finding a common ground.
Has N.E.W. been preparing to enter the Chinese market even before your joint partnership with Huace?
We didn’t take any aggressive actions or have any specific plans, but with the information we came across, we’ve always had interest in the Chinese market. Nevertheless, we weren’t set on jumping into the market regardless of any risks. We felt that we had to wait for the right time because for a people-driven business like entertainment, who you work with is a crucial issue. And Huace Media that had the same vision with us appeared at the right time.
How is HUACE&NEW structured and operated?
With the China-based headquarters, we will make Chinese films with the principle of joint investment and co-production-everything will be a 50:50 effort. As co-presidents, John Chiew of Huace and myself, representing N.E.W., will head the production and planning divisions. There is also an acting Board of Directors consisting of 2 board members from each company, making 4 members in total, who will take part in important decision-making procedures. All employees will be newly recruited. In fact, the interview round starts tomorrow. As for the operation scheme, it’ll be the same as other film production companies.
You said all investments would be shared evenly, but this could cause tension when it comes to any decision-making or company operation.
Such tension is necessary for any company, even if it’s not a joint corporation. It becomes a problem when the tension is so high that it delays any decision-making process or stalls the operation, but persuasion is required when you’re creating a content that’s competitive in the market.
You are preparing a film adaptation of web cartoon Witch as your first joint corporation project along with the Chinese remakes of The Beauty Inside and The Phone.
The film adaptation of KANG Full’s web cartoon, Witch, will take place separately in each country. This is the first example of purchasing the rights for a single original story at the film development stage with the goal of adapting it into two separate films for two different markets. The Korean version directed by
KIM Dae-woo (
Obsessed, 2014) will undergo sizable revision from the original story while the Chinese version is aiming for one that’s more faithful to it. Leste CHEN, the director of
20 Once Again, the Chinese-language remake of Korean megahit
Miss Granny, is set as the executive artistic director of the Chinese version. The director hasn’t been decided yet.
BAIK, the director of the original Korean version of
The Beauty Inside, will also be directing the Chinese version. Meanwhile, we are looking for a Chinese director to work on the remake of
The Phone. All three films are in the scriptwriting stage. We’re preparing each of these three films in slightly different manners, and through these diverse attempts, we’re trying to find the best contents and working method for HUACE&NEW.
All these films have started out from N.E.W. Will HUACE&NEW mark a new phase for a more active Korean contents export?
HUACE&NEW doesn’t intend to focus just on Korean contents. Chinese items and other companies’ materials can also be made into films. In order to acquire competitiveness in the Chinese market, we’re just focusing on finding contents with good quality.
There are news stories on the Chinese film market’s growth every day. As a film professional that has jumped into the Chinese market full throttle, how would you assess the Chinese film market’s global position and potential?
Its growth during the past few years has been amazing, but the main point about the Chinese market is its potential to grow even more. China’s average visits to theaters per person are about 0.8 per year. Hollywood is 4 while Korea is 4.2. If you multiply this by each market’s population, Hollywood’s total attendance amounts to 800 million to 1 billion, Korea’s about 200 million. But for China, despite its annual rate of 0.8 per person, its total attendance amounts to 800 million. Even with this simple calculation, it’s a market that can only grow bigger.
It seems definite that the Korean market will clearly expand with more active Korean-Chinese partnerships.
It’s hard for the Korean market to suddenly reach 800 million admissions, but with such joint partnerships, we hope the constraints of the local market can be overcome. The key is how stably and efficiently you can move the already-mature Korean market.