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Carnival in the birdcage: a study of the film and media industries' reforms in China after 1978 and its soft power

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Carnival in the birdcage: a study of the film and media industries' reforms in China after 1978 and its soft power

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Content CARNIVAL IN THE BIRDCAGE:
A STUDY OF THE FILM AND MEDIA INDUSTRIES’ REFORMS IN CHINA AFTER 1978
AND ITS SOFT POWER

by

Katherine Kit Ling Chu

A Dissertation Presented to the
FACULTY OF THE USC GRADUATE SCHOOL
UNIVERSITY OF SOUTHERN CALIFORNIA
In Partial Fulfillment of the
Requirements for the Degree
DOCTOR OF PHILOSOPHY
(POLITICS AND INTERNATIONAL RELATIONS)

December 2012

Copyright 2012 Katherine Kit Ling Chu

ii
D E D I C A T I O N

To my parents.

iii
A C K N O W L E D G M E N T S
This dissertation project has truly been an intellectual journey, both challenging
and rewarding. It is with deep gratitude that I thank my family, friends, colleagues,
professors and various research institutions whose support, in one way or another,
contributed to making this dissertation a reality.
To my academic advisor and the chair of my dissertation committee, Professor
Stanley Rosen, I offer my heartfelt thanks and appreciation. His patience,
encouragement and thoughtful criticism were invaluable not only in the writing of this
dissertation but also with regards to my intellectual growth. I am also most thankful to
Professor Daniel Lynch’s intellectual curiosity that allowed him to supervise a
dissertation that was not quite fit with his research interests at the moment. To Professor
Dominic Cheung, I extend a special thank you for his unfaltering belief in the project and
in my intellectual abilities. In addition, I would like to thank Professor Eugene Cooper,
Professor Akira Lippit, and Professor Douglas Becker for their support and help at
various stages of my graduate studies. I have received generous financial support from
the University of Southern California, the USC School of International Relations, the USC
Center for International Studies, the US-China Institute, the USC East Asian Studies
Center and the USC Department of History during the course of my studies and research.
I greatly appreciate their trust and support.
A number of scholars and intellectuals also made invaluable contributions to my
research and continue to influence my thinking on the Chinese media industries, Chinese
film industry and Chinese politics: Professor Robert Chi at the University of California,
Los Angeles, Professor Sun Shaoyi at the Shanghai University, Professor Yuezhi Zhao at

iv
the Simon Fraser University and Professor Mirana May Szeto at the University of Hong
Kong.
The completion of this dissertation owes not only to the many intellectual
encounters with both professors and fellow graduate students, but also to the
administrative staff in the School of International Relations and the Department of
Political Science. I would like to thank a number of staff who played an important role in
my journey: Luda Spilewsky, Karen Tang, Linda Cole, Cathy Ballard, Indira Persad and
Veridiana Chavarin. I am deeply grateful for their ongoing support.
While many of my friends were a source of intellectual inspiration during my
studies at USC, it is their friendship and support that I cherish the most. My sincere
thanks to Li Cheng, Chengna Chen, Peimin Zhang, Haili Yang, Rita Min Rui, Jeanine
Yutani, Kate Svyatets, Jia Tan, Alan Chan, Monique Wan, Cecilia Poon, Rosa Chan,
Surajit Chakravarty, Kosal Path, Eric Blanchard, Jeffrey Fields, Xiaowen Zhang, Deniz
Cakirer, Nadejda Marinova, Maria Armoudian, Yesim Ince, Christina Faegri, Zeynep
Sahin, Ron Osborn, Minna Jia, and Hong Pang. A special thanks to Joy Lam and
Yanhong Zhu for the many ways in which they have been there over the years. I would
like to thank Cherry Cheung, Sandra Cheng, Irene Choi, Parry Leung, Ken Yau, Suet-Wah
Choi, Celia Tsui and Yat-Tung Chan from Hong Kong together with Ran Ran from Beijing
for their unwavering support and inspirations. Their direct or indirect help were critical
for this research and their friendship has served as a vital source of motivation.
To my family I owe a very special thank you, especially my parents for their deep
belief in the value of education. The love and support from my brother and his family
throughout my studies at USC’s have made an invaluable contribution to the completion
of this dissertation project. Finally, I want to express profound gratitude to Nevin Wong

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for sustaining me with love, friendship and laughter. His help in editing this dissertation
has been crucial to its completion.
Thank you all.

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T A B L E O F C O N T E N T S
DEDICATION ii
ACKNOWLEDGMENTS iii
LIST OF TABLES x
LIST OF FIGURES xi
KEY TERMS xii
ABSTRACT xv
INTRODUCTION 1
I.1 The Arguments in Brief 2
I.2 Why Films and Contributions? 5
I.3 Methodology 7
I.4 Shortcomings? 9
I.5 Outline of Chapters 10
CHAPTER 1: MEDIA REFORM, REGIME DURABILITY 12
1.1 Introduction 12
1.2 The Media Birdcage: Research Questions 16
1.3 Chinese Media Reform: A Paradox 18
1.3.1 The Democracy Framework 18
1.3.2 Serving “Two Masters” 22
1.4 Theoretical Considerations 25
1.4.1 Explaining Regime Stability amid Widespread Change 27
1.4.1.1 State Durability 28
1.4.1.2 Institutional Change 30
1.4.2 Institutional Development Analysis: Key Concepts 33
1.4.2.1 Path Dependence 34
1.4.2.2 Institutional Displacement, Layering,
and Conversion 36
1.4.3 The Film Industry: Three Sub-Systems 37
1.4.4 Conclusion 39

vii
CHAPTER 2: FILM INDUSTRY STRUCTURE AND THE STATE 41
2.1 Introduction 41
2.2 Transitioning to a Communist Film Industry Structure 43
2.3 The Hierarchy of Government Jurisdiction 54
2.3.1 The Central Administration: SARFT 54
2.3.2 Local Administrations: The Local ARFTs 59
2.3.3 Administrative Hierarchy in Chinese Media
Systems 60
2.4 The Film Management Bureau: Licensing and Censorship 62
2.4.1 The Licensing System and Quotas 62
2.4.2 Censorship 64
2.5 Shifting State-Studio Relations 71
2.6 Conclusion 78
CHAPTER 3: THE OFFICIAL REVIVAL OF CHINESE COMMERCIAL FILM 80
3.1 Introduction 80
3.2 Commercial Development, 1978-1989 82
3.2.1 Recovery from the Collapsed Film Economy:
The Beginning 84
3.2.2 Where to Start? 86
3.2.2.1 The Production Sector 86
3.2.2.2 The Distribution and Exhibition Sectors 89
3.2.3 1984: The Crisis 97
3.2.4 Ratings 102
3.3 The Paradoxes of 1980s Commercial Film Development 105
3.3.1 The Marginalization of Entertainment-Focused Films 108
3.3.2 Rationalizing Commercial Film 113
3.4 Conclusion 119
CHAPTER 4: REBUILDING THE FILM INDUSTRY:
THE RISE OF MAIN-MELODY FILMS 122
4.1 Introduction 122
4.2 Rebuilding the Film Industry 124
4.2.1 Establishing the Fund for Main-Melody Filmmaking 125
4.2.2 Suppression of Commercial Filmmaking 128
4.2.3 Patriotic Campaigns and the Rise of Main-Melody Films 141
4.3 The Emergence of the Main-Melody Concept 151
4.4 Conclusion 156

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CHAPTER 5: RAPID COMMERCIALIZATION, “IDENTITY DEVELOPMENT,”
AND CHINESE CINEMA 159
5.1 Introduction 159
5.2 Major Reforms 163
5.3 Censorship Revisited 180
5.4 The Reentry of Hollywood 187
5.5 The “Blockbusterization” of Chinese Cinema 194
5.6 Conclusion 197
CHAPTER 6: BUILDING AND SELLING ITS IMAGE:
“SOFT POWER” AND CHINESE FILM REFORM AFTER 2002 202
6.1 Introduction 202
6.2 China’s National Image 203
6.3 Mechanisms for Controlling and Managing the Film Industry 206
6.3.1 Ideological Control 208
6.3.1.1. China’s Peripheries:
Hong Kong and Taiwan 208
6.3.1.2. The Production Sector:
Licensing 210
6.3.2 Bureaucratic Control 212
6.3.2.1. The Distribution Sector:
The Duality of Government Roles 212
6.3.2.2 Exhibition: Centralized Dominance 215
6.3.3 Soft Controls 218
6.4 Soft Power and the Chinese Film Industry 225
6.5 Soft Power and the Film Industry: China on the Rise 227
6.6 Conclusion 235
CHAPTER 7: HOW BIG IS THE CAGE? RAPID INDUSTRY COMMERCIALIZATION
AND FILMMAKER STRATEGIES FOR SURVIVAL 237
7.1 Introduction 237
7.2 Filmmakers: A Typology 238
7.3 Loyalists 242
7.4 Local Champions and Opportunists 244
7.4.1 Local Champions 246
7.4.2 Opportunists 250
7.4.2.1 Strategically adaptive behavior 256
7.4.2.1.1 “Justice cannot be conquered by evil” 257
7.4.2.1.2 “Talk more about the past” 258
7.4.2.1.3 “Do not show blood and nudity” 258
7.4.2.1.4 “Ghosts can only be in the heart” 259
7.4.2.1.5 “Social stability is the key” 260
7.5 Rebels 263
7.6 Analysis of Filmmakers’ Strategies 272
7.7 Conclusion 275

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CONCLUSION 277
C.1 Introduction 277
C.2 State-Media and Market Relations 281
C.3 Media Reforms and Democracy 282
C.4 Institutional Change, Regime Durability 292
C.5 Conclusion 297
REFERENCES 299
APPENDICES
APPENDIX 1: The 17 Internal Departments of SARFT 318
APPENDIX 2: The 33 Organizational Units of SARFT 326
APPENDIX 3: Functions of the Branches Related to Filmmaking 329
APPENDIX 4: Local Administration of Radio Film and Television
(ARFT) Divisions 332
APPENDIX 5: Filmography 333
APPENDIX 6: Glossary of Chinese Names 348
APPENDIX 7: Glossary of Chinese Terms 353
APPENDIX 8: Film Periodization 362
APPENDIX 9: List of Interviews 365
APPENDIX 10: Film Industry Regulations Passed in the PRC 371

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L I S T O F T A B L E S
Table 2.1: First Five-Year Plan of the Film Industry, 1953-1957 48
Table 2.2: Film Production, 1952-1975 53
Table 3.1:
China Film’s Employment Figures, Distribution
Income, and Annual Profits, 1965-1980
92
Table 3.2: Screening Unit Statistics, 1949-1982 94
Table 3.3:
The “Four Indicators” (Xi xiang zhibiao) of the
Guangdong Film Market, 1979-1984
100
Table 3.4: Regional Ticket Pricing Scheme 101
Table 4.1:
Major Main-Melody Films Promoted by Government,
1988-2000
145
Table 5.1: Co-Production Options 192
Table 5.1
FN
: Chinese National Holidays, 2012 170
Table 5.1: Co-Production Options 192
Table 6.1: Growth of Export Films, 2004-2011 229

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L I S T O F F I G U R E S
Figure 2.1: Chinese Film Industry Structure, Pre-Reform 51
Figure 2.2:
Chinese Film Industry Structure, 1980s—early 1990s
56
Figure 2.3:
Chinese Film Industry Structure, 2008—present
61
Figure 5.1: Feature Film Production in China, 1976—2011 165
Figure 5.2: Movie Theater Growth in China, 2002—2011 173
Figure 6.1: Film Attendance, 1976—1999 214
Figure 7.1: Types of Filmmakers in China 241

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K E Y T E R M S
ARFT Administration of Radio, Film and Television
BJSYB Beijing Statistical Yearbook
The Board Film Scripts Discussion Board
CCP Chinese Communist Party
CCTV China’s Central Television Station
CEPA
Closer Economic Partnership Arrangement
between Hong Kong and the Chinese Mainland
CFG China Film Group Corporation
CFYB China Film Yearbook
CMP China Media Project
CPPCC
Chinese People Political Consultative
Conference
FEC Film Examining Committee
Film Bureau Central Film Management Bureau
Film Companies
Film distribution and exhibition management
companies
FRC Film Re-Examining Committee
The Fund
Development Fund for the Chinese Film
Business
GO General Office
MII Ministry of Information Industry

xiii
MOFCOM Ministry of Commerce
MOFTEC
Ministry of Foreign Trade and Economic
Cooperation
MPA Motion Picture Association
MPAA Motion Picture Association of America
MRFT Ministry of Radio, Film and TV
PLA People’s Liberation Army
PRC People’s Republic of China
RFT Radio, Film, and Television
RMB
Renminbi, ¥
[The Official Currency of China]
SAIC
State Administration for Industry and
Commerce
SARFT State Administration of Radio, Film and TV
SCIO State Council and Information Office
SFG Shanghai Film Group Corporation
SOE State-Owned Enterprise
SRE Systemic-Regulated Enterprise
The Three Central Stations
1) China National Radio; 2) China International
Radio; and 3) China Central Television
TRIPS Trade Related Intellectual Property

xiv
UNESCO
United Nations Educational, Scientific &
Cultural Organization
USD
US Dollar, $
[The Official Currency of the United States]
VCD Video Compact Disc
WTO World Trade Organization

xv
A B S T R A C T
This dissertation is an investigation into the development of China’s cultural
industry over the past 30 years. The study focuses on China’s film industry, through the
frame of institutional theory. The study centers on three major research questions: 1)
How has the Chinese government’s control over the film industry affected the industry’s
commercial success and the Party’s own legitimacy? 2) With the increasing
commercialization of media industries in general— and the film industry in particular—
how can we explain the apparent lack of political liberalization? That is, why haven’t
media producers and other cultural sector workers demanded democratic reforms? 3)
How can we understand, within the framework of institutional theory, the stronghold of
China’s authoritarian regime despite modest reforms?
The findings of this study reveal that media reforms have enhanced the influence
of political leaders over the industry’s development and audience tastes; such political
influence has demanded that film content tow the Party line. Commercialized media
outlets have remained vulnerable to state control, subject to intense regulation and
bureaucracy throughout all aspects of production, distribution, and exhibition.
Increasingly, private corporations (both domestic and foreign) are attempting to
gain entrée into the Chinese film market. It is highly likely that, in the single-minded
drive to maximize profits, private enterprise will continue to submit to SARFT
regulations. Within this dynamic, there appears to be a space for media reform, though,
arguably, it necessitates increasing political liberalization.

1
I N T R O D U C T I O N
This research project investigates the Chinese film reforms since 1978 and its
relationship with the political transformation of China. It draws on the conceptual
framework of institutional theory, modernization theory and media and cultural policy
studies. What are the elements under examination include the industrial structures,
government policy initiatives and media workers’ survival strategies. A range of film
reform policies will be covered in the discussion, including those on distribution,
exhibition, production and co-production. Essentially this study discusses and evaluates
some core theories and concepts of regime durability and media controls in authoritarian
regimes, and some ideas of cultural globalization, such as “cultural imperialism”. This
dissertation contributes to academic scholarship in the field of democracy, economic
transition, media studies, cultural policy studies and globalization, as well as relating to
policy and industry practices in the global media arena.
In academic terms, the previous scholarship on Chinese media studies has placed
much emphasis on the newspapers industry and increasingly in the television industry.
Yet, the film industry has rarely been a case study and is even left out in the limited
research on Chinese media studies. Much has been written on Chinese cinema from the
perspective of textual analysis. But there is a paucity of scholar work on its institutional
and policy dimension. Even less has been done centering on the relationship between the
film industry and the institutional and policy as well as regime transformation
perspectives. In practical terms, I hope this research can produce a better understanding
of the Chinese film industry reform since 1978. People need to know better China’s
cultural traditions and sensitivities, and the paramount socio-cultural functionality
conferred upon its national cinema. Furthermore, this study will shed light on the

2
understanding of industry practitioners’ strategies and behavior in China where they
have confronted with heavy censorship and controls.
At the center of this research project stands an intriguing dual phenomenon. On
one hand, China seeks the best way to revise its current government policies, industrial
structure and operating practices to rejuvenate a national film industry, which has
declined since the mid-1990s. Furthermore, it also wants to use the film industry to
increase its national image both, domestically and internationally. The goal is to make
the Chinese film sector best-fit China’s fast growing market economy. On the other hand,
the increasing transnational media players are viewed as a challenging force to the Party-
state political system. This development has triggered the question of how the Chinese
government manages the institutional reform of film industry without regime change.
I.1 The Arguments in Brief
My major research question is three-pronged:
? How has the Chinese government been able to control the film
industry without jeopardizing its commercial success or threatening
the Party’s legitimacy?
? With the increasing commercialization of the film industry — indeed,
of the media industries in general — what explains the lack of
political liberalization? That is, why haven’t media workers
demanded democratic reforms?
? How has China remained authoritarian despite the wide-ranging
reforms occurring between the late 1970s and 2011?
1

1
This third inquiry is informed institutional theory.

3
Let us begin by addressing the question of how the Chinese government
controlled the film industry. This dissertation argues that the transformation of the
Chinese film industry did not undermine the state’s dominant influence, but rather
advanced the state’s power through three mechanisms for controlling the film industry:
1) Ideological control. The relatively unchanged institutional and
bureaucratic structure, which remains embedded in the film industry, enables the
government to establish its control over filmmaking. In particular, the licensing system
and censorship have effectively controlled the creativity of the production sector. Not
only domestically, but also extends to China’s peripheral territories such as Hong Kong
and Taiwan.
2) Bureaucratic control. The control-and-management mechanism remains
a top-down process. Besides cleverly capturing foreign capital, the Party is also
empowering its administrative agents such as SARFT to reinforce their control over the
film industry by instituting comprehensive regulations.
3) Soft controls. Through the inducement of such mechanisms as subsidies,
quotas, and monopolies of imported films, the Chinese government has successfully
protected the national film industry against foreign competitive challenges. Moreover,
soft controls are used strategically to constrain filmmaking on topics that are in conflict
with the government’s principles. The ability of the regime to constrain filmmaking is
effective in ensuring that films generally do not divert from the government’s position.
In order to illustrate the second part of my research question, which is why media
workers didn’t demand democratic reforms, I have composed a typology of filmmakers’
political behavior. It explains how the film industry talents relate to the state and how do
their relationship shape their attitudes and resources in filmmaking. The findings of this
study reveal that the number of filmmakers is growing, but they are not likely to

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participate in political activities that might contribute to a democratic transition. On the
contrary, they choose to cooperate with the state and comply with the rules and
regulations to continue their filmmaking. Although the media workers are able to use
“strategically adaptive behavior” to test and negotiate the boundaries of some issues, the
government still has the ultimate control. Thus, the result of commercialization in the
film industry has efficiently co-opted the film talents into its system.
My final question seeks an explanation of how China remains authoritarian
despite the institutional changes. Drawn directly from Mahoney and Thelen, I propose
three processes: 1) displacement; 2) layering; and 3) conversion.
2
These processes are
intended to reform the existing system for the sake of better serving the interests of the
government, and to some extent, to the industrial actors. It is precisely these three
institutional processes that facilitate the self-undermining processes of the institutions,
thus enabling regime durability.
The heart of this dissertation lies in tracing the logic of the changing policies of
the film industry. It is an attempt to seek the internal logic of institutional change. My
explanations have highlighted how some moments provided opportunities for
endogenous institutional transformation. These opportunities not only provided
practitioners a way to engage in acts of creativity, but also allowed the government to
reduce tensions, which, it turns out, empowered the state actors to resolve that crisis by
constructing new institutions. This is why institutions in Chinese film industry change
without regime change.

2
In the endogenous institutional changes.

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I.2 Why Films and Contributions?
The Chinese in the past 60 or so years have experienced a series of extraordinary
events, such as revolutions, wars, mass movements, and economic reforms. Mao
Zedong’s terror and Deng Xiaoping’s practicality have transformed millions of Chinese
lives. As a student who has grown up in Hong Kong— a place relatively close in distance
yet distinctly different from China, with its own unique identity— I am interested in what
people in Mainland China are experiencing. People in Hong Kong usually doubt the
legitimacy of the regime. We Hongkongers have no problem identifying ourselves as
“Chinese,” but do not wish to be subjects within the Chinese Communist Party (CCP),
particularly as millions of our parents and grandparents left their own countries to
become subjects under British rule. In this post-1997 era, Hongkongers remain
ambivalent towards the Chinese government. As I look back upon the history of CCP, I
am compelled to delve further into the lives of the people who lived through those years,
as a means toward better understanding contemporary cultural and political relations.
Reading books, newspaper, magazines and seeing films made at the time are helpful.
After all, writers, journalists and directors shared their experiences and addressed their
concerns by their own language. I believe that in their works, they reveal their ideas and
contribute to constructing the spirit of the age. Among all these media, movies provide
better raw material.
First of all, the popularity of the art from was great, films reached a larger
audience than other written format, especially since people might find it is boring to read
novels or they do not trust the heavy controlled news media. Second, CCP saw clearly the
propaganda potential of the films and determined to use it. As a result, films even the
entertainment ones, are still ideological and less heterogeneous in their content than
novels, magazines and newspapers. Third, the movie houses showed what the regime

6
wanted them to show. Because filmmaking is an expensive undertaking, the state has no
trouble in enforcing its monopoly and the filmmakers are less powerful to say no than
other media. As a consequence, the history of Chinese cinema well reflects the changing
political ideas that the CCP wished films to transmit.
Zhang Yimou’s great films in the 1980s, bravely revealing the source of tragedies
experienced by Chinese people are not caused by individuals; instead it is from the
oppressive and absurd rituals and customs Chinese society (Chow 1995). His equally
impressive films made 20 years later concentrated on the heroes of history. In the early
part of the open door policy in 1980s, many films were made about the common people
and low level of government officials in improving people’s life, but at the end of the
decade the favorite heroes in films are high-rank Party leaders. Mapping all these
changes helps us to understand the Chinese political system and changes. Moreover, by
tracing all the details of the film industry reforms, this study enables us to understand
how the CCP changed its mentality toward the definitions of “film” – from a tool, to
finally accepting it as a commercial product. This ideological turn has great implication
on the study of Chinese economic transitions. For example, how did the CCP co-opt the
film enterprises in serving its interests? How did the CCP manage the influx of foreign
capital in the film industry?
Another reason to study film industry reforms is that it contributes to the fields of
political science and international relations in filling the gap of Chinese media studies. In
the studies of Chinese media, most of the studies have focused on the sector of
newspapers or the Internet development. It is difficult to find film industry development
in their studies. Although there are some exceptions such as Zhu Ying’s Chinese cinema
during the Era of Reform, which was published in 2003; and Zhang Rui’s Cinema of
Feng Xiaogang: Commercialization and censorship in Chinese cinema after 1989,

7
which was published in 2008, I would say, film industry reforms is not their major focus.
Instead, they have concentrated on the analysis of film contents. This is very common
within the field of Chinese cinema. In contrast, my study solely focuses on the film
industry itself. With such a focus, I attempt to incorporate the frameworks that have
already been applied in other Chinese media studies, such as Pan Zhongdang and Chen
Huailin’s institutional model, Zhao Yuezhi’s democracy framework, and Li Chin-Chuan’s
power, money, and media concepts in the study of Chinese films.
Lastly, film used to be viewed as a commercial product; scholars typically glossed
over its social values and political implications. I hope this dissertation encourages
future studies to explore the relationship between film and politics. Topics like
nationalistic themes in film, film controls under different political regimes,
3
and film as a
means through which to increase soft power are all pertinent to the study of political
science and international relations.
I.3 Methodology
This dissertation draws on existing scholarship in the areas of institutional theory,
democracy and media controls in authoritarian regimes, cultural and media
globalization, cultural and cultural policy studies, media studies, Chinese politics and
Chinese soft power, in order to put the research topic of the relationship between China’s
democracy and film industry reform through the lens of institutional theory, and to
examine it with multiple approaches. Nevertheless, given the paucity of academic
literature on the topic, this project, for the most part, relies on primary sources, such as
government documents, public statements, press releases and face-to-face interviews.

3
For example, a comparison of film controls among the regimes in India versus China.

8
My field research started in the year of 2008 till to early 2012. It was composed
of archival research and personal interviews in Beijing, Shanghai, Hong Kong and Los
Angeles. During the time, I carried out archival research in the following venues: Beijing
Film Academy, University Service Center for Chinese Studies at the University of Chinese
University of Hong Kong, Hong Kong Film Archive and the Richard C. Rudolph East
Asian Library at UCLA. I also conducted some archival work in the National Library of
China in Beijing to gather materials on film reforms through the PhD Dissertation and
Master Thesis Data Library.
In addition, the research relied on verbal interviews with filmmakers, including
government officials, directors, producers, scriptwriters, investors, researchers, and
educators from China, Hong Kong and the U.S.. Their personal experiences and business
strategies are important in the context of Chinese film reforms. I have interviewed total
39 film workers from Beijing, Shanghai, Hong Kong and Los Angeles since 2008 to early
2012. Interviews were conducted face-to-face and in Mandarin, Cantonese and English.
Some of the interviewees were requested to be anonymous. For more information on the
composition of interviewees and other detail see the appendix 9.
This study has also highlighted policies changes throughout the year in very fine
detail. These materials were collected from Beijing Film Academy and the National
Library of China in Beijing. Among them, 40 Years of film industry construction in new
China (1949-1989) and Latest collection of film and TV laws and regulations are
considered as internal reference materials, which means they are internal, limited
circulation material for the Chinese government officials. Because of these materials, I
am able to gather an extensive list of reform policies on film industry since 1949 to 2005,
which is not easy to find from other published books, reports or Internet.

9
It needs to be noted that besides the internal documents, I am able to get access
to the Chronicle of Chinese Film Industry (a collection of nine books) edited by Chen Bo,
the former head of the Film Bureau, from the Library of UCLA. The collection has
provided abundant information, including the red head documents, about the film
industry from the high-level officials’ perspectives.
I.4 Shortcomings?
This study examines the top-down relationship between the state and filmmakers.
Although I have emphasized the active role of the film industrial practitioners in
negotiating boundaries with the state, this study does not capture and investigate the
bottom-up linkages between the media outlets and the state. That is, how exactly did the
media workers change the leaders’ decisions in policy changes? Are there any formal,
and informal, channels that the government has opened to collect public opinion
regarding media reforms?
This research also lacks emphasis on the perspectives of the film audiences. This
dissertation has made the assumption that film is a powerful tool to manipulate and
control people. However, this study lacks evidence to support the fact that audiences are
affected by films, and how are they being affected. Cinema audiences have the right to
choose what to see, and decide what the meanings of the film have constructed. As more
and more Chinese have grown up with films, they understand the codes and conventions,
which means they are not merely the passive recipients of ideas. I think conducting
surveys with mass audience is an essential precondition to understand the influence of
films.
Finally, my dissertation will be greatly improved if I have more discussion or a
case study on the implementation of the rules and regulations. Although I have

10
interviews with filmmakers and officials, this dissertation lacks in a case to reveal what is
the daily practice of filmmaking? What actually needs to be done for a filmmaker if
he/she wants to make a film? What is the process? How do a filmmaker interplay with
the government in a film production?
I.5 Outline of Chapters
Chapter 1 lays out the analytical and methodological framework of this study.
Instead of relying on marketization/commercialization as the main determinant in
Chinese media reform, I provide an alternative approach by focusing on the relationship
between two variables: the state and the media, particularly the film industry.
When it comes to the development of media reform, I examine why the media did
not let go of its role as the Party’s “mouthpiece”, despite the breathtaking speed of
commercialization. In other words, how does the state continue to exercise blunt forms
of media censorship? In Chapter 2, I first give a historical account of the political
structure of the propaganda system and the structural change of the film industry. I then
examine policy changes since 1978, providing an in-depth narrative of the most
important policies in the three sectors of the film industry, including production,
distribution and exhibition, to reveal the fundamental institutional environment for the
State and the media industry to interact.
Chapter 3 introduces the intense relationship that has developed between the
state and the film industry since 1978, leading to the dawn of the 1989 Democratic
Movement. Chapter 4 addresses China’s transformation from a mixed (ideological and
performance-based) regime to an authoritarian regime and how it restructured the film
industry after 1989. Chapter 5 analyzes the media reforms from 1992 to 2002, when the
film industry was on the verge of collapse. Chapter 6 explores film reforms from 2002 to

11
the present in order to reveal a new alliance between the state and the media industry.
Chapter 7 examines how the state co-opts filmmakers in order to sustain its control over
the media systems. What are the co-opting strategies? The final chapter is the
Conclusion.

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C H A P T E R 1
Media Reform, Regime Durability
The cage [of press control] is actually much larger than we can
see…Often [the real question for journalists] is not how to expand
the space for reporting, but about how to use the space that is
available to the greatest extent possible.
— Cheng Yizhong
1

Institutions provide the basic structure by which human beings
throughout history have created order and attempted to reduce
uncertainty … They connect the past with the present and the
future so that history is a largely incremental story of
institutional evolution in which the historical performance of
economies can only be understood as a part of a sequential
story. And they are the key to understanding the
interrelationship between the polity and the economy.
— Douglass North
2

1.1 Introduction
Since the advent of the “open-door” policies in 1978, China has undergone three
decades of economic and institutional reform. These reforms have transformed the
domestic industrial structure, increasing China’s integration into the global economy.
Recent decades have also seen China’s media industry evolve from a state-funded
operation to among the nation’s most lucrative sources of revenues.
To illustrate, China’s GDP was RMB 24.953 trillion in 2007 — about 61 times
1979’s GDP of RMB 406.3 billion. Meanwhile, total income from advertisements in the

1
Cheng Yizhong, founder and former chief editor of the Southern Metropolis Daily and the Beijing News,
also used the term “cage” to describe the state-media relationship in China. He was jailed for 5 months in
2004 following his groundbreaking reports on the case of Sun Zhigang, a graphic artist beaten to death in
prison in March 2003. He was awarded the UNESCO World Press Freedom Prize in 2005. This quote was
from his speech at the University of Hong Kong in early 2011 [see Young Wang, C. Zhuang, and F. Yin,
“Chinese Media Must Push the Limits.” China Media Project, Journalism and Media Studies Center at HKU
(January 21, 2011), accessed February 24, 2012, http://cmp.hku.hk/2011/01/21/9635].
2
D. C. North, Institutions, Institutional Change and Economic Performance (Cambridge, MA: Cambridge
University Press, 1990), 118.

13
newspaper industry has increased from RMB 10 million in 1979 to RMB 174.1 billion in
2007, which is about 17,410 times the figure in 1979 (Cui and Lu 2005; Guo 2011; X. Wu
and Gao 2011; G. Zhao 2011). According to Ian Weber, China’s “advertising spend”
reached RMB 2.5 billion in 1990, and RMB 185.6 billion in 2000, with television and
newspapers receiving the lion’s share of funds for advertising (Weber 2002, 59). Two
documents – the “Central Committee of the Chinese Communist Party Decision
Concerning Deepening Cultural Structural Reform” and the “Outline of the 12
th
Five-Year
Plan for National Economic and Social Development of the People’s Republic of China” –
further demonstrate that the Chinese cultural industry is increasingly becoming an
“important pillar for economic and social development” and that the position and
function of culture have become even more “prominent,” as it is increasingly becoming
an important factor in “comprehensive national strength and competition.” According to
the Vice President of the Central Propaganda Department, Sun Zhizhong, the total
production of the Chinese Cultural Industry has increased from 1.94 percent of the GDP
in 2004 to 2.75 percent in 2010, with total volume of RMB 110 million. He adds that the
government believes the growth of the industry is set to reach 5 percent of the total GDP
in 2015 (Weber 2002, 59).
Alongside these developments, there remain several mysteries about the media
industry in the Reform era. First, while the Chinese government has relaxed its sanctions
on the media’s industrial workers and the level of economic liberalization has increased,
scholars generally agree that the Party continues to exercise tight control of the media
industry (Brady 2010; K. Chu 2010; He 1998; Y. Zhao 1998). Why and how does the
state maintain its tight control over information flows despite the fact that the media
industry’s workers are enjoying more autonomy, both politically and economically, in

14
reporting and production? What are the mechanisms by which the state controls the
media?
Second, although media workers, including newspaper journalists and some film
producers, have tried periodically to “hit the line balls,”
3
the media industry have not
developed into a competing political power against the government. Why are media
practitioners willing to work with the state although they never stop to complain about
the censorship system and other regulations?
Third, based on neoliberal logic, the more government control there is on the
media, the less the economic return. However, the competition between media outlets
has increased tremendously since the economic reform. Chinese media outlets have
been transformed from heavily funded state-owned enterprises (SOEs) into a major
source of income for the government. The industry’s taxable income reached RMB 10
million in 2002, which surpassed the tobacco industry’s taxable income. The same year,
CCTV paid RMB 1.2 billion in taxes to the central government, and became the largest
taxpayer in the city of Beijing in 2006. How were the media outlets able to realize huge
profits, despite the fact that a lot of their offerings are “propaganda, main-melody
products”?
4
In the other words, how did the media industry manage to survive state
censorship and increasingly competitive markets?
Fourth, it is widely assumed that state-owned media outlets do not expect their
products to reflect the demands of their audiences, but rather hold to the preferences of
official censors. If that were the case, people would not like media products produced by

3
This phrase — roughly analogous with the English term “push the envelope” and clearly built on a sports
metaphor — is used to refer to media reports that take calculated political risks, staying close within the
bounds of what is permissible (CMP 2007).
4
The term “main melody” (and its alternative, “leitmotif”) is an official guideline in filmmaking with the
aim of promoting the ideological goals of the Party leadership. (See more in Chapter 4, Section 4.3.)

15
the state propaganda apparatus. And yet the Chinese box office has climbed to earnings
of RMB 13.15 billion (USD 2.09 billion), according to a recent report from the country’s
State Administration of Radio, Film and Television (SARFT) (SARFT 2011; X. Zhang
2012). Additionally, 558 feature films were produced in 2011, compared with 456 in
2009. The film industry also added an average of 8.3 new screens per day in 2011
(Orzeck 2011; X. Zhang 2012). In 2011, there were more than 9,200 screens in China,
compared with 6,200 in 2010. China’s film industry is developing into the world’s third
largest, behind only Bollywood and Hollywood, both in terms of the number of films
produced and box office rankings (Hunt 2011). Why do audiences continue to flock to
state-controlled media sources when they have so many other options from which to
choose?
In sum, how can the Chinese media industry survive and develop into a large
media empire under the stress of conflicts between these three contrasting variables –
namely, government control, media workers’ professionalism, and commercial pursuits?
Given this backdrop, this dissertation attempts to study the development over 30 years
of China’s cultural industry, particularly the film industry, through the lens of
institutional theory. Institutions are important because they determine “the rules of the
game” and shape the environment in which cultural activities and business take place
and the transaction cost that firms incur (North 1990). However, much of the work on
the application of institutional theory to media industry tends to focus on the newspaper
industry (Chen 1998; Chen and Chan 1998; He 1998; X. Wu and Jin 2004; Yu 2005;
Zhou 2007). This type of analytical approach rarely has been used to explain the film
industry in China. In this dissertation, I adopt an alternative standpoint to examine
institutions’ impact on the Chinese media industry in general, with a particular focus on
the film sector.

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1.2 The Media Birdcage: Research Questions
Media in China can be likened to a “birdcage.”
5
This is reflected in the vast power
asymmetry between the state – a dominant actor with immense power to shape local
media freedom in the complex Chinese media environment – and the media, composed
of individual media workers whose professional freedoms and pursuits are wholly
dependent on the Chinese state. I attempt to explore the dynamic nature of this
“birdcage” – that is, the limits and constraints of media control on the film industry.
Compared to other SOE reforms, such as in education and health care, Chinese
media reforms seem to have been the most successful, although its development stands
in contrast to most theorists’ predictions, including modernization theory: The more
media markets are opened, the more choices are provided to the citizens, and the greater
the possibility of eroding a regime’s legitimacy, especially in the case of authoritarian
regimes (Lawson 2002; Olukotun 2002; Rawnsley and Rawnsley 1998). This has not
been the case in China, however.
Because of this unexpected outcome, Chinese media scholars have paid
significant attention to the relationship between institutional shifts toward media
deregulation and the resultant changes in cultural production. Much of the extant

5
Chen Yun uses the term “birdcage” to describe Chinese economic reform, meaning that birds are free to
fly within the cage within the socialist planned economy. This theory provided an ideological foundation for
the establishment of Special Economic Zones in the 1980s (Walter and Howie 2011, 13). In Vice President Xi
Jinping’s response to foreign criticism of the Beijing Olympics in 2008, he said, “We cannot worry too much
whether people like the fact that Beijing is hosting the Olympics. The world is a big, bustling place made up of
all sorts of people and that’s why it’s so colorful. It’s like a huge birdcage where all kinds of birds coexist. If you
try to drive away the ones making the most noise, the cage would no longer be a bustling place and you would
lose that wonderful variety and color. The key is to mind our own business well” (Shi 2008). Chen and Chen
(1998) used “birdcage” to discuss the Chinese media’s freedom, suggesting that after the economic reform, the
media are still struggling to fly away from the cage – that is, the press control of the state. They thus conclude
that in the Post-Deng era, there are three characteristics of the Chinese media systems. First, the CCP is still
able to control the core media (such as newspapers, radio, and TV stations) but allows media organizations to
make their own profits. Second, the increasing commercialization process is weakening the CCP’s control of
the peripheral media outlets (magazines, books, films, and grassroots/small-scale newspapers, radio, and TV
stations). Third, the CCP’s media control, however, is not sustainable (Chen and Chan 1998, 61).

17
literature centers on such cultural forms as television and the news media; in depth
scholarly investigations of the effects of governmental and institutional shifts on the film
industry, however, remain glaringly scarce. In attempting to fill this chasm in the
literature, this study sees as its focus the effects of reform on decision-making and
practices in the film industry. In attempting to make traverse this scholarly terrain, the
study is faced with several questions, including,
? As the state has yielded increasing economic autonomy to the
industry, why hasn’t the film sector taken this cue and revoked its
allegiance to the state?
? As institutional structures have been established, dramatically
increasing efficiency and uniformity, how have film industry
practices changed?
? In a society that has transitioned from a command economy to a
market system, what are the causal processes of institutional and
structural change? How does the film industry satisfy consumers’
demands when it comes to movies?
? Once institutions are constructed by the state, what are the factors
associated with their adoption by the players in the industry, and
how do the meanings of the institutions vary from the perspective
of individual filmmakers?
? Why have media practitioners not mobilized to demand
democracy? Why might cultural producers have been willing to
cooperate with the state government despite ongoing censorship?

18
Through an institutional analysis of the media reforms during China’s great
economic transition, this study seeks to uncover answers to each of these questions. The
dissertation explores the structures inside the cultural sector that have affected film
industry development and production (see Chapter 2). The study also considers the
three sectors of the film industry –production, distribution, and exhibition – in the
context of post-1978 reforms (see Chapters 3-6). The effects of institutional shifts on
cultural practitioners and practices comes under consideration in the research (see
Chapter 7).
This study is about the transformation of media institutions, particularly in the
film industry and that industry’s relationship to state structure, state control and
economic reform in an authoritarian regime. Although the study is primarily concerned
with film industry structures and practices, it aims to engage in the study of Chinese
politics during the economic reforms. Through the lens of institutional development, this
study will provide a window into how economic actors are shaped by the political
environment.
1.3 Chinese Media Reform: A Paradox
1.3.1 The Democracy Framework
The literature on Chinese media overwhelmingly emphasizes a link between the
increasing commercialization of Chinese media and democratic development, although
the relationship is not necessarily presented as a positive one. Some question whether
the political autonomy of the media industries is spontaneously improving because
economic autonomy has been achieved. There is no consensus on this question, but there
are some facts. To cite a few: the number of newspapers published in China has
skyrocketed from 186 in 1979 to 1,445 in 1985, with a steady growth to around 2,000 in

19
2010 (Cui 2010, 25). There were also about 9,549 magazines published by the state and
provincial-level departments in 2010. Many varieties of TV episodes, documentaries,
shows and films have become available to ordinary people. Media outlets, including TV
stations, film studios and publishing companies, have become internationalized and
technologically sophisticated. This stunning development has spurred a debate on
whether media reforms are associated with the political liberalization of media outlets.
A first group of researchers holds to the idea that the Chinese media industry are
currently undergoing a process of market liberalization, which has created “tension” or
“ambiguities and contradictions” between state control and economic reform. Most of
the literature by this group concludes that the state still maintains tight reins on the
media, but three decades of reform have weakened their “still-strong mouthpiece
role”(Li 2009, 10). China’s accession to the WTO has opened China’s media markets to
increased international content and more foreign investment. The literature suggests,
however, that this exposure will not have a dramatic or immediate impact on the stability
of China’s government. Instead, the threats posed by the globalization of Chinese media
are complex and subtle (Shambaugh 2007).
The increased volume of private capital in the media industry will lead to some
degree of diversification and probably pluralization. In fact, Lull (1991) and Zha (1995)
both demonstrated that the commercialization of the media industries have diminished
the state’s legitimacy.
Pei’s (1994) study shows that private capital has become a powerful contender
against the propaganda system. He says, “The transfer of media resources from the state
to society had deprived the Communist Party of its monopoly on propaganda. The media
had become, instead, an instrument shared by the state and society. Media
infrastructure, capable of contributing to future political liberalization, had come into

20
existence in China” (176). Chu (1994), Keane (2002), Zhu (2003), and R. Zhang (2008)
all assert that the commercialization of the media industries (either in the television or
film industry) has reduced the state’s ideological control over the media. Wu Guoguang
(2000) deploys the term “socialization” to describe “a breakup of the state-monopolized
media structures and replacement by a new structure in which various non-state actors
play an increasingly significant role … [S]ocialization of media structures means political
reallocation of media resources from the State to some social sectors”(53). Thus,
although the reform is economic in nature, “its effect may eventually spill over into the
political arena” (63) as the ongoing media reforms are “significant enough to offer an
increasingly larger space for journalists”(46). Daniel Lynch (1999) also offers a relatively
pessimistic assessment, although he draws a distinction between the pluralism of China’s
media and the pluralism of industrial democracies. Lynch argues that the “thought
work” market has lost its influence on society because of technological advances
combined with administrative fragmentation and property-rights reform. This has
created an un-institutionalized and chaotic public sphere, as “praetorian,” entailing
corruption, bribery, and violence from both above and below (1–17). He thus concludes
that “ongoing state efforts to eliminate ‘bad’ messages from the thought-work market,
though far from completely effective, are somewhat effective, and the general climate of
political repression does deter people from publicly circulating messages that directly
challenge the legitimacy of Communist Party rule” (141).
The above approach invoked immediate opposition. For instance, Anne-Marie
Brady reacted strongly against those who believe propaganda and thought-work in China
has lost its effect (Brady 2006; 2009; 2010). Counter to those researchers on her list,
she argues that propaganda work is the “very blood of the party, the main means for
guaranteeing the party’s ongoing legitimacy and hold on power”(Brady 2006, 59). In her

21
new book, she furthers her arguments by claiming the Chinese government “has married
old methodology such as using entertainment as a vehicle for political thought work,
with new methodology and technology such as political Public Relations and the
Internet. In the process, it has greatly strengthened and revitalized the formerly
moribund propaganda system and successfully dealt with the challenges posed by
China’s modern-day propaganda and thought work blind spots”(Brady 2010, 87).
Similar to Brady, Zhao Yuezhi (2000a) argues that the consolidation of media
into large conglomerates during the latter 1990s has blunted the diversity that Guoguang
Wu found earlier. She also notes that investigative news reports rarely criticize state
polices; instead they mostly target individual abuses of power (Y. Zhao 2000b, 587).
Lee, Chan, Pan, and Clement claim that since 1990, media have been less critical of the
state. He Zhou’s study shows that Chinese media have been transformed from a
propaganda apparatus to a “Public Inc.,” with strong incentives to increase advertising
income as well as to “publiciz[e] the party’s policies and interests” in order to promote
“the image of the party and justify its legitimacy” (He 2000, 143–144). Likewise,
Stockmann and Gallagher (2011) find that media contents – in their case, media
coverage on labor disputes – hews closely to the party line, despite the fact that
marketization has changed the way news is delivered. They thus conclude that the
commercial liberalization of the media not only may be compatible with authoritarian
resilience but also may be a factor in that resilience.
Neither of these two approaches should be regarded as universal. It is a common
claim in the democratization literature that mass media should promote democracy.
Empirically, however, the media can either stabilize or undermine an authoritarian
regime. In addition, the path to democratization is not simple. The belief that the
marketization of mass media must lead to democracy is a myth. Both of the two

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dominant approaches in Chinese media studies have overlooked the special role of a
“strong state-weak society” structure in contemporary China (D. Zhao 2001). The fact is
that the Chinese State controls the media. As Lee (2001) n, “the state takes a dominant
role in shaping the distribution of political, economic and cultural power” (86). This is
serves as an apt starting point in the discussion of the relationship between the state,
media and market, and we should not underestimate the ability of the Chinese state to
negotiate with the market power while maintaining the imposition of censorship. Based
on this, we also need to acknowledge the fact that in every polity, there is always
competition between the state and the power of media; however, our interest should
focus on how the state solves the contradiction. Unlike a liberal State, an authoritarian
state rarely provides legal and institutional protection of media freedom. Instead, it
relies on an array of censorship tools and an elaborate system of coercion to co-opt the
private media enterprises into a “patron-client relationship” (C.-C. Lee 2001, 86). Third,
we cannot simply assume the market-driven media corporations are aiming to promote
democratic communication. The fact is they are in China to make a profit, as stressed by
Zhao in her book Communication in China (Y. Zhao 2008, 58). Based on interviews
with a variety of media workers, I will demonstrate that media professionals in China are
pragmatic and creative, but that they do not consider democracy to be their goal in their
efforts to reform the media system. To summarize, the economic reform has generated
room for media liberalization, but the state is still highly powerful in the game.
1.3.2 Serving “Two Masters”
There is another challenge in studying the media industry. The media outlets
themselves are multifaceted institutions, playing according to both economic and
political logic. Media organizations are profit-driven businesses, but they are also the

23
“mouthpiece” of the Chinese state. The reform is indeed a process that has caused the
media industries to have “two masters” (Lee 2000; Polumbaum 1990) – the state and
the market.
6
However, the media reforms have never changed the political relationship
between the media and the state. No matter how much the media outlets have achieved
since 1978, they are still public-sector organizations or service organizations (Lam and
Perry 2001), or in Chinese, shiye danwei, which means “non-profit business units” or
“public institutions.” Since 1978, the CCP has transformed itself from an ideological
party to a performance-based party (D. Zhao 2001), and that is interested in achieving
economic goals, which has made the political logic seem submissive to the business logic
of media organizations. Although media workers have tried to challenge the state’s
authority, such as through “hit the line balls” or by producing underground movies, their
efforts have been mostly ignored or hidden from the public, and, worse, some journalists
and filmmakers have been punished either by being jailed or kept from making films for
several years. Hence, the state’s controls over media are retained, but in fieldwork
interviews, almost all interviewees say that the media are much more open and free than
in the past. “You can make any type of film,” declares one of the interviewees, “as long as
you have money and don’t touch the sensitive issues that the government doesn’t like”
(see Interview 8).
What explains this variance? The Chinese media systems are distinguished from
other countries in that it is always strictly controlled by the state. Thus no matter how
brutal the “competition” between the state and media workers, media are always placed
under the authority of the state. That means the power structure between the media and

6
Pan furthers this argument by stating, “With ‘media industrialization,’ the situation has now evolved into
serving ‘three masters.’ In the words of journalists, media now must ‘satisfy the senior officials, the masses,
and business bosses’” (Pan and Lu 2003).

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the state is asymmetrical. Some argue that marketization has become an important
variable in changing the relationship between the state and the media workers; however,
the advancement of the state’s controlling mechanisms over the media industries as well
as the “guerilla policy style”
7
toward different filmmakers have made the commercial film
industry fully compatible with China’s authoritarianism (Chapter 6).
Studies of the Chinese media industries have mostly concentrated on the state-
media-market models where the media are characterized by demanding more freedom,
while the state is assumed to have more interest in controlling the media in order to use
them to legitimatize and stabilize the regime. Most studies see the marketplace as an
important means of challenging the single-party political system. However, in contrast
to most of these studies, the marketplace is described, in this dissertation, as a territory
where the state and media contest one another, in which the media have a limited ability
to influence the political system.
Opening the market is no doubt an important force in driving the state to change
and adapt to new institutional arrangements. However, I have to emphasize that my
study is not only a systematic detailing of the state-level media policies and changes of
the economic reform, but also a study of what those policies and changes have meant to
the actual actors. This approach is counter to the traditional theories, which
conceptualize media organizations as a “mouthpiece,” giving the media workers no room
to voice their demands. As Sun (2006) describes, “… [T]he Chinese broadcasting system
does not work as an administrative pyramid or as a unified whole. Dispute and conflict
take place at every corner” (54). The State has constructed many new laws and policies,
but if the governed people have ignored the rules, then the institutional reforms are

7
The term “guerrilla policy style” is adopted directly from Heilmann and Perry (2011, 11-15).

25
meaningless. Thus, as we will see, it is the friction between the economic and political
roles of the media industries and a complex system with multiple interests that drive the
media reforms in China. This will be the central theme of this dissertation.
Media workers may not agree that democracy will satisfy their needs and
interests, but they play an important role in changing the media systems and Chinese
politics. The interactions between officials and media workers have contributed to
important changes in the formal political institutions since 1978. In this dissertation, I
thus am interested in examining how media professionals go about their work and how
they have actually changed the formal political landscape. I intend to explain why media
workers have shown no interest in demanding democracy and why China has seen
significant institutional evolution, even in the absence of regime change.
1.4 Theoretical Considerations
In his work on media change in China, Pan Zhongdang (Pan 1997; 2005; Pan and
Lu 2003) illustrates the ways in which the power of the state over the market has shaped
journalists’ and media organizations’ practices and decisions. The ongoing negotiation
between journalists, media managers and regulators has shaped the rules of the media
institutions and the markets in which they are situated. Pan’s work provides theoretical
and methodological insights for the study of media change and institutional change in
the political economy. He argues that the emergence of the market and the
transformation of the media are initiated by the state, where the state defines the
institutional structures of the marketplace and actors define their worlds within these
boundaries - that is, the media practitioners agree not to challenge the “principles and
basic rules of the Party-press system”(Pan 2005, 7). Although the rules are established
by the state, the PRC’s media reforms “are not a well-planned and coherent project with

26
a clearly specific destination. Rather, they have been unfolding as a joint adventure into
some unknown terrain by the collaborating Party-State and media practitioners” (Pan
2005, 8). This view of the politics of the market provides us with a way to study the
socialist transformations where the command economy is being destroyed and rebuilt on
a daily basis, leaving the media reforms an undetermined project. I begin with this
theoretical approach and explore empirically what is occurring in the case of the film
industry. Institutional development and resultant changes in law and policy, the
structure of state institutions, and the implications for film organizations and
organization-level action (i.e., filmmakers’ decisions and practices) are my primary
interests. Throughout this study, I endeavor to investigate control — both as an
empowering and disempowering process — as well as the kinds of resistance filmmakers
have deployed and to what ends.
Such an analysis should improve our understanding of how change occurs, even
in a system characterized by a preponderance of top-down control. The state is not only
the architect of the new institutional structures (both macro-level institutions and
emerging markets); the state is also a major actor. I see institutional reform (systemic
reconfiguration) as the result of a process of constant negotiation and contestation
between the state and media workers (Rosen 2012).
PRC media are state-controlled. Media are part of the power system. I want to
study the question of whether filmmakers can be shown to exercise even limited relative
autonomy in the workplace. If so, then the workplace as a site of social agency is not
simply an instrument of the authorities. Moreover, negotiation and contestation of
power are the norm in this workplace – not, as is commonly thought, the exception.

27
1.4.1 Explaining Regime Stability amid Widespread Change
According to North (1994), institutions provide the “rules of the game” and they
are the “structure that humans impose on human interaction and therefore define the
incentives that determine the choices that individuals make that shape the performance
of societies and economies over time.” Crawford and Ostrom (1995) assert that
institutions “are enduring regularities of human action in situations structured by rules,
norms, and shared strategies,” where “rules” and “norms” are linguistic constraints that
influence mutually understood actor preferences and optimizing behavior, and “shared
strategies” means the stability that arises from mutually understood actor preferences
and optimizing behavior. Institutions could be norms or rules, and they could also be
treated as equilibrium between players. The former represents the contents of the
institutions, while the latter represents the formation process of the institutions.
Furthermore, I believe institutions are “multidimensional” sets of rules, so it is crucial to
track all the important dimensions over time in order to determine what kind of change
has occurred (Campbell 2004, 36; 2007, 18).
In media studies, understanding media institutions is about understanding who
produces media texts, what their set of codes and values is and their relationship to
ordinary people as individuals. However, these are not my concerns. What concern me
the most are the rules that regulate the media organizations and the media workers,
particularly in the film industry. The term “film industry” is often used to describe any
activity related to the production of feature films, documentaries, newsreels,
commercials and television products. It also includes pre-production, post-production,
distribution, exhibition and film financing. Pre-production refers to the planning phase
of a production and involves finding the location, planning and scheduling the shoots,
budgeting and employing casting and crewing agents. Post-production refers to the

28
editing process where the production is edited, and special effects and sound are added.
The sub-sectors of film are interlinked with many production houses, crew and film
professionals working in a number of areas.
1.4.1.1 State durability
As discussed above, a prerequisite for analyzing institutional evolution is
recognizing the mechanism that causes institutions to persist and to exhibit stability. In
order for an institution to persist through time, it must be reproduced.
8

There are at least five approaches used to explain the absence of democracy in
China. First, Asian values are often cited as evidence that the Chinese are unlikely to
adopt a democratic system (Pye 1985; Sim 2001). Critics of this cultural explanation
have pointed out that many Confucian-influenced countries, such as Japan, South Korea,
Taiwan and partially Hong Kong, are experiencing a transition toward democracy, and
they have provided strong empirical evidence to counteract the cultural theorists.
Second, one of the ways the CCP has consolidated its power is through the political
incorporation of different classes by granting special privileges to them over different
periods. Jiang Zemin’s “Three Represents” is one way to incorporate a capitalist class
into the “socialist” state system, while the more broad-based and vigorous rural
entrepreneurialism promoted in the 1980s was a strategy of rural incorporation (Huang,
2008). Similarly, the co-optation of the capitalist class is a means to ensure the regime
survival (Dickson 2003; 2008).

8
An institution is reproduced when the rules and beliefs that enabled, guided, and motivated an
individual’s actions are not refuted by observed behavior or outcomes. Thus, observed behavior and outcomes
confirm the rules and beliefs that enabled, guided, and motivated the original behavior, as expectations are
consistent with outcomes (Greif 2006, 161).

29
Third, in addition incorporating the “most advanced productive forces, that is the
“Three Represents” into Party’s constitution, the government is increasingly concerned
about the non-state actors, such as business associations, which have become an
important force to effect changes in regulations and policies (Kennedy 2005; Nevitt
1996; Unger 1996).
Besides this social-structure approach, the fourth common explanation for the
persistence of the authoritarian regime has been that China’s post-Mao political
institutions have established a high level of institutionalization in terms of adaptability,
complexity, autonomy and resilience (Nathan 2003; Shambaugh 2008). Fifth, since the
economic reform, China has experienced significant and sustained improvement in its
economy. As Przeworski et al. (2000) have found, economic growth is an important
variable in determining a regime’s survival. Hence, China’s high economic growth has
helped to stabilize the regime.
While the standard of living has improved for most Chinese families, the
economic reform has also led to an increase in “mass incidents.” An article published in
Southern Weekend demonstrated how the characteristics of those mass incidents have
shared some noticeable similarities, including an increase in fierceness and violence,
increases in protests incited by online public opinion, labor-wage disputes, and pollution
(Shan 2010). Yu Jianrong, a researcher at the Chinese Academy of Social Sciences, notes
that the number of mass incidents increased tenfold, from 8,709 in 1993 to 87,000 in
2005 (Ren 2011). A further disaggregation shows that mass incidents staged by farmers
and workers take up 35 percent and 15 percent, respectively, of the total number of mass
incidents. The reason for this proliferation is the frequent encroachment on the interests
of the middle and lower classes. As such, the rapid economic modernization has been
correlated both with political instability and with democratization (Huntington 1968;

30
Lipset 1959). This view is linked to the relationship between media reform and
liberalization discussed below.
These indicators explain why China has pursued reform in its film business.
Here, I want to look at the causal mechanisms underlying the relevant institutional
dynamics. That is, the persistence of the regime may be traced to the interactions
between the state and the organizational actors that enabled the formal institutions to
adapt to change. As Mahoney and Thelen (2010) observe, institutional change is
possible even in the absence of fundamental transformation.
1.4.1.2 Institutional change
Several schools of thought seek to explain why media institutions have changed
in China during the reform era. They include arguments that emphasize either domestic
or external factors.
Early work in explaining the media reforms focused on industrial performance.
In particular, scholars stressed that the film industry was in serious crisis, as evidenced
by shrinking audiences and box-office returns. Movie theatre attendance had declined
from a record high of 29.3 billion in 1979 to 16 billion in 1990, and declined further to 3
billion in 1993. Of 142 films produced in 1987, only 34 were able to cover their costs
(Wang and Weng 1989, 297). By the end of 1989, almost all state-run studios were in the
red, including Beijing, Shanghai and Changchun (CFYB 1994, 226–228; R. Zhang, 2008,
40; Zhu 2003, 77). The downfall of the film industry and the market has driven a series
of institutional changes. In short, scholars in this school generally agree that the driving
force for institutional change in the film industry is endogenous to the internal crisis of
the film industry.

31
This school of explanation does the best job of interpreting the changes in the
earliest stage of the media reforms. But it cannot explain the changes after 2004, when
the Chinese film industry experienced the fastest boom not only in its history, but also in
the history of cinema (K. Chu 2010). More important, most of the institutional changes
in the film industry have occurred after China’s entrance into the WTO.
In contrast to the arguments around lagging industry performance, several
scholars have focused on the impact of the entry of Hollywood films into the Chinese film
market, and China’s accession to the World Trade Organization (WTO) (Rosen 2002).
The importation of foreign films into the Chinese market, which began in September
1994, led to the spread of institutions modeled after Hollywood. As DiMaggio and
Powell (1983) argue, organizations observe surrounding organizations, evaluate which
ones are performing best and then copy what they do in the hopes that doing so will
improve their own performance.
9
Led by Hollywood, success in the Chinese film
industry is becoming increasingly reliant on market share. Vertical and horizontal
conglomerates have led to consolidations of power; for example, the China Film Group
(CFG) controls more than half of all domestic film distribution ("The Economist" 2011).
As was demonstrated by the Hollywood influence, China’s accession to the WTO would
increase international capital in China’s media markets, which is assumed to be another
driving force in changing the media landscapes.
First, this approach has recognized that institutions at the national level are
actually connected to institutions at the transnational level in ways that affect change.
However, the Hollywood influence on institutional settings is an over-simplified and lazy
explanation, as it fails to take seriously the notion that diffusing institutional practices

9
In a film discussion session, a famous film critics from China remarked, “Our commercial film production
is actually a copy from Hollywood” (Yin, et al., 2011).

32
are modified and transformed when adopted to translate it into formal rules, and during
implementation, in order to fit China’s institutional environments. Moreover, the idea of
Hollywood is a broad concept that does not give us sufficient information about how it
motivated the changes in China. Indeed, the introduction of Hollywood films into the
Chinese market provides reliable sources of revenue to distribution and exhibition
sectors, which in turn helps to rebuild the production sector. Second, importation
quotas are strictly controlled by the Chinese government, which has the authority to
restrict the extent to how much Hollywood films can impose their influence.
Third, transnational corporations are not allowed to independently carry out
their filmmaking activities in China, which has strictly limited their mobility. This third
perspective argues that institutional change has meant the structure of the film industry
has shifted from exhibiting the characteristics of state administrative or non-profit
business units (shiye) to profitable enterprises (qiye). It means that the film studios are
now responsible for economic losses, and the state has withdrawn from its role as
financier. In addition, the Film Bureau has started to recognize the commercial value of
film, rather than considering the industry solely as a propaganda tool. Therefore,
institutional principles were redefined and new elements, such as film styles and
investment from non-state capital, have been blended into the already-existing
institutional arrangements. Those who make this argument have seen institutions not
as constraints that limit the range of choices available for the state to transform the
media sectors; on the contrary, institutions have been interpreted by this approach as a
resource for state leaders to exploit. Redefining the nature of the film industry as a
collection of “enterprises” whose aim is to profit opens the marketplace for both non-
state and foreign investors. The Chinese government, therefore, has successfully co-

33
opted foreign and domestic capital to sustain and expand its coercive and authoritarian
power (K. Chu 2010; McCormick 2002, 202).
This approach has several advantages over the others reviewed here. First, it
clearly implies that maintaining the power of authority is the core motivation driving
institutional change. Second, as mentioned earlier, this view sees institutions as
dynamic, not as constraints on action. Rather, actors can use institutions to facilitate
their goals. Third, the changing nature of the film industry, or, more broadly, the media
industries, was the impetus of the institutional reform in the 1990s. At the same time, it
was also the driving force to constitute the alliance between the media outlets and the
state authority that began in the 2000s. This is especially important because it reveals
how institutional reproduction and change are two sides of the same coin. The processes
of institutional reproduction and change are thus mutually constitutive, as the case in
China shows. Indeed, those who benefit from the existing system may prefer continuity
of the arrangements, but to ensure such continuity, they need to resolve institutional
ambiguities in their favor. The durability of the Chinese regime is due to its ability to
create and nurture coalitions to support the regime.
1.4.2 Institutional Development Analysis: Key Concepts
Although financial crisis and foreign intervention provide contexts of
institutional transformations, a number of studies have also provided an insight into the
study of institutional development during “settled times” (Thelen 2004). In the
literature of historical institutionalism, some concepts are useful to adopt here to explain
the endogenous institutional change of the Chinese film industry since 1978.

34
1.4.2.1 Path dependence
Viewing institutions largely as the legacy of concrete historical processes, this
concept argues that history and/or historical events play a major role in influencing
political choices and outcomes. The idea of path dependence was originally developed to
study technology (David 1985). Campbell (2007) defines it as,
A process where contingent events or decisions result in institutions
being established that tend to persist over long periods of time and
constrain the range of options available to actors in the future, including
those that may be more efficient or effective in the long run. In other
words, latter events are largely, but not entirely, dependent on those
that preceded them. (4)
Thus, an explanation of political outcomes requires a close analysis of events over long
periods. Critical antecedents and critical junctures are two distinct stages of the
historical processes, which interact and lead to political outcomes.
A critical juncture is characterized by significant changes. Collier and Collier
(1991) define a critical juncture as “major watersheds in political life … [which] establish
certain directions of change and foreclosure of others in a way that shapes politics for
years to come” (29). Mahoney and Thelen (2010) define it as a period “of contingency
during which the usual constraints on action are lifted or eased” (7). Critical junctures
can thus be analyzed from different perspectives. A critical juncture can be precipitated
by either internal or external forces or a combination of them. It can also range from a
brief and rapidly unfolding moment to an extended period that opens up opportunities
for agents to change the trajectory of development. It is thus a “choice point when a
particular option is adopted from among two or more alternatives” (Mahoney 2001, 113).
It is important to note that a critical juncture does not occur in a vacuum. The
significant changes that take place during a critical juncture are substantially shaped by
critical antecedents (Collier and Collier 1991, 27). According to Slater and Simmons,

35
critical antecedents are conditions existing before a critical juncture that sequentially
combine with the causal factors during a critical juncture to cause the outcome of
interest. Unlike critical junctures that tend to unfold rapidly, critical antecedents are
generally formed in slow-moving processes.
Hence, the starting point of the institutional development is the antecedent
historical context, which defines a range of variations and options for the actors to
choose during the critical juncture. The choice made during a critical juncture becomes
a set of new institutions, and it is assumed these new rules will enable certain political
actors to maintain their authority over time. It is this self-reinforcing (or institutional
reproduction) feature of path dependence that enables the regime to consolidate power.
On the other hand, Mahoney proposes another concept of “reactive sequences”
characterized by transformative and backlash processes in which there is movement
toward reversing previous patterns, which is different from the processes of institutional
reproduction marked by self-reinforcing processes (Mahoney 2001, 115). That is to say,
just because an event that occurred earlier has an impact on the final outcome does not
mean the outcome will develop in the same direction as the earlier event.
Since my concern is the coexistence of Chinese authoritarian durability and the
media’s institutional transformations, the concept of reactive sequences is useful in
showing that significant institutional change could occur without the breakdown of the
regime. The concept of self-reinforcement is fruitful as well in eliciting structural
persistence. We move on here to the next concern, the shift of reinforcing processes to
reactive sequences.

36
1.4.2.2 Institutional displacement, layering, and conversion
The second concept used to explain endogenous institutional change is drawn
directly from Mahoney and Thelen. The term “displacement” describes the removal of
existing rules and the introduction of new ones. “Layering” refers to new rules being
attached to the existing institutional structure. Processes of layering usually take place
within the existing system by adding new principles or practices to old ones. In contrast
to displacement, layering does not introduce new rules but involves processes of
“amendments, revisions, or additions to existing ones” (Mahoney and Thelen 2010, 16).
Thus, actors in both cases intentionally reform the existing systems either for the sake of
better serving their interests or because there are no better alternative at hand. A related
concept having to do with institutional change is “conversion,” a situation where rules
remain the same but their function is directed to new or alternative purposes and goals.
Conversion occurs when there is a gap between the intentions and actual outcomes of
institution building. The idea of conversion is best incorporated here to explain change
during “settled times,” rather than during periods of crisis or “unsettled times”; that is
the importance of critical junctures that I discussed earlier.
In a nutshell, the varying path dependence, displacement, layering and
conversion approaches enlighten our understanding of how institutional development
occurs within an existing system without the breakdown of the regime. It provides the
basic explanations of the coexistence of regime persistence and various institutional,
economic and social changes in China.

37
Moreover, understanding these approaches mean we accept that institutional
change is relational, in the sense that we cannot focus on a single institution; rather, it
has to focus on the relationships among institutions. As Campbell (2007) notes,
This is not because a change in institution A necessarily triggers a
functional response in institution B. Rather, this is because actors in
institution B have learned to live with institution A in ways that yield
certain benefits … So when institution A changes, actors in institution B
may suddenly have incentives to make changes in B in order to preserve
these benefits or develop new ones. (15)
In the following chapters, I will provide additional examples of how institutional
displacement, layering and conversion can result from endogenous processes of
economic and social change, during or in the absence of critical junctures.
1.4.3 The Film Industry: Three Sub-Systems
One of the major features of the historical institutional analysis is that a polity is
made up from more than one institutional arrangement. That is, various pieces of
arrangements “do not necessarily fit together into a coherent, self-reinforcing, let alone
functional, whole” (Thelen 1999, 382). A well-integrated system, the film industry
comprises three institutional subsystems:
1) The Production Sector. Involves all work leading up to and including filming.
This includes development, pre-production, and principal photography. It also involves
post-production, including all activity involved in putting together scenes to make
production complete: for example, editing, visual effects, computer graphics, animation
and special effects; developing, printing and processing; captioning and sub-titling; film
and video transfers or reproduction; and audio and duplication.
2) The Distribution Sector. Encompasses the process of distributing the
completed work for display to the market (for example, film distribution; film library
operation, and film leasing). It also includes marketing of the completed work, but

38
excludes retail distribution.
3) The Exhibition Sector. Refers to the display of a completed work to the public
at a pre-set location, such as a cinema, a drive-in-theater, festivals, or as part of a
museum display. Besides public screenings, consumers can view completed works in
private through either home video rental (the rental of film on any format, e.g. DVD) or
online streaming.
All three form a “mutually reinforcing whole” (Campbell 2007), the relationship
among them at any given time either independent, coherent or in conflict. Relatedly, the
source of change comes from the interactions between these three sectors. Change along
one sector, or more than one, affects order along the others – that is, as interactions
among processes in different institutional realms, such as political settings and economic
systems, open up possibilities for political change. In the case of the film industry, the
institutional evolution of the three sectors is influenced by the political and economic
settings. Stark and Bruszt (1998) argue for “social change not as a transition from one
order to another but as a transformation – rearrangements, reconfigurations, and
recombinations that yield new interweavings of the multiple social logics” (7). As Orren
and Skowronek (1998) stress, “within any given country, we find […] many [transitions]
occurring in different domains – political, economic, and social – and the temporality of
these processes is often asynchronous and their articulation seldom harmonious” (in
Stark and Bruszt 1998, 81). Change in one sector affects other sectors’ ongoing
processes, and it is this wide-ranging change that foments institutional evolution.
There are two groups of relationships that drive change in institutions: one is the
dynamics moving within the sectors (production, distribution and exhibition); the other
is the interactions between one or more sectors and the domains (the political system
and the economic system). In his study, Aoki describes these two types of relationships

39
as “linked,” which means the outcome of one or more sectors coordinates across another
sector or a domain. Moreover, the strength of this type of linkage mechanism will be
varied. For example, the linkage between the distribution and exhibition sectors is
“bundled,” as the wellbeing of the distribution sector greatly depends on the number of
movie theaters and screens. The success of distribution-exhibition is also closely related
to economic conditions, as theaters need moviegoers to buy tickets at the box-office. On
the other hand, the production sector is greatly affected by political policies, especially in
China.
Since the Chinese government has liberalized its market economy much faster
than its political system, the institutional changes of the three sectors are multifaceted.
The distribution-exhibition sectors are more influenced by economic policies, and thus
the evolution in these two sectors is much more dramatic than the production sector.
Indeed, as Nakajima (2007) asserts, the first 20 years of film reform were very limited,
as the Chinese government put much of its efforts into reforming the distribution-
exhibition sector (109).
1.5 Conclusion
Contrary to some efficiency arguments, institutional change is not the result of
the financial crisis in the media industries (Chen 1998; Y. Zhao 1998) or the demise of
the film industry in terms of box-office returns and the number of films produced
annually (Zhu 2003). Rather, it is the result of the state seeking legitimacy by
instrumentally exploiting the logic of commerce to rebuild its media systems as part of
the state building project.
Rules and institutions certainly establish important constraints on action, but
they are not unequivocal. The transformation of Chinese media institutions, particularly

40
in the film industry, is not caused by exogenous shock, namely the intrusion of
Hollywood; rather, it is structured by the ambiguity of rules, which provides critical
openings for creativity and agency (Mahoney and Thelen 2010). These critical openings
allow those within the industry to work within limits. However, this should not be seen
as a trend towards media liberalization. Rather, the bureaucracy charged with
implementation, interpretation, and enforcement has a large role to play in shaping
institutional evolution.
In my exploration of Chinese film industry reform, I aim to shed light on the ways
in which China’s regulatory practices have been used to cultivate a cultural environment
conducive to the state’s interests. As Mahoney and Thelen (2010) note, the ambiguity of
rules is a point of conflict; this ambiguity will either decline over time or be resolved
through the formalization of the rules – or both. However, as the authors observe, the
ambiguity of institutions can be considered a permanent feature, even where rules are
formalized (Mahoney and Thelen 2010). Realistically speaking, rules can never be
precise enough to extend to every corner of the world. We can surmise, then, that
varying players with divergent interests will perceive these interstitial spaces as
opportunities to effect change vis-a-vis media institutions.

41
C H A P T E R 2
Film Industry Structure and the State
2.1 Introduction
Despite the obvious importance of such economic issues such as box office, in the
end the film industry in China privileges its propaganda function over its economic
function. It has at least two features distinguishing it from other film industries around
the world. First, its performance, including the number of annual productions (supplies),
prices, costs, capital investment and taxation, has long been controlled by the state-
planning agencies. Second, some of the profits of film products are taken by different
bureaus and departments, such as the Ministry of Culture, that use them for other
purposes, like building up other artistic and cultural activities in their jurisdictions. The
film industry, therefore, is a tool of propaganda. As a unit of the government, it performs
a variety of sociopolitical functions for the government and the society.
Propaganda is something that all governments do in one form or another because
all governments would like to influence the public opinion of either their own people or
of those around the world. States, apparently, like to be loved. This chapter is an attempt
to understand how the Chinese do it – that is, how the Chinese government has adapted
its propaganda methods to suit the needs of the twenty-first century. As Brady argues,
propaganda still has a central role in China, but it is very different from that of the Mao
era. While it is the right of every government to promote its views, it is also prudent to
examine the effects of such propaganda. As Shambaugh observes, the CCP Propaganda
Department is handling “virtually every conceivable medium which transmits and
conveys information to the people of China” (Shambaugh 2007, 28). The official

42
government website reports that the functions of the Propaganda Department are wide-
ranging:
It has a central and guiding role over theoretical research, study and
propaganda for the whole of Chinese society. It is responsible for guiding
the public opinion and leading and coordinating the work of news
outlets. It is responsible for producing spiritual products. It is
responsible for the planning and deployment of global ideological and
political tasks. It also coordinates with the Central Organization
Department to educate Party members, prepare educational materials
and cooperate with relevant departments to study and improve the
ideological education of the masses. It also works with the Central
Committee to manage the Ministry of Culture, Press and Publication
Administration, Chinese Academy of Social Sciences, People’s Daily,
State Administration of Radio, Film and Television (SARFT), the Xinhua
News Agency and other news units. It has the right to suggest the
appointment and removal of heads of propaganda departments in the
provinces, autonomous regions and municipalities. It is responsible for
drafting guidelines on publicity, ideological development, cultural
policies and regulations. It is responsible for coordinating various
propaganda and cultural departments in order to complete the tasks set
by the Central Committee.
1

The contemporary Chinese film industry structure is a variant of generic
Communist ones; this fact is highlighted by a look at the pre-reform period. In the study
of political science and political economy, scholars use the term “path dependence” to
refer to the effect that preexisting structures and systems have on the trajectory of
political and economic transitions. In short, new institutions are built on past legacies
and systems. Preexisting structures are important because, countries such as Taiwan or

1
The original Chinese: 負責指導全國理論研究、學習與宣傳工作 ﹔ 負責引導社會輿論，指導、協調中
央各新聞單位的工作 ﹔ 負責從宏觀上指導精神產品的生產 ﹔ 負責規劃、部署全局性的思想政治工作任
務，配合中央組織部做好黨員教育工作，負責編寫黨員教育教材，會同有關部門研究和改進群眾思想教
育工作 ﹔ 受黨中央委托，協同中央組織部管理文化部、新聞出版署、中國社會科學院的領導干部，會同
中央組織部管理人民日報社、廣播電影電視總局、新華社等新聞單位和代管單位的領導干部，對省、自
治區、直轄市黨委宣傳部部長的任免提出意見 ﹔ 負責提出宣傳思想文化事業發展的指導方針，指導宣傳
文化系統制定政策、法規，按照黨中央的統一工作部署，協調宣傳文化系統各部門之間的關系 ﹔ 完成黨
中央交辦的其他任務。(CPC 2012).

43
Singapore, which share a similar culture with Mainland China, are bound to have very
different paths toward economic transitions. Moreover, on the individual level,
preexisting structures have different impacts on different actors. In this study, I focus on
the institutional structure of the film industry that was created after 1949 and its
transitional proximity to the central government during the reform period.
This chapter will first outline the Communist film industry structure prior to the
economic reform and then will briefly explain the structure of the State Administration of
Radio, Film and TV (SARFT). I present a view of China’s economic and media transition
that places this government structure at the center of the reforms. It follows the
discussion of how the state administration is able to successfully maintain its control over
the film industry while pushing the administrative and economic responsibilities down to
the heads of the film studios. I argue that the hierarchy of the former command economy
is not disappearing, but it is being rearranged as well as being recentralized. Economic
responsibilities are being pushed down the hierarchy of the former command economy
while the power of the state maintains its influence over the industry through two
mechanisms: the licensing system and censorship.
2.2 Transitioning to a Communist Film Industry Structure
The government administration of the media industries, particularly the film
industry, is complicated. The Central Film Management Bureau (Zhongyang dianying
ju; hereafter, “Film Bureau”) was set up under the direct control of the Central
Propaganda Department in early April 1949. After the CCP won the Civil War and came
to power, the Film Bureau was moved under the administration of the Ministry of Culture
on November 1, 1949, its name officially changed to the Central Film Bureau of the
Ministry of Culture (Zhongyang wenhuabu dianying Ju) (B. Chen 2005; H. Ji 1991, 198).

44
However, since film was treated as a special form of art that could be used to serve the
Party and educate the masses (Berry 1991; Clark 1988; Y. Zhang 2004; Y. Zhu 2003), the
Film Bureau was also under the direct control of the Central Party Propaganda
Department. Indeed, the function of film was not intended to apply exclusively to the
masses, but was also seen as beneficial to the domestic and international goals of the
leadership. According to the “Propaganda Department’s Instructions to the Special
Branch of Deployed Cadres Army about the Development of the Film Industry”
(Zhonggong zhongyang xuanchuanbu wei fazhan dianying shiye zhi ge ye zhangjun
zhengzhibu choudiao ganbu de zhishi),
The art of film has the largest mass and it has the most common effect in
publicity. We must strengthen this cause, in order to facilitate
nationwide and international propaganda of the Party and the
democratic revolution. […] We need to increase the productivity of film
production in order to meet the demand. (CFYB 1988, Section 11–2; H.
Ji 1995, 37)
2

After the establishment of the Film Bureau, it published the first film regulation
document “Ministry of Culture’s Five Interim Measures on the Film Industry”
(Wenhuabu guanyu dianyingye wuge zanhang banfa) in October 1950. The document
outlined five measures:
i. Registration of the film productions
ii. Screening permit applications
iii. Removal of old films
iv. Regulations of Chinese film exports
v. Regulations of foreign-imported films
3

2
The original Chinese: 電影藝術具有最大的群眾性與最普遍的宣傳效果，必須加強這一事業，以利於
在全國范圍內及在國際上更有利地進行我黨及民主主義革命和建設事業的宣傳工作… 今後必須加強我國
影片的產量，主要提高國制片廠的生產效率，以適應當前的需要
3
H. Ji, Exploring ten years (Tansuo Shinian) (Beijing: China Film Press, 1991), 198; 274–5.

45
With this first “Film Law,” film licensing was introduced and was followed by the
formation of a Film Guidance Committee (Yingpian Shencha Weiyuan Hui). The former
was aimed at nationalizing film studios by undermining the residual influence of private
studios opened in Shanghai before 1949, and later that strengthened the centralized
system by setting up specific ideological and artistic standards for films. “[T]he members
[of the Film Guidance Committee] would consider story outlines and scripts. […] They
would examine completed films and distribution figures, and comment on films made by
the private Shanghai studios” (Clark 1988, 35). After the examination, the film scripts
had to be submitted to receive the approval of the Ministry of Culture before shooting.
On some issues, such as annual film studio production quotas and themes related to
“important political events,” film scripts were to be submitted to the Central Propaganda
Department for evaluation (H. Ji 1995, 58).
In June 1949, a temporary Film Guidance Committee was formed in Northern
China that was responsible for examining foreign films (mainly US films) and a few
domestic films. Members included Tian Fang, Jiang Yang, and Shen Jialun. A meeting
was held in Shanghai on September 19, 1949, to discuss the issue of terminating the
screening of US films. Soon after, on February 15, 1950, the Central Propaganda
Department of the Communist Party issued a document called “Guidance on the
Standard of Censorship of Poisonous Films” (Dui you du yingpian shencha biaozhun de
zhishi), the first document about film censorship. In the document, the authorities
agreed to censor films; however, they added that the standard should not be too strict.
The Film Guidance Committee, they said, should consider the demand of the public and
the private studios’ needs. They advised against banning films too often, which might
result in too few films to fulfill society’s demand (H. Ji 1995, 33).

46
On May 3o, 1950, a formal Film Guidance Committee was finally established, with
Yuan Muzhi as the chairman; Cai Chusheng and Shi Dongshan, vice-chairmen; secretary,
Luo Guangda; along with fellow committee members Chen Boer, Luo Jingyu, Sheng
Jialun, Yuan Shuhua, Tian Fang, Wang Yang, Zhao Wei, Chen Ming, Xin Hanwen, Qian
Xiaozhang, Huang Can, Peng Hourong, and Cheng Jihua. According to Ji Hong, in 1951
the team examined a total of 281 films made by private film studios (mainly in Shanghai),
36 US films, 9 UK films, a few films from the former Soviet Union and some films made
by state-owned studios. The team issued screening permits to 127 films in 1951. Over half
of the films were banned (H. Ji 1995, 33).
Heavily indebted to the Soviet-style film industry, the early Chinese film industry
was characterized by centralization in production, distribution, and exhibition.
Nationalization of the film industry had been achieved in 1953, the first time in Chinese
history that government installed a centralized communication system; film production
was a branch within it. In order to learn the Soviet film industry model and seek
guidance from the Soviet government, the CCP sent a delegation, including delegation
head Wang Lanxi; members Zhang Min, Situ Hui, Zhong Jingzhi, Chen Yading, Qian
Xiaozhang, Cai Ben, Hong Lin, and Lai Zhiyou; and translators Meng Guangjun and Tian
Dawei to Russia in June 1954 (H. Ji 1995, 62). Two months later, another delegation
went to Russia to elicit assistance in building the Beijing Film Studio. In November, a
cadre of Russian experts, including university professors, directors, actors, recordists,
and a cinematographer, visited China and assisted the Chinese government in
establishing the Beijing Film Studio (Beijing dianying zhipian chang); National Film
Preservation Library (Guojia yingpian baocun ku); Film Plant (dianying jiaopian
chang); and the Studios and Printing Photos Workshop (Zhipian changxi yinchejian).
The Russian experts also helped the Shanghai Film Studio in designing the construction

47
of the studio. With substantial assistance from the Russians, the First Five-Year Plan for
the Chinese film industry was settled (see Table 2.1).

48

Table 2.1: First Five-Year Plan of the Film Industry, 1953-57
GENRE 1953 1954 1955 1956 1957 TOTAL
Features
9 14 17 20 24
84
Large-Scale Documentaries
2 1 3 2 2
10
Small-Scale Documentaries
2 7 5 2 2
18
Animation
1 2 2 2 2
9
Puppet Films
1 2 3 3 3
12
Full-Length Documentaries
11 10 4 4 4
33
Short Documentaries
18 27 30 2 34
141
Newsreels
25 64 72 72 72
305
Films about New Villages
12 12 12
36
Films about Today’s China
6 12 12 12
42
Scientific-Educational Films
9 15 18 21 24
87
Science and Technology Films
1 4 6 6 6
23
Foreign Films Dubbed into Mandarin
44 42 50 54 58
248
Foreign Scientific-Educational Films
in Mandarin
12 68 120 140 160
500
Foreign Films in Minority Languages
8 15 70 70 80
243
Foreign Scientific-Educational Films
in Minority Languages
9 30 30 30
99
Features in Local Dialects
9 7 10 10 10
46
Documentaries in Local Dialects
8 20 20 20 20
88
ANNUAL TOTAL
160 304 484 482 555

49
Table 2.1 illustrates the considerable effort the Chinese government put into
translating foreign educational films, close to 90 percent were Russian (H. Ji 1995, 75),
with target audiences of Han Chinese (500 in Mandarin vs. 99 in minorities’ languages).
In contrast, the authorities allowed minorities to enjoy the same number of foreign films
as the Han Chinese (243 in minorities’ languages versus 248 in Mandarin). Regarding
the promotion of scientific knowledge, the government focused more on the educational
realm than on the pure science genre. Half of the feature films were dubbed into local
dialects; most of them were in Cantonese targeting Hong Kong, Southeast Asia, and
Chinese in other overseas regions.
The Film Bureau in the 1950s was highly centralized and was responsible for all
aspects of the film industry. Its duties included setting quotas and missions to the studio
to make films. It distributed the films to the local exhibition sectors. It also led the
arrangement of staff and officials, resource planning and cinema construction and
maintenance. Although it was under the control of the Ministry of Culture, it was an
independent management unit and had the right to draft its own budget plans and its
future development (Ji 1991, 203). By 1957, after completing the First Five-Year Plan,
China had built 11 film studios and the number of feature films had increased from 4 in
1952 to 40 in 1957 (Ji 1991, 203). By the end of 1957, there were 9,965 screening units
with about 1,030 cinemas and 6,692 screening teams. The number of admissions in 1957
increased to three times the level of 1952, to 1.75 billion. Distribution income reached
RMB 61.19 million, which was 3.8 times more than in 1952. In the exhibition sector, box-
office receipts grew to RMB 23.84 million, 26.3 times more than in 1952. The film
industry generated RMB 35.05 million in tax income for the government (Ji 1991, 204).
Ji believes the success of the First Five-Year Plan in the film industry was mainly due to
the highly centralized management system in which the Film Bureau had the right to

50
control all three sectors beneath it (Ji 1991, 204). It is important to note, however, that
the centralization of the film industry was broken after the document “Provisions on
Shifting the Leadership from Local Film Distribution Companies to the Local Cultural
Administration Units” (Guanyu gedi dianying faxing qiye huajia defang wenhua
xingzheng jiguan lingdao he guanli de guiding), was issued by the National People’s
Congress in April 1957. The document stated that all the local China Film subsidiary
companies would be under the control of the local cultural departments instead of
following the central leadership of China Film. All matters related to the film industry –
for instance, personnel arrangements, profits, and construction of film facilities – were
moved under the leadership of the Ministry of Culture. The decentralization of the film
industry from a centralized authority to a collection of local authorities was maintained
until the 1980s, which led to an increased number of staffers and greatly decreased the
efficiency of the film industry (Ji 1991, 205–6).
In February 1963, a new document, “Circular Requesting Improving Management
of Distribution and Projection” (Guanyu gaijin dianying fangying yewu guanli tizhi de
shixing fang an), was issued, which concluded that local film distribution-exhibition
companies were to be led by both China Film and the local Ministry of Culture branches.
All the income from distribution and exhibition was to be handed in to China Film, and
local film companies were allowed to keep 8-15 percent of profits as a management fee.
However, this policy was only adopted by Guangxi Province and was abandoned during
the Cultural Revolution, as depicted in Figure 2.1 (Ji 1991, 209).

51
Figure 2.1: Chinese Film Industry Structure, Pre-Reform

52
The Cultural Revolution greatly destroyed the productivity of the film studios. No
films were produced between 1966 and 1969. From 1966 to 1973, China produced a mere
7 feature films. After 1973, the film industry began a slow revival, producing 35 feature
films by the end of the Cultural Revolution. During the 10 years of the Cultural
Revolution, China produced 104 films, which translated to fewer than 10 films made
annually (as depicted in Table 2.2).
4

4
Film production included animation, documentary, newsreels, and features.

53

Table 2.2: Film Production, 1952-1975
7

5
Data on the number of films produced from 1973-1976 come from Shen Yun’s book, The History of
Chinese Film Industry. According to Shen, besides features films, after 1973, China has also produced a large
number of musicals. Shen counts there were total 76 films produced from 1973-1976 (Shen 2005, 193). Ji
Hong, in her book, 40 Years of Film Industry Construction in New China (1949-1989), states that China had
produced 69 feature films from 1966-1975, but absolutely no films were produced in 1967, 1968 and 1969. Ji
also claims that there were 7 films produced from 1970-73 (Ji 1995). Both of the authors indicate there were
35 films produced in 1976. Based on these data, I calculated that there were 28 films produced from 1966-
1972, which shows that 25 films were produced in 1966. As Shen shows that 4 films were made in 1973 that
means that from 1970-1972 China made 3 films.
6
Data on the number of animated films, newsreels, sci-fi, and dubbed films in 1976 from B. Chen,
Chronicle of Chinese Film Industry [Beijing: China Central Document Press (Zhongyang wenxian
zhubianshe] 2005), 639.
7
Data source: H. Ji, 40 Years of Film Industry Construction in New China (1949-1989) [Xin Zhongguo
Dianying Shiye Jianshe Si Shi Nian, 1949-1989] (Beijing: Non-Published, Internal Reference), 99; 109; 117.
YEAR FEATURES ANIMATION NEWSREELS
SCIENTIFIC-
EDUCATIONAL
FILMS
DUBBED
FILMS
1952 4 1 107 12 39
1953 11 2 135 11 32
1954 15 4 170 22 40
1955 23 5 182 25 46
1956 42 8 246 51 69
1957 40 3 218 49 79
1958 103 27 1017 178
1959 82
1961-64 28
1965 52 10 262 100
1966 25
1967 0
1968 0
1969 0
1970-72 3
1973
5
4
1974 15
1975 22
1976 35 5 286 86 39
6

54
2.3 The Hierarchy of Government Jurisdiction
2.3.1 The Central Administration: SARFT
After the Cultural Revolution, many government departments were
reconstructed, although the communication system was not. In 1986, the Ministry of
Radio and Television was transformed into the Ministry of Radio, Film and Television
(MRFT). This change indicated that the Party had extended the definition of film to
include not only art but also something with a function similar to that of radio and
television – the “mouthpiece” of the Party. However, only the Film Bureau and its
directly subordinated units were merged into the new ministry. The Ministry of Culture
retained control of provincial levels of filmmaking activities, encompassing thousands of
local distribution companies and tens of thousands of exhibition units. This still deeply
impacts the film industry, as the two “heads” of the industry cooperate once in a while
but remain in conflict in most instances.
Local distribution and exhibition units are governed by China Film (a subsidiary
of the Film Bureau) as well as by the cultural bureaus of local governments. The former
supervises business practices but is without the authority to hand down policies and
directives to the cultural bureaus; the latter oversee personnel arrangements and asset
management. Under this arrangement, a local cultural bureau could hypothetically
assign someone who knows nothing about film, who would become the manager of the
distribution and exhibition company. Because the system puts the film industry under
the purview of two different administrations, conflicts are considerable.
In 1996, MRFT was reassembled into the State Administration of Radio, Film and
Television (SARFT) by extending its authority to provincial levels of film production and
distribution, though the exhibition sector was still reserved for the Ministry of Culture.

55
In December 2008, in order to promote further integration of the industry (H. Zhu
2008), a new document was issued by the State Council in 2008: “Provisions on the Main
Duties, Internal Organization and Personnel Allotment of SARFT” (Guojia guangbo
dianying dianshi zongju zhuyao zhize na she jigou renyuan bianzhi guiding de tongzhi)
(CGPIO 2008). SARFT had been promoted so that it supervised all film industry
activities, from central to provincial levels (see Figure 2.2).

56
Figure 2.2: Chinese Film Industry Structure, 1980s—early 1990s

57
This bureaucratic division of labor is described in the aforementioned document.
The bureaucracy of the Chinese film industry is enormous, with a tremendous number of
departments and internal organs. Before we begin parsing the divisions, let’s first review
the main duties of SARFT:
i. Formulating general policies for the development of radio, film
and television (hereafter RFT) propaganda and creation; grasping
correct public opinion and creative ideas
ii. Drafting laws and regulations for RFT and information network
audiovisual program services; drafting technical standards and
departmental rules to promote the structural reforms of RFT
iii. Promoting public service in the area of RFT; implementing major
RFT projects, assisting the construction and development of RFT
in lesser-developed areas (old ethnic minority borders and poor
regions); guiding and supervising the key infrastructure
construction of RFT
iv. Mapping out RFT’s development; guiding and coordinating the
industrial development of RFT; managing national-scale major
RFT activities
v. Providing and monitoring RFT and information network
audiovisual programs; managing the introduction and withdrawal
of correspondent businesses and the RFT programs produced by
non-state actors
vi. Supervising, reviewing and censoring contents and qualities of the
RFT programs, information networks programs and public
audiovisual media programs
vii. Guiding the scientific and technological development for RFT and
information network audiovisual programs. Supervising RFT
programs’ transmission, monitoring, and broadcasting
viii. Guiding the foreign RFT’s exchanges and cooperation, including
products from Hong Kong, Macao and Taiwan. Managing the
importation and recording of RFT programs
ix. Leading, guiding, coordinating and managing the China National
Radio, China International Radio and China Central Television
(hereafter the Three Central Stations) on major issues such as
propaganda, development and transmission coverage, etc.

58
x. Undertaking other issues assigned by the Central Committee and
the State Council
This new document cancelled the annual production quota for the film studios;
most important, the Ministry of Culture’s duties in guiding film distribution and
exhibition work were brought under the jurisdiction of SARFT for the first time since
1949. However, the Ministry of Culture remained responsible for industrial planning;
industrial bases; program establishment; exhibition; and transactions and market
supervision related to cartoons and network games. The document strengthened
SARFT’s role in conducting business with non-state film actors, a completely new task for
SARFT. According to this new policy, SARFT’s administrative personnel allotment was
292 (including five committees’ personnel allotments, three flexible work allotments, and
29 retired cadre work personnel allotments). Among those allotments, there were a
single director, four deputies, and 45 bureau-level leaders (including a Party Committee
special assistant secretary and three retired cadre bureau leading posts).
SARFT is an administrative behemoth, divided into 17 internal departments (see
Appendix 1) and 33 branches (see Appendix 2).
8
Within these 33 branches, besides the
biggest film company in China –CFG – other filmmaking-related units are the Radio,
Film and Television Developmental Research Center; the China Film Science and
Technology Institute; the Institute of Film QA Inspection; the China Film Art Research
Center (China Film Archive); the Digital Film Programs Management Center; the Center
of Screenplay Planning; the Office of the Special Developmental Fund for the National
Film Industry; the Radio, Film and Television Talent Exchange Center; the Central
Newsreel Documentary Film Group; and the Cinema Satellite Channel Program
Production Center (See Appendix 3 for the functions of these branches). SARFT, usually

8
Besides the duties listed in the document, there is a more detailed version on SARFT’s official webpage.

59
shortened to “Guangdian zongju” in Chinese, is among the most powerful entities in the
Chinese media system.
2.3.2 Local Administrations: The Local ARFTs
To perform all of political functions, a municipal-level or provincial-level
Administration of Radio, Film and Television (ARFT) is usually composed of standard
divisions or sections. It should be noted that, in practice, these subunits might not all be
separate and equal; some may be subordinate to, or embedded in, others (see Appendix
4).
The provincial and municipal levels replicate the central structure, which means
an individual ARFT was formed in each province and municipality, led by both the local
Party and the government. Thus, it is a rule that almost all subordinate departments of
the bureaucracy have their mirrored divisions, sections, or individuals in an ARFT. The
higher up an ARFT hierarchy, the more divisions and sections it contains and the greater
the division of labor within it. An ARFT at a lower level of, say, a county, generally does
not have many subunits, so each section or individual division has to handle a wider
scope of responsibilities. A General Office (GO), however, exists at all levels, which
provides the “leaders with a countervailing base of expertise and information and
necessary organizational capacity to attempt effective control over the bureaucracy”(W.
Li 1994, vii). Among all the divisions, a GO usually is the largest. In general, a GO looks
after every administrative activity, namely analyzing, storing information, providing
advice for policy-making, drafting official documents, arranging meetings and leaders’
activities, monitoring, supervising, and coordinating subordinate units, and taking care
of leaders’ and staffers’ food, housing, transport, health care, salaries, recreation,
security, and even arranging their funeral services (W. Li 1994, 10). The organizational

60
structure of this system reflects ARFT’s role as an integrating work unit that makes it
possible for the leadership to closely monitor and control the subordinate bureaucracy.
2.3.3 Administrative Hierarchy in Chinese Media Systems
Since 1949, the Chinese media industries have been part of a complex system (see
Figure 2.3). The system was built on an administratively decentralized governance
structure that allowed the central government to promulgate policies down the hierarchy
of government jurisdictions, relying on the local government offices to mobilize
organizations as well as the people. Media polices were made by the Editorial Board of
SARFT, who then passed the documents and policies down to the next-level bureaus and
work units under their jurisdictions. The system assumed central government to be the
most efficient unit for the management and control of the nation. The result of these
policies was a “nested hierarchy”(Walder 1996) of government organizations spread
throughout the country, each with jurisdiction over a smaller sector of the population. In
the Chinese media systems, all organizations are directly under the jurisdiction of a
specific governing organization at a specific level of this administrative hierarchy. This
administrative structure forms the hierarchy in which national resources and incentives
are allocated from the central command to the various levels of local governments.
Organizations at different levels of this hierarchy have varying access to resources.
Higher levels of government jurisdictions and their subordinate work units, e.g., the CFG,
Shanghai Film Group and the West Movie Group, are always in favor of economic
transitions.

61
Figure 2.3: Chinese Film Industry Structure, 2008—present

62
2.4 The Film Management Bureau: Licensing and Censorship
9

2.4.1 The Licensing System and Quotas
The SARFT editorial board, formed by the heads of all branches, is responsible for
transmitting the central government’s policies down to local Film Bureaus and other
subsidiary sectors’ departments; drafting strategies for carrying out the state’s goal to
each RFT station or studio; promoting propaganda campaigns; managing the operational
costs of each station or studio; and exercising editorial censorship on scripts and final
products. Below the editorial board, the Film Bureau– one of the branches of SARFT – is
directly in charge of film production, distribution and exhibition. Its duties include:
i. Implementing the laws and regulations in the film industry
ii. Legislating policies and regulations related to the film industry
iii. Defining the number and structure of film production units and
their production plans
iv. Examining the establishment of film production units
v. Examining the establishment of independent film production
units
vi. Examining Sino-Foreign co-production issues
vii. Examining film production unit activities outside Mainland China
viii. Examining films’ exhibition, importation, distribution and export
ix. Appointing film import units
x. Building up film archives

9
Regarding the “control” of the film industry, I will discuss this important topic in the following chapters.
In this section, I will discuss how the structure of the film industry helps the authorities control it.

63
xi. Examining Sino-Foreign film exhibition events, international film
festivals, participation in foreign film expos and festivals and other
exchange activities
xii. Examining inter-province distribution units and organizing rural
screening activities
xiii. Instructing national propaganda campaigns
xiv. Under certain circumstances, halting the distribution and
screening of an approved film [with the board reserving the right
to approve the redistribution and exhibition of a modified film]
xv. Penalizing illegal film production activities
xvi. Guiding film production organizations nationally
10

Virtually all filmmaking-related activities depend upon the approval of the Film
Bureau. Among the primary duties of the Film Bureau are the issuing and cancelation of
permits for shooting, distributing, and exhibiting. In this way, the Film Bureau is able to
control the annual output of the film industry, including not only the quota for feature
films but also quotas for documentaries; scientific and educational films; and animated
films.
In addition to the film output quota, the Film Bureau is also able to determine the
subject of films produced. Film content has been categorized based on the timeframe of
the story, which consists of three major categories:
i. Modern subjects – Film stories occurring after 1949
ii. Revolutionary historical subjects - Films about the founding of the
CCP; this period covers 1921-1949
iii. Other historical subjects - This includes film stories occurring before 1949
(apart from those covered in the previous categories)
Each category is further divided into sub-categories. For example, modern subjects are
divided into industrial stories, urban stories, rural stories, war or army stories, youth

10
Interviews 10, 18, 24, 25, 26, and 27.

64
stories, police stories, reform stories, and so forth (Wu 1992, 227). Before 1979, the Film
Bureau was very strict in controlling the subjects of films, and film studios during that
period had a very limited array of choices. Since the economic reform, film studios have
been encouraged to produce films that reflect the current social condition (Xia 1987).
And the quota system has been changed to include two types: one is “referential,”
meaning the studios are allowed to produce a certain number of films to reflect their
interest in fulfilling the market demand. The second type of quota is “required,” meaning
film studios must make films on certain subjects (Wu 1992, 229).
As of August 2012, Tong Gang is the head of the Film Bureau, and Zhang
Hongsen, Mao Yu, La Peikang, and Gu Guoqing are the deputies (GO 2008). The
provincial and municipal levels replicate the central structure, which means an individual
Film Bureau was formed in each province and municipality, led by both the local Party
and the government. Today, there are 37 local Film Bureaus nationally, including in
Tibet and Xinjiang, but not in Hong Kong and Macau (SARFT 2012). Major duties
include following the guidance of the SARFT Film Bureau and implementing their
decisions. Additionally, they examine film scripts and assist producers in obtaining the
requisite permits for shooting, distributing and exhibiting.
2.4.2 Censorship
In any discussion of Chinese films, the nature of censorship is inevitably a central
issue. The criteria for censorship are ambiguous and constantly changing, the principles
often too vague to have any clear definition. A film that passes through censorship one
year might be criticized and banned the next, or even mere months later. Only the Film
Bureau is intended to possess the authority to censor films; however, in practice, any
Party leader could ban a film if he or she does not like it. For example, Hu Jian, Manager

65
of China Film, was stopped prior to boarding a plane to Japan because he was carrying a
controversial film, A Legend about Tianyun Mountain (dir. Xie Jin, 1980). Although the
film passed through the censorship process and an agreement with Japan had already
been signed, certain officials from the Film Bureau insisted the film was not suitable for
foreign audiences (Ding 1987). As director Wang Xiaoshuai expresses,
The biggest problem of the current censorship system is that there are
no set standards. Because this system mostly relies on man-made
decisions, no one knows for sure what will happen at any given time.
This time you might be able to get through, but next time the feeling of
uncertainty will come back again. (S. Sun and X. Li 2008, 86)
According to Shi Fanyu (1987) outlines four activities the Film Bureau performs
with regard to censorship: 1) Censor a film to see whether it is politically and
ideologically correct. Some comments are issued to the production studio after the
discussion session, most are referential, but a few are mandatory; 2) Read screenplays
submitted by studios and offers its comments and suggestions, which are referential.
Film studios have the freedom to accept the comments or reject them; 3) Hold various
meetings for screenplay editors of studios to discuss the films to be produced. The
editors act as collective censors for each other’s screenplays. Some screenplays are
terminated in these meetings; and 4) Send its employees to read screenplays and to see
the working prints of films in the studios (164).
Upon entering the 2000s, the Party, in an attempt to improve its image, had been
willing to provide standards of censorship aimed at standardizing the system. As a result,
updated regulations and rules have been issued to help clarify the principles of
censorship.
11

11
Though statutes not previously updated since the late 1980s, the criteria were continually adjusted in
accordance with the current political conditions.

66
According to the Film Management Regulations (2001), Article 24, all films
(including features, documentaries, educational films, animations and all other formats)
are subject to the ex-ante examination system, whereby,
Films not examined and adopted by the film examination entity of
SARFT shall not be distributed, exhibited, imported or exported.
(SARFT 2005, 9)
According to the policies, films must be censored before their distribution, exhibition,
import, and export. All co-productions must to apply for shooting permits. For those
films related to “important revolutions and history, special themes, government-funded
films and co-produced films,” filmmakers need to provide a full script to SARFT prior to
the shooting. In many cases, film directors do not enjoy absolute creative control –
especially in relation to state-funded films. Additionally, film authorities retain veto
power over all steps along the process —from the first stage of scriptwriting to the final
stage of editing the film, and all activities in between. Films may be completed yet
banned from public screening, or even removed from theaters arbitrarily.
One point worth mentioning is that a number of filmmakers, film writers, and
other artists are representatives of the Party, and are those same individuals responsible
for ideological education. As Kenez discusses with regard to the Soviet film industry,
many co-writers or co-directors are actually censors and, thus, the Party is actually
participating in every stage of the production of the film, from the first glimmer of an
idea to the last cut (Kenez 1992, 149). One of the most prominent examples of this
phenomenon is the China film czar Han Sanping, who comes from a cadres’ family and
has been working for the government since 1977 when he first entered the Emei Film
Studio. He later became the head of the Beijing Film Studio in 1994. In 1999, he was one
of the founding members of CFG and was promoted to be the chairman of CFG in 2007.

67
A producer, director and also a government official, he controls nearly every aspect of the
film market in China.
Despite the fact that a list of prohibited content is provided in Article 25 in the
Film Management Regulations, directors and scholars often find it difficult to make
informed decisions about film censorship, since what is and is not permissible is often
not explicitly defined, as illustrated in Article 25:
i. Content that defies China’s Constitution and laws
ii. Content that endangers the unity of the nation, sovereignty, and
territorial integrity
iii. Content that divulges secrets of the state; endangers national
security; damages the honor or benefits of the state
iv. Content that incites hatred and discrimination toward minorities;
undermines the solidarity of all ethnicities; infringes upon
traditional customs and habits
v. Content that propagates evil, cults and/or superstition
vi. Content that disturbs the public order and undermines social
stability
vii. Content that propagates obscenity, gambling and/or violence;
incites or instigates crime
viii. Content that insults or slanders others; infringes upon the lawful
rights and interests of others
ix. Content that endangers public ethics or great folk cultural traditions
x. Other content prohibited by laws, regulations, and/or state
provisions
12

12
SARFT, Film Management Regulations, Article 25 (2005) 9–10.

68
By late 2011, a new Film Law had been proposed, the “Film Industry Stimulation
Law of the People’s Republic of China (Opinion-Seeking Draft)” (Zhonghua renmin
gonghe guo dianying cujinfa (zhengqiu yijian gao). In the draft, the items on the
banned-content list increased from 10 to 13, with the addition of the following items:
i. Content that propagates religious fanaticism; endangers amity
among religions; harms the religious feelings of religious citizens;
destroys the unity of religious citizens and non-religious citizens
ii. The original No. 7 was expanded into two points:
a. Content that propagates obscenity, gambling, drug use,
exaggerated violence and terror
b. Content that instigates crime and teaches criminal methods
iii. Content that violates the lawful rights and interests of minors;
damages the mental and physical health of minors
13

My research indicates that the government uses at least two additional methods
of inspecting films to censor content and make sure the rules are implemented, besides
the above written rules: monitoring of scripts and examination of films. First, all film
scripts have to be reviewed by the Film Scripts Discussion Board (Dianying juben
lunzheng hui; hereafter, “the Board”), a subordinate unit in the Film Bureau. A film-
examination entity, the Board is typically composed of 10 members at a time, focused on
dealing with film scripts. Group members usually hail from a diversity of fields, including
government officials, university professors, veteran party cadres (who have formerly
worked in the media or as propaganda officials), and the film industry.

13
State Council, Film Industry Stimulation Law of the People’s Republic of China (Opinion-Seeking Draft)
(2011).

69
Their major tasks include:
i. Conducting research and providing options and advice to the
Production Team of the Major Revolutionary Historical Films
(Zhongda geming lishi ticai yingshi chuangzuo lingdao xiaozu)
ii. Proposing solutions to film-script problems
iii. Arranging meetings to organize scriptwriters to collaborate on
film scripts; selecting the best scripts for film productions
14

Besides the Board, there is also a Film Examining Committee (Dianying shencha
weiyuan hui, hereafter FEC) and a Film Re-examining Committee (Dianying fushen
weiyuan hui, hereafter FRC). The former has nearly 40 members; the latter, roughly 20.
The two committees are formed, with artists, directors, and educators. Members are
typically recruited on a two-year basis and the components of the committee are varied.
All completed films are to be submitted to the FEC to obtain a “Film Screening Permit”
(Dianyingpian gongying xukezheng). The FRC is responsible for providing guidance to
the FEC, at times reviewing films submitted from the FEC and making final judgments
(Interviews 24, 25, 26 and 27). Both committees may request that minor changes be
made in a film. However, both committees must consult the directors of the Film Bureau
and SARFT, or other experts if major changes are to be undertaken. Some films related
to major historical periods may even go to the leaders of the Central Committee of the
CCP for approval. For example, Baishe Uprising (dir. Chen Jianlin, 1989), Founding
Ceremony of the PRC (dir. Li Qiankuan and Xiao Guiyun, 1989), Three Decisive
Campaigns (dir. Li Jun and Wei Lian, 1992), among others, are under the direct
supervision of the Central Committee of the CCP.
Both the Board and FEC or FRC have the right to ban films, or require films be
modified (Interviews 24, 25, 26 and 27). The examination can be very rigorous and can

14
Interviews 19 and 24.

70
require detailed modifications. More contentious films may receive warnings or be
terminated even after they’re screened. Because of this system, film producers tend to be
conservative and overly cautious about content, especially regarding issues such as
politics, homosexuality, and social justice. Film practitioners self-censor their films,
reporting that they would painstakingly avoid topics to the list below to prevent being
banned or subject to other penalties. Stories with significant content about gambling,
gangsters, ghosts or the supernatural are not allowed; other stipulations include:
i. Prostitutes, drug traffickers, and criminals may not enjoy positive
portrayals
ii. Bad guys must be arrested
iii. Ruthless characters must not originate from Mainland China
15

Furthermore, film content is usually required to affirm social advancement,
support the national stability and unity of today’s China, and cannot cover “negative”
content; for instance, police officers’ images must be positive (Interview 22). Films have
to reflect the bright side of society, and thus crime drama is very limited. Films about
disasters, social incidents, and diplomatic events must follow the government’s
propaganda guidelines (Miao 2011, 97).
16
Certain topics, such as criticism of, or
speculation about, China’s leaders are always off-limits. Some historical events, most
obviously the Tiananmen crackdown on June 4
th
of 1989, are strictly prohibited too
(Interview 22). Zhang and Sun also point out, there is a common knowledge about the
political campaigns, for instance, the anti-rightist movement in the 1950s, the Great Leap
Forward, the Cultural Revolution, among other campaigns are forbidden. “No matter

15
Interviews 28 and 29.
16
According to Rosen, Feng Xiaogang has made the point in interviews that he can make films about
natural disasters, such as “Aftershock,” but not about man-made disasters such as the Great Leap Forward or
the Cultural Revolution.

71
what is your view on these campaigns, it is absolutely not allowed to talk about them in
films” (Zhang and X. Sun 2009, 28).
According to a scholar from China,
17
the Chinese government insists on the
censorship of the film industry; he projects, “[The Government] will never change this
principle” because film is at the “heart” of the propaganda system (Interview 30). As the
scholar continues,
Censoring film has long been a tradition in the Chinese film industry. It
is part of the culture and it has happened not only in China but also in
other countries, like in India or the US – even though they are so-called
democratic countries…. The Chinese government views censorship of
films as positive for the public because films are available to all ages. As
a responsible government, the authority is required to censor film
content. I don’t feel it’s a problem. (Interview 30)
Regarding foreign films, China Film censors them. The censors of foreign films
consist of the directors of the Film Bureau, members of the Bureau’s general office and
managers of China Film (Wu 1992, 236).
2.5 Shifting State-Studio Relations
While the overall rank of a governing organization is important, the relationship
between administrative offices and filmmaking corporations has changed significantly,
and these changes represent another important issue for this chapter. Within the
arrangements I have discussed in the above sections, two types of changes have occurred
in the state-studio relationship.
The first change has occurred in the relationship between the Film Bureau and
the film studios. Under the command economy, bureaus controlled all production
decisions, development plans, and investment strategies, and now some of these

17
A professor from the Communication University of China, the scholar wishes to remain anonymous.

72
responsibilities, especially the economic responsibilities, have been pushed down to the
filmmaking organizations below them. This means the individual film organizations now
need to develop long-term transition plans, developmental plans, and strategies in order
to survive in the emerging market economic system. Different film studios have adopted
different strategies; for example, the Shanghai Film Studio has reconstructed its internal
organization and has established its own regulations – “Temporary Regulations on
Managing Feature-Film Production in the Shanghai Film Studio” (Shangying chang
guishipian shenchan guanli zanxing guiding) to rebuild the structure of the film studio
after the Cultural Revolution (C. Shi 2011). As the economic responsibilities are pushed
down the hierarchy, the onus of accountability has fallen primarily on the heads of the
studios. Therefore, the studios are now no longer just receiving directives from the
central government, but are more responsible for the economic health of the
organizations they preside over. As one official explains,
Film studios are totally different than they were in the ‘50s and ‘60s.
Their job is no longer just producing films; they now need to search for
sources of investment. Without investment, they cannot survive. Of
course, government still plays its role in guiding them. But mostly they
have to decide on their major budgets and development plans.
(Interview 34)
The transformation of the relationship between the state and media outlets could
be viewed as part of a transformation from administrative bodies to economic ones. The
bureaus still exist to monitor the filmmaking processes and the finished films, but they
are taking less responsibility for the economic strategies and other developmental plans.
The film studios now emphasize not only filmmaking activities, but also other business-
related issues (for instance, real estate, shopping malls and hotel management) with the
goal of surviving market reform and also exploring other filmmaking-related business.
So the goal of this change is to transform film studios – especially the heads of the film

73
studios – from administrators to investors. Thus, the government has turned over much
of the responsibility that used to lie in their hands during the command economy to the
organizations below.
The second change is related to the first, but it has occurred at the film-studio
level specifically. Studios are now increasingly operating under a system of independent
budgets and independent accounting systems. This system allows film studios a degree
of developmental freedom while also enabling the state to detach itself from the daily
practices of the studios. Studios, in turn, are granted greater freedom to seize and attract
foreign investments than they have had since the beginning of the reforms. The studios
have added budgetary responsibilities, but at the same time, they have more capital to
reinvest in filmmaking, as some amount of revenue can stay with the studios; most
revenues had to be submitted to the central government within the command economy.
Besides the emergence of independent budgets, self-responsibility for gains and
losses is a new concept introduced during the economic transition. Within this system,
studios are not only able to keep some amount of the profits, but they are required to
cover any losses. Under the new system, the studios are allowed to keep a portion of
after-tax profits for their own use. Early on in the reform, this system created a difficult
situation for some studios, as they could not manage to sell copies of their films to
cinemas. As the responsibilities have shifted down to the heads of film studios, the state-
owned film studios have felt the economic reforms most strongly. These film studios
were used to being guided by the state administration, and suddenly they were exposed
directly to the market. In order to survive, film studios had to stop making films and
tried to survive by assisting other production teams, renting out their shooting
equipment or studios, or simply selling their studios’ titles to someone not able to get
shooting permits. They called these types of productions “co-productions,” which are

74
completely different from today’s co-productions format in which both parties have
capital investment and a division of labor. Some film studios even transformed their
studios into flea markets for short-term income (Sheng, Wen, and Peng 2009).
Film studios were nearly bankrupt during the mid-1990s. In order to address the
film industry’s financial crisis, the state re-assumed the guiding role of the film industry
by restructuring the film studios.
18

In 1995, the Shanghai Radio and Television Bureau merged with the Shanghai
Film Bureau. The joint administrative agency decided to construct two companies: The
Shanghai Film and Television Company, and Yongle Film and Television Group
Company, based at the Shanghai Film Studio, which absorbed the Shanghai Film Lab,
Shanghai Film Development Company, Shanghai Dongfang Film and TV Distribution
Company, and several theaters. It is mainly engaged in film production. Yongle
Company, based at the Shanghai Film Distribution Company and Shanghai TV Station,
absorbed several TV drama production companies of Shanghai TV stations. It is mainly
engaged in film distribution and exhibition and TV drama production. The bureau also
allowed the following mergers: Shanghai Popular Science Film Studio with Dongfang TV
Station, Shanghai Animation Studio with Shanghai TV Station, and Shanghai Film-
dubbing Studio with the dubbing department of the Shanghai TV Station (Jin 131). The
mergers were intended to make cooperation between film and television sectors easier, as
well as to unify the censorship activities of TV and film industries. Later, in 1996, the
state government further expanded this vertical and horizontal reform by establishing a
pay-per-view movie channel on the satellite broadcast of China’s Central Television

18
For more on China’s leading film production companies, see Chinafilmbiz.

75
Station (CCTV). This movie channel helps to promote the public’s awareness of and
interest in film.
The Shanghai Film and Television Company changed its name to Shanghai Film
Group Corporation (SFG) in 2001 and further integrated with the Shanghai Documentary
Film Studio, the Shanghai Animation Film Studio, the Shanghai Dubbing Studio, and the
Shanghai Film Technology Plan. The company currently owns 640 feature films, 30,000
minutes of animated films, 1,555 documentary films, and about 10,000 episodes of TV
series. It has also set up its own cinema circuit, the United Circuit, with over 75 cinemas
and 198 screens in Shanghai. SFG topped the most successful box office lists in 2003,
2004 and 2005. In 2008, of the 10 biggest film hits, three were produced by SFG. The
company itself accounted for one-sixth of the national film market in 2001, and jumped
to 26 percent in 2008 (SFG 2009; Yin and Shi 2009, 167). Like the Hollywood
conglomerates, SFG not only works with film, but also has other business interests, such
as hotel services (e.g., Shanghai Holiday Inn), real estate, steel production, tourism, etc.
It is reportedly the largest film conglomerate in China.
19

In February 1999, with approval from the State Council, CFG merged with the
original China Film Corporation, the Beijing Film Studio, the China Children’s Film
Studio, the China Film Co-Production Corporation, the China Film Equipment
Corporation, the China Movie Channel, the Beijing Film Developing and Printing and
Video Laboratory, and the Huayun Film and TV Compact Disc Company (Zhang and Yu,
2006). CFG is directly under the leadership of SARFT. Since then, it has become the
“head of the dragon” – the most comprehensive and far-reaching company in the Chinese
film industry. According to Yeh and Davis, CFG wholly owns “14 fully funded

19
For additional information, please see their official website:
http://www.sfs-cn.com/node3/node1828/u1a27.html

76
subsidiaries, 34 major holding companies and joint-stock companies, and the only movie
channel (CCTV-6) in the country, with total assets worth 2.8 billion RMB” (Yeh and Davis
2008, 42). In 2008, among the 18 biggest box office hits, eight were CFG productions or
co-productions with other companies, which accounted for about 30 percent of the
national box office revenue (SARFT 2009). With imported films included, CFG earned
67 percent of the total national box office receipts in 2008 (W. Zhang 2009).
The Beijing Forbidden City Film Company, one of the subsidiaries of CFG,
originally set up in April 1997, was 100 percent funded by the state and combined the
production, distribution, and exhibition functions. The model is a “twin-fisted” policy, as
it not only produces commercial movies, such as Part A, Part B (dir. Feng Xiaogang,
1997) or Be There or Be Square (Feng Xiaogang, 1998), but also main-melody films, e.g.,
Life After the Departure of Lei Feng (Lei Xianhe and Kang Ning, 1997), Purple Sunset
(dir. Feng Xiaoning, 2001), and The One-Man Olympics (dir. Hou Yong, 2008).
In order to further expand, Beijing Forbidden City Film Company cooperated with
Beijing Film Company and New Film Alliance and formed the “Forbidden City Three
Alliance Films and TV Distribution Company.” At the same time, Beijing Film Company
reorganized into a multi-level technology provider known as “Beijing Film Equipment
and Technology Company.” Since then, the transformation of the state-owned film
industry has been successfully integrated into the enterprise.
The establishment of CFG and the consolidation of Beijing Forbidden City Film
Company have strengthened Beijing into an important center of the Chinese film
industry, both in terms of film production and film consumption. In 2000 and 2001,
there were only 7 and 9 feature films, respectively, produced in Beijing, but in the
following years, the number of features soared up to 30, 35 and 43 in 2002, 2003, and
2004, respectively (BJSYB 2003; BJSYB 2004; BJSYB 2005). Beijing’s population made

77
up for around 1 percent of the total national population in 1993, and accounted for about
1 percent of the national box office. However, Beijing’s box office represented 9 percent
of the national gross in 1998, although the population remains the same (Tang 2002,
324). In 2008, box office receipts in Beijing totaled RMB 525 million (USD 76.9 million),
which accounted for close to 12.5 percent of the national gross (Y. Li 2009).
These changes have fundamental implications for the transformation of the
system. Aggressive studio directors are rewarded through the developmental success of
their studios, and the system, in essence, is encouraging studio heads to optimize studio
production and increase overall profits, either through internal restructuring or through
outside investments. But independent budgets and self-responsibility policies are
flexible to some extent. As one official explains,
Of course the government does not want to close down the studios
because most of the studios have more than 1,000 workers, and it’s too
risky to just send them home. And filmmaking is a special business in
China; the government cannot just let the studios close. As you know,
before the 1990s and even in late 1990s, a lot of studios not only did not
make money but a lot of them were losing money. There are definitely
cases where the government is giving money to studios to cover losses,
but it is rare (Interview 10).
As an example, Forbidden City received RMB 2 million from the Beijing
Municipal Government during its first year. The Shanghai Radio, Film, and Television
Bureau also invested over RMB 1.3 million in a few of the films produced by Shanghai
Yongle Company (Liu, 15). Taking another case is in August 1996 Shanxi Province gave
RMB 10 million loan to the Xi’an Film Studio to support film production and also
promote the creation of “high-quality” (Jing pin) movies. In addition to supporting film
production, the General Office of Shanxi Province in early 1997 decided to give another
$4.5 million for the construction of Studio Number 4 (B. Chen 2005, 974).

78
Recently, the director of SARFT, Wang Taihua, ordered that all the 38 state-
owned film studios had to transform from public institutions (shiye) into profit-making
enterprises (qiye) by the end of 2009, or else the studios were not allowed to make
movies (Zhou, et al., 2009). It required entire film studios to manage their own
development plans and strategies. Government is no longer able to guide everything for
the individual film studios.
2.6 Conclusion
Some scholars have argued that the CCP is one of the distinctive institutional
variables in forming Chinese society. In the above sections, I have described the
transformation in which economic and administrative responsibilities were rearranged
down the hierarchy. Although the hierarchy still exists, the Party plays a less direct role
compared to the past. Therefore, while it is true that the Party still impacts the general
policies of filmmaking, as an organization it has little direct influence over the daily
practices of an individual studio or filmmaking enterprise.
This chapter has emphasized two aspects of institutional change crucial to our
understanding of the economic transition in the Chinese film industry. First, focusing on
the institutional structure of the state administration pertaining to the film industry is
the crucial part of this analysis. The position of the film industry within the governmental
structure is a crucial variable in explaining the lessening liberation of filmmaking,
especially in terms of film content, over the course of the “reform and opening.” The
second point, although the hierarchy remains, some of the administrative
responsibilities, and especially economic responsibilities, have been pushed farther down
the hierarchy. Film studios, once under the direct jurisdiction of the state
administration, have seen less protection and increased uncertainty since the economic

79
transition began. The situation began to improve in the late 1990s, when the state
regained its guiding role by way of issuing various administrative orders toward
restructuring state-owned film organizations and transforming them into profit-making
enterprises. By the time this transformation concluded in 2009, almost all state-owned
film studios had been transformed into profit-oriented film enterprises.
While economic and administrative responsibilities are being pushed down the
ladder, it would be a mistake to assume the administrative hierarchy has disappeared
completely. Indeed, the state maintains the licensing system and film examination
responsibilities – the two most critical mechanisms for controlling the film industry.
As discussed in Chapter 1, these changes are only meaningful if the economic
actors adopt them. The Chinese economic reform is clearly state-led, as opposed to a
bottom-up transformation; however, questions remain about what changes have been
made, exactly, through all this institutional rearranging. What have the players
(producers, directors, and other film industry workers) actually accomplished in the face
of emerging markets? What is the meaning of these institutional changes for these
players in the economic transition? We will explore these questions in the chapters that
follow.

80
C H A P T E R 3
The Official Revival of Chinese Commercial Film

3.1 Introduction
The reform of Chinese media began after the Cultural Revolution, though it
reached critical mass only after Deng Xiaoping’s 1992 Southern Tour. Zhao Yuezhi points
to the introduction of the business management model at the People’s Daily and other
newspapers in 1978, and to the reappearance of newspaper vendors on the streets in
1980, as the beginning of media commercialization (Y. Zhao 1998). However, in the early
days of the reform, Chinese media, particularly the film industry, were officially treated
as a powerful propaganda weapon, and less stress was placed on its commercial value.
Prior to these reforms, media organizations were administrative units that were not
expected to return profits. Only in 1988 were a brand-new group of players, independent
producers – film production investors responsible for the financial returns or losses of
films – invited to join the industry. Besides the entry of independent producers,
authorities also redefined film as a “commodity” (Shangpin) during a national conference
at the end of 1988. In his speech, Chen Haosu, Vice President of MRFT, suggested that
films have three functions: “Films’ function as entertainment is at the origin of the film
industry; it’s fundamental. Their function as art and education is an extension; that is a
development” (H. Chen 1989b, 12).
1
Therefore, he encourages each film production “to
return to its origins - that is, respect its entertaining characteristics […] [I]t must put the

1
The original Chinese: 娛樂功能是本原，是基礎，而藝術（審美）功能和教育（認識）功能是延
伸，是發展) 。

81
function of entertainment at the forefront”(H. Chen 1989b; Zhang 1989).
2
He adds that
art films and entertainment films have to be to divided according to their properties and
needs, and thus both of the genres should have their own market share (H. Chen 1989b,
13).
This leads us to implore, what actually happened? The independent producers
themselves did not pressure the regime to grant them the right to enter the film industry.
Instead, these dramatic reversals in the treatment of the film industry resulted from elite-
level reactions to the decadence of the film industry.
I begin with a brief overview of the post-Mao policy environment concerning the
film industry from 1978 to 2012 from Chapters 3 through 6. This chapter centers on the
period from 1978 to early 1989. Chapter 4 discusses how the government rebuilt the
propaganda system after the Tiananmen crackdown in 1989. Chapter 5 focuses on the
most challenging period for the Chinese film industry: when the market reopened to
Hollywood. Chapter 6 surveys the changes made to film policies after China entered the
WTO and the implications for Chinese filmmaking. This is followed by a review of
existing studies of Chinese film producers and interviews with film producers conducted
from 2008 to 2012 that illustrate the challenges they faced during those years; changes
since then will be discussed in Chapter 7. Both existing scholarship and my field
interviews confirm that media workers have exhibited limited signs of political
aspirations; however, they are by no means passive.
Overall, the observations presented in the following chapters reveal two trends
that defy the expectations of popular theories of political economy and political
communication. First, commercial films expanded rapidly during the first decade of

2
The original Chinese: 恢復電影藝術本原，即尊重它做為大眾娛樂的基礎的特性… 把娛樂功能放在
主體的住置上。

82
reform, in the absence of formal regulatory institutions to support such dynamic
development. Despite the fact that prior to the Tiananmen demonstrations,
commercialization was not as dominant a theme in the media reforms as it came to be in
the 1990s, as observed by Zhao Yuezhi (1998), the debate that began in 1988 about the
commercialization of films marked a turning point for the film industry, although the
debate halted after the Beijing June 4 Massacre. Second, the increasingly favorable
conditions for commercial film producers were led by the reform-oriented elites in
Beijing. To be sure, the Beijing government was instrumental in making the decision to
reform the Party and the PRC institution. But in this dissertation I argue that the
accumulating interactions between the state and non-state actors created an important
impetus for these key reforms. As scholars have argued, the CCP government is flexible,
adaptable and responsive to actors who drive the country’s economic growth without
making trouble (Shambaugh 2008).
3.2 Commercial Development, 1978- 1989
After the Third Plenum of the CCP’s Eleventh Central Committee, a meeting was
held in December 1978 that marked the party’s gradual transition in favor of economic
reform rather than militant socialism. Reform of the film industry was begun by a series
of discussions among filmmakers and bureaucrats in all sectors. None of the topics that
were tackled, such as the monopoly of film distribution, the rating system, the
privatization of film studios, etc., have been settled, except for the decentralization of film
management, which was addressed by expanding the film studios’ autonomy. The
reforms of the film industry were much more restrictive than in other sectors, largely due
to ideological considerations. While film is still viewed as a tool of the Party, the objective
has changed.

83
Film had been repackaged from an entertainment product in the 1930s into a
powerful weapon for educating the masses and attacking enemies after 1949. After the
Cultural Revolution, film was no longer used as a tool in class struggle, but the need to
educate people remained a central aim of the Party. Moreover, the media were promoted
as “instruments of economic and cultural construction, with a new stress placed on
business information and entertainment”(Y. Zhao 1998, 34). When Deng came back into
power, his first task was to rebuild the social order and the economy. Deng Xiaoping’s
speech at the Fourth Congress of the Chinese Writers and Artists Association in October
1979 defined the central principle of art. In his speech, he first reaffirmed Mao’s Yan’an
policy on art, which required all forms of art to “serve the people.” Besides this, he
declares,
We must preserve the policies that allow a hundred flowers to blossom,
abandon the old in favor of the new, use foreign things to serve China,
and make the past serve the present. In terms of culture creation, we
advocate the free development of different styles and genres. In the
realm of cultural theory, we advocate free debate between different
points of view and academic schools. (Barme 1999, 20)
Cultural workers hailed this speech. But the Party’s “twin-fisted policy” (Liang shou
zhua), according to Mueller and Tan (1997), means grasping both economic development
as well as ideological control, both of which had always made relations between cultural
workers and bureaucrats tense (8). Although the Party remained strict in its policy of
restricting the “unregulated” spread of liberalism and Western ideas, the early stage of
opening up China was a time for people to experience novel concepts.

84
3.2.1 Recovery from the Collapsed Film Economy: The Beginning
3

Since the founding of the People’s Republic, 19 national film studios have been
established, along with a few provincial film studios, annual feature film productions
have increased from 29 films in 1950 to 35 in 1976 to 127 films in 1984– a more than
fourfold increase. Besides feature films, these nationalized film studios made 1,270
features between 1949 and 1983, 8,670 newsreels, 5,010 educations films, and 537
animation films, and translated 1,763 foreign films into Chinese. Among those 1,270
locally made features films, 552 have been translated into Mongolian, Tibetan, Uyghur,
Qazaq, Korean and other minority languages. Film exhibition units have developed
rapidly to reach 162,000 in 1983, an increase of more than 127 times since 1950, when
there were only 1,263 screening units. Movie admissions have jumped from 146 million
in 1950 to 13.2 billion in 1976 and reached its peak of 27.37 billion in 1983. Income from
distribution has increased from RMB 210 million to RMB 630 million. China Film also
increased its revenue, peaking in 1980 with net gains of RMB 13.3 million (Ji 1991, 97;
103–4).
4

In the early period of the reform, the exhibition sector reform moved faster in
rural areas than in urban centers (Ji 1991, 111). This was caused by several factors. First,
cinemas in rural areas were more flexible in changing their policies, since cinema
managers were directly under the heads of their villages. However, local cinemas in the
cities were under the control of the city Film Bureaus and management teams were under
the leadership of the Ministry of Culture. The Provincial Ministries of Culture led the

3
According to Ji Hong (1995), from 1961 to 1965, China Film has made RMB 0.2 billion profit for the state.
It means it had made RMB 70 million annually. However, from 1966 to 1976, it had lost RMB 20.89 million.
In 1976, it lost RMB 11.08 million. No wonder, Chen asserts the Chinese film industry was collapsing after the
Cultural Revolution. (B. Chen 2005a, 74)
4
China Film’s revenue, however, decreased to RMB 4.91 million in 1983.

85
town-level Ministries of Culture (See Figure 2.2 in Chapter 2). It turned out that local
cinema owners have no right to determine much of their own business. For example, the
Ministry of Culture appointed the managers of the local cinemas. Those managers were
either transferred from other industries, often having nothing to do with the film
industry, or were from the production sector with no experience in the exhibition sector.
For instance, in Shanghai, Gaoshan Cinema has only 738 seats but has recruited 41
employees, most of them appointed by the Ministry of Culture in Shanghai. In Wuxi
Heping Theater, the appointed vice-manager in the 1990s was a famous local actor, but
he had no experience nor management skills in the exhibition sector (Ji 1991, 111). The
lack of control in personnel arrangement was a great burden to the urban cinemas.
Second, cinemas in the cities were without the authority to determine their own
budgets. For instance, local theaters in Changzhou City had the right to set a budget only
within the limit of RMB 30 (USD 4.74). Every budget over RMB 30 needed approval
from the upper-level authority, which was the City Cinema Company. Budgets over RMB
200 (USD 31.59) had to report to the Ministry of Culture for approval (Ji 1991, 112). With
such complex procedures, several cinemas in Changzhou could not get enough funding to
renovate their theaters, or simply put they had no rights on setting budgets at all.
Third, the government set the ticket price, which was unified nationally. The
number of seats in theaters was fixed. With a unified ticket price set by the government,
the theater managers had no incentive to improve their sales.

86
3.2.2 Where to Start?
One of the foremost questions asked during the beginning of the reform was: How
can we rebuild the film studios? How does one jumpstart the production process after
the Cultural Revolution?
3.2.2.1 The production sector
The Ministry of Culture first decided to change the policy around the price per
film. It opted to charge RMB 7,000 for a feature film (the cost increased to RMB 9,900
in 1981) and RMB 5,000 for a musical film (later increased to RMB 7,000 in 1981), based
on an audience of 30 million. If the audience numbered more than 30 million, the film
studio would receive an additional bonus of RMB 240 for each 10,000 admissions.
Within three years, if admissions did not reach 20 million, the film studio had to return
RMB 100,000 to China Film. If admissions did not reach 10 million, it was required to
return RMB 200,000 to China Film (B. Chen 2005a, 81). The system forced studios to
produce films that met the audience’s demands.
A document issued in December 1980, “The New Settlement Method of Feature
Films and Stage Art Films” (Guanyu shixing gushipian, wutai yishupian xin de jiesuan
banfa), established that:
i. Film copyrights would now belong to the film studios
ii. China Film would pay studios RMB 9, 900 per feature film (to
fluctuate based on the quality of the film) and RMB 7,000 for
musical films
iii. The highest price for a feature film was to be RMB 10, 890; the
lowest, RMB 8,910
iv. For exported films, film studios would receive 60% of the profit; 40%
would be recouped by China Film
5

5
B. Chen (2005a), 90.

87
In the same month, the first film “law” of censorship was issued: “Trial Measures on Film
Scripts, Film Examination” (Dianyin juben, dianying shencha shixing banfa). Among
the major regulations:
i. All films would be submitted to film studios for examination
ii. After having been approved by the film studios, film scripts would be
submitted to: the central Film Bureau; the corresponding Film Bureaus in
the provinces, cities, and autonomous prefecture levels; and the Ministry of
Culture
6

Once a film had been completed,
i. It would first be examined by the film studios
ii. It would be submitted to the Film Bureau and the Ministry of Culture for a
second round examinations
iii. It would be submitted to the regional level’s Film Bureaus if plans involve
distribution of the film in those regions
iv. All foreign films and Hong Kong films would first be examined by China
Film. Films that pass the examination are to be submitted to the Film
Bureau
v. The Film Bureau would issue screening permits for foreign films and Hong
Kong Films. All foreign Films would be examined by the Ministry of Culture
prior to public screening
vi. The Film Archive reserved the right to examine and hold foreign films and
Hong Kong films; such actions would need to be reported to the Film Bureau
vii. China Film reserved the right to examine films to be exported
viii. Only those films with screening permits issued by the Film Bureau would be
allowed to screen
7

In sum, the policy offered studios more power to determine what could be
produced. Some film studios were also allowed to sell their products directly to the
provincial distribution companies by skipping the monopoly of China Film. Films began
to adopt a realistic style and to humanize their contents, and their output became less

6
B. Chen (2005b), 672.
7
B. Chen (2005a), 85.

88
political and conceptual. Censorship was relaxed a bit and ultra-leftist movies produced
during the Cultural Revolution were criticized. The flourishing of fourth- and fifth-
generation (See Appendix 8) directors in the cultural sphere domestically and overseas
amazed the West. The focus on eliminating Western influence had given way to a belief
that “we have to use Western technology to modernize our country,” although the term
“selectively” was stressed. Concepts of “aesthetics” were used to discuss film and local
opera. The arrival of Hong Kong and Taiwanese popular movies and music changed the
filmmaking culture and the audience’s taste. At the same time, more Chinese films were
exported. From 1977 to 1980, China Film exported about 1,600 films (600 features) to
60 countries and 200 regions. Films such as Anxious to Return (dir. Li Jun, 1979), Love
on Lushan Mountain (dir. Wang Zumo, 1980), Xiao Hua (dir. Huang Jianzhong and
Zhang Zheng, 1979), Moonlight on Second Spring (dir. Yan Jizhou, 1979) and Third
Sister Liu (dir. Su Li, 1978); and some movies before the Cultural Revolution, e.g., The
Opium War (dir. Zheng Junli and Cen Fan, 1959) and Stage Sisters (dir. Xie Jin, 1965),
were quite popular in the overseas market. In 1981, the average profit of film studios was
115 percent higher than the year prior (Bao 1983). The China Film Export and Import
Corporation, under the leadership of China Film, set up overseas branches in United
States, France and Hong Kong to promote Chinese films to the world market.
On the other hand, as the studios received more freedom in deciding what kind of
films they could produce, the government decreased its subsidization of feature film
productions, with an exception made for propaganda films. Moreover, state-owned film
studios were treated like private enterprises, which required them to pay a 35 percent tax
to the Treasury – a rate that is only 5 percent less than for other industrial enterprises.
This was quite unusual, as the film industry and other media industries were the most
stringently controlled by the state government. As discussed in Chapter 2, unlike under

89
the command economy, the economic responsibilities were pushed down after 1978 to
the film studios. Moreover, China Film was no longer obliged to buy films, and it paid
differently based on the performance of the box-office, which placed further demand on
the individual film organizations, which had to devise long-term transition plans and
strategies to survive in the emerging market economic system. These policy changes
were challenging for film studios. State-owned film studios had once been protected and
guided by the government, but gradually, they were exposed directly to the market.
3.2.2.2 The distribution and exhibition sectors
In the distribution and exhibition sectors, Document No. 198, “Circular
Requesting Instructions on the Management of Distribution and Projection” (Guanyu
gaige dianying faxing fangying guanli tizhi de qingshi baogao), was issued in 1979 to
reassemble the projection facilities that were demolished during the Cultural Revolution.
Major policies included:
i. Reorganizing all film distribution-exhibition management
companies (hereafter “film companies”) at all levels, including in the
provinces, prefectures, cities, autonomous prefectures and towns,
and strengthening the management of all types of filmmaking
activities in all provinces, cities and autonomous regions. All local
film companies were placed under the leadership of China Film. All
theaters remained under the leadership of the Ministry of Culture.
ii. Profits from the exhibition sector were divided based on the
following regulations:
a. Provincial film companies were allowed to hold 80% of the
profits from screenings as a “Development Production Fund
(Fazhan shengchan jijin)” for their own film development; the
remaining 20% of profits were to be submitted to provincial
treasuries.

90
b. Film companies in the prefectures, cities and autonomous
prefectures were required to submit 20% of profits to the same
levels of treasuries, but they were allowed to keep 15% of the
profits for their own film development; the remaining 65%
would be submitted to upper-level film companies. Film
companies at the township levels would retain 40% of profits
for their own development; submit 20% to local treasuries; and
submit the remaining 40% to upper-level film companies.
c. Revenues that stayed with the film companies would be used to
establish three funds:
1. The Development Production Fund
2. The Workers Welfare Fund (Zhigong fuli jijin)
3. The Workers Rewards Fund (Zigong jiangli jijin)
There was also a China Film Development Production Fund
created under the management of China Film.
iii. An average of 70% of profits from the distribution sector were
submitted to China Film; towns recouped the remaining 30% to
cover operation and management expenses (B. Chen 2005a, 81).
China was organized for this purpose into six regions, each region
allowed to keep a certain amount of profit from the distribution
sector for its own development (B. Chen 2005a, 83):
a. Region 1 — Beijing, Shanghai, Tianjin 18%
b. Region 2 —
Liaoning, Sichuan, Guangdong,
Heilongjiang
25%
c. Region 3 —
Jiangsu, Shandong, Hebei, Jilin,
Hubei, Henan, Hunan
33%
d. Region 4 —
Shaanxi, Zhejiang, Fujian, Anhui,
Shanxi, Jiangxi
33%
e. Region 5 — Guangxi, Yunnan, Gansu, Guizhou 37%
f. Region 6 —
Inner Mongolia, Qinghai, Ningxia,
Xinjiang
40%
iv. The Developmental Production Fund was to be used for:
a. The maintenance, reconstruction, and renovation of theaters and
cinemas

91
b. The rebuilding and construction of film archives and building
workers’ housing
c. Buying and repairing film equipment
d. Improving workplace safety and enforcing workers’ training
e. Technology improvements
v. The China Film Developmental Production Fund would be used for:
a. Supporting the development of provinces, cities, and
autonomous regions, with special attention to regions with
national minority populations
b. Film business development, strictly — not to be used for the
operating of film studios
8

After the establishment of the Developmental Production Fund in 1979, RMB 500
million was spent to renovate about 2,000 theaters and improve studios’ equipment
(Tang 2002). In Jiangxi Province, 66% of the profit was kept to renovate the cinemas.
Within three years, 88 theaters were built. The Jiangxi authority also used 34% of the
profits to reconstruct working units, film archives and workers’ housing (Ji 1991, 34-35).
In sum, the film reform was quite successful in the exhibition sector – especially
the renovation and reconstruction projects. It helped to renovate many facilities
destroyed during the Cultural Revolution. It served an audience of 70-80 million every
day. It also expanded both the urban and rural market for film demand. Exhibition units
increased from 115,936 in 1978 to 143,650, a jump of 24%. Cinemas in urban areas
increased from 2,548 in 1978 to 5,816 in 1982, nearly a 128% increase. The number of
screenings increased by 34%, from 2,621 in 1978 to 3,513 in 1982. At the same time,
admissions climbed to the Chinese film industry’s peak of RMB 29.3 billion. Income
from film distribution increased by 27%, from RMB 500 million in 1978 to RMB 633.1
million in 1982. China Film’s profit posted an increase of 80%, from RMB 45.56 million

8
B. Chen 2005a, 83–4.

92
in 1978 to RMB 81.98 million in 1982. The number of film productions increased by
143% from 46 in 1978 to 112 in 1982 (Ji 1991)(see Table 3.1)

Table 3.1: China Film’s Employment Figures, Distribution Income, and Annual Profits,
1965-1980
9

9
Data source: Chen 2005a, 91.
Year No. of Employees
Distribution Income
(RMB in Millions)
Profit
(RMB in Millions)
1965 217 143.893 29.371
1966 227 113.364 40.094
1967 235 31.375 -0.228
1968 237 25.865 7.471
1969 217 36.518 -1.467
1970 243 70.343 25.818
1971 82 100.657 24.552
1972 142 121.552 21.961
1973 167 128.812 22.139
1974 169 156.701 -4.846
1975 219 180.870 -3.274
1976 225 131.332 -11.079
1977 230 - 24.771
1978 244 121.802 45.345
1979 248 416.467 117.412
1980 263 648.904 139.284

93
In 1981, after two and a half years of reform, there was a total of RMB 270 million
in the development fund, together with China Film’s RMB 100 million fund, available to
renovate and rebuild 1,341 local cinemas and construct 435 cinemas in villages. It also
built 334 local film archives and provided housing for 2,254 employees. China Film also
gave RMB 83 million to less-developed areas to improve film screening foundations (B.
Chen 2005a, 102).
10
In 1982, the number of film productions climbed to a new high in
Chinese film history. However, the director of the Film Bureau, Shi Fangyu, believed that
most of the films produced in 1982 were of “low quality” and in bad taste. He stated that
the number of film productions should not exceed 90 in 1983 (B. Chen 2005b, 717).
However, the cost of the film per print increased from RMB 700,000 in 1979 to RMB
990,000 in 1983, which greatly increased the burden on China Film. Its expenses
increased by 65.8%, from RMB 89.82 million in 1978 to RMB 136.47 million in 1981. The
extra cost per copy in some cases improved the quality of the films; however, in most
cases, it just meant that China Film lost money. In early 1983, 10 films were distributed
by China Film, and eight of them did not make a profit (B. Chen 2005a, 114).

10
In 1982, after 3 years of the reform, in total there was about RMB 600 million used to renovate and
rebuild 2,000 cinemas. Of that, RMB 400 million served as the distribution income for local companies, and
RMB 140 million came from China Film’s developmental fund. China Film also gave RMB 110 million to less-
developed areas, such as Inner Mongolia, Xinjiang, Qinghai, Gansu, Ningxia, Shaanxi, Jiangxi, Yunnan,
Guizhou, Guangxi and Tibet (B. Chen 2005a, 111).

94

Table 3.2: Screening Unit Statistics, 1949-1982
12

11
Including cinemas, theaters, film clubs, and village mobile screening teams.

12
Data source: CFA 1984, 213.
Year
No. of Screening
Units
11

%
change
Year
No. of Screening
Units
%
change
1950 1,263 - 1966 21,819 14.56
1951 1,658 3.95 1967 22,404 5.85
1952 2,285 6.27 1968 22,708 3.04
1953 3,883 15.98 1969 23,923 12.15
1954 1,928 -19.55 1970 26,569 26.46
1955 5,869 39.41 1971 33,836 72.67
1956 8,662 27.93 1972 12,300 -215.36
1957 9,965 13.03 1973 17,351 50.51
1958 12,579 26.14 1974 55,470 381.19
1959 14,808 22.29 1975 69,661 141.91
1960 16,819 20.11 1976 86,088 164.27
1961 18,831 20.12 1977 103,211 171.23
1962 18,583 -2.48 1978 115,916 127.05
1963 18,468 -1.15 1979 122,121 62.05
1964 18,906 4.38 1980 125,440 33.19
1965 20,363 14.57 1981 130,827 53.87
1982 113,620 -172.07

95
A political campaign was initiated in 1983 and lasted until 1984. The so-called
“Spiritual Pollution Campaign” aimed at “rectifying” the spiritual pollution brought about
by the influx of foreign cultures in the form of films and books that were said to
promulgate pornography and violence. The issue of extracting spiritual pollution was
taken up as an important agenda item at the Second Plenum of the Twelfth Congress of
the CCP Central Committee. Because of this campaign, filmmakers became careful not to
produce films that might be criticized for going against the Party’s political ideology.
Not coincidentally, audience numbers declined by 650 million and distribution
income decreased by RMB 37 million. It is clear that by this time film as mainly a form
of entertainment had been in decline in terms of popularity due to an increase of
alternative entertainment outlets, such as TV, pop music and disco.
Arguably, 1984 marks the worst year for the Chinese film industry post-reform.
From January to August, 70% of the distribution income was from foreign and Hong
Kong films, although these films only accounted for about 30% of the total screened
movies. The other 70%– domestically-produced Chinese films– earned about 30% of the
distribution income (B. Chen 2005a, 138).
Shi Fangyu, in his speech at the Production Conference in 1985, complained that
too few films in 1984 portrayed the economic reforms and the heroes in the socialist
construction. He suggested that the government should give some administrative orders
for those kinds of films (CFYB 1986, 165). Shi gave these orders to studios, but the
resulting films fell short of the expectations of the Party. Xia Yan, a senior leader in the
film industry for many years, complained that the industry’s production plan for 1985
contained too few films about current life in the country. He expected that the Film
Bureau could order every studio to produce at least one or two films in 1985 to deal with
this subject (CFYB 1986, 87).

96
Regarding censorship, in addition to the authority of the Film Bureau to censor
films, Party leaders might also ban films based on their own preferences. Local
governments could also ban or limit the distribution of a given film. The film industry
complained about this situation, and in the mid-1980s some leading officials in the Party
supported the abolition of censorship. An editorial in People’s Daily, “Abolish the
Superiority of One Man’s Choice and Improve the Art of Leadership,” cited the comment
of a senior leader of the Party on film censorship: “With regard to whether a film can be
released or not, I think we should abolish, absolutely, letting one man decide its life or
death” (Editorial 1984).
In response to the backlash against the tight restrictions, film censorship was
relaxed a bit in the following period. However, censorship remained in effect — in 1987,
the authorities vetoed seven films. According to Shi Fangyu, one of the films, The Dove
Tree (dir. Wu Ziniu, 1985), produced by Xiaoxiang Film Studio, was locked up by the
studio without even bothering the Film Bureau.
13
Officials in neither the Ministry nor the
Film Bureau saw the film. Two films, Age at Nineteen (dir. Hua Yongzhuang and Luo
Zhen, 1986)
14
and The Heart-queen on Pursuit (dir. Wu Tianren, 1986), one produced by
the Xiaoxiang Film Studio and the other produced by Guangxi Film Studio, were formally
disapproved of by the Film Bureau. A film called The Lost Necklace (dir. Ling Zi, 1985)
was stopped from being exhibited after passing the censors of the Film Bureau because
some high-ranking officials in the Party indicated the film was “too boring and indecent”
(Wuliao youyu, xialiu buzu). Produced by Guangxi Film Studio, the film The Big Parade
(dir. Chen Kaige, 1986) suffered the same fate of withdrawal from exhibition, all because

13
Rosen recalls, “Deng Xiaoping saw the film and said it made propaganda for the Vietnamese, and was an
anti-war film.”
14
The movie has an alternate title, Nineteen Flowers (Shi jiu duo xianhua).

97
the military consultant on the film took issue with some of the film’s representations.
Two other films — The Death Proof and The Last Clue of the Big Case (dir. Bai Hung,
1985), produced by Changchun Film Studio and Emei Film Studio, respectively — were
scrutinized by top Party officials, with the requirement that the films be edited before
screening (F. Shi 1988).
3.2.3 1984: The Crisis
In Guangdong Province, the percentage of cinemas’ occupancy rate dropped from
86.5% in 1981 to 50.6% in 1982. The low admissions changed the way the theaters were
used. A lot of theaters were remodeled to serve as teahouses, hotels or small-scale
shopping centers. In the city of Foshan, Guangdong, at least 400 film teams were
terminated. Twenty film companies had been losing money annually since 1982. Film
business-related income decreased to RMB 30 million in 1982. In Daxing, Heilongjiang
Province, in the first half of 1983 the number of screenings decreased by 24%; admissions
fell by 25.4%; and income from distribution and exhibition dropped 22% and 21%,
respectively, as compared with 1982. Among the 15 film companies in Heilongjiang
Province, seven had lost money. Among 115 cinemas, 31 made no profit (Ji 1991, 90).
So, what were the problems? What made for the film industry’s demise? For one
thing, films were broadcast on TV stations too soon, sometimes even earlier than the
films screened in theaters. For instance, the film The Shaolin Temple (dir. Zhang Xinyan,
1982) appeared on the TV station in the town of Daxing, Heilongjiang Province five times
prior to its debut in the local theaters (Ji 1991, 90).
Second, on some important dates, such as New Year, Spring Festival, Labor Day
and National Day, the authorities required that a new film show both on national TV
stations and also in theaters. This policy worsened the film industry’s situation. For

98
instance, a film called Two Brands (dir. Guo Baochang, 1982), produced by Guangxi Film
Studio, was considered a celebratory film, and slated to be screened both on TV stations
and in theaters on Labor Day in 1983. The distribution company ordered fewer copies
from the studio, and the Guangxi Film Studio lost RMB 200,000. And since most people
had already seen the movie on TV, admissions numbers were dismal; total box-office
earnings were less than RMB 600,000. Such meager revenue could not even cover the
distribution fee (including the copyright fee, film prints fee and marketing expenses) of
roughly RMB 1.66 million. In the end, the distribution company had lost nearly RMB 1
million (Ji 1991, 193).
From time to time, particularly on Children’s Day and Army Day, the authorities
would require TV stations to broadcast more new films. Under this policy, TV stations
paid only RMB 180 per film, a negligible figure for the studios, considering the cost of
production, let alone film distribution costs. Indeed, this policy of showing new films on
important dates stunted the development of the film industry. As Ji Hong (1991) reports,
admissions in 1984 shrunk 25% in 11 big cities, including Beijing, Tianjin, and Shanghai;
screenings decreased 20% in 1984, as compared with the previous year; and distribution
income contracted 25 percent (Ji 1991).
There were three additional factors in the downturn of the film industry. First,
there was an influx of TV dramas from Hong Kong and Taiwan into the market, which
changed the tastes of Chinese consumers. Second, the policy of “producing and selling”(zi
chan zi xiao) — producing films and selling them directly to the cinemas without the
involvement of China Film (Ji 1991, 124) — resulted in a significant decrease in the
number of screenings and admissions. In 1985, after some film studios adopted the
policy, the number of screenings dropped to 300,000 and admissions decreased to 280
million. Exhibition and distribution income decreased RMB 8.63 million and RMB 1.86

99
million, respectively. Among 71 town-level film companies, 53 had lost money. Even
more startling, fourteen of them were able to pay only 70% of their employees’ wages. By
the end of 1984, the policy of “produce and sell” had been deemed a failure (Ji 1991, 127).
Between 1979 and 1984, income from distribution was around RMB 600 million
a year; however, the cost of distribution skyrocketed from RMB 370 million in 1979 to
RMB 590 million in 1984. Copyright fees rose by 92%, from RMB 84.96 million to RMB
163.81 million. China Film’s profits plummeted by 78%, from RMB 117 million to RMB
25.44 million (Ji 1991, 130). Table 3.3 illustrates these dramatics shifts.

100

Table 3.3: The “Four Indicators”(Xi xiang zhibiao) of the Guangdong Film Market, 1979-1984
15

15
Data source: B. Chen 2005a, 154.
Indicator
Year
Change in % 1979 1984
# of Cinemas 7664
6522 -15%
# of Screenings 1,930,000 1,620,000
-16.2%
# of Admissions 1.62 billion 1.17 billion
-27.6%
Distribution Income
(in RMB)
3,641,000 3,330,000
-8.5%

101
Besides the falling audience numbers, ticket prices were far lower than the
appreciation rate, putting 70 percent of the screening units in the red. Thirty percent of
screening units were closed, and in some areas the closing rate reached 50% (B. Chen
2005a, 165). In seeking to remedy this situation, authorities approved an adjustment in
the ticket prices at the beginning of 1986. The new regulation conceived four areas by
which ticket pricing would be determined, as illustrated in Table 3.4:

Area
Ticket Prices
(Range in RMB)
Low High
Municipalities 0.35 0.5
Provincial cities, populations greater than 500,000 0.3 0.4
Cities, populations of fewer than 500,000 0.25 0.35
Towns 0.2 0.3
Table 3.4: Regional Ticket Pricing Scheme
16

The regulation changed the policy of flat-rate prices to a more flexible rate based on the
quality of films, regional particularities, and the specifications of a cinema’s equipment.
Though prices increased a bit, they remained too low to support the high cost of
filmmaking.
On February 15, 1986, the National People’s Congress decided to shift control of
the film industry from the Ministry of Culture to MRFT. However, provincial and local

16
Data source: B. Chen 2005a, 165.

102
film companies were to remain under the leadership of the provincial- and city-level
Ministries of Culture.
17
This so-called “policy change to the upper level but not its
subsidiaries” (Shang dong xia bu dong) did not simplify the administration of the film
industry; it just put it under dual leadership. All documents issued by MRFT needed to
include copies for the Ministry of Culture; officials from MRFT were also required to stay
in very close communication with Ministry of Culture staff.
The third factor in the downturn of the film industry during the 1980s: drastically
increased production costs. The average production cost of a film was RMB 500,000 in
1986, rising to RMB 650,000 in 1987 and RMB 900,000 in 1988. To break even, a film
needed to sell at least 100 copies. However, two-thirds of the films made in 1988 sold
fewer than 100 copies.
3.2.4 Rating System
Film reform had reached a new stage when Zhao Ziyang submitted his first
political reform to the National Party Congress in October 1987. Political openness had
spurred the demand for a fundamental systemic reform of the film industry.
By late 1987, political pressure had lessened in intensity; meanwhile, the film
industry’s financial situation was significantly more depressed than before. The film
quota had been relaxed. Film studios had more freedom to produce the films they liked
and the number of films made for a “required category” had decreased. In its quota for
1989, the Film Bureau got rid of the required category for propaganda but kept the
required category for children, which accounted for one-tenth of the annual quota.
Although the Film Bureau continued to recommend that film studios concentrate on the

17
From the document “Notification about Film and TV Organizations Consolidation Issues” (Guanyu
dianying, dianshi jigou hebing shixiang de tongzhi).

103
main-melody films dedicated to the fortieth anniversary of the PRC, the Film Bureau
gave studios the authority to decide what they would produce. An increasing number of
films for entertainment were produced for profit only.
Fundamental change meant a complete detachment of the state from the film
industry. Some demanded that the film studios be self-managed, led by neither
government nor the Party. They insisted that directors have the right to assemble crews
and write scripts; in return, directors would assume responsibility for profits and losses.
They called censorship unnecessary; they demanded unfair distribution be abolished.
They protested the quota system as inappropriate (Wang 1987). However, such radical
reform did not gain mass support, though Wang Jingyang’s article suggesting these
changes was circulated widely and received several responses, including an article by J.
Yang (1987) in Movie Review and an essay in Movie Weekly (Editor 1987).
On March 25, 1989, MRFT implemented a rating system that would begin on May
1 that year. The directive stressed that the rating system would not mean any change to
the criteria for censorship for those films covered by the rating system. The censorship of
a film, regardless of whether it is for adults or children, must adhere to the Central
Committee of the CCP’s guiding ideology about the construction of a socialist spiritual
civilization and the principle of “Letting one hundred flowers blossom and one hundred
schools of thought contend.” Under this stipulation, the following themes are regarded
as “Unsuitable for Children”:
i. Rape, stealing, drug use, drug dealing, prostitution, etc.
ii. Violent murder and fighting that may scare adolescents and
children
iii. Sexual situations
iv. Aberrant social phenomena

104
Rating was mandatory. Children sixteen years of age and younger were not allowed to
see films rated “Unsuitable for Children.” These films could not be provided to mobile
projection units in rural areas and could not be broadcast on TV. Not surprisingly the
memo was “scuttled and quickly forgotten” (Martinsen 2006). The rating system had
been discussed in China for a long time since the beginning of the reform, but because of
the accepted meaning of “film”– by definition, films had to be available for all people
regardless of age, class, and sex, particularly under the leadership of an avant-garde and
progressive Communist Party – the discussion of a rating system was continually
suppressed. After the Tiananmen crackdown, the discussion was completely banned.
It was not until May 2000 that Director Huang Jianxin invoked the “rating
system” in a speech during a national film workers conference. He projected that,
[a]fter entering the WTO, the market will be more competitive. The
Chinese film industry needs to construct a series of measures to face
such challenges. The authorities should consider the rating system and
they need the authority to establish a Chinese rating system
immediately. (Yin 2005)
Another famous director, Feng Xiaogang, quickly responded, retorting, “It’s very
urgent that we set up a Chinese rating system. Setting a rating system does not mean
producers are going to make category-three movies;
18
instead, the rating system is a
mechanism meant to protect the freedom of filmmaking and audiences.” Other directors,
like Zhang Yibai, Zhang Yuan, and Xu Jinglei, expressed their support for a rating system.
Commissar Wang Xingdong, a well-known scriptwriter and Chairman of the Chinese
Film Literature Association, submitted a proposal, “The Implementation of a Not-For-
Children Film Rating System was Inevitable,” to the Chinese People Political Consultative
Conference (CPPCC). In 2001 and 2003, the issue was brought before the public once

18
Refers to R-rated movies.

105
again. An online survey found that, among the 52,947 survey respondents, 88.72 percent
supported the establishment of a rating system, while only about 8 percent were against
it (Cui and N. Zhao 2003; Rosen 2012).
19
Although it had raised public awareness
regarding the rating system, the government resisted passing any bills or regulations to
implement one.
Contemporarily, notorious films such as Lost in Beijing (dir. Li Yu, 2007) and
Lust, Caution (dir. Ang Lee, 2008) have brought the prospect of a rating system once
again to the public’s attention (Rosen 2012). However, authorities have remained
ambiguous in their position, at times claiming there to be no need for a rating system, at
others saying that one is being prepared. Recently, one official decried a rating system
as the first step in legitimatizing the production of pornographic movies (Schwankert
2008). Rating system proponents base their support on the presumption that it will
improve freedom of speech, enabling filmmakers to enjoy greater autonomy (Sun and X.
Li 2008). However, as “film” remains an instrument of the government, a rating system
alone is powerless in fomenting free speech; a rating system, therefore, will not be
implemented.
3.3 The Paradoxes of 1980s Commercial Film Development
Chinese cinema studies have yielded varying conclusions about the views of the
development of commercial films, their relationship to the State and their impact on
institutional development. Specifically, existing works have pointed to: 1) the Party’s
leadership over the film industry, which made the state government very cautious about
producing commercial films; 2) the uneasy relationship between the production and the

19
For more information, see http://edu.sina.com.cn/focus/yxps/index.html and
http://www.southcn.com/ent/zhuanti/fenji/. Accessed August 21, 2012.

106
distribution sectors throughout the reforms– the film studios vied for greater latitude in
producing the entertainment-focused films they were eager to produce; yet, in the face of
China Film’s monopoly, it was very difficult for them to turn a profit; 3) the competing
relationship between the TV and film industries, which worsened the film industry’s
financial situation; and 4) the instrumental use of cinema in the hands of the leaders —as
the definition of movies remained ambiguous, leadership would, at least some of the
time, exploit cinema. Taken together, these wide-ranging observations suggest that
China’s entertainment-focused and commercial films barely garnered enough attention
or the legitimate position necessary to challenge mainstream filmmaking. Mainstream
films treated cinema as a propaganda tool, capable of diffusing socialist and communist
ideas to the Chinese people, and as an educational tool, able to enlighten and expand the
minds of the Chinese masses with knowledge and beauty. Although films for
entertainment value consumed nearly three-fourths of the film market in 1988,
commercial filmmakers were far too limited by their circumstances to engage in collective
action in defense of their creative freedom and material interests.
In time, China’s policy environment has become increasingly hospitable toward
entertainment-focused film productions, while institutions within the film industry have
undergone major changes that welcome private capital to enter the market. Rapid
commercial film growth has preceded many of the policy and institutional reforms,
creating more favorable conditions for non-State filmmakers. How can these phenomena
be explained? Why has government transformed its institutions to encourage increased
commercial film production?
From the perspective of historical institutionalists, institutions are mutually
dependent, in that they do not exist in isolation from one another (Mahoney and Thelen
2010). Policy and institutional reforms related to the film industry should be viewed in

107
this light. These changes may be traced to particular forms of interaction among industry
actors. The changes in certain institutions then spurred shifts within other institutions.
The growing skepticism toward the Party’s central dictum — that the most important
criterion to judge a film is whether a film serves the “workers, peasants and soldiers” —
and its subsequent replacement by those who suggest the key question be whether film is
exclusively a commercial product, paved the way for the legitimation of commercial films
after the 1980s, which then attracted independent producers. The rising use of studio
credits to produce more films for the sake of entertainment influenced the culture of
filmmaking, which then altered official views of films, and finally co-opted the “wolves”
(transnational film talents) under the control of the CCP (discussed further in Chapter 6).
In turn, the debate between different actors in the field, both from and outside of the
state, enabled reform-oriented elites to justify revisions to the PRC dictum so that
authorities recognized the existence and value of entertainment-focused and commercial
films.
Indeed, the cultural orthodox formulated by Mao Zedong in the 1940s, and
endorsed by Deng in 1979, has been updated to read: “film should contribute toward
developing a socialist spiritual civilization” (Barme 1999, 15), which implies that the
market force had started to challenge the Party’s domination over the film industry. The
collapse of the film market in the 1980s and throughout the 1990s proved that the old
aim – funding film productions and pleasing audiences – was no longer an easy task.
Audiences were allowed to pick their favorite movies and stars. Consumers would
abandon films that did not meet their tastes, no matter which films were funded,
supported or heavily promoted by the government.

108
3.3.1 Marginalization of Entertainment-Focused Films
As we have seen, most of the policies governing the film industry have evolved in
an experimental and sometimes contradictory manner. Although the reform allowed the
film studios more freedom to produce films, i.e., to produce more films strictly for
entertainment, the state did not formally sanction the revival of commercial films until
1983, when Zhao Ziyang, in his “Report of the State Council,” officially heralded film as a
cultural product and an important commodity (CFYB 1984, 5). Supported by Zhao
Ziyang, the limited revival of commercial films had two main purposes: first, to improve
the economic performance of the film industry, and second, to lessen the financial
pressure on the film studios and the government. Regulations governing independent
productions and co-productions were then drafted, though it was not until June 15, 1988
that Hu Qiming, Head of the Beijing Film Studio, signed a contract with Huangpu Keren,
the first accredited independent producer. The studio granted Huangpu use of its credit
to produce a film, but Huangpu would need to find investors for his film and, too, assume
all financial risk (X. Wu 1992, 160). Some filmmakers, directors, and screenwriters began
to relinquish their state jobs to work freelance. A private screenplay supply company,
Wang Screenplay Company, Ltd., was registered in Guangzhou at the end of 1988 (X. Wu
1992, 161). Widening the scope of private filmmaking activity was ideologically justified
by the theory of the “initial stage of socialism”; formally articulated by Zhao Ziyang in
1987 during the Thirteenth Party Congress, the theory held that, in the process of
facilitating the development of a socialist economy, China needed to first develop its
individual economy.

109
However, in earlier 1983, in Zhao’s State Council Report, the CCP decided to
launch a national campaign to clean up “spiritual contamination.” The emphasis of this
movement was to fight “bourgeois liberalization” and commercialization of cultural
products. Although this campaign did not last long, it made the film industry more
cautious in choosing subjects for its movies. In 1984, all kung fu films, the most popular
genre of entertainment films, were cut from production. Hence, even ideological
rhetoric, economic practicalities, and formal regulations governing the
commercialization of the film industry were no defense against the development of shifts
in the political environment. Besides the periodic political campaigns against spiritual
pollution in 1983 and 1984, the bourgeois liberation in 1987 and the democratic
movements in 1989 challenged the legitimacy of the commercialization and privatization
of filmmaking to varying degrees. This indirectly explains why the scale of the
commercialization and privatization of the film industry in the 1980s was very limited.
From 1949, the profitability of individual films at the box office remained a
nonissue for the PRC — that is, until the early 1980s. This was partly because most films
made money, and partly because there were very limited after-work entertainment
options for the public. It might also be partly influenced by socialist ideology, which
deemphasized profit as the major aim in making films. Some critics looked down on
films made for entertainment value (Shao 1989, 15) believing them to be “mere trash”
(Luan qi ba zao de dongxi) (H. Chen et al. 1987, 27). Cultural producers who made these
films were viewed as low-class people, mocked as “that one who has no face” (Yao qian
bu yao lian) (Shao 1989, 12). Leading filmmaker Zhang Yimou directed a commercial
movie in 1988, Code Name: Cougar, later lamenting that it was the worst movie he ever
made. He noted that Code Name: Cougar “was not the thing I wanted to produce; it was

110
only made for my friend. Since then, I would avoid making this type of movie”
20
(Wei
and Ke 2008, 73).
21

In response to the rising number of commercial film productions, Deng Xiaoping
set up a rule for the film industry in his “Speech at the National Congress of the CCP” on
September 23, 1985. “Every department of propaganda, culture, education and health
should hold social benefit as their only criterion,” Deng claimed. “The enterprises
attached to them must also employ social benefit as the highest criterion. Propaganda
and cultural circles should create more high-quality spiritual products and determinedly
forbid the production, importation and circulation of low-quality products” (CFYB 1986,
1:1).
Deng’s speech became law within the film industry. Ai Zhisheng, Minister of
MRFT, decreed that the film industry should first take social benefit into consideration.
He asserted that many poor films were the result of overemphasizing financial profits
(CFYB 1986 3:1). Ding Qiao, Vice Minister of Culture in charge of the film industry,
identified four major problems in the film industry in 1985. They were films for money’s
sake, films for art’s sake, an insufficient number of films aligned with the official theme
or main melody, and films with ideological errors. He wanted the Film Bureau to draw
up a five-year plan for making films with state-sanctioned themes and to assign them to

20
Refers to purely commercial films.
21
Rosen notes that there is another story about the movie. He recounts,
I spoke to Zhang Yimou about this film and criticized it years ago, but he gave me a
somewhat different story, saying that when he started to make the film the relationship
between the mainland and Taiwan was quite good and he was given a lot of official
support to emphasize cooperation in combating an airplane high jacking. However,
while the film was being made the relationship became much less good and the support
was substantially withdrawn, making him less eager to promote “reconciliation” and just
get the film over with. So it appears that he made it with official support, which then
became tepid at best.

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each studio (CFYB 1987, 3:4–7). The Father of Chinese film, Xia Yan, also contended
that there were too many kung fu movies, thrillers, and love stories but too few movies
about contemporary subjects. He suggested that the Film Bureau should require each
studio to produce at least one or two movies dealing with the subject of reform (CFYB
1986, 87). One critic even claimed that the ratio of Chinese film productions should
follow a formula of six-to-three-to-one: For every six films with contemporary themes
directly serving political and propaganda purposes, three should center on revolutionary
history to glorify the Party’s and the nation’s history in order to educate the younger
generation; produced by someone outside the circle of dominant directors, one film
would be designed to entertain. The film for entertainment was considered harmless, yet
profitable (H. Chen et al. 1987, 27).
Shi Fangyu confessed that the Film Bureau overemphasized the studios’ financial
crisis, and perfunctorily approved some films of poor social benefit or some
overwhelmingly vulgar films because the Film Bureau was afraid of increasing a studio’s
financial burden if changes were required. He also claimed that another factor
responsible for poor films was that the Film Bureau did not, in the preceding year,
provide enough guidelines for scriptwriters on what should be produced. Notice was
issued to every studio to limit kung fu and thriller films to one-seventh of the total films
produced in 1986. In his own defense, Shi argued that, although he had deemed film a
commodity, he insisted that he had not promoted or encouraged commercial films. He
complained that, in matters of finance, the state treated studios producing cultural
products the same as enterprises producing material goods. The state wanted both social
benefit and financial benefit from studios. It had set up three financial targets, as with
the manufacturers of material goods, for studios to accomplish each year. The most
troublesome was the profit target. The welfare of the employees in a studio was to be tied

112
to the studio’s profit: the more a studio earned, the more its employees shared. The
problem with the profit target was that it always had to be higher than the previous year.
A studio head was therefore under great pressure to consistently increase profits (CFYB
1987, 7–12). Thus, the debate over the commercialization of films brought a dilemma to
the industry: Propaganda bureaucrats wanted social benefit, treasury officials sought
financial benefit, filmmakers desired quality art, and audiences demanded
entertainment.
In sum, at the beginning of the reform, the traditional discourse about films –
derived from the Yan’an Forum dictum that art must serve politics – was still firmly in
place. According to this discourse, films need to reflect and promote Party policy and,
most importantly, Party’s achievement. The box office fall-off was perhaps the best
indicator that the public was less interested in these types of propaganda and educational
films. In response to this, the film studios began to produce kung fu films, detective films
and other entertainment-oriented films that hardly fit the official ideological thinking.
The financial pressures suffered by the film studios forced them to produce more
entertainment-oriented films.
22

Although there is no doubt that film is a commodity (Curtin 2007), the
conventional conception of film as a propaganda tool is still either favored by many critics
or strongly held by the government. The debates between these two views have continued
since the beginning of the reform. The success of a Hong Kong movie, Shaolin Temple
(dir. Zhang Xinyan, 1982), inspired some local filmmakers to respond to this potential

22
Stanley Rosen told the author, in some cases, such as Wu Tianming, head of the Xi’an Film Studio,
produced kung fu films such as the “The Magic Braid” (1987) to make enough money to support the art films
he really wanted to make. He wasn’t interested in making “main melody” films, but the contradiction there
was between art films and “entertainment” films.

113
market. However, this trend was attacked by the accusation of promoting “everything for
money” in the periodic political campaigns throughout the 1980s (CFYB 1985, 113).
Thus, the Chinese film industry reform was aimed at serving political ends rather
than to improve the film industry, despite the original intentions, unanticipated
consequences produced very different results from what was expected. As I have
discussed in the previous chapter, the Film Bureau was the executive body controlling
everything related to the film industry, from production, distribution and exhibition, to
the training of film talents, the publication of film-related books and magazines, the
research of film-related technology and the manufacture of equipment. Hence, the
development of the film industry remains very susceptible to government policy.
3.3.2 Rationalizing Commercial Film
The discussion about film as a commodity opened the door for commercial film
production. Restrictions on investments in film production were not strict. Since
government investment was not adequate, film studios were eager to find more funding
sources. Independent producers, a term referring to those filmmakers outside the
system, were interested in entering the film industry. The complaints calling the studios
making commercial films money-minded began to disappear in early 1986, when an
article was published that pushed the old principle of “appealing to both popular and
refined tastes” (Berry 1991b). Although there were still some attacks on commercial
films, it more strongly affirmed the need to entertain an audience than had been done
before.
The year of 1988 marked the most controversial year for the film industry before
the crackdown of the 1989 Democracy Movement. It was the year when Red Sorghum
won the Golden Bear Award, the highest possible award, at the Berlin International Film

114
Festival. It was the highest international honor a Chinese film had earned up to that
point. Besides Red Sorghum, 32 films won 46 awards in 31 international film festivals.
Eight of these films won grand awards (CFYB 1985, 113). To the backdrop of this
international applause, 158 domestic films were produced in 1988 – a record high since
the establishment of the PRC.
On the other hand, it was the most difficult year for film studios in terms of
finances. Since 1988, all 22 national film studios saw entertainment films as a “life-
saving soup” (Jiu ming tang) (Shao 1989). Out of 158 films produced in 1988, over three-
fourths were films meant for entertainment. In the 1980s, kung fu became the most
popular type of film, usually earning around RMB 7 million in box-office returns.
Detective films also attracted large audiences with box-office earnings usually around
RMB 4 million to RMB 5 million. In 1988, there were about 24 films that sold over 200
prints and among those 24 films, most of them were entertainment films (Ni 1989).
“Anti-bourgeois liberalization” arose in the beginning of 1987 in response to
student unrest at the end of the previous year, though Chris Berry (1991a) describes the
dearth of articles discussing what sort of films should be made and what should not.
Berry observes that film studios faced financial collapse, as a result of their collective
failure to satisfy the tastes of the public (Berry 1991a, 119). Because of the lack of funding,
more and more film studios moved toward producing entertainment-based films in an
effort to reduce financial pressures, and also with the goal to make enough profit to
continue making films – especially since the fortieth anniversary of the PRC was
approaching, by which time every studio had to produce several films dedicated to the
celebration.
The turning point came in January 1988, when the definition of “film” was
officially changed to mean “a commodity.” It was the first time that the government

115
issued this definition in such stark terms. Chen Haosu, new Vice Minister of MRFT,
oversaw the film industry from July 1987 to May 1990. In the meeting, Subject Plan for
Feature Film 1988 (1988 Quan guo gushipian ticai guihua huiyi), he remarked,
I solemnly state: Do not oppose the production of films for
entertainment; on the contrary, we need to promote some high-quality
entertainment films…. When planning this year, we need to increase the
quantity of entertainment films. (H. Chen 1989a, 3:3)
At the same conference, Ai Zhisheng, Minister of MRFT, agreed that films should serve
the masses, and that it is not bad if a film makes a profit. The only issue, he said, is that
the film should be of good quality (Ai 1988).
More breakthroughs occurred when Teng Jinxian, Director of the Film Bureau,
named the current time as the most open and free period for the creative work of
filmmaking since the PRC’s founding. In 1989, the authorities cancelled the quota for
studios that demanded they produce propaganda films. Second, the discussion of films
for entertainment was a timely topic, as filmmaking was passing through a transitional
period. He said,
Under the impetus of the economic reform, the gradual formation of the film
market, and the influence of the socialist commodity economy, the pattern of filmmaking
and film products have changed. In terms of feature films as a spiritual cultural product
as well as a commodity, […] its various functions and properties have been re-evaluated
(Teng 1990, 12).
He also agreed that through the economic reform, the transformation of films
from a propaganda tool to entertainment, or a combination of the two, is reasonable and
inevitable (Teng 1990, 15). To conclude, Teng noted that entertainment is an inherent
feature of a film, equal to the features of education and aesthetics. He added that Chinese
films had stressed only the educational features and had ignored the benefit of

116
entertainment for too long, and now “it is necessary to put emphasis on the films’
entertainment features” (Teng 1989, 9). This new attitude redefined the nature of film.
Echoing Teng’s sentiments, Chen Haosu, brazenly remarked, in his famous article “About
the Subjectivity of Entertaining Films and Others” (Guanyu yulepian zhutilun ji qita),
I believe there are three levels of films. The function of entertainment is
at the origins; it is fundamental. The function of art [aesthetics] and
education [recognition] is an extension, is a development. Looking back
at history, a film’s first function was as entertainment for the masses.
Then later it developed into an art. Only recently has it become a mode
to spread ideological thoughts […] [For a long period,] a film was over-
stressed as a propaganda tool, which diminished or eliminated the
function of art and entertainment. […] Obviously, this exclusion is
harmful. It should be prevented. (H. Chen 1989b, 12)
His views suggest the industry shift its considerations of film away from its
potential commodification, and more toward the form to serve as entertainment.
“Entertainment should be the main emphasis,” he urged. “Its production should be
determined by the market and it should have to follow the self-financing business
approach” (H. Chen 1989b, 13). Other kinds of films, such as art films, would be
subsidized by the state. He also encouraged the promotion of entertainment-focused
films to explore more sources of capital for the film industry (H. Chen 1989b). While
Chen lauds film’s potential as an educative tool, he is careful to add that this is not the
only responsibility of films (Zhang 1989).
Following the encouragement of government officials, there was ample discussion
among film workers, film critics and academics. In July 1987, Popular Cinema devoted a
whole issue to the discussion of comedy films, which was the most popular genre both in
domestic and international markets. The magazine also published an imploring letter
demanding to know why Chinese people always preferred foreign films to Chinese films.
Second, there was a Seminar on Chinese Contemporary Entertainment Films (Zhongguo
dangdai yulepian yantaohui) held during the first week of December 1987. The

117
magazine Contemporary Cinema organized the seminar. There were over 50 film experts
attending, including the Deputy Director of MRFT Chen Haosu, the Director of the China
Film Art Research Center Cheng Jingliang, the Deputy Director Xi Shanshan and Vice
Editor of Contemporary Cinema Xu Zhuang and Shen Jiming, together with some heads
of film studios, film artists and film critics (Zhang 1989). After the conference, the
magazine started to publish a column, in February 1989, called “Discussion on
Entertainment Films” (Yulepian taolun).
An article penned by Wu Yigong, a famed director and the head of Shanghai Film
Studio, appeared in March 1988. In the article, titled, “We Must Become Film Artists
Who Deeply Love the People,” Wu stressed that he was not against “vulgar films”;
instead, he opposed “salon art,” arguing that greatness cannot be attained unless one’s
works are liked by the “broad masses of people.” While not going so far as to say that
box-office success equals greatness, Wu made it clear that in his mind, greatness is
impossible without box-office success, a stance very different from the official dictum
that was once held in the early 1980s. Film critic Chen Xihe believed that films are for
entertainment, and thus we needed to confirm this function. Entertainment films also
carried a very important social function, he said, which cannot be ignored (T. Li, et al.
1987, 66).
Song Chong has called for films to be considered on varying levels, contending
that should be, for example, films for entertainment, art films, and experimental films
(Song et al. 1987, 10). He also believed films should not be for all ages:
The concept ‘for everyone’ (lao shao jie yi) ruins the development of
films. […] We can’t use the same rule to measure films, or we’ve just
rejected all films. We need to use the standard of entertainment films to
evaluate an entertainment film, and we need to use the standard of
experimental films to review experimental films. Only with this
practical thinking will the development of films ever become prosperous.
(Song et al. 1987, 10)

118
How, then, did Song define entertainment? Films that are box-office hits are
entertainment films. Why do the people like to see them? For one thing, films
represented a departure from the emphasis on the Cultural Revolution, a mental escape
from society’s depressed atmosphere. For another, films provided people a means of
taking a break from their rapidly changing lives after the economic reforms. It was a
classic case of demand (Song et al. 1987, 11).
In his consideration of the varying characteristics of film, Chen Huaiai puts forth
the following useful categories: 1) The entertainment film; 2) The art film;
23
and 3) The
propaganda or educational film.
24
Among these, entertainment-focused films are the
most difficult to produce (H. Chen, et al. 1987). One explanation for this is the industry’s
limited acknowledgment of the significance of films as entertainment; another is the
issue’s once-heavy suppression; some critics had even rejected the existence of
entertainment films (H. Chen et al. 1987, 27). As Xu Yinhua contends,
Film is a means of art, but it needs the power of economics. Money is
needed in producing films. Where does the money come from? The
market. So films need to occupy the market. We need to be honest and
admit this point. Do not pretend to be gentle. Our films are made for
audiences. If the market for film is shrinking, the film industry is not
viable. (H. Chen, et al. 1987, 41)
Similarly, film scholar and the Vice President of the China Film Archive Rao Shuguang
observes,
Film is a cultural commodity, relying on the audience to pay to survive.
Indeed, audience is the king; without audiences, films could not exist. If
a film wants to satisfy the audience, it must first understand the
aesthetic needs of the audience. (H. Chen et al. 1987, 42)

23
Entertainment films are seen as able to satisfy the needs of a mass audience. Alternatively, art films have
been criticized for neglecting audience psychology.
24
H. Chen, et al. 1987.

119
The debate over films made for entertainment value is an example of how the interactions
between industrial workers, film critics, scholars, and government officials contributed to
the institutional conversion of a formal regulation. The production of commercial films
not only lessened the financial pressure on the film studios, but it also created a politically
acceptable rationale for the leaders to adjust their political dictum. In this case, the
impetus for institutional change stemmed from two frictions: first, there was tension
between the preexisting institutions that favored main-melody filmmaking and the
ideology-sanctioned limited development of commercial films, and second, there was a
lack of fiscal reform that enabled the production sector to retain more revenue to reinvest
in film production. Despite the fact that some government officials were removed and
this commercial trend was attacked by some conservative political elites, the relaxation of
political controls over the film industry reached its peak at the beginning of 1989.
Although this trend was abruptly halted after the June 4 Massacre, the increasing
marketization and private sector development required the state to expand the scope of
the film industry’s commercialization. As we will see in Chapters 4 and 5, the debate over
commercial films in the 1980s not only influenced the legalization of entertainment films,
but also provided the basis for subsequent institutional changes in the Chinese media
industries.
3.4 Conclusion
Film was treated as a powerful propaganda weapon after 1952, when the Chinese
film industry was nationalized under the strict control of the CCP. Mao Zedong stated in
the Yan’an Forum, “Any class of society would always set its political standard prior to its
artistic standard.” This statement would remain the sole guideline for the cultural
industry. The production of films was therefore purposed to serve political ends, and film

120
became an important tool for the CCP to use in unifying the minds of the Chinese. This
absolute control over the film industry reached its peak during the Cultural Revolution.
Almost all of the films produced prior this period were banned, while the Film Bureau
intervened extensively in films produced during the Cultural Revolution. Audiences’
tastes and wills were irrelevant to the film production process; the Party had the absolute
right to decide what one should view.
This situation began to change in 1977, when the role of government diminished
sharply with respect to both political and economic aspects. Using film as a propaganda
weapon was stressed less politically, while using film as a commodity was added to the
agenda. Film studios and filmmakers had more freedom to decide what subjects and
genres to cover. Interaction with other countries’ film industries improved, which
resulted in a boom in co-produced film development. Financially, the government
backed off its support of the film production and exhibition sectors. The pay for film
studios and filmmakers varied in accordance with box-office potential. The relationship
between filmmakers and audiences changed, as filmmakers had to cater to the audience
in order to increase their profit and survive. These changes were profound, and
generated two extreme experiences within the film industry – more autonomy, but
increasing financial pressure.
Despite some changes having been made from 1979 to the end of the 1980s, the
quota system for imported films has not been completely removed. China Film continues
to restrict the number of foreign films entering the market. Ideologically, Deng’s open-
door policy has shifted China from a position of repelling the West to emulating the West,
and even embracing the West. Maoist ideological beliefs, which dominated among
millions of Chinese for thirty years, already had been rapidly weakened. However, the
principle central to the film industry – that it is a tool to educate the masses – remained

121
unalterable, forcing an ever-wider gap between people’s needs and tastes and the Party’s
goal. This gap partly explains the film industry’s demise from the mid-1980s to the
1990s, in terms of audience numbers and box-office revenues.
It is remarkable that the CCP agreed to change and reverse its former ideological
depiction of films as exclusively propaganda weapons and educational tools. Allowing
entertainment to be one of the functions of films was a strategic decision to incorporate a
growing and increasingly wealthy segment of Chinese society. It was an effort to satisfy
both the industrial workers and also the demands from the broader public. Ultimately, it
was made to continue the regime’s sustainability. Moreover, through the above
discussion, the underlying causal mechanisms leading to this decision were rooted in the
growing power of economic actors that had evolved over the first decade of economic
reform. Both Party members and film talents were actively engaged in the discussion of
film industry reform. And leading party officials were willing to look the other way.

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C H A P T E R 4
Rebuilding the Film Industry: The Rise of Main-Melody Films
Propaganda is an important measure of the Party’s success,
and the Central Committee is greatly concerned about it.
Leaders within all Party divisions must recognize the
importance of propaganda. Leaders need to strengthen
their guidance. Comrades in the Propaganda Department,
please uphold the key points of propaganda, and please
continue your efforts to practice it seriously.
—Jiang Zemin
1

Experience indicates that films encouraging patriotism and
devotion need government support to cover their costs. In
most cases, Zhao Wu explains, ‘people watched these films
because their supervisors recommended they do so, not
according to their own will.’
— Xinhua News Agency
2

Since the Tiananmen massacre, none of the questions raised by
the heartbroken parents have been answered; nobody has been
held accountable. On the contrary, immediately after the military
crackdown, after the mass arrests and purges, the government
launched an elaborate campaign to reestablish its legitimacy. An
official version of the events was constructed and a massive effort
undertaken to ensure this fiction would become the national
memory. The soldiers who fired on the unarmed civilians
became ‘Guardians of the Republic.’ A patriotic campaign was
initiated, and the military crackdown was described as necessary
for stability and prosperity and as against a Western conspiracy
to divide and weaken China.
—Rowena He Xiaoqing
3

4.1 Introduction
The post-Tiananmen conservative leadership mounted a nationwide crackdown
on debates around free speech and commercial activity. This eased somewhat in 1993
and 1994, and substantially thereafter, but a more binding constraint began to impinge

1
Jiang Zemin, Instructions to the Propaganda Workers (B. Chen 2005b, 869).
2
Xinhua News Agency. September 9, 2004.
3
Rowena, a Harvard lecturer, teaching a class on the Tiananmen Massacre.

123
on the media industries for the rest of the 1990s and remains in place to this day. The
prevailing policy in the 1990s was to favor main-melody films over commercial films,
state studios over private producers, and foreign capitalists (mostly from Hong Kong)
over indigenous capitalists. There were other components of this policy as well, including
an emphasis on the conglomerate of media enterprises in Beijing, Shanghai, and
Changchun rather than on regional productions from studios like the Xi’an Film Studio,
Emei Film Studio and Yunnan Film Studio. The cumulative effect of all of these policies
was a dramatic change in the balance of power between the central government and the
local authorities – the peripheral film studios were more capitalistic and market-driven
and the three big film studios were more state-controlled. In the 1990s, the balance tilted
decisively in favor of the three big conglomerates.
Thus, 1989 marked a policy turning point. As is well known, 1989 was a
year of political turmoil. University students protested and held hunger strikes in
Tiananmen Square. In this chapter, my focus is on the implications of what is famously
known as the “June Fourth Massacre.” Most analysts, while acknowledging the political
importance of the Tiananmen crackdown, view the event as a brief pause in China’s
economic reforms, or have downplayed its influence, choosing instead to focus on Deng
Xiaoping’s famous “Southern Tour” in 1992. But what happened after the protests? In
this chapter and the one following, we will examine how the Chinese government rebuilt
its film industry after the 1989 Democratic Movement by first looking at the ideological
perspective on the nature of media controls, particularly in the film industry (Chapter 4).
Chapter 5 will focus on the use of political power to reconstruct the film industry’s
structure in order to confront the rapid commercialization of the industry and the influx
of Hollywood movies into the Chinese market.

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4.2 Rebuilding the Film Industry
One might imagine that the immediate ideological effects of the 1989 turmoil on
the economic reform and on the private sector would be short-lived. However, within the
media industries, the effects were vivid and intense, and lasting far longer than anyone
could have predicted. The post-1989 milieu saw not only a reversal in the relatively
liberal regulatory environment, but also robust and wide-open public debate around
commercial and entertainment-focused films as well as thorough repudiation of the once-
promising political reforms. The reforms had been aimed at fostering a vigorously
commercial film market, moving toward increased filmmaking independent of the state’s
financial and ideological control. Between 1989 and 1992, the reforms stagnated
completely. The leaders of the CCP were committed to maintaining a permanent
monopoly on power, and were intolerant of those who questioned its right to rule. Even
today, the Party is obsessed with “Wei wen” – maintaining stability. According to the
Asia Times, the CCP has set up a high-profile institution to prosecute individuals deemed
potential threats to social stability. Special funds have been allocated for the institution.
In March 2010, the government revealed its budget for maintaining social stability as
RMB 514 billion (USD 72 billion) for that year, up 8.9 percent from 2009. This is almost
equal to the central government’s RMB 518.6 billion defense budget. And the 8.9 percent
growth in social-stability spending eclipses the 7.5 percent increase in the defense budget
(Z. Wu 2010).
Besides maintaining social stability, the CCP made massive efforts to recentralize
political management of the Chinese film industry. First, it invested a huge amount of
capital to produce films serving the party, such as propaganda films or main-melody
films. Second, the government switched its favor to propaganda filmmaking from
commercial filmmaking, although this was not new for the CCP; it had reversed the

125
liberal environment in China during the period from 1988 to early 1989. Third, the
government tried through a series of campaigns at all levels to promulgate the idea of
patriotism, collectivism and socialism. The cumulative result of all these measures was
the rise of main-melody film production, which began in the 1990s.
4.2.1 Establishing the Fund for Main-Melody Filmmaking
The 1989 Democracy Movement seriously hindered the development of both
economic and political reform, but the reforms themselves could not be stopped.
However, Party hardliners claimed that the Party had used a strong hand in dealing with
the construction of material civilization while using a weaker hand in dealing with the
construction of spiritual civilization. The Party had been determined to maintain the
principles of the reform while fighting against bourgeois liberalization. The film industry
saw some changes. First of all, the head of the Beijing Film Studio, Song Chong, was
ousted because of his open support of students. The Minister of Culture was removed
immediately following the crackdown. Chen Haosu, the Vice Minister of MRFT
responsible for the film industry’s development, was removed in May 1990. Wu
Tianming, the well-known head of the Xi’an Film Studio, was blacklisted, leaving China
immediately after the crackdown and finally settling in the United States (Yin 1989).
Other directors faced similar fates, including Peng Xiaolian, the director of Ba Jin, who
moved to New York to study film; Huang Jianxin, the director of The Black Cannon
Incident, who became a researcher in Australia; and Zhang Zeming, the director of Swan
Song, who defected to London (Rayns 1991). Moreover, a large number of writers sought
refuge overseas, including Liu Binyan, Wang Ruowang, Gao Xingjian, Fang Lizhi, Kong
Jiesheng, Gu Hua, Bei Dao and Yang Lian. Some died in exile without ever returning to
their homeland.

126
Although the democratic demonstrations and the military crackdown had
disrupted the film industry to some extent, some of the projects, which had been decided
at the beginning of the year, were continued. Projects that had been processed by the end
of 1988 were also allowed to continue. Most of those films were about the fortieth
anniversary of the PRC. But there were some exceptions, such as Peng Xiaolian, whose
film about the writer Ba Jin was cancelled mid-production after the 1989 massacre
(Rayns 1991, 29). Although studios still worked on such earlier projects after June
Fourth, they likely were more cautious. At the same time, the production of
entertainment-based and commercial films had not stopped, and by the end of the year
about 90 commercial films, out of 136 feature films, had been produced in 1989. It was
the first time that the number of commercial films produced surpassed that of
propaganda films. However, the audience did not accept the films. Of the 16 film studios,
11 had deficits in 1989. This situation greatly affected the studios’ productions in the
coming year.
The government had no option but to back film productions. For example, the
trilogy Grand Decisive Battles (dir. Li Jun, 1991) was 100 percent funded by the People’s
Liberation Army (PLA) for RMB 100 million. Thousands of PLA soldiers also assisted in
the production. The government also decided to set up a fund to encourage more big-
budget propaganda films with themes centered on grand contemporary subjects and
revolutionary historical events. “The Development Fund for the Chinese Film Business”
(hereafter the Fund), was set up in early 1991, and enabled the Film Bureau to finance
some main-melody film productions. It is estimated that about RMB 130 million was
collected annually. This was an important development for the Chinese film industry, as
the Fund basically guaranteed the production of propaganda films and the construction
of some essential projects, including distribution and exhibition channels for the

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development of the industry (Wu 223). In 1995, the government attempted to improve
the efficiency of the Fund by dividing it into three sections:
i. Loans to film producers
ii. Awards to outstanding film producers. The maximum award
amount was RMB 3 million. The award money had to be used to
produce “key films” (Zhong dian pian)
iii. Financial assistance to certain key films
4

In short, the immediate action after the Tiananmen crackdown was to directly infuse
financial capital into the film industry in order to foster the production of politically
correct films. The government gave priority to main-melody films. The distribution
sector also was required to order more prints of the main-melody films. The exhibition
sector was asked to enact a preferential policy, scheduling more screenings and the best
time slots for main-melody films. The Film Bureau did not handle financial matters; it
would merely issue orders and wait for the finished products. However, film studios
complained about the large investment in producing the films, especially the big-budget
main-melody films. For a time, the Film Bureau also felt awkward requiring studios to
produce such films while watching studios fall deeper in debt. However, the government
equated the value of important cultural projects to that of other industrial projects, such
as car manufacturing, and the need for funding big-budget propaganda films grew even
greater after the Tiananmen crackdown. Therefore, the subsidization policy became
more centralized and many of the productive financial innovations in the film industry
were discontinued. The State reversed its stance on private capital, no longer viewing it
as a useful complement but rather as dangerous competition to be firmly stamped out.
Prior to 1989, many film studios had sold studio credits to private producers in
order to survive (discussed further in Chapter 2). However, selling studio credits was

4
B. Chen (2005b), 926.

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banned in early 1990. MRFT clearly stated that films produced by private producers
using studio credits would not be examined by the Film Bureau. Studios that continued
to sell credits to unauthorized private producers would be criticized and their quota
would be decreased for the following three years (B. Chen 2005b, 840). This was a big
shock to the industry, as there were only 16 State-owned film studios officially allowed to
produce films. Before this ban, a lot of private film enterprises had invested in
filmmaking, and most of them depended on the 16 sanctioned film studios’ credits to
distribute their films, though some of the studios might not even be involved in the actual
filmmaking. Although the ban was lifted in 1995 when the State finally allowed private
investors once again to engage in filmmaking, as long as their investment was more than
70 percent of the total production cost, the reversal of policy throw away private capital
after 1989 had greatly harmed the film industry (for further analysis, see Chapter 5).
4.2.2 Suppression of Commercial Filmmaking
On November 1, 1989, the National Distribution-Exhibition Conference
(Quanguo dianying faxing faying gongzuo dahui) was held in Beijing. The last similar
conference had been held in 1957. This was the Chinese film industry’s biggest
conference since 1957. All the leading officials attended, including Deputy Secretary-
General of the State, Liu Zhongde, Vice Ministers of MRFT Nie Dahan, Xu Chonghua,
Chen Haofang and Wang Feng, Director of the Film Bureau Teng Jinxian, Deputy Chief
of the Film Bureau Dou Shoufang, and other high-ranking officials from the Film Bureau
(B. Chen 2005, 218). During the conference, Manager of China Film Hu Jian, concluded
that the development of the film industry had greatly improved, especially in the
exhibition sector. The number of exhibition units had increased by 250 percent, from
600 in 1949 to 160,000 in 1989. Up through June 1989, the government had remodeled

129
1,200 theaters and had also built 12,000 cinemas in towns and villages (B. Chen 2005a,
218).
Later in November the Exhibition Sector Conference took place. At that meeting,
attendees agreed to focus on theatre remodeling and reconstruction work, not only in big
cities like Guangzhou, Shanghai, Shenyang and Harbin, but also to extend it to medium
and small cities and towns. The goals of the project were to provide a large number of
high-quality theaters to audiences, to increase the profitability of theaters, to provide a
healthier environment for promoting “the socialist material civilization and spiritual
civilization” (Shehui zhuyi wuzhi wenming he jingshen wenming) and to correct the
crisis” (B. Chen 2005a, 219).
At the end of the same month was the Production Sector National Conference.
The conference’s attendees included all the heads of the state-owned film studios, leaders
of the Film Bureaus, managers of China Film, the China Co-Production Company and the
Hong Kong Sil-Metropole Organisation Ltd. The participants agreed that the authorities
should strengthen their management and control of film production in order to improve
its quality (B. Chen 2005, 220). They concluded the conference with a 16-word slogan:
“Shenhua gaige, hongguan diaokong, jiaqiang guanli, wenchan gaozhi”, meaning
“deepening the reform, macro-controlling the reform, strengthening management of film
production, and producing high-quality films.” They also criticized film production in
1988 as a mess. First, they noted that too many films were produced. The industry was
supposed to produce 141 films but it turned out 158.5.
5
Second, they also agreed that
there was a lack of planning and management in some of the film studios, which had led
to a rise in the cost of film production (B. Chen 2005a, 220).

5
Because of overproduction in 1988, a decision was made to lower the quota for 1989 to 124 feature films
(B. Chen 2005b, 820).

130
After the three national conferences, which had each focused on one of the three
film industry sectors, the Propaganda Department made another call to request that all
cultural industry workers in China attend a meeting in Beijing in January 1990. Li
Ruihuan, a member of the Politburo of the CCP in charge of ideological affairs, gave a
keynote speech at the conference, “On Promoting the National Culture and Related
Issues”(Guanyu hongyang minzu wenhua de ruo gan wenti). He specifically pointed
out that promoting national culture is not only related to the development of a country’s
culture, but also to politics. Promoting national culture is used to strengthen the national
spirit, to enhance people’s self-esteem and self-confidence, and to develop patriotism,
which can help the masses resist foreign pressures. Moreover, he also emphasized the
need to correct attitudes toward film production. He said films and other cultural
products should “serve the people and serve Socialism.” Regarding the social and
economic benefits of films, he explained that the first goal should be to try to combine the
two into one, and second, to place social benefits before economic benefits, and third to
sacrifice economic benefits if the two are in conflict with one another. In February, Li
Ruihuan, in another speech to screenwriters, maintained that the function of film is not
only as an art for the masses, but also as an educational and propaganda tool to be used
by the Party. He urged industry workers to produce more films reflecting socialist
modernization projects and economic reforms (B. Chen 2005b, 839).
By late February 1990, another national meeting was held in Beijing. Several
high-ranking officials attended, including PLA Marshal Nie Rongzhen, famous Chinese
playwright and screenwriter Xia Yan, Deputy Director of the Political Department Guo
Linxiang, Director of the Film Bureau Ai Zhisheng, Deputy Director of the Propaganda
Department and Director of the Ministry of Culture He Jingzhi, and other film
bureaucrats such as Chen Huangmei, Ding Qiao, Chen Haosu, Zhu Li, Chen Bo, and some

131
film studio heads such as Wang Yang, Hu Jian, Su Yun, Zhao Chen, Ding Li, Liu Jia, Xiao
Mu and Chen Mengjun (B. Chen 2005b, 840). At the meeting, Ai Zhisheng emphasized
the necessity of correcting the ideology of filmmakers. He noted that too many films
produced in the past few years had illustrated the dark side of society and too few films
had praised the achievements of the Party. He urged filmmakers to produce more films
praising the constructive side of the government and creating new images of socialism.
He also warned that films stirring up political emotions were dangerous and harmful,
although they successfully attracted larger audiences. In addition, he advised film
industry workers to be more careful to avoid producing such films, suggesting that
censorship would kill such pictures anyway; he expected that they would be detected and
destroyed before production (CFYB 1991, 5–16).
After Ai Zhisheng’s speech, the government tightened its grip on Chinese films.
First there was the unexplained withdrawal of Wu Ziniu’s film The Big Mill from
competing in the Berlin and Singapore film festivals, and later the withdrawal of Zhang
Yimou’s Ju Dou from consideration for the Academy Award for Best Foreign Language
Film. Ai Zhisheng also extended his power to pressure Du Youling, the producer of Ann
Hui’s My American Grandson, to cut parts of the film before screening. Later he also
banned several films produced in 1990 that displayed glimmers of creativity. Among the
most notorious banned films were Zhang Yimou’s Raise the Red Lantern; Li Shaohong’s
Bloody Morning; Zhou Xiaowen’s Black Mountain Road; Zhang Yuan’s Mama; Xia
Gang’s Half Flame; Half Brine; and Zhang Liang’s A Woman’s Street. He also forbade
Wu Ziniu’s The Big Mill from screening overseas(Rayns 1991).
At the same meeting, Teng Jinxian gave a thoughtful review of the Chinese film
industry’s development in 1990. He said that over the course of the year, “we had had to
review past years, but at the same time, the film industry also needed to look at the

132
future. At home, the “Beijing Counter-Revolutionary Riot” had flared up in the country,
and in the outside world, capitalist countries were strengthening their strategies to
overthrow socialist countries.” Thus, it was critical for film workers to uphold the four
cardinal principles
6
and to fight against bourgeois liberalization and the conspiracy of
“peaceful transformation” hatched by the enemies both at home and abroad:
We need to find the role of film and recognize our responsibility. We
need to focus all our efforts on producing films that educate people,
especially the youth and adolescents, about patriotism, collectivism,
socialism, communism and the revolutionary tradition, to advocate the
spirit of self-reliance, hard work, and selfless devotion, and to stimulate
national dignity and confidence from the people so as to raise the
quality of the nation and to train the new socialist man with ideals,
knowledge and discipline. (J. Teng 1990, 11)
In addition to emphasizing the role of films, Teng Jinxian also argued there were five
negative tendencies in the film industry. First, some filmmakers emphasized
entertainment and aesthetics but ignored the educational purpose of films. Filmmakers
attempted to lessen the political messages in their films while ridiculing the films that
presented the major melody in order to serve the needs of the government. The result
was that only about 40 percent of films produced in 1989 represented contemporary life.
Films depicting contemporary life usually accounted for about 60 percent to 70 percent
of the films produced per year. Many protagonists were no longer workers, farmers,
soldiers and intellectuals; rather, they were the dregs of society, such as spies, bandits,
thieves and gang members. Second, some people advocated, “Total westernization” and
copied Western films’ content, style and expressions in Chinese films. Third, some
people advocated abstract human nature and abstract humanism to dilute or replace the

6
The four cardinal principles outlined by Deng Xiaoping in 1979:
i. The principle of upholding the Socialist path
ii. The principle of upholding the people’s democratic dictatorship
iii. The principle of upholding the leadership of the CCP
iv. The principle of upholding Marxist-Leninist-Maoist thought

133
social and class nature of human beings. These films described the suppression of human
nature by society and its abnormal or distorted elements. Fourth, some filmmakers
argued that films were only a means for artists to express themselves. Those filmmakers
neglected films’ intellectual and social benefit for the public. Fifth, due to the difficult
economic situation, the worship of money was a very serious issue in the film industry
after the mid-1980s. Some filmmakers had no choice but to make poor-quality films,
thus earning Chinese films a very poor reputation (Teng 1990, 13).
In addressing these harmful trends, Teng Jinxian urged filmmakers to guard their
products in order to safeguard the people’s, the State’s and the Party’s wellbeing,
remarking,
Our movies have to serve socialism, and benefiting the people is the
foundational goal. We can no longer tolerate films that are harmful to
the Party and to socialism and that spread skeptical and distrustful
emotions to the Party and socialism. (Teng 1990, 15)
This argument was straightforward and it marked a great turn from the debate that
emerged in the late 1980s, as discussed in Chapter 3. The government had again made
its point clear that films not only had to serve society, but, most importantly, the Party.
In addition to the bureaucrats in the Film Bureau who enforced the function of films,
other leaders also expressed their views. For example, Jiang Zemin, on May 3, just after
he took over the chairmanship of the Central Military Commission when Deng Xiaoping
stepped down in late March, gave a speech called “Patriotism and the Mission of our
Country’s Intellectuals” (Aiguozhuyi he woguo zhishifenzi de shiming). He contended
that the role of intellectuals in China’s social and economic development is irreplaceable,
and thus all leaders have to deal with intellectuals seriously and strengthen and improve
the guidance they give to intellectuals. He also argued that the goal for the current
government was to strengthen and develop the current political stability and unity so as

134
to concentrate on economic construction. All sectors, he said, including literature and
arts, should voluntarily submit to and serve this goal. The bottom line here is very clear,
he added: the state government needs to manage the thoughts of intellectuals, and
literature and arts were not value-free. All the intellectuals and their products must serve
the country’s interest – or, in other words, the Party’s interest, voluntarily or not.
In June, Jiang gave another speech at the National United Front Conference. He
urged the committee to unify all the people who could unite to serve the goal of socialist
modernization and open-door reform, which meant the government attempted to further
unify the thoughts of intellectuals and cultural workers. In July, the National Feature
Film Production conference was held in Beijing. There were four main goals of the
meeting:
7

i. Unify the guiding ideology
ii. Adhere to the correct direction
iii. Strengthen the management of film production
iv. Improve film quality
8

All of these speeches, documents and conferences aimed to restructure the state’s
intervention in the cultural industry, particularly of the media industries. After 10 years
of reform, the state felt there was chaos that could soon lead to the fall of the Party. The
government believed its most important task was to pay attention to the ideological fight.
And the CCP was determined to handle this through the suppression of commercial
filmmaking.
In order to guarantee the production of films that would serve the Party, it took a
number of steps. First, on February 17, 1990, MRFT announced to all film sectors that

7
B. Chen 2005b, 845.
8
In Chinese: 統一指導思想，堅持正確方向，加強制片管理，提高影片質量

135
the government was going to strengthen its control over film, TV dramas and audio-video
productions, publishing and broadcasting. In order to maintain its managerial role over
the film industry, MRFT required all local Film Bureaus to consolidate their roles in
planning and management. China Film also needed to strengthen its role in coordinating
all three sectors of film production. MRFT also required the Boards in the Film Bureaus
to maintain a leading position in screenwriting (B. Chen 2005a, 227).
In the same month, MRFT issued a document reinforcing a policy that was first
issued in 1987 regarding the language used in films. The Ministry of Culture again
required that all film departments to ensure that Mandarin was to be the only language
allowed (B. Chen 2005b, 845).
On August 28, 1990 the Propaganda Department and MRFT co-published
“Opinions on Strengthening Features’ Censorship” (Guanyu jiaqiang gushipian shencha
baguan gongzuo de yijian). The document required that all film productions be
examined by the corresponding Film Bureaus prior to production. Censorship had
relaxed in the mid-1980s when the authorities allowed the film studios to examine their
own scripts and produce them even without submitting them to the Film Bureau for
examination. However, after the 1989 Beijing Massacre, censorship power was restored
to the Film Bureau, instead of to the heads of the film studios, since it was clear that
individuals such as Xi’an’s Wu Tianming and Shanghai’s Shi Fangyu tended to have more
liberal ideas about film genres and contents. In addition, the approval for screenplays
tightened, as did censorship of completed films. Films had to be submitted to both the
Film Bureau and to provincial Propaganda Departments. This meant that a film had to
be examined by the local censors before being approved by the Film Bureau. This double
censorship aimed to minimize the production of problematic films.

136
During this time, the Propaganda Department, the Political Department, MRFT,
and the Ministry of Culture jointly issued “Provisions on the Production of Major
Revolutionary Historical Films and the Problems of Censorship” (Guanyu Zhongda
geming lishi ticai yingshi zuopin paishe he shencha wenti de guiding) (B. Chen 2005b,
846). The document required anyone who wanted to produce a film about major
revolutionary historical issues to have a production permit. To apply for the permit, a
film producer first of all, after the script was preliminarily approved by the local
provincial, autonomous region or municipal MRFTs and the local Propaganda
Departments, had to send the permit and preliminary script-approval document to the
“Major Revolutionary Historical Film and TV Creation Leading Small Group (Zhongda
geming lishi ticai yingshi chuangzuo lingdao xiaozu) (hereafter “Leading Group”). All
movies related to major revolutionary historical events have to submit to the Leading
group for examination.
9

At the beginning of 1991, more detail on how to arrange for the production of
cultural products finally came. In January, the magazine “Contemporary Film”
organized a seminar. The goal was to find a way to create a film script in order to fit the
construction of socialism with Chinese characteristics. The magazine published articles
written by bureaucrats from the Film Bureaus and MRFT, such as Chen Huangmei Liang
Guangdi, Yu Min, Teng Jinxian, Huang Gang, Cheng Jihua, Su Shuyang, Chen
Guangzhong, Yu Lan and Xi Shangshang. All the articles expressed the idea that film
workers needed to unite to handle the critical economic situation of the film industry,
and also that film workers needed to pay more attention to how to produce films that
stabilized the social and political environment.

9
To access the original document, please visit BJLawyerOnline.

137
On February 7, Film Bureau Director Teng Jinxian penned an article in People’s
Daily, “On Main-Melody Chinese Films” (Guanyu zhongguo dianying de zhuxuanlv). In
the article, he asserts that “making main-melody prominent and insisting on
diversification” is not an “expedient measure” (Quan yi zhi ji); rather, it is a strategy to
encourage the development of the Chinese socialist film industry, a systematic project
(Xitong gongcheng). As the writer stipulates,
Comrades who work in the film front (movie industry) need to unify
their ideas in the same direction forge ahead in unity, and all exhibit
their talents. Then we will be able to create a more brilliant future for
China’s film industry.
On March 1, 1991, the directive “Some Opinions about Enabling the Current Production
of Literature and Arts to Flourish” (Guanyu dangqian fanrong wenyi chuangzuo de
yijian) was published. Co-authored by MRFT, the Ministry of Culture, and the
Propaganda Department, the directive declared that the basis of film awards should
clearly reflect the Party’s principles and policies on literature and arts.
10
It required
artists to study Marxism, Leninism, Mao Zedong Thought, the Party line, principles and
policies to enrich artists’ sense of social responsibility and mission. The result of this
kind of studying would be one of the major criteria for the decisions of future promotions.
Work units were required to organize groups to collectively train creative workers.
Universities and educational institutions had to host classes teaching government
officials and organizations’ leaders. Other than pushing for these study sessions, the
directive also aimed to strengthen the management of production plans and “key films.”
It urged artists to produce and create works that would have a vivid socialist spirit, reflect
profoundly on contemporary life, praise the new socialist men and women, and have
national characteristics. Lastly, the government had promised to give special financial

10
For the original document, please see Law-Lib.

138
protection to some good works and some work units. An awards system was established
to encourage more works to follow the Party’s principles and policies. Two of the films
that were most widely promoted by the government were The Founding Ceremony of the
PRC and Jiao Yulu (dir. Wang Jixing), produced in 1989 and 1990, respectively. These
two won all three major film awards in 1990 and 1991; few films had received such
acclaim in previous years.
A document, “Notice on Film Ticket Price Management and the Establishment of
the Development Fund for the Chinese Film Business” (Guanyu mingque dianying
piaojia guanli quanxian he jianli guojia dianying shiye fazhan zhuanxiang zijin de
tongzhi), was approved by the State Council and jointly issued by MRFT, Ministry of
Finance, the State Bureau of Commodity Prices, The State Administration of Taxation
and the Industrial and Commercial Bank of China in January. According to the
document, it was estimated that about RMB 130 million could be collected annually from
the exhibition sector. The document also stated that ticket prices in different areas were
managed by the local film bureaus, which had the right to decide prices based on their
local economic conditions. The “Development Fund for the Chinese Film Business”
(hereafter the Fund), which was set up May 1991, enabled the Film Bureau to work out its
long-term plan for the film industry. This Fund could basically guarantee the production
of propaganda films and the construction of some essential projects, such as distribution
and exhibition channels for the development of the industry. The documents specifies: 1)
five cents (in poorer areas, two cents) would be taken from every film ticket to be used for
the Fund; 2) the Fund could only be used for the major revolutionary historical films and
for some contemporary social films, key documentaries, scientific-education films, and
children’s films and animation; 3) it could also be used in the remodeling of theaters in
the cities. The Fund would also support the development of less-developed regions; and

139
4) the fund could be used to renovate some key state-owned film studios and subsidize
their productions (B. Chen 2005b, 852).
In May, the magazine Film Weekly published several important articles produced
by leading Film Bureau officials. Ai Zhisheng’s article “Creating more high-quality films
to reflect the times” (Chuangzuo geng duo wukui yu shidai de youxiu dianying) is one
example. In his article, he promotes six guidelines for future film productions:
i. Uphold the leading ideology
ii. Insist on the “one hand on consolidation, one hand on enriching
the prosperity of the film industry” policy, and at the same time
control the number of film productions and improve films’ quality
iii. Produce more high-quality and proper films for the masses
iv. Chinese films, first and foremost, need to serve the Chinese people.
They need to have a Chinese meaning before attaining a universal
meaning
v. Continue to uphold the dominant thought
vi. Enhance education
Another task for the Film Bureau was to establish laws and regulations. The
political and economic reform of the 1980s called for more systematic legal
administration. In 1987, the Film Bureau set up a special group to draft film laws and
regulations. These included the Film Law, the Film Copyright Act and the Film
Censorship Act, the Regulation on Film Distribution, the Regulations on Film Exhibition,
and the Regulations on Film Production (X. Wu 1992, 223). Drafts of the laws were sent
to the State Council, but none were actually implemented.
The government also focused its efforts on reforming the exhibition sector in
order to reestablish that area’s legitimacy. On September 9, 1995, MRFT issued “Notice
on How to Promote Key Films’ Distribution and Exhibition” (Guanyu zuo hao
zhongdianyingpian faxing fangying gongzuo de tongzhi) stipulating that distribution

140
companies needed to distribute “key films” to theaters every year, and that the number of
“key films” had to account for at least 15 percent of total distribution. It also required
exhibition units to show “key films” for at least 15 percent of total annual screenings (B.
Chen 2005b, 942). In 1995, “keys films” included The Lu Gou Qiao Incident (dir. Li Qian
Kuan and Xiao Guiyun, 1995); Yang Kai Hui (dir. Qin Zhiyu, 1995); Red Cherry (dir. Ye
Daying, 1995); Jiu Xiang (dir. Sun Sha, 1994); Di Hou Wu Gong Dui (dir. Kang Ning
1995); and Sheng Si Qian Li (dir. Zhuang Hongsheng, 1995).
After the Changsha Meeting in 1995, MRFT and the Ministry of Culture issued a
joint circular, “On Completing Key Films: Releasing and Screening Notice,” which
strengthened and enforced the requirement that all theaters allocate at least 15 percent of
screen time to the exhibition of domestic “key films”. The regulation also required that
all the distributors have no less than 15 percent of “key films” per year (CFYB 1997, 25).
In 1997, the government allowed theaters to show foreign films, but they could not
account for more than one-third of screen time. Rewards were given to those companies
who placed their efforts on promoting key films, and permits were revoked if theaters
violated the regulation. In addition, government authorities could block foreign films
from being shown, usually arbitrarily. Although, according to Y. Zhu, there are “three
blackout periods” in which exclusively local films should be shown (Y. Zhu 2002, 146), in
most cases, the rule of blackout periods is not followed (Rosen 2006).
11

In comparison with the commercial film debate that I discussed in Chapter 3, it is
easy to see why the Party changed its mission. Before the Tiananmen crackdown, the
discussion among government officials and film workers attempted to limit the direct
interference from the Party and put more weight on the role of the marketplace, while the

11
Blackout periods remain prevalent, albeit the 1/3 screens rule has not been strictly enforced.

141
new “mission” I discussed above points to the important role of the Party and they
attempt to strengthen the Party’s leadership and to stress the role of Party in every stage
of film production, from production to distribution and exhibition.
4.2.3 Patriotic Campaigns and the Rise of Main-Melody Films
After the military operations in response to the mass democratic movements on
June 4, 1989, the Chinese government was denounced by most Western countries, which
imposed economic sanctions against China. Domestically, the media reforms stagnated.
While the film market perished, the only thing the central government could do was
continue to financially support film productions, especially main-melody films. Deng’s
Southern Trip in 1992 during the Chinese New Year did help bring the economic
reformists back on track. However, after the collapse of the Soviet Union on August 20,
1991, China was left standing as the biggest Communist country in the world. This fact
reinforced both anti-Western and xenophobic feelings within the Party. For this reason,
the Party made an enormous effort to broaden and repackage its patriotic indoctrination
project by exploiting the entire propaganda apparatus.
In 1993, Document Number 3 was issued.
12
It set a quota of 150 films to be
produced annually, with 3-4 films deemed “outstanding films” (You xiu pian), and 30
films “key films.” Among them, at least 60 percent of the films needed to reflect
contemporary issues. Studios were not allowed to produce any politically incorrect films.
Patriotic education peaked in 1994 when the Party launched the “Outlines for the
Implementation of Patriotic Education,” and followed that with the “9550 Project” on
March 18, 1996, when MRFT and the Ministry of Finance jointly issued their “Notice on
the Establishment of Special Funds to Support the ‘9550’ project to Produce High-quality

12
Document Number 3 is discussed further in Chapter 5.

142
Films” (Guanyu sheli zhichi dianying jingpin ‘jiu wu ling’gongcheng zhuanxiang zijin
you guan guiding de tongzhi).
13
The notice required 3 percent of TV-commercial income
to be extracted from every TV station at the provincial level and for the municipal level to
support the production of “high-quality films.” Film studios had to produce 10 high
quality films (Jing pian) every year and a total of 50 high quality films in 5 years.
14
This
rule was viewed as an official response to the increase in poor-quality commercial films
since the late 1980s, and it used subsidies to try to reverse this trend, and at the same
time, re-strengthen the state government’s patriotic education. In addition to the “9550
Project,” the government also promulgated the “Tribute Films Project” (Xian li pian de
ticai guihua). In his interview for Contemporary Cinema, Wang Gengnian, the Deputy
Director of the Film Bureau, explained that since 1998 there was a plan for “tribute films”
– films used to celebrate the founding of the CCP or the PRC. First of all, they chose 60
film scripts from a pool of 200 scripts provided by the film studios. After discussions,
they selected the best 30 scripts. Then the committee discussed the scripts one by one
and made changes. Finally, they decided which films to produce. Of the 30 films they
produced, 18 were selected as “tribute films” (Tang and Shao 2005, 245), for instance, A
National Anthem (dir. Wu Ziniu, 1999) , Great Battle in Ning Hu Hang (dir. Wei Lian,
1999), Roaring Across the Horizon (dir. Chen Guoxing, 1999), Crash Landing (dir.
Zhang Jianya, 2000), My 1919 (dir. Huang Jianxzhong, 1999), Team Spirit (dir. Qi Jia,
2000), Dragon Boat Race (dir. Wang Hengli, 1999). “Since most of the tribute films had
big budgets, they needed a plan. Without a plan, they would not be able to produce those

13
The so-called “9550 Project” emanates from a stipulation from 1996 to 2000, when studios were required
to produce 10 “high-quality” films each year and 50 films by the end of the year of 2000. This project was
proposed during the Changsha Conference in 1995.
14
An “outstanding film” must be a “key film,” which are promoted by the government. But “outstanding
films” usually refer to those classified as “key films.” The term “high quality films” refers specifically to the 10
films produced under the “9550 project.”

143
tribute films,” he explained. Secondly, all government departments (including the
Propaganda Department and its local offices, MRFT and its local offices, and studios)
worked together to make this happen. “This is not an easy task!” he said (Wang 2000, 5).
In another interview, he added that since 1996, the central government and local
governments had invested at least RMB 100 million each year to produce tribute films.
The total investment accounted for roughly a third of the total investment in the film
industry every year. He agreed that without government support, it would have been
impossible to produce that number of films annually (Wang 2000, 7). This level of
investment would have been unimaginable in the past.
In addition to instituting the mandatory quota, the Chinese government granted
different awards to promote the production of main-melody films. Films such as Life
after the Departure of Lei Feng (dir. Lei Xianhe and Kang Ning, 1997) and A Tale of the
Sacred Mountain (dir. Feng Xiaoning, 1999) outnumbered the imported Hollywood
movies. But, as Yang says, the “success” of these main-melody films was premised on
their promotion by all levels of government leaders. She claims that 80 percent to 90
percent of audience members were given free tickets by their working units (Yang 2008).
For another film, Kong Fansen (dir. Chen Guoxing, 1995), only 5 percent of the movie
tickets were sold to ordinary moviegoers. In Beijing and Sichuan, the percentages were
even lower: 0.51 percent and 0.2 percent, respectively (Rosen 2002; R. Tang 2002, 295).
Politically, the patriotic education campaign started in June 1991, when the
Propaganda Department issued the “Circular on Fully Using Cultural Relics to Conduct
Education in Patriotism and Revolutionary Traditions” and then the next year, the
Propaganda Department, the State Education Commission, the Ministry of Culture and
MRFT jointly issued the “Circular on Education in Patriotism in Primary and Secondary

144
Schools Throughout the Country by Films and TV.” That meant the corresponding
departments had to organize screenings for minors and students.
The first response to these documents was for the film studios to increase the
production of main-melody films and the Propaganda Department, Ministry of Culture
and other related departments to place their efforts on promoting main-melody films
either by administrative order or by randomly passing “red-head” documents (Hong tou
wenjian) down to the local offices.
15
Since 1991, it is apparent that the government has
expended extensive efforts in pushing main-melody films to the public (illustrated in
Table 4.1).

15
“Red-head document” is a document to instruct leading bodies of the Party and the government.

145
Date
Title
Chinese English
1988
FEBRUARY 紅高梁 Red Sorghum
1989
APRIL 巍巍崑崙 Towering Kunlun
JULY 百色起義 Baise Uprising
OCTOBER 豆蔻年華 In Their Teens
1990
FEBRUARY
黃河謠
（音樂故事片）
Ballad of the Yellow River
(Musical)
MARCH 周恩來 Zhou Enlai
MAY 林則徐 The Opium Wars (Lin Zexu)
1991
FEBRUARY 焦裕䘵 Jiao Yulu
JUNE
大決戰· 遼寧戰役
Decisive Engagement:
The Liaoxi Shenyang
毛澤東和他的兒子 Mao Zedong and his Son
開天辟地 The Creation of a World

Table 4.1: Major Main-Melody Films Promoted by the Government, 1988-2000

146
Table 4.1 Continued
JULY 大決戰· 淮海戰役
Decisive Engagement:
Wei-hai Campaign
SEPTEMBER 周恩來 Zhou Enlai
OCTOBER 大決戰· 平津戰役
Decisive Engagement:
Beijing Tianjin Campaign
NOVEMBER 決戰前後 After the Final Battle
1992
JUNE
毛澤東的故事 The Story of Mao Zedong
啟明星 Twilight Star
AUGUST
秋菊打官司 Story of Qiu Ju
高朋滿座 The Weddings
1993
FEBRUARY
新中國第一大案
The First Case in
New China
蔣築英 The Scientist Jiang Zhuying
JUNE 夢非夢 The Dream is not a Dream
JULY 秋收起義 Autumn Harvest Uprising
AUGUST 重慶談判 Chongqing Negotiations
DECEMBER
中國出了個毛澤東
（紀錄片）
Mao Zedong Emerged from
China (Documentary)

147
Table 4.1 Continued
1994
JANUARY 鳳凰琴 Country Teachers
APRIL
大海風 Hurricane over the Sea
第一誘惑 First Attraction
都市情話
Romance in Metropolitan
Shanghai
JULY 復活的罪惡 Evil or Revival
SEPTEMBER 金沙水拍 The Long March
OCTOBER 一個獨生女的故事 A Story of a Singleton
1995
JANUARY 天地人心 Popular Will
JUNE 楊開慧 Yang Kai Hui
JULY 花木蘭傳奇 The Legend of Hua Mulan
1996
MARCH 孫文少年行 Sun Wen Shao Nian Xing
JUNE 孔繁森 Kong Fansen

148
Table 4.1 Continued

1997
FEBRUARY 離開雷鋒的日子
Life after the Departure of
Lei Feng
MARCH 大轉折 Turning Point
MAY 鴉片戰爭 The Opium War
OCTOBER 黑眼睛 Black Eyes
1998
JUNE
越過太平洋—— 江
澤民主席’97 訪美紀
行（紀錄片）
Across the Pacific Ocean:
Chairman Jiang’s US Trip
in 1997 (Documentary)
世紀大典
( 紀錄片)
Ceremony of the Century
(Documentary)
1999
SEPTEMBER 黃河絶戀 Grief over the Yellow River
DECEMBER 橫空出世 Roaring Across the Horizon
2000
FEBRUARY 走出硝煙的女神 Goddess in War-Time
AUGUST 生死抉擇 Fatal Decision

149
Secondly, the Ministry of Education, MRFT and the Ministry of Culture jointly
organized a national campaign called “Patriotism Film Education Month” (Aiguozhuyi
jiaoyu dianying yue). The theme for the campaign was based on the 150 Years of the
Opium War. The three departments recommended 30 films, including The Opium Wars
(or called Lin Zexu) (dir. Zheng Junli, 1959), to all students with the aim of teaching them
about how the Chinese fought against the Imperialists beginning in 1842.
Other examples included the major campaign from July 12 to September 1, 1993,
called “Love Our Chinese Films Exhibition” (Ai wo zhonghua yingpian zhanbo),
organized by the China Children’s Film Studio, Beijing TV Station, and Beijing Film
Distribution-Exhibition Company, which had screened varieties of propaganda movies to
young people for the purpose of promoting patriotism and collectivism (B. Chen 2005b,
900). On May 20, 1994, the Propaganda Department organized a “Five-One
Project”(Wu ge yi gongcheng), recommending ten films to be shown in ten major cities,
including Beijing, Shanghai, Tianjin, Guangzhou, Chengdu, Wuhan, Nanjing, Xi’an,
Changchun, and Shenyang. Among the ten main-melody films: Country Teachers, First
Attraction, Chongqing Negotiations, Autumn Harvest Uprising, Jinggang Mountains,
Going East to Native Land, Amannisahan, Burning Snow, Hurricane over the Sea, and
An Artillery Major (B. Chen 2005b, 915). The screenings were free to the public, and
lasted one month in each of the cities. During the same year, in late September, the
National Patriotism Campaign reached its peak when MRFT ordered all local film
distribution companies and exhibition units to organize varieties of screenings to
celebrate China’s National Day (B. Chen 2005b, 921). In Shanghai, the Shanghai Film
Bureau decided to hold a “free public screening program” (Mianfei gongyi chang). A
main-melody film would be shown on the first Sunday of every month starting from April
1995. The public screenings were not exclusively in the urban areas. In January 1996,

150
the Propaganda Department and the Ministry of Agriculture organized a project called
“Sending Cultural Activities to the Countryside Plan” (Kaizhan zuzhi wenhua xiaxiang
huodong de jiahua). The plan suggested 20 films for the village film bureaus and
requested that they show those movies to the villagers during the Chinese New Year (B.
Chen 2006, 949–50).
Films such as Baise Uprising and The Founding Ceremony of the PRC were the
major films screened after the crackdown. These screenings were organized by all levels
of Party officials. In some provinces, such as Hubei, Jiangsu, Shanghai and Harbin, the
First Secretary of the Provinces, Governors, General Commanders, and CPPCC Standing
Committees all went to the premieres. The governments also organized varieties of
public screenings to promote the films and requested all employees of state-owned
enterprises to go see the films (B. Chen 2005a, 221). For Towering Kunlun (dir. Jing
Mukui and Hao Guang, 1988), the Propaganda Department, MRFT, the Ministry of
Culture, and the General Political Department of the Armed Forces co-issued a notice
decreeing that their local branches promote and organize an audience to see the film.
Thus the series of main-melody films all had good box-office records because of this
national promotion and the organized screenings (B. Chen 2006).
Concerning the public screenings, government had been concerned with the
education of youth. After National Day (October 13, 1994), MRFT organized a national
conference named “Implementation of Patriotism Education Seminar”(Aiguozhuyi
jiaoyu shishi gangyao zuotanhui) in Beijing (B. Chen 2005b, 922). The seminar
gathered educators, film studies experts and university professors to discuss how to
effectively teach students about patriotism by using films, especially how the 100
outstanding films carefully selected by the government in early 1993 should be used. In
September 1994, the Propaganda Department, the Ministry of Education, MRFT and the

151
Ministry of Culture jointly issued “How to Apply Outstanding Films to Promote National
Patriotism to Primary and Secondary School Students throughout the Country.” The
document designated two categories of films: 1) “must-see films” (bi kan pian) and 2)
“recommended films” (xuan kan pian). There were 50 films in each category for primary
and secondary schools (CFYB 1996, 6).
Each of these campaigns were attempts to invigorate the spirit of the nation;
enhance societal cohesion; bolster national self-respect and pride; and strengthen
patriotism (Barme 1999, 257). It is clear that, after the military suppression in 1989 and
the collapse of the Soviet Union, the CCP was urgently seeking ways to regain its
legitimacy.
4.3 The Emergence of the Main-Melody Concept
Scholars generally agree that the term “main-melody” was introduced at the
Studio Directors National Conference in Beijing (February 20—March 3, 1987).
According to Barme (1999) and S. Lu (2007), Teng Jinxian, Chief of the Film Bureau, was
the first person to promote this idea, while R. Zhang, based on Liu Cheng’s article,
“Reviews of 1989 Films,” claims Ding Qiao and Shi Fangyu both promulgated this idea at
the Conference in 1987 (Zhang 2008).
16
In fact, the main-melody concept should not be
considered to originate from film culture. The term “main-melody” had been used widely
in literature to glorify nationalism or patriotism –for example, in “Patriotism – The
Main-Melody of Lu Xun in his Early Works and Activities” (Hu 1982) – or used to mean

16
I attempted to locate Ding Qiao’s speech at the conference; however, there is no apparent record of it.
Shi’s speech from February 23, 1987 addressed three problems of film productions in 1986; he also offered
some suggestions. He warned that film productions could not privilege two entities to “serve” (“serve the
people” and “serve the society”) while casting aside “double blossoms” (“let all flowers bloom together and
hundreds of schools of thought will contend”).Additionally, Shi observed that a main theme is needed each
year to guide the productions, noting, “Main theme means: tendency, main stream and main-melody.”
Finally, Shi commented that Chinese movies need to concern themselves with audiences’ tastes (CFYB 1988).

152
a noble spirit, as in “Elevated: The Main-Melody of the Time” (W. Chen 1982), or even to
mean a philosophical aspiration, such as “Main-Melody: The Humanism in Socialism: A
Talk on Zhang Kangkang’s Novels” (Li 1983). These examples illustrate that the term
“main-melody” had been used for a long time, but without direct reference to politics.
The term’s connection to film occurred only after the military crackdown in 1989, when
the film industry was the first propaganda organ among all other cultural activities to be
ordered to fulfill its social responsibility by producing products to unite, educate and
arouse people’s enthusiasm for the socialist system. So 1989 not only marked the end of
liberal cultural policies, but also the return of ideological control, particularly through the
use of films.
What constitutes the concept main-melody? In the fall of 1989, Film Bureau
Director Teng Jinxian gave an interview that was published in Film Monthly (Dianying
Tongxun). The interview was divided into three parts. The first part was about the
general development of the Chinese film industry; the second part was about the
definition of main-melody films and their contents; and the third part was about the
future of the film industry. In the interview, Teng claimed he was the first one who had
proposed the slogan – “Make main-melody prominent and insist on diversification” (Tu
chu zhuxuanlv, jianchi duoyuanhua), as he said on March 1987 at the National
Conference – but the term “main-melody” had been used before.
17
The reason for the
promotion of this slogan in 1987 was the “anti-bourgeois liberalization” campaign, and

17
The deputy of MRFT, Chen Haoshu, once defined the term in early 1989, asserting, “Main-melody film
means all excellent works that are good for stimulating people to work harder and keep forging ahead, and all
excellent works that are good for cultivating people’s morality and sentiment.” 一切有利放現代化建設和
全面改革的優秀之作，一切有利於激發人們奮發圖強開拓創新積極進居的優秀之作，一切
有利於陶治人們道德情操的優秀之作，都是主旋律作品。(H. Chen 1989, 14). These works were
encouraged. The definition of main melody as used here is broader than the original one, which contained
only the first of the three categories included in the new definition. However, the Deputy’s promotion did not
have much impact on the film industry because of the unexpected 1989 Democratic Movement.

153
the slogan originally was not a political one, but it was “about the creativity of the film
industry in that specific moment” (Teng 1989, 1). And thus “main-melody,” when it was
promoted in 1987, meant, “Film that could reflect the modern spirit and reflect the
reforms of society. The producer who makes main-melody films must feel his/her social
and historical responsibility and thus the films he/she produces must endorse a positive
way of thinking and maximizing the social benefit. The contents of main-melody movies
must be those that have emphases on reform and opening, the four cardinal principles,
and reflect the reality and spirit of the current times” (Teng 1989, 2). In short, main-
melody refers to films that can “reflect the spirit of current social situations and be
beneficial by propagating the revolutionary tradition” (Teng 1989, 3).
18
In 1994, main-
melody was extended to mean “patriotism, collectivism and socialism” (CFYB 1994, 13).
The slogan “Make main-melody prominent and insist on diversification,” finally
led to the organization of the “Leading Group of Significant Theme Sustentation in Films
and Television.” The group completely funded the production of six main-melody films,
RMB 10.5 million (USD 1.53 million) in total (Teng 1992);
19
this came mostly from the
military (Teng 1989, 5). In 1994, the August 1
st
Film Studio received an order to produce
a series of five Revolutionary War big-budget films.
20
All the films were funded and
monitored by the PLA and the Central Political Department (B. Chen 2005b, 918). In
October 1989, the head of the Central Propaganda Department, Li Ruihuan, announced
that 60 percent of films should be of the main-melody variety (Berry 1994, 45). In 1991,

18
Teng’s definition of “main-melody films” was reiterated by Li Ruihuan in February 1990 (B. Chen 2005b,
839).
19
The films: The Kunlun Column (1988); The Baise Uprising The (1989); The Birth of New China (1989);
Mao Zedong and His Son (1991); and Zhou Enlai (1991).
20
Films included Ting Jin Da Bie Shan (dir. Wei Lia, 1996); Great Advance – Liberation of the Northwest
(dir. Wei Linyu, 1997); War of Annihilation in the South (dir. Zhao Jilie and Jia He, 1997); Great Battle in
Ning Hu Hang (dir. Wei Lian, Shi Wei and Xiao Jiang, 1999); and Fight Back to the Southwest (dir. Yang
Guangyuen, 1997).

154
the Propaganda Department, the Ministry of Culture and MRFT jointly issued a
document called “Suggestions on Current Prosperous Literary and Artistic Creation,”
which not only emphasized the Party principle on art – that is, serve the people and the
society – but also stressed that financial support and policy must be inclined to promote
the outstanding main-melody products. The document did not touch on any of the
reforms that had been discussed prior to 1989. As a result, after a decade of intense
experiments in both film and culture more broadly, the film reform had come to an end.
In its place had come a virtual flood of main-melody films that entered the market in the
1990s.
To sum up, the term “main-melody” is an official guideline in filmmaking with the
aim of promoting the ideological goals of the Party leadership.
21
Although the term was
promulgated before 1989, the government vigorously promoted “main-melody” films
after the Tiananmen crackdown to reinforce the Party’s control. In order to encourage
the production of “main-melody” films, the government financially sponsored most of the
productions and the main-melody films were given the best screening times.
Government departments, schools and state-owned work units all had to organize
screenings in order to make sure the films were widely received by Chinese audiences.
These films’ thematic motifs fell along six major categories:
1) Films focusing on the revolutionary history of the Communist Party — In 1991,
the August First Film Studio produced The Founding Ceremony of the PRC, Chongqing
Negotiations, National Anthem, and Roaring across the Horizon, all in celebration of
the seventieth anniversary of the founding of the Chinese Communist Party. In a similarly

21
“Leitmotif” is a similarly contextually relevant term.

155
example, the government promoted the key film The Founding of a Republic in 1999, to
mark the sixtieth anniversary of the founding of the PRC.
2) “Patriotic” films — Studios produced a lot of these in the 1990s, such as Sun
Zhongshan, Sun Wen Shao Nian Xing, A Brilliant Man, Genghis Khan, Liu Tianhua, or
those that focused on historical events, such as The Opium War, My 1919, Bodyguards
and Assassins. These films all dramatized some historical events in order to enforce the
ideology of nationalism, and used them to strengthen the legitimacy of the CCP Party-
state.
3) Films that explore traditional Chinese culture in order to promote a
harmonious society domestically and enhance China’s soft power abroad — Confucius is
a typical example that shows the CCP attempting to explore traditional culture in a
manner that is conducive to promoting and exporting Chinese culture to the outside
world.
4) Biographical films of heroic characters and symbolic nationalistic heroes —
Examples include The Sino-Dutch War, Zhan Tianyou, and Lu Xun; the Party’s heroes,
including The Story of Mao Zedong, Zhou Enlai, Deng Xiaoping, and Young Liu
Baocheng; and Communist revolutionary models such as Jiao Yulu, Kong Fansen, Life
and Death of Niu Yu Ru, or those heroes possessing traditional Chinese values and the
spirit of sacrifice, including The Forest Ranger, The Courthouse on Horseback and The
Dream is Alive. This group of main-melody productions is best characterized as
glorifying the success of the CCP leadership.
5) Films with metaphorical meaning with regard to Sino-Taiwan relations — This
group includes such productions as The Knot.
6) Movies that use a natural disaster to reflect on the human condition —
Examples in this category include The Way of the Snowstorm and Aftershock.

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There was a report published in China Film Weekly (Zhongguo dianying
zhoubao) on December 12, 1991, on the reception of main-melody films. It noted that up
to November 30, there were a total of 23 tribute films distributed nationally in that year.
Among them, the film Jiao Yulu was the most successful. It sold 513 prints, was viewed
by more than 200 million people,
22
and earned RMB 50 million in distribution income.
Meanwhile the film Zhou Enlai sold 420 prints and drew 100 million admissions in a
month, earning RMB 25 million. Other films such as The Great Decisive War, The Birth
of a New Age, and Mao Zedong and His Son all made over RMB 20 million (B. Chen
2005b, 869). In addition, through the end of December 1991, 1.32 billion people went to
see the tribute films. Taken together, tribute films generated RMB 274 million (B. Chen
2005a, 243).
However, even the government’s massive sponsorship could not improve the
overall situation of the film industry, which was suffering under the dual pressure of the
government and the market.
4.4 Conclusion
In 1992, industrial performance was worse than it had been the year before. From
January to April, all the indicators reached their lowest points. Admissions shrunk by 1
billion, down 19.8 percent from 1991. Distribution revenues decreased to $72 million,
nearly 18.9 percent below 1991 (B. Chen 2005a, 273).
The situation was caused the limited capital available for film studios to produce
films. At the same time, there were a large number of illegal foreign videotapes and films,
imported mostly from Hong Kong and Taiwan, which further limited the market for
theatrical releases. In order to stymie illegal activity, the government strengthened its

22
Up to December, the number of admissions increased to 300 million (B. Chen 2005a, 243).

157
control over incoming foreign films by empowering pertinent departments, e.g., the
Administration of Customs; it also reinforced the monopoly of China Film, the only
importer of foreign films (B. Chen 2005a, 274–276).
One of the reasons given as an explanation for the Tiananmen demonstrations
was the neglect of political education. In addition, political leadership within the film
industry complained that there were too many works that propagated a bourgeois style of
life. As a result, the Film Bureau tightened its control over film scripts and censored
films more harshly. The tendency toward pure entertainment and commercial films was
stifled. Replacing those entertainment-focused film productions was a large number of
propaganda films that had been produced with large subsidies from the Party and the
PLA.
However, the Party was unable to transform film back into a pure propaganda
tool. Although there were a lot of propaganda films produced with great support from
the government, both in financial and administrative terms, the film industry
nevertheless survived on the profit from entertainment films. Of the 126 domestic films
released in 1990, the top 10 were action films, thrillers and martial arts films (Hong 1991,
27). After the Tiananmen protests in 1989, even though the government tried to unify
the industry under tight control, it could not solve the basic problem of the film industry:
balancing political correctness and artistic freedom with economic efficiency. The
reforms have certainly improved many aspects of the film “industry,” particularly in
comparison to the Cultural Revolution, but most of the efforts have not been sustainable.
The film industry is still a highly centralized propaganda machine with a lack of financial
capability. Above all, this was a government that put a lot of effort into empowering itself
both politically and economically. All of the developments after 1989 reinforced the
effects of the increasing financial and ideological repression of the private sector and

158
were directly responsible for the economic malaise of the film industry in the 1990s. In
the next chapter, we will examine the government’s reversal of its policy again, this time
pushing for the conglomeration of Chinese film enterprises in order to compete with
Hollywood films.

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C H A P T E R 5
Rapid Commercialization, “Identity Development,” and Chinese Cinema

5.1 Introduction
After the economic and political reforms that started in the late 1970s, tensions
between the conservative and the relatively liberal camps escalated. The 1989 Beijing
Massacre offered the conservative forces bullets to fire at economic and political
liberalization. Although Deng’s Southern China trip revitalized economic reform efforts,
the central leadership quickly adjusted the policy and redirected the public back onto the
track of authoritarian control. This was called the “twin-fisted policy,” a term Mueller
and Tan (1997) employ to describe leadership grasping at both economic development
and ideological control (8). All political, economic, and even cultural decisions were kept
in the hands of the leftist leadership in order to protect the CCP’s control and ideology
from domestic and foreign liberal influence. In November 1993, President Jiang Zemin
urged the CCP members that they should understand the significance of ideological
control through the 1989 Democratic Movement. He stated that the CCP should advocate
correct social values and a healthy, modest lifestyle, and create a healthy, positive, and
progressive social environment. The state should preserve the positive aspects of
traditional culture, he said, and absorb the advanced aspects of foreign cultures, but not
their corrupted negative aspects. The following four principles were quoted repeatedly
and nationally in January 1994: propaganda departments of all levels should “arm people
with scientific theories, direct people with correct opinions, model people’s minds with

160
lofty ideas, and encourage people with excellent cultural work.”
1
MRFT reiterated that
the task of the film industry was to produce more and better films “to raise the quality of
the nation and to train the new socialist man with ideals, knowledge and discipline” (X.
Wu 1992, 168). The state attempted to redirect the film industry to its former
conservative track, which was highly centralized propaganda machine. This derivative,
as I have discussed in the previous chapter, further damaged to the film industry.
In her study, Zhu Ying argues that there are several factors that accounted for the
severe constraints in film development in the early 1990s. First, the state-owned film
industry, which previously had been fully funded by the central government, suddenly
lost this support because of decentralization and privatization reforms. These aggressive
reforms devastated the film industry infrastructure. Second, the rise of other
entertainment options, such as TV programs from Hong Kong and Taiwan and the spread
of pirated VCDs,
2
provided alternative choices for the public. Going to the theater was no
longer the only choice for them; watching television at home provided a similar kind of
joy. Third, the importation of Hollywood movies dramatically marginalized the domestic
market share of Chinese films (Zhu 2003). However, Zhu missed one of the most
important factors – after the crackdown of 1989, the CCP not only tightened its control
over the mass media, but also reinforced the function of the mass media as propaganda
and restored the dominant position of the state in the cultural life of the nation. Films

1
The Central Party History Research Center. 2001. Brief History of the Chinese Communist Party.
Chapter 10. enorth.com.cn. Accessed August 25, 2012. The speech was announced on January 25, 1994 at the
“National Propaganda Working Meeting.” The campaign soon spread nationally; its four principles are still
widely quoted today. As an example, on July 10, 2007, in the Guang Ming Daily, Hu Jintao cited the four
principles to reinforce “the core values” of Socialism. GMW.cn. Accessed August 25, 2012.
2
Video Compact Disc or VideoCD: A storage format used for film distribution; the unit resembles a
CD and contains moving pictures and sound. Although its popularity diminished sharply amid the emergence
of DVD and Blu-Ray technologies, the cost-effective VCD form continues to circulate, particularly among
secondary or lower cost markets (Source).

161
produced after 1989 were either banned by the government from being screened publicly
or were main-melody films – the only ones that had any chance of reaching the masses
(Chapter 4).
However, no matter how well the rhetoric played at the official level, the common
people were no longer as easily impressed. As the market economy made its way into the
arts and into cultural products, the 1980s witnessed an unprecedented growth of
liberated cultural life and a marvelous number of works were produced with the explicit
dual purpose of sheer entertainment and commercial profit. At the same time, the influx
of Taiwan and Hong Kong pop culture added another dimension to this commercialized
atmosphere. “It was the apolitical, money-centered and spiritually disillusioned
atmosphere that prevailed in Chinese society by the mid-1990s” (Wedell-Wedlellsborg
1999, 225).
Film as a propaganda tool had been used by the CCP since 1949. One of the
lessons the Party had learned after the 1989 Beijing Massacre was that it had ignored or
had not paid enough attention to ideological control, especially with regard to bourgeois
liberalization. In the two years after 1989, the government invited artists, industrial
workers, and film critics from all over the country to participate in different conferences,
meetings and seminars, aiming to educate them and unify them under the control of the
CCP.
Until June 4, 1989, it was possible to engage in political debates in the public
sphere and even establish relatively independent think tanks to formulate alternative
political as well as economic policies. Deng initially also allowed his protégé, Hu
Yaobang, to update Marxism-Leninism to make it more relevant to the reforms, but these
efforts were blocked by conservative Party members. After June 4, however, except for
brief periods such as during the calls for political reform following Deng’s 1992 effort to

162
resuscitate the economic reforms and after the Fifteenth Party Congress, public political
dissent was suppressed. In the mid-1990s, Deng Liqun, former Head of the Propaganda
Department, together with a group of professional ideologues, allied with former central
planners and sought once again to make class struggle the core of propaganda work and
to recentralize economic and regional state authority.
In the 1990s, China continued to march toward a market economy – but toward a
very different kind of market economy. In the 1980s, a version of market-driven
commercial filmmaking and small-scale art film productions were developing vibrantly.
In the previous chapter, I have shown that the government had invested a huge amount
of political and financial capital to force the production of government-led films. First, in
this chapter, I will illustrate how the state reorganized its control by first describing the
major reforms in the three sectors of the film industry since 1993. As the demise of the
film industry after the mid-1980s had greatly affected the ability of film studios to
produce films, 1989 was not only critical in presenting the government with the need to
regain its legitimacy, but also for the film industry in that it became necessary for the
industry to rebuild its popularity among the masses (see Figure 5.1). The Chinese film
industry lost ground as imported films took the majority of the market share. The size of
audiences significantly declined, from over 27 billion in 1983 to 16 billion in 1990.
Although the Chinese-made entertainment-focused films entering the market in the mid-
1980s might have been a cure for the Chinese film industry’s ills, their quality was low
and they did not suit audiences’ tastes. More and more Chinese moviegoers had to give
up mainland Chinese films and choose foreign films, including films from Hong Kong
and Taiwan and, most importantly, from Hollywood. Second, this chapter attempts to
discuss state cultural policy in the film business by examining the influx of domestic and
foreign capital investments in the transnationalization of the Chinese film industry.

163
Finally, I will discuss whether changing these cultural politics maintained or shifted
Chinese cultural identity.
5.2 Major Reforms
In October 1992, the Fourteenth National Party Congress officially adopted
Deng’s progressive economic reform, which represented a sharp turn. In his article, Wu
Guoguang argues that there were two reforms in China: one began in 1978, and the
second started in 1992 (G. Wu 2004). One of the major difference between these two
reforms was the monopolization of transnational capital by the ruling elites in 1992 so
that the country’s leaders could consolidate their power rather than empower the
proletarian class to affirm the socialist dictum.
3
In the 1980s, reform and opening up
were stressed with a footnote describing “integration of the planned economy with
market regulations” (Fewsmith 2008, 49). But in 1992 Deng “declared that the market
and planning were both economic ‘methods’ and argued that whatever promoted the
socialist economy was socialist” (Fewsmith 2008, 49). Thus, the Chinese economic
system started to become completely transform from a planned economy to an open-
market economy.
In response to this radical economic plan, on January 5, 1993, MRFT issued two
documents: 1) “Several Opinions on Deepening the Current Chinese Film Industry’s
Institutional Reform” (Guanyu dangqian shenhua dianying hangye jizhi gaige de
ruogan yijian de tongzhi) and 2) “Implementation Details (Opinion-Seeking Draft)”
(Shishi xize zhengqiu yijiangao), known also as “Document Number 3.” This was the
most comprehensive regulation of the film industry since 1949. Although the document

3
The other two differences: 1) The origins of the reforms and 2) The roles of farmers, the state, and
intellectuals.

164
continued to define film as a “spiritual product,” which meant the development of the
film industry should not rely on the market only but also needed to benefit the society as
a whole, the changes it made to the film industry were the most radical in years, because
it fundamentally changed the monopoly of the state over the film industry. After this
document, the film industry reform was formally put into place.

165
0
100
200
300
400
500
600
76 77 78 79 80 81 82 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11
Number of Features Films
Year
Figure 5.1. Number of Feature Films Produced in China, 1976-2011.
Sources: Chen (2005): 639, 645,655, 673, 689, 702, 715, 731, 747, 766, 785, 801, 815, 836, 850, 869, 888, 908, 925, 947, 972, 997, 1024, 1050, 1081;
China Flm Yearbook 1996: 44, 2002: 101,

166
In the exhibition sector, movie ticket prices started at three to four Jiao (USD
0.04-0.06) in 1949. The state tried to adjust the price by introducing different systems,
namely the “structure price” (Jiegou piaojia) and “class price” (Dengji piaojia).
However, the administrative bureaucrats controlled all these systems. But as of October
11, 1992, theater owners were free to set ticket prices depending on the quality of films,
screening time, location, and theaters’ movie-watching experience. For first-class
theaters, ticket prices ranged from RMB 2-3.5 (USD 0.29-0.51) during the day to RMB 4-
9 (USD 0.59-1.32) at night. In luxury-class theaters, ticket prices usually ran from RMB
10 (US 1.46) during the day to RMB 30-40 (USD 4.39-5.86) at night. Today, prices in big
cities range from RMB 30-80 (USD 4.4-11.7). But in some cases, the price can run up to
hundreds of yuan,
4
and different theaters have different strategies. For instance, in one
of the most traditional strategies, theaters give special discounts to their loyal members,
sometimes up to half off the ticket price. Other more creative strategies include calling
Monday “Coke Day,” which means every ticket holder will get a free cup of Coke. Tuesday
is half price for everyone. Wednesday is “Popcorn Day.” If your birthday is on Thursday,
you get a free ticket. Friday is “Couples Day,” and so on
5

The crux of Document Number 3 was abolishing the monopoly of China Film in
distributing films to the exhibition units. According to the Document, film studios were
now free to deal with local distribution-exhibition units. Following this new policy, on
April 16, 1993, the Beijing Film Studio and Shanghai Yongle Film and TV Stock
Corporation signed a contract to distribute Tsui Hark’s Once Upon a Time in China III

4
The basic monetary unit of China, 元 (Source).
5
The average price of a ticket in 1998 and 2009 was RMB 28 and RMB 50, respectively, as reported by
China Daily . Accessed April 28, 2009. In 2012, the average price of ticket has increased from RMB 50 to RMB
70, as noted by the. Chinese Ministry of Culture. Accessed August 25, 2012.

167
(Ni 1994, 54). This was the first time that a film studio directly distributed a film to the
city-level distribution-exhibition companies without the engagement of China Film.
Following the example of the Beijing Film Studio, on May 19, 1993, the 16 film studios
and the four city-level distribution-exhibition companies signed a contract for the
distribution of films produced by the 16 film studios (Ni 1994, 55). In March 2003, the
policy further expanded to welcome different forms of investment in the distribution
sector. According to the policy, a film was given RMB 500,000 in upfront capital, and if
the theater successfully distributed one “state-recommended film” – usually main-
melody films – the theater could apply for a film distribution permit to distribute a film
made by an independent producer, for example from Hong Kong, issued by the Film
Bureau.
This was a fundamental change from the hierarchical system of the distribution-
exhibition of domestic feature films with China Film at the center. The long-established
system known as “Unified Purchase and Unified Sale” (Tonggou tongxiao) was finally
dismantled. However, China Film remained in control of the distribution of foreign
films, the much more lucrative business.
The “Implementation Details” consisted of six parts:
i. China Film would set up a Film Exchange Market (Yingpian jiaoyi
shichang) to be launched on April 1, 1993. Two to three film
exhibitions would be held each year in Beijing, aimed at promoting
features; children’s films; animation; science-educational films;
and documentaries.
ii. China Film would remain the exclusive importer of foreign films
iii. The national market would be divided into three regions:
a. The most developed cities, e.g., Beijing, Tianjin, Shanghai,
Guangzhou and Chongqing
b. The medium-developed regions, e.g., Huadong, Huabei,
Huanan, and North-East

168
c. The least-developed regions
Film prices would vary depending on region: For the first group,
the price for a film print would be around RMB 16-17,000; for the
second group, RMB 11,000; the third group, RMB 6-7, 000
iv. Film studios were free to export their films, at a minimum price of
USD 15,000 apiece
v. Film development (both exhibition and filmmaking) was
vigorously encouraged in the least-developed regions. Among the
least-developed regions: Tibet, Inner Mongolia, Xinjiang, Qinghai,
Ningxia, Gansu, Guizhou, Yunnan, Guangxi, and Jiangxi
vi. All departments needed to cooperate and coordinate among
themselves to manage all problems
The key point in the document was that the price of each reel of film was fixed in
reference to China Film’s price in 1990. However, some people thought the price should
not be fixed based on the 1990 price, especially because in 1990 the film market was
much healthier than in 1993. The production sector also declined the reference prices
proposed in the document. Moreover, China Film organized the first Film Exchange
Market in late April 1993. However, most of the attendants just “wait and see,” they did
not have enough confidence. Finally, no films sold in the market.
The breakdown of China Film’s monopoly later evolved into a “cinema chain”
system when SARFT first published “Several Opinions on Deepening the Reform of the
Film Business”(anyu jinyibu shenhua dianyingye gaige de ruogan yijian) (hereafter
“Several Opinions”) on August 1, 1994. The same document was reprinted and its
regulations were enforced beginning on June 6, 2000. A document called “Details of
Implementation on the Reform of Film Distribution and Exhibition Mechanisms”
(Guanyu gaige dianying faxing jizhi de shishi xize) (hereafter “Details of
Implementation”) was published just after “Several Opinions,” providing more
information on how to reform the exhibition sector. Because of these two documents, on
December 18, 2001, a theatre chain system was set up by mandate.

169
Let us examine the first document, “Some Opinions on Deepening the Reform of
the Film Business” (CFYB 2001, 2), which outlined the following reform steps:
i. Standardize the organization of enterprise groups. It was deemed
necessary to make some big film enterprises as the leaders through
reorganization and optimize resource allocation to transform operational
systems with the aim of raising film and television production and
operation capacity.
ii. Try share-holding systems to adjust property structures, which means the
film industry is no longer 100 percent owned by the state government. By
transforming filmmaking, exhibition and distribution units to a share-
holding system, the authorities could attract non-state capital, but they
still had to be controlled by the state. Exhibition and distribution units
could attract foreign investment capital too (except China Film). Single-
permit shooting filmmaking companies could attract both non-state
capital and foreign capital.
iii. Vigorously promote cinema chain systems and establish regional cinema
chains and inter-provincial cinema chains through the competitive and
vital film market, with the aim of stimulating film income to be reasonably
allocated among the production, distribution and projection sectors.
iv. Encourage film enterprises to produce films first and foremost, instead of
selling credits to those independent producers, but also encourage them to
try their best to use available assets to explore operational structures that
support filmmaking activities, not only to themselves, but to the film
industry in general.
v. Deepen film enterprise internal management mechanism reform.
Promote personnel rewards and profit-sharing systems to muster film
workers’ vitality, increasing film enterprises’ economic success.

170
vi. Encourage distribution of domestic films. According to regulations,
exhibition units had to project domestic films for no less than two-thirds
of total projection time. During important political activities 6 and
holiday7 periods, the exhibition sector had to project excellent domestic
films within the entire country.
vii. Raise technological capacity and strengthen domestic films’ audiovisual
experience quality. Theaters had to renovate and transform their facilities
to improve viewing conditions and raise service quality.
viii. Further implement the “2131 Project” (2131 Gongcheng), continuously
implement the subsidy polices in rural areas and encourage more excellent
films to be shown in less-developed areas
8

6
Mostly this means the anniversary of the founding of the PRC on October 1
st
and the celebration of
the anniversary of the founding of the CCP on July 1
st
.
7
Chinese National Holidays of 2012:
NATIONAL
HOLIDAY
DATE
LENGTH
(IN DAYS)
NEW YEAR’S DAY January 1 3
SPRING FESTIVAL
Lunar Calendar January 1
(January 22 – 28)
7
QING MING FESTIVAL April 2 - 5 3
LABOR DAY April 29 – May 1 3
DRAGON BOAT FESTIVAL
Lunar Calendar May 5
(June 23 – 25)
3
MID-AUTUMN FESTIVAL
Lunar August 15
(September 30 – 31)
2
NATIONAL DAY October 1 – 7 6
Table 5.1
FN
: Chinese National Holidays: 2012
8
Started in 1998, the “2131 Project” was aimed at screening a film in every village in rural China each
month for free by the twenty-first century. In Chinese, the slogan was “Yi cun yi yue yi dianying,” or “one
village, one month, one movie.”

171
ix. Expand film product exports and encourage more Sino-foreign entities to
engage in joint ventures. Foreign capital was allowed to reform theaters
and other technological equipment, but the Chinese remained in control
of the managerial authority. Just after the reissue of “Several Opinions” in
2000, the “Details of Implementation” was published on December 18,
2001. In the new document, SARFT included more details on how to
reform the film chain system. In total, it contained 10 steps.
x. The main purpose of film reform: increase efficiency and optimize
resource allocation among the three sectors of the film industry.
xi. Reconstruct China Film and further consolidate its power by using the
income from imported films to support the rural film market and the
production of children’s films and science-education films.
xii. Set up a new company for distributing imported films
xiii. Require all areas to set up theater chains by June 1, 2002, or prohibit them
from screening imported films
9

xiv. There were several requirements for the establishment of a film chain:
a. The applicant had to have 10 theaters or more to apply for a film chain
within a province
b. The applicant had to have at least 15 theaters to apply for a film chain
across provinces
c. No entity could have more than three film chains within a province. A
theater could only belong to one film chain
xv. Encourage inter-provincial cooperation
xvi. Encourage foreign investment in the reorganization of theaters and film
chains
xvii. Implement computerized ticket-selling systems
xviii. China Film and the new companies for distributing imported films had to
distribute at least 20 domestic films (including 12 recommended Chinese
films) and the box-office returns could not be less than RMB 50 million
from all 20 domestic films
xix. Strengthen the Film Bureaus and other related departments’ guidance and
related leadership of film development and management

9
To avoid being disallowed from screening imported films., theaters in Beijing, Shanghai, Jiangsu,
Zhejiang, Hubei, Hunan, Guangdong, and Sichuan were given until October 1, 2002 to construct two circuit
chains.

172
Thus, the exhibition sector was also opened to private investment. Private investors
could apply for permits at the film administration offices at the county-level or above.
Because of the compulsory enforcement of the theater chains, in 23 provinces, 30 theater
chains were established, with 872 theaters and 1,581 screens. Among the 30 chains, 11
were inter-provincial and 19 were intra-provincial (Tang and Shao 2005, 283–4).
Beijing, Shanghai, Hubei Province, Hunan Province, Guangdong Province and Sichuan
Province established two chains, and Jiangsu Province and Zhejiang Province established
three, the maximum. Two years later, in 2004, China had set up 36 cinema chains with a
total of 1,188 theaters and 2,396 screens. By 2008, there were a total 1,545 theaters and
4,097 screens, 800 of which were digital screens (H. Zhu 2008). By 2011, number of
screens had increased to 10,000, with a total of 2,800 theaters (See Figure 5.2).

173

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Cinemas 1019 1140 1188 1243 1325 1427 1545 1635 1687 2800
Screens 1834 2285 2396 2668 3034 3527 4097 4483 4723 10000
0
2000
4000
6000
8000
10000
12000
N u m b e r o f
Year
Figure 5.2. The Growth of Movie Theaters in China (2002-2011)
Source: B. Cui, 2009, p. 257; CFAIRC
Cinemas
Screens

174
The most successful theater chain in China today is Wanda Cinema Chain
(Wanda yuanxian), which has the largest number of screens, and its theaters are located
all over the country. It is financed by a real estate agency. Of the 730 screens in 87
theaters, their box office earnings accounted for 15 percent of the total national box office
returns. Wanda also plans to open 200 theaters with 2000 screens in 2015, with the aim
to be one of the biggest cinema chains in the world.
10
In addition, the company has
developed its own multi-complex with movie theaters, shopping malls, hotels, casinos,
and office buildings. Meanwhile, the facilities within its theaters are impressive, too:
most of them have 3-D projectors or at least digital screens and wide, soft seats, and some
contain studio couches. Although both the number of screens and theaters are less than
Shanghai United Circuit (Shanghai lianhe) and China Film Stellar Theater Chain
(Zhongying xingmei), Wanda Movie Chain in 2011 had a total of RMB 1.402 billion in
box-office revenues, which has accounted for 14 percent of the national box-office income
(CFAIRC 2011, 112).
The three documents issued in 1993, and then in 2000 and 2001, stressed the
reformation of distribution and exhibition sectors, especially the corresponding
organizational structure of the film enterprises. The term used in Chinese was
“Jituanhua,” or “formation of media conglomerations.”
11
Before the entry of China into
the WTO in early December 2001, Xu Guangchun, the Minister of SARFT, explicitly
stated that, in China, there were 35 film studios and three big conglomerates: China Film
Group (CFG); Shanghai Film Group (SFG); and Changchun Film group. “Besides the Big
Three in Beijing, Shanghai and Changchun,” he remarked, “we are planning to establish

10
Website of Wanda International Cinema: WandaFilm.com. Accessed Aug 25 2012.
11
As discussed in Chapter 2, Section 2.5.

175
one in Xian, Zhujiang (in Guangdong) and Emei (in Chengdu).” Although strategies and
structures were different in all six of these places, all sought to integrate vertically and
horizontally in order to strengthen Chinese films in their competition with Hollywood
films (Q. Shi 2011).
12
Following the policy proposed in the early 2000s, the Emei Film
Group was set up in 2003; the Zhujiang Film Group began operations in 2008; and, at
last, the West Film Group in Xi’an was consolidated in 2009.
The establishment of film groups not only consolidated the allocation of
resources, which has greatly increased the efficiency of film production, but it also
provided abundant capital – both financial and human capital – to support the state’s
production of propaganda movies, or so-called “high-quality” films. For instance, CFG
produced Roaring across the Horizon (dir. Chen Guoxing, 1999); To be With You
Forever (dir. Ding Yinnan, 2001); My 1919 (dir. Huang Jianzhong 1999); and, in early
2000, Rhapsody of Spring (dir. Teng Wenji). In recent years, CFG has produced epics
The Founding of A Republic (dir. Han Sanping and Huang Jianxin, 2009), a patriotic
film made to celebrate the sixtieth anniversary of the PRC and The Beginning of the
Great Revival (dir. Han Sanping and Huang Jianxin, 2011), another patriotic film
released in 2011 to mark the ninetieth anniversary of the CCP. All were big-budget with
star-studded Chinese casts and resulted in successful box-office returns. In 2000, CFG
invested RMB 50 million to produce nearly 30 films, which accounted for one-third of
film production that year. SFG also contributed several “high-quality” main-melody
films, e.g., Fatal Decision (dir. Yu Benzheng, 2000); Crash Landing (dir. Zhang Jianya,
2000); Red Turn (dir. Li Xiepu and Liang Shan, 2001); Red River Valley (dir. Feng

12
Vertically means by including the production, distribution, and exhibition sectors. Horizontally means by
including film production, TV production and video and DVD productions. That is, combining both film and
TV production.

176
Xiaoning, 1999); Lovers’ Grief Over the Yellow River (dir. Feng Xiaoning, 1999); and
Purple Sunset (dir. Feng Xiaoning, 2001). Changchun Film Group also produced Mao
Zedong and Snow (dir. Song Jingbo and Wang Xuexin, 2000) and Xi Lian (Sun Sha,
1996). Thus, the conglomeration of film studios greatly enhanced the state’s ability to
produce more propaganda films and strengthen its power (He 2001).
The establishment of film groups also had another implication: the privatization
of the film industry, which reflected the government’s ambitions to restructure the film
industry to its political ends. The Chinese film industry had long been fully funded by the
government, which generally made film industry workers ignorant to the need to tailor
their films to satisfy their audiences’ tastes. Although the newly established film groups
remained under the state-owned system, they opened the industry to private investors
and producers, with the expectation that these groups would improve the connection
between the film industry and audiences. The restructuring of the Chinese film studios
reflected the Chinese government’s desire to sustain the development of the film
industry. Government officials knew the survival of Chinese cinema in the face of a
transnational Hollywood presence would depend on the state’s ability to provide sensible
protective measures.
Immediately following this horizontal and vertical integration of the film industry,
“Interim Provisions on Operation Qualification Access for Movie Enterprises” (Document
Number 43) (Dianying qiye jingying zige zhun ru zanxing guiding) was released in
November 2004; it allowed foreign investors to have a hand in Mainland Chinese film
production, distribution, and projection for the first time. It also allowed foreign
investors to set up joint ventures with local domestic film enterprises and participate in
the transformation of film productions, basic facilities for screening and technical
equipment. Following this provision, “Interim Provisions on the Administration of

177
Chinese-Foreign Equity and Contractual Joint Ventures of Radio and Television Program
Production,” “Provisions on Legislative Procedures for Radio, Film and Television” and
“Provisions on Film Examination” were all initiated, gathering more resources and
capital in order to construct a strong Chinese national film industry. The document read,
“It is our goal through five to ten years of development to form several large modern film
enterprises […] and make China’s film industry stronger and bigger so that it can become
one of the world’s film powerhouses.”
At the same time, local governments became actively engaged with the
transnational companies by granting rights to two independent film companies, Huayi
Brothers and Taihe Film Investment Co., and Beijing New Picture Film Co., to take part
in film co-productions as independent, copyright-sharing, and co-producing entities.
These two independent film companies were not only allowed to share profits, but also to
produce domestic films in their own names. Prior to the new rules, domestic film
companies were only recognized as co-investors. Thus, the new rules helped Chinese film
companies attain bigger shares of their films’ overall revenue. In 2008, for instance,
Huayi Brothers earned RMB 700 million (US $103 million) from film productions and
distributions, which accounted for one-fourth of the total national box-office income.
The film If You Are the One (dir. Feng, Xiaogang, 2008) was the biggest Chinese language
box office hit up to that time, earning RMB 340 million (USD 49.8 million) in mainland
China, followed by CFG’s mega-production Red Cliff I (dir. John Woo, 2008), which
earned RMB 320 million (USD 46.8 million) (Yin and H. Shi 2009, 155).
The policies obviously created a more open and accommodating environment for
domestic players and helped attract foreign capital, which shored up the domestic film
industry locally and “in competition with Hollywood in the world market” (Rosen 2006).

178
On January 5, 1995, MRFT issued “Regulations of Management Work in the
Reform of Feature Film Production” (Guanyu gaige gushipian shizhi guanli gongzuo de
guiding) (Document Number 1) for the production sector, which invited private capital
into production for the first time. The regulation also allowed investors to be considered
“co-producers” if their investments reached 70 percent of the total cost. In 1996, the
required percentage was lowered to 30 percent to encourage more non-state investment
(CFYB 1997, 23). The new policy greatly helped mobilize non-state capital in the film
industry. In 1996, “Regulations on the Administration of Films” (Dianying guanli tiaoli)
stated that the “state government encourages enterprises, public institutions and other
social organizations as well as individuals to participate in the production of films via
financial aid and investment,”
13
which fully legitimized the privatization of the industry.
Because of this directive, some private enterprises, such as Great Wall Film and TV
(Changcheng yingshi), Vanke (Wanke), SASTAV (Xianke), and Nan Yang (Nanyang) all
entered film production. Their investment provided an important boost to the Chinese
film industry. Some popular films, such as Red Cherry, Warrior Lanling (dir. Sherwood
Hu, 1995), The Emperor’s Shadow (dir. Zhou Xiaowen, 1995) and Lie Hu (dir. Tung Wei
1995), were backed by these private investors. The Beijing Film Studio also benefited
from this policy. In 1995, the Beijing Film Studio attracted nearly RMB 200 million
(USD 29 million) in private capital to produce 30 films, the highest in the studio’s history
(Tang and Shao 2005, 239; Yang 2008).
On December 24, 1997, MRFT issued a “Circular on the Licensing for Single-
Feature Film Productions” (Guanyu shixing ‘gushipian danpian shizhi xukezheng’ de
tongzhi), which allowed any film company, TV station or TV drama production unit to

13
Regulations on Administration of Films (1996) have been replaced by Regulations on Administration of
Films (2001), but Article 17 remains in the new Regulations.

179
obtain permits to shoot feature films (CFYB 1998, 14–5). In 1999, the policy further
relaxed to allow any enterprise officially registered with the Bureau of Industry and
Commerce above the city-level to produce films on a one-time basis.
Films My Days since Lei Feng (dir. Lei, Xianhe, 1997) and The Opium War (dir.
Xie, Jin, 1997) are two examples of successful incorporation of private capital into film
production. However, Yang and Rosen contend that films produced in 1998 and 1999
were largely supported by the state and that market forces were weakened by that
intervention (X. Yang 2008; Rosen 2002a). Yet, when SARFT announced in 2002 that
any private enterprise could make and release its films, private capital finally became the
major force in the film industry. This was the biggest change to the system of production
because not only did it allow more companies to get into the film business, but it also
furthered a market-oriented consciousness within the industry. In 2003, of the 197
feature films produced, 60 were made using private capital (S. Lu 2005, 49), which
constituted one-third of the total productions that year. Besides local capital, foreign
capital was also encouraged to enter the China market. In 2004, SARFT issued
Document 44, which formally allowed foreigners to participate in the production sector.
Because of this new policy, of the 212 feature films produced in 2004, fewer than 20
percent were produced with government financing, which meant more than 80 percent
of the films were produced by private and foreign capital.
In 2008, there were a total of 61 film studios; among them, 18 were state-owned
but privately run enterprises, 20 were “semi-state-owned” (i.e., “public institutions”) and
three were completely state-owned studios. Besides these traditional studios, there were
about 300 privately run production houses throughout the country (H. Zhu 2008).
On November 25, 2003, the “Temporary Regulation on Foreign Companies
Investing in Theaters” was issued by SARFT, which allowed foreign companies to own a

180
theater, with a limit of 49 percent ownership. In some cities, including Beijing, Shanghai,
Guangzhou, Chengdu, Xian, Wuhan and Nanjing, foreign capital was allowed to own up
to 75 percent of a theater. Investors from Hong Kong and Macau were allowed to own up
to 75 percent of theaters in all areas. However, foreign companies remained blocked
from forming a cinema chain. Indeed, before the 2003 directive, in early 1997, the
authorities allowed foreign investors to build theaters in three cities: Beijing, Shanghai
and Guangzhou. However, immediately after the directive, some private investors
already invested in other cities, such as Wuhan, Kunming and Chongqing through some
informal measures (Tang and Shao 2005, 260).
In short, at the end of 2003, all three sectors became less strict and opened to
private investors and foreign capital. Since 1993, numerous policies have attempted to
promote the domestic film industry to compete with Hollywood. The old governance
structure was transformed. The hierarchy, with China Film and its monopoly on the
distribution sector at the top, was broken. Private investors were now free to enter all
three sectors, though they were still restricted by the state government. At the same time,
the state-owned studios began to expand into Hollywood-style film groups, both
vertically and horizontally.
5.3 Censorship Revisited
In 1989, the Film Bureau adopted a rating system for exhibitions, classifying films
with categories such as “generally suitable” and “unsuitable for children” (Wu 237).
14

However, the rating experiment was brought to a halt after the June Fourth Massacre.

14
As explored in Chapter 2.

181
As the state tightened its control on social and cultural life, film censorship became even
more conservative.
After the 1980s, tensions between creative filmmakers and conservative officials
emerged. Bitter Love (dir. Li Tie, 1964) and River without Buoys (dir. Wu Tianming,
1984) were shelved without a public exhibition (X. Wu 1992, 237). Legend of Tianyun
Mountain (dir. Xie Jin, 1980) was withdrawn from showings abroad. Shao Mujun, a
senior researcher affiliated with the China Film Association asserted that “a main target
of the Chinese film industry on its road to reform is to fight for full freedom of creative
expression, stand against ‘crude interference’, and break away from the agitprop task of
illustrating current policies” (Pickowicz 1989, 51). However, it was impossible for the
CCP to give this “freedom” to the public, since national unity and stability could only
come about with social unanimity revolving around the dominant socialist ideology.
The struggle between directors and cultural bureaucrats continued throughout
the 1990s. Many films banned in the 1990s contained controversial political opinions, or
revealed the backward side of contemporary China. Films like Chen Kaige’s Farewell My
Concubine (1993), Zhang Yimou’s To Live (1994), and Tian Zhuangzhuang’s The Blue
Kite (1993) all depicted the misery caused by the Great Leap Forward and the Cultural
Revolution, directly pointing to the leadership of Mao Zedong. These films either
required re-editing or were simply banned in the Mainland.
This “banning” issue is very complicated; after the success of the fifth-generation
directors in the overseas art houses, the Chinese government became more strict and
sensitive about movie productions, especially non-major-melody films. Another Zhang
Yimou film, Ju Dou (1991), was not controversial when first submitted for an Oscar; it
became so only after the Film Bureau unsuccessfully sought to withdraw the film for
consideration at the Academy Awards. Chinese authorities deemed the movie unsuitable

182
for Chinese audiences by reason of its sexual content and because it dealt with China’s
problematic past (Ziesing). After submitting The Blue Kite to the Tokyo International
Film Festival without prior state approval, Tian Zhuangzhuang was expressly forbidden
from producing films in China for five years. Among the younger generation’s directors,
Zhang Yuan’s works have mostly been viewed as too controversial and disturbing. His
East Palace, West Palace (1996) was the first gay film in China. Beijing Bastards (1993),
a documentary about the first rock singer in China, Cui Jian, sheds light on underground
immigrant populations in Beijing. Son (1996) recounts the true story of a family torn
apart by alcoholism and insanity. None of his works were initially allowed public release
in China, save for his first, Mother (1992), which depicts the difficult life of a Beijing
woman struggling to raise her handicapped child alone. Other banned works include The
Days (dir. Wang Xiaoshuai, 1993); Frozen (dir. Wang Xiaoshuai, 1996); Postman (dir.
He Jianjun, 1995); Papa (dir. Wang Shuo, 2000); The Pickpocket (dir. Jia Zhangke,
1997); Mr. Zhao (dir. Lu Yue, 1998); Devils on the Doorstep (dir. Jiang Wen, 2000);
Beijing Bicycle (dir. Wang Xiaoshuai, 2000); Suzhou River (dir. Lou Ye, 2000); Platform
(dir. Jia Zhangke, 2000); Unknown Pleasures (dir. Jia Zhangke, 2002); Orphan of
Anyang (dir. Wang Chao, 2002); Blind Shaft (dir. Li Yang, 20003);
15
and Summer
Palace (dir. Lou Ye, 2006).
16

15
Blind Shaft is director Li Yang’s 2003 award-winning film adaptation of Chinese writer Liu Qingbang’s
short novel Shen Mu [Sacred Wood] about two desperate coalminers in northern China. The film is a harsh
indictment of the poverty-stricken and under-regulated Chinese coal mining industry, which claims
thousands of lives each year. The Chinese government banned screenings of Blind Shaft, but the DVD is
widely available. Li Yang is no longer allowed to make films in China.
16
Lou Ye was forbidden from making films for five years after Summer Palace was sent to the Cannes
Festival without the state’s approval. There is a rumor that, in order to prevent a future situation similar to the
Lou Ye’s case, “the Film Bureau attempts to require that all scripts have to be submitted for approval before
shooting, and that scripts, once approved, cannot be changed” (MediaCh.com, 30 July 2007).

183
As international film critics increasingly took note of Chinese films, foreigners
became more curious about the censorship system that was in place in Mainland China.
Ironically, officially banned movies became more popular and in greater demand. In
response, the Film Bureau tried to instill a complicated administrative process to deny
the legal status of newly produced movies, or simply refuse to issue required documents
for the distribution of the movies. Sixth-generation filmmakers were frustrated and
desperate. They continued submitted their films to international film festivals without
prior official approval. In January 1999, this led to the Chinese government prohibiting
outright all of the filmmaking activities of Wang Xiaoshuai, Zhang Yuan, and Jia
Zhangke. The hostile confrontations between the two sides began to subside towards the
end of that year as some younger directors gradually transitioned to above-board
projects. By 2003, Wang Xiaoshuai and Jia Zhangke were allowed to shoot new films;
Shanghai Dreams (Qing Hong) and The World were their first-ever legal films. By 2006,
almost all of the banned movies had been legitimized, including Wang Xiaoshuai’s
Beijing Bicycle and Jia Zhangke’s Xiao Wu.
After the experience of having films banned, most of the directors became much
more cautious. Since then, the pressures from the Chinese censors on previously
censured filmmaker Zhang Yimou have drastically increased. Zhang rarely grants
interviews anymore; if he does, they are of the “politically correct” sort. In an interview
with Nigel Andrews at the 1995 Cannes Film Festival, Zhang described his gangster film
Shanghai Triad (1995) as a caution against materialism and obsession with excess; these
warnings coincide with Communist ideology, which contrasts his earlier positions. In
early March 1992, he remarked to Chinese writer Mayfair Mei-hui Yang,
I believe the Chinese people’s oppression has been going on much
longer, for thousands of years. The Revolution has not really changed

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things. It’s still an autocratic system, a feudal patriarchal system. A few
people still want to control everything and install a rigid order. (Ziesing)
Younger-generation filmmakers might not have fully agreed with Zhang’s
philosophy, but they also started to deal with state censors in a more sophisticated
manner. For example, Wang Xiaoshuai obtained an official state stamp of approval and
a six-figure budget for 1998’s So Close to Paradise (Kochan 2003). It was allowed a
limited showing after the movie was heavily re-edited. Zhang Yuan also sought
government permission to produce Home for the Holidays (1999), though it took him
months to get the approval.
17

The censorship system is a painful experience for directors in China. The strict
censorship hampers the initiative of filmmakers and reduces their creativity and
imagination. It is one of the reasons why many Chinese films lack appeal to the local
Chinese. A famous commercial film director, Feng Xiaogang, once complained that he
knew what would make people laugh uproariously, but he could not go for it because it
would not pass the censorship process. Zhang Yimou’s reflection on his film Keep Cool
(1997) also revealed the bitterness a film artist bears in his heart over censorship:
If we were given just a little freedom, if the control was loosened just a
little, we could make much better films than the current ones. Keep Cool
would have been a much better film had we been allowed to express
what had been intended. Under the current system it became a farcical
façade without any essence. (Y. Tan 1999, 10)
In recent years, as many enterprises, mainly from Hong Kong, invest in the production of
feature films; the harsh and obscure state censorship also plagues them. Censors may
require changes in a finished film. Filmmakers who came from Hong Kong had to
produce two endings in the movie Infernal Affairs (dir. Andrew Lau and Mak Siu Fai,

17
See more discussion on how did the directors deal with the censors in Chapter 7.

185
2002), in order to receive approval for screening in Mainland China, and the original
ending could only reach Hong Kong and overseas audiences. After Hollywood films
entered the Chinese market, many Hollywood companies were confronted by the same
problems. Disney once complained that China Film took 16 months to make the decision
to screen Lion King (1994), but gave Disney marketers only a few weeks’ notice before
the movie was scheduled to be in theaters (Stanley 37). One more example is the sudden
removal of The Da Vinci Code (2006) from all the theaters in Mainland China on June 9,
2006, after 22 days of screening.
18

In June 1993, the first formal “Provisional Film Examination Regulations”
(Dianying shencha zanxing guiding) was issued, with a total of 27 articles. The
Regulations represented the first time that producers received a list describing the
examination procedure with clear information about the required documents and details
about applying for a permit to produce a film. The application requirements were
complicated; they required film producers to submit a written application to the Film
Bureau to request an examination in order to earn a screening permit. Information in
the written report had to include:
i. Title of the film
ii. Screenwriter’s full name (if an adapted work, the name of the
original work and the full name of the author)
iii. Producer’s name, the full names and résumés of the main creative
personnel such as screenwriters, directors, filmographies, art
designers, lyric writers, composers, and actors
iv. Main film themes and plot outline
v. Written approval from the author if the script is an adapted work
vi. Film specifications (length, width, color type, language, sound
standard, etc.)

18
Other examples include Memoirs of Geisha (2005) and Mission: Impossible III (2006); see Rosen
(2006).

186
vii. Contract or agreement letter with domestic or foreign producers
for co-produced films
viii. Original shooting country, region, studio name, and publishing
date of imported films
ix. Original-language script or plot outline of imported films
x. Approval letter of producers (or distributors) of foreign films
agreeing with public screening of that film in China

xi. When applying for the examination of science and education films
or documentaries, it was necessary to write on the report form the
opinions of the controlling authority relevant to the content of that
film. Where the film producer had a different opinion from the
controlling authority and state entities, the film holder had to
simultaneously report the different opinions
xii. The film producer’s reason for the examination application
xiii. Other matters that had to be explained
There are also topics from which producers were forbidden from featuring, including
those themes that can be seen as:
i. Violating the country’s Constitutions and laws
ii. Harming the state’s interest, social stability, ethnic dignity and ethnic
unity
iii. Violating present major state policies
iv. Violating socialist public moral norms;
v. Violating science, propagating superstition
vi. Graphic material, sexual simulation, propagating pornography, exposure,
violence or detailed description of criminal methods
vii. Having content and plot details violating the spiritual and mental health
of minors, or inducing minors to degenerate
viii. Other content and details not covered, as determined by authorities
The prohibited contents on this list are much shorter than the later version that was
discussed in Chapter 2. The significance of the 1993 Regulations was that it provided a
standard that could be expanded in the later version. The Chinese government not only

187
adapted to the economic environment, but its ruling techniques were also updated over
time.
5.4 The Reentry of Hollywood
Commercialization and globalization set the stage for Hollywood’s expansion into
China beginning in the 1980s. As Thompson says, “It is virtually impossible to assess a
national [film] industry in any given period without dealing with its attempt to counter
American competition” (Thompson 2003, 168). In this section, we will investigate how
the state and the film industry in China both tried to compete with Hollywood for market
share.
Film was introduced to China for the very first time on August 11, 1896, in
Shanghai. A year later, the first American film showman arrived in Shanghai to screen a
program of Edison films shot in the US (Leyda 1972, 2). This screening program was
widely publicized by local newspapers and the term “electric shadow” (dianying), the
Chinese term for “film,” is believed to have derived from this moment in history. Early
film imports in China were mostly from Europe; it was not until the outbreak of WWI
that the US replaced Europe as the major supplier of raw film stock for Chinese movie
production, and that Hollywood became the dominant player in the Chinese film market
(Y. Tan 2003). The dominance of Hollywood films in China remained until the CCP
established the “New China” in 1949. In 1933, there were 355 US feature films out of a
total 431 imported feature films. In the following years, American films continued to
pour into the Chinese market; US imported films even increased to 92 percent of total
imported films in 1946, during which 352 US films were released in Shanghai’s theaters,
while there were only 13 Chinese domestic films, 15 films from the UK, and three from
Russia (Zhou 2002, 113).

188
After 1949 and the Korean War, the Mainland Chinese market was closed to
Hollywood films (Chapter 2). The deadlock was resolved after Sino-US bilateral
diplomatic relations were officially established on January 1, 1979, and a new spirit of
opening-up and market liberalization took hold. At this time, China Film began to build
initial contacts with the American film sector. The cinema in China was still heavily
controlled by the state, and film was regarded as an important form of art for government
propaganda as well as social enlightenment, aimed at national cohesion and ideological
unification. Hollywood strategists failed to recognize this position, arguing for an
importation arrangement through a uniform revenue-sharing formula, essentially
rejecting the possibility of flat sales, which China preferred at that time (Zhou 2002, 117).
As a result, only a small number of US films and other foreign films were allowed into
China in the 1980s to early 1990s, and most of those films were low-budget, outdated,
independent productions from small, independent film distributors, such as First Blood
(dir. Ted Kotcheff, 1982), and Harry’s War (dir. Keith Merrill, 1981). In 1986, two
Hollywood film studios, Paramount and Universal, signed an agreement with China Film,
with an import quota of 24 films over three years. After signing this first deal, Hollywood
began to slowly enter the Chinese film market.
Prompted by the dismal trend of the Chinese film industry, in January 1994 a
groundbreaking policy was announced by MRFT that required China Film to import ten
“excellent” foreign films that “basically reflect the finest global cultural achievements and
represent the latest artistic and technological accomplishments in contemporary world
cinema” (Chen 2005, 914; Groves 1994). The purpose for introducing this new policy was
to lure moviegoers back to theaters, thereby also helping the survival of the local film
industry. This new policy was successful in enticing major Hollywood companies, such
as Warner Bros., to move swiftly. In September 1994, China Film and Warner Bros.

189
reached a “mutual benefits” agreement, in which they would import and distribute the
Warner Bros.’ blockbuster The Fugitive (dir. Andrew Davis, 1993) to China on a revenue-
sharing basis to begin on November 2, 1994 (Zhou 2002, 118). The film was screened in
six major cities, Beijing, Tianjin, Shanghai, Guangzhou, Chongqing and Zhengzhou, for a
week. In total, it attracted more than 1.39 million moviegoers and earned RMB 1.27
million in box-office profits (Chen 2005, 923). However, the movie was withdrawn after
one week because of the struggle between Beijing Film Distribution Company and China
Film over the profits earned distributing the film. Other sources explained that some
film industry officials were against the import of foreign films, claiming that it was “using
socialist money to fatten the capitalist pig,” which violated Chinese political mores
(Rosen 2002). The dispute between China Film and local distributors was resolved when
the Film Bureau issued the document “Regulation for the Reform of the Management for
Making Feature Films” (Guanyu gaige gushipian shezhi guanli gongzuo de guiding) on
January 5, 1995, clarifying that local distributors were able to share the revenue of
imported films.
19
The Fugitive reopened mid-January 1995.
In 1996, after the screening of The Fugitive (1993), the Changchun, Beijing and
Shanghai film studios distributed three other Hollywood movies: 1995’s Waterworld,
Jumanji, and Toy Story. Although the distribution was a trial measure, all three movies
drew significant income for the film studios. In Guangzhou, Jackie Chan’s movie Rumble
in the Bronx earned RMB 3 million in two weeks, making it the most popular movie in
the city during the 1990s. Rumble in the Bronx also broke records in Beijing. In total, it
earned RMB 516 million in box-office revenue in Beijing (R. Tang 2002, 264). The
opening of the Chinese market for foreign movies not only signaled the end of the

19
The policy required the studio to produce a successful main-melody film and established that the film
studio would be rewarded the right to distribute an imported blockbuster.

190
entrenched practice of acquiring a product for a flat fee, but also represented an epic step
in China’s approach to Hollywood, and the agreement itself was another step in the
country’s move to a market economy.
After their reentry, Hollywood films dominated the Chinese film market. In early
1996, in Beijing and Guangzhou, Hollywood films accounted for 70 percent to 80 percent
of total box-office receipts. Imported films became China Film, distribution companies
and theaters’ major source of income. The ten excellent imported foreign films hit the
box office in China and reached their peak when Titanic entered the Chinese market. In
1998, the box office revenues for Titanic in Beijing were USD 4.22 million – one-fourth
of the local market’s total intake in 1997. Obviously, the winner in the new landscape was
not the Chinese domestic film industry, but the imported Hollywood mega-productions.
Up until 2000, on average, ten imported films accounted for over two-thirds of China’s
annual total box-office receipts, while the rest, comprising less than one-third of the
revenue pie, went to some 100 Chinese domestic films (Zheng 2000, 5). The ten foreign
blockbusters indeed helped to attract the Chinese public back to theaters, but only for
Hollywood productions; moreover, the imported films further worsened the gloomy
situation of the Chinese national cinema industry. Famed critic Dai Jinhua (1999)
warned that, “like Titanic, the Chinese film industry is sinking amidst tender feelings and
happiness, almost without any measures of resistance” (22).
Another beneficiary of this new policy was China Film, thanks to the 50/50
revenue sharing system (sometimes, 60/40).
20
Although the entry of Hollywood films
had greatly eclipsed the local demand for Chinese films, China Film was able to secure a
major share of the imported films’ revenues. It would not be incorrect to say that the

20
The actual revenue shared by the foreign studios was much lower, especially after payment of tax, other
fees and duties. It was reported that usually the foreign productions received 13% of box-office receipts.

191
Chinese government successfully transferred the state power into business capital
through the agent of China Film by enforcing its monopolistic right to distribute foreign
films (see Chapter 6).
Since the economic imperative of the Chinese state had been to enter the
international market and to gain international recognition, especially around 1999 when
China bid for WTO status, many in the film industry acknowledged the necessity of
accepting foreign investments and generating box-office revenues, and as a result did not
fault the policymakers who made significant concessions in signing the Sino-US
agreement on China’s accession to the WTO on November 15, 1999. The commitments
included: doubling the annual import quotas from 10 to 20, allowing foreign investment
in joint ventures for video distribution, permitting foreign investors to own up to 49
percent in companies that build and operate cinemas, reducing tariffs on film (from 9
percent to 5 percent) and home videos (from 15 percent to 10 percent), and protecting
intellectual property under the terms of the WTO agreement on Trade Related
Intellectual Property (TRIPS) (“Written Testimony”). The Motion Picture Association of
America (MPAA) strenuously pushed for greater market access to China for the US
government during the bilateral trade negotiation process and even required that
Hollywood film sectors “must be part of any acceptable WTO accession package with
China” (MPAA 1999). Liu Jianzhong, former Director-General of the Film Bureau at
SARFT, who represented the Chinese film sector in the WTO negotiations, later
acknowledged that the American side pushed hard to eliminate China Film’s monopoly
over film imports and to engage directly in film distribution in China (Liu 2002).
However, they still had the right to subject foreign films to censorship prior to their
import to China, which gave the Chinese government the power to protect its film market.

192
Following this decade, Chinese film industries entered a new era in which they
increasingly became a target of transnational cultural industries and, at the same time,
expanded their influence in the global market through co-productions with foreign film
companies. In July 1994, “Regulations on Sino-Foreign Film Co-productions” (Guanyu
zhongwai hezuo shezhi dianying de guiding) was issued by MRFT. The Regulations had
a total 27 articles, which defined the concept of “Sino-Foreign Film Co-productions” and
also specified the three ways in which foreign players could co-produce films in China:
through joint production, assisted production and commissioned production (see Table
5.1).

Type Description
JOINT PRODUCTION
(Lianhe shezhi)
Chinese and foreign production
companies jointly invest (capital, labor
and equipment)

The co-production parties jointly produce
the film and jointly share the profit as
well as the risks
ASSISTED PRODUCTION
(Xiezuo shezhi)
Foreign production companies provide
funding and do all filming in China
Chinese production companies provide
equipment, location, labor and other
forms of assistance
COMMISSIONED PRODUCTION
(Weituo shezhi)
Foreign production companies
commission the Chinese companies to
film in China

Table 5.1: Co-Production Options

193
After China entered the WTO, and following the unexpected global success of
Crouching Tiger, Hidden Dragon in 1999, foreign companies rushed into China by
setting up subsidiaries in the film business. This process was accelerated after the signing
of “Closer Economic Partnership Arrangement between Hong Kong and the Chinese
Mainland” (CEPA)

in 2003, which took effect on January 1, 2004.
21
At the same time,
local government also actively involved itself with the transnational companies by
granting the rights to two independent film companies, Huayi Brothers and Taihe Film
Investment Co. and New Picture Film Co. The new policies were likely to benefit both
Chinese and foreign companies. In this regard, is it indisputable that the periphery states
remained daunted when faced with the dominant force of Hollywood, as suggested by the
advocates of the cultural imperialism thesis?
22

Curse of the Golden Flower (2006) completed a trilogy of sorts for Zhang Yimou,
which began with Hero and continued with House of Flying Daggers. This trio of movies
represented a new image for Zhang, as compared to his earlier work, e.g., Red Sorghum
(1987); Ju Dou (1990); Raise the Red Lantern (1991); and To Live (1994). This
represented a new stage in Chinese national cinema history. While some film critics

21
CEPA was a “generous gift” presented from the central government to the Special Administrative Region
(SAR) at the sixth anniversary of the latter’s return to the “motherland.” Most people in Hong Kong were
pleased with this agreement and some of the entertainment-related workers were more than happy to believe
that CEPA would bring new hope to the languishing Hong Kong film industry. “Now that CEPA is in place,”
comedian-turned-producer Raymond Wong told Today at the Hong Kong Convention and Exhibition Centre,
“we have hope for the future.” Foreign media companies and filmmakers, especially those from Hollywood,
were eager to use Hong Kong as a launching pad to break into the Mainland market.
22
Advocates of the cultural imperialism thesis use the term “national cinema” to refer to the competition
and impact of US film productions. This theory states that international capitalistic structures determine
cultural production and state policy given the context of the asymmetrical power relationship that exists
between the core and periphery. The countries in the periphery are unable to withstand the pressures of
globalization. Transnational corporations, in conjunction with the core state(s), are the principal agents in the
cultural imperialism process. Thus, a periphery state, like China, is significantly constrained in its ability to
exercise political agency in the face of external forces. However, the underlying assumption of this school is
that the presence of a production sector in local industries is a necessary and sufficient condition for the
cultural expression of a population. Imported material cannot have this kind of authentic relationship with
national audiences.

194
worried that the Chinese film industry might have been doomed by China’s joining the
WTO and because of the increasing “intrusion” of Hollywood movies into the local
market, some professional filmmakers acted proactively, creating movies meant to go
global by consuming China’s cultural resources and catering to the world market.
Filmmakers like Zhang Yimou, Chen Kaige, and Feng Xiaogang displayed their talent and
ambitions toward breaking out of domestic territory and elevating their careers. The
question remained whether this newly developed style of domestic films promoted
cultural identity.
5.5 The “Blockbusterization” of Chinese Cinema
With a production budget of about USD 31 million, 2002’s Hero had been among
the most expensive Chinese film.
23
Hero recruited Hong Kong superstars Tony Leung
(well-known throughout Asia) and Maggie Cheung (renowned in both Asian and
European art houses); global martial arts stars Jet Li and Donnie Yen; rising mainland
star Zhang Ziyi; and Chinese local superstar Chen Daoming. The director also recruited
the highest-quality pan-Asia-Pacific crew, which included Hong Kong experienced action
director Tony Ching; highly-acclaimed Australian cinematographer Christopher Doyle;
Oscar-winning Japanese costume designer Emi Wada; and Oscar-winning Chinese
composer Tan Dun. It generated USD 31 million at the box office domestically and USD
130 million internationally. Hero’s debut was the biggest ever of any foreign-language
import in the US; it set a record among Asian films in North America, grossing USD 18

23
Compared to other Hollywood mega-productions, such as Lord of the Rings I (2001), II (2002) and III
(2003), costing $93 million, $94 million, and $94 million, respectively, and Mission: Impossible II (2000)
and III (2006), which cost $125 million and $150 million, respectively. But Hero cost twice as much as 2000’s
Crouching Tiger, Hidden Dragon, which cost $15 million. Hero’s position as most expensive film was
usurped by The Flowers of War (2012), a recent Chinese blockbuster that set a new record of USD 94 million.

195
million in its first and second week.
24
Without a doubt, the success of Hero helped to
rebuild the Chinese public’s confidence in domestic films after 20 dismal years, and also
set an inspiring example for the national cinema industry.
After the success of Hero, a series of martial arts movies, e.g., House of Flying
Daggers (2004), The Promise (2005), The Banquet (2006), and Curse of the Golden
Flower (2006), were produced by highly acclaimed Chinese directors aiming to follow
the same formula as Hero – famous superstar casts, professional crews, vapid themes,
stunning audio-visual effects, extensive budgets, and sophisticated marketing strategies.
All of these films fully utilized modern technology, endowing them with grandeur,
mystique, and visuals infused with wondrous light and color. These mega-movies merely
satisfied audiences’ eyes and their need for visual pleasure, but without spirituality or
substantial messages. Moreover, these movies mostly tried to repackage the official
explanation of history in a successful commercial way in order to resonate with the
official statement on some social issues; for example, by concluding that social stability is
crucial to healthy economic development. In Hero, Emperor Qin, who by most
conventional historical accounts was a notorious cruelly aggressive and despotic leader,
is portrayed by director Zhang Yimou as a benevolent emperor who sacrificed his own
fame for the sake of the common people. Even worse, by the end the Emperor has
successfully unified the country by killing the chosen assassin, Nameless (portrayed by
Jet Li), because only the Emperor Qin can stop the war and give the people a peaceful
life. This ending reminds me of Zha Jianying’s (1995) observation:
For the time being at least, a silent pact seems to exist between the old
emperor and his people: I rule, you prosper, and let’s forget everything
else. All the evidence indicates that the Chinese population has been
playing by this rule. So far, the result should please Deng: the Party is
still running the country, the country is enjoying a boom, and the boom

24
Box office of 2004’s Hero (BoxOfficeMojo, July 30, 2007).

196
is eroding the memories of the past tragedies. Nobody, save for the
exiles and a few isolated individuals, it appears, is brooding over the
fading of memory. (13)
So, what message does the film Hero deliberately deliver? Party leadership is important
to national economic development. Suppression such as June 4, 1989 in Tiananmen or
other political demonstrations is the price that people have to pay, just as Nameless had
to be sacrificed at the end of the film.
It’s not surprising that these movies generated little favorable acclaim overseas
and generated negative reviews at home, just like movies made in the classic martial arts
(wuxia) genre, but with shallow knight-errant’s (xia) content.
25
Directors were too
aggressive to “achieve too many things at the same time: spectacular architecture and
landscape, colorful costumes and sets, superhuman martial-arts skills, sensuous music
and dance, as well as beautiful female faces and bodies” (Zhang, et al. 2007). Although
Zhang Yimou was highly criticized after House of Flying Daggers, he continued with the
same genre and a similar style in Curse of the Golden Flower, suggesting that directors in
China were willing to leave their home audiences (especially those film critics) behind for
the commercial market, both at home and globally.
Superficially, it is laudable that Chinese national cinema could expand its
audiences from art house members to the global mainstream circuit although, by and
large, these films were often still part of the art house circuit abroad since they had
subtitles. This leaves no doubt that China is fully capable of making its own blockbuster
movies that can appeal to mainstream audiences both at home and arguably abroad.
26

However, this does not imply that the Chinese film industry can provide an alternative to

25
Martial arts films, see more from Stephen Teo’s book Chinese Martial Arts Cinema: The Wuxia Tradition
(2009).
26
Although there has not really been a Chinese martial arts film that has been a success at the Western box
office since Jet Li’s Fearless in 2006.

197
Hollywood. Ironically, these Chinese-blockbusters have proven that Hollywood’s films
have already cultivated mass audiences’ taste in peripheral countries, which in return
compelled the peripheral filmmakers to comply with Hollywood’s tastes. Movies by
Zhang Yimou, Chen Kaige, and Feng Xiaogang all reflect Hollywood’s influence on the
production of cinematic spectacles in China.
27
These movies all show a standardization
of cultural expression under the influence of commercial imperatives.
The CCP developed domestic film industries largely because of its commercial
imperatives. The China Media Yearbook and Directory states that “the foreign policy
goal of China’s media regulators is to export Chinese culture via TV and radio shows,
films, books, and other cultural products,”
28
which shows that the CCP government
intended to use films to improve its national image. In fact, the “blockbusterization” of
Zhang Yimou, Chen Kaige, and Feng Xiaogang was encouraged by Chinese government
policies, which enabled them to achieve great success in the film business, but these
blockbuster movies were widely condemned among Chinese audiences and film critics,
both domestically and internationally.
5.6 Conclusion
Chinese national cinema has grown dramatically with transnational and national
investors, which facilitated the casting of multinational stars from Mainland China, Hong
Kong, Taiwan, Japan, South Korea, and even Hollywood. After several decades of crisis,
Chinese national cinema began to attract local moviegoers to theaters and to rebuild local
confidence in domestic productions. National cinema took off in the 1980s and 1990s

27
Feng Xiaogang has not been successful overseas, despite his desire to succeed outside China. His
blockbuster films, for example The Banquet, have failed at film festivals (Venice in that case) and with foreign
audiences. In the US market, Feng Xiaogang’s blockbuster Aftershock, released in US in October 2010, only
got USD 62,962 compared with its total gross in the home market, which is USD 96,569,846.
28
China Media Monitor Intelligence, 2007 China Media Yearbook and Directory.

198
when the state began its political and economic reforms. Considering increasing
international connections and interactions, the neoliberal thesis would claim that the
local economic and cultural sectors would be altered or modified by international forces,
typically by transnational corporations. Chinese national cinema demonstrates that this
thesis must be modified. The film industry has been changed, developed and influenced
by relationships, sometimes cooperative and sometimes conflicted, among the State,
domestic investors and companies, and transnational corporations. We have seen how
national and regional processes helped to commercialize the Chinese film industry in the
1980s and 1990s, but, at the same time, the Hollywood model was also crucially
important in “blockbusterizing” modern Chinese films. The neoliberal thesis seems less
compelling in the Chinese case since the government is capable of blocking, mediating,
and even reversing neoliberal tendencies. More explicitly, in the era of globalization, the
Chinese state pursued a proactive cultural policy while the market was deregulated.
The Chinese government has taken roles both as an initiator and preserver in film
reform. Such policies as encouraging non-state investment in the early stage and both
domestic and foreign investment in the later stage, breaking China Film’s monopoly, and
allowing vertical and horizontal mergers of film companies to become driving forces in
boosting the film market. At the same time, however, the state government also
implemented strict regulations to monitor, control, and even punish filmmakers who did
not remain loyal to the state’s ideological standards.

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However, the overall goal of Chinese film reform was mainly about economic
imperatives. Nevertheless, even when the intention is to use film (as a means of soft
power) to develop China’s international image, cultural sovereignty is not secure.
Cultural identity and ideological meaning were considered among the most important
issues to the Film Bureau in the early years of the reforms. With increasing consumerism
and the incursion of Hollywood movies, cultural identity and ideological control were no
longer major priorities for the policymakers. The success of the mega-Chinese-
Hollywood movies in recent years shows that there is no lack of talent in Chinese cinema.
Unfortunately, their success was achieved at the expense of cultural distinctiveness, in
compliance with Hollywood’s model.
In conclusion, since the CCP is an authoritarian regime, there are no mechanisms
in place to determine its policy mentality and flexibility, no system of checks and
balances. The future of Chinese cinema clearly depends on the openness and consistency
of state policy. However, in addition to the role of the state, Chinese cinema may depend
on how it manages three other major issues. First, the film industry has to learn the ways
in which it can maintain and expand the current boom in domestic films without support
from the state. In the success of mega-films, despite the carefully calculated marketing
strategy, one cannot overlook the whole set of arrangements from the state government.
For example, both Hero and House of Flying Daggers enjoyed unique screening
privileges in Mainland China. For those weeks, theaters were not allowed to show other
domestic or foreign movies. Also, the screen quota system that currently limits imported
films in the domestic market might be reduced or even abolished, since foreign
companies can use Hong Kong as a platform, protected by CEPA, to overcome the system.
Internationally, the future of Chinese cinema cannot solely depend on mega-
films. Homegrown blockbusters were supposed to be China’s answer to Hollywood.

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Zhang Yimou, Chen Kaige, and Feng Xiaogang are regarded as the best triad in today’s
Chinese cinema, and their extravagant budgets and eye-popping special effects films did
their job, yet none of them received Academy Awards, or dominated overseas box offices.
Every director understands that success in the domestic market is not enough to make a
real fortune in films, so the magnitude of the overseas market seems crucial, particularly
the US market. However, the question remains, how can they make Americans go watch
a film with subtitles? Besides China’s 5,000-year-old history, beautiful natural
landscapes, and the martial-arts genre, all of which can serve as a mine of exotic stories
to satisfy foreigners’ Chinese mythical imaginations, what else can Chinese films offer to
foreign audiences? How can they provoke thoughts and not just leave audiences
confused over calligraphy, swords, and dazzling colors?
Culturally, the strong point of Hollywood movies is how they invoke a unifying
and consensual sense of nationhood and express it via cinema. It should not be
unacceptable for Chinese cinema to resort to modes of production and cinematic forms
that were derived from outside China. In other words, Chinese film productions can
draw on the history and mythology of China as well as on Hollywood’s narratives and
styles. Even though there is a lot of tension between the indigenous and foreign models
and, in some instances, it may seem subversive toward national policy and ideology, the
fact is that the interaction between Chinese national cinema and Hollywood’s influence is
more complex than the unidirectional model conveyed by the notion of “cultural
imperialism.” This explains why it is so difficult to answer these questions: Is the survival
of Chinese cinema merely defined by competition with Hollywood in grand spectacles
and extravagant budgets? Are there themes worth exploring that could be emotionally
compelling for foreign audiences? How can we maintain a balance between Chinese
cultural identity and film industry efficiency? To maintain the current boom in domestic

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film production, Chinese policymakers and industry leaders must to figure out how best
to integrate the identity of domestic culture into the logic of the global film market. The
degree to which Chinese film policymakers have concrete insights into the
interrelationship of cinema and national identity, however, remains to be seen.

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C H A P T E R 6
Building and Selling Its Image:
“Soft Power” and Chinese Film Reform after 2002

6.1 Introduction
This chapter will discuss how China projects itself to the world through its “soft
power,” a term coined by Joseph Nye that refers to the ability to get others to want what
you want (Nye 2004). Nye suggests that China is not only rising as an economic power,
in its military development, and in its levels of participation in multilateral international
organizations, but also in its soft power. This is evidenced by its traditional culture, the
popularity of Chinese NBA star Yao Ming, global networks of the Confucius Institute, and
the widening broadcasts of China Radio International. In China, the idea of soft power is
being promoted with far more zeal than it is in Washington, D.C. In 2007, the Party’s 17
th

National Congress placed the improvement of soft power at the national strategic level.
Hu Jintao called for enhancing Chinese culture as the country’s soft power to “better
guarantee the people’s basic cultural rights and interests” through methods like
managing the Internet and investing in cultural industries in order to improve the
industry’s international competitiveness (Hu 2007).
In recent years, Western and Chinese analysts have frequently discussed the term
“China’s soft power.” Although most scholars agree that China’s soft power is expanding,
they acknowledge it is still very limited and also can hardly sustain a real competition
with the US (Nye 2005, 2008; Sheng 2011; Zhao 2008, 2011). Without necessarily
claiming that China’s soft power is more potent than that of other states, it is reasonable

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to assert that soft power considerations weigh heavily on the minds of Chinese decision-
makers.
This chapter is divided into three parts: The first part describes problems and
challenges to the Chinese national image-building project. The second part will focus on
the film industry reform and explain how the state transformed its propaganda tools from
2002 to the present. Finally, this chapter will argue that China’s film industry, though
unable to compete with Hollywood or even other Asian cinema, successfully transformed
post-reform from a state-controlled media to a systemic regulated enterprise (SRE) that
has been used as an instrument to boost the CCP’s legitimacy both domestically and
internationally. Moreover, such an enterprise enables the state to capture transnational
capital for its own agenda. It has contained Hollywood’s market expansion in China and
restricted America’s soft power influence. Furthermore, by transforming its film
industry, China has been able to hone its propaganda tools to control both the media and
capital flows centered in China, which can be used to project its dominance in periphery
regions, such as Hong Kong and Taiwan, and even Singapore, Indonesia, Malaysia, South
Korea and Japan, which in turn strengthens the “Chinese Diaspora” connection with
Mainland China, despite the persistence of an authoritarian regime.
6.2 China’s National Image
China enjoyed a very positive image abroad after charismatic leader Deng
Xiaoping’s “open-door policy” and economic reform. According to Sheng Ding’s study,
from 1979 to early 1989, Americans’ “most favorable” to “very favorable” perceptions of
China increased from 30 to 70 percent, while Americans with “mostly unfavorable” to
“very unfavorable” perceptions of China sharply decreased from 65 percent to 10 percent
(Sheng 2007). After the 1989 Beijing Massacre, China’s image was in crisis. The

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predominant image of a progressive China was replaced by a global icon: the tank in
Tiananmen Square. A sense of alarm emerged immediately among the CCP leaders, but
the Party-state had not put forth much effort in boosting its international image after the
June Fourth massacre; it only did so after the country’s internal power struggle was
brought under control by new leader Jiang Zemin in the mid-1990s.
The “China threat theory” stated that a rising China is a revisionist power, which
would make the status-quo powers and neighboring countries insecure. This was another
factor that accounted for China’s rising concern about its image overseas. China’s initial
response was refutation of the China threat theory, and it stressed the uniqueness of
Chinese culture, which would rise peacefully and not seek to be a global hegemon (Yan
1995). In the late 1990s, China began to advocate a “new security concept,”
1
in a July
1998 defense white paper called “China’s National Defense,” which showed the Party-
state had realized how to better sell itself by creating numerous “strategic partnerships”
(Finkelstein 2001, 3). Beijing started to emphasize various dialogues, peacekeeping
operations, security consultations, and security agreements to facilitate economic and
political cooperation in the region. In fighting against the “China threat,” the phrase
“peaceful rise” was slightly repackaged to “China opportunity” in 2002, stressing the
social stability of the region and the idea that a rising China was an opportunity rather
than a threat (Moore 2004, 117). In mid-2004 the CCP began to adopt the phrase
“peaceful development”
2
because the word “rise” was inconsistent with the “guideline of
keeping a low profile in the world” (S. Chu and Ren 2009, 11). By September 2005, Hu

1
Ministry of Foreign Affairs, China’s Position Paper on the New Security Concept (July 31, 2002),
MFA.gov.cn, retrieved February 14, 2010.
2
The State Council Information Office, Full Text Report of China’s Peaceful Development Road,
PeopleDaily.com.cn., retrieved February 14, 2010.

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Jintao declared that China’s growth was aimed at building a “harmonious world”
3

(Xinhua News 2005). Beyond utilizing all these pithy slogans, China began
strengthening its international broadcasting power. As a corollary to hard power, soft
power is “the power of persuasion through ideas, culture and policies” (Nye 2004, 60). A
country’s soft power comes not only from its own actions but also from exported
products. Thus, besides developing the state-controlled media – such as Xinhua News
Agency, CCTV Chanel 9, China Daily, China Radio International and the film industry –
the CCP attempted to compete with world’s leading media companies, like BBC World
Service, Reuters, or AP, hoping they would be taken just as seriously. Furthermore,
China leapt into the film industry, attempting to produce its own big-budget blockbusters
to export its authentic traditional Chinese culture abroad, as I have discussed in Chapter
5.
However, China’s positive self-portraits were less than successful in many parts of
the world. China was still viewed as a repressive authoritarian regime, although it had
grown richer. China was also criticized for deliberately promoting the “authoritarian”
growth model to Africa and other politically repressive states (Kurlantzick 2007).
Numerous reports on Chinese products and food safety issues, the suppression of
minority groups, mainly in Tibet and Xinjiang, the incarceration of political and
environmental dissidents, and restrictive Internet censorship have further affected its
international image.
The major concern for the current Chinese government in improving its image is
to boost its legitimacy at home and lure foreign investment to maintain its 8 percent

3
Please check Journal of Chinese Political Science. Vol. 13, No. 2, August 2008. The journal has dedicated
the whole volume to a discussion of the “Harmonious World.”

206
annual GDP growth.
4
And thus, China’s main goal in its image-building campaign is to
build a strong, stable state with a long history and an ancient culture that is now working
hard to deal with enormous challenges at home to improve its people’s standard of living.
Internationally, China wants to be seen as a responsible and trustworthy member willing
to cooperate with others and capable of contributing to world peace. Put simply, China
strives to be viewed,
As a country with a long history and ancient culture;
As a developing state; and
As a responsible state.
6.3 Mechanisms for Controlling and Managing the Film Industry
After three decades of economic reform, the number of domestic films increased
to a historic high of 558 in 2011. More and more people have tried to participate in
China’s film industry. The abundance of private studios does not, of course, ensure
ideological pluralism. Indeed, the rise of marketization has added new pressure to
directors, producers, and managers, as they are not only required to assume the risk of
their investment, but also to have to compete among themselves for limited resources
within society and the market. Some film producers have increasingly moved closer to
the government and have handled an increasing number of governmental projects. Being
dependent on the government’s protection does not always imply that an individual’s
mentality has changed on topics of societal values (e.g., growing more opposed to
democracy); rather, it is a transformation of structure mobilized by the combination of
political and economic forces.

4
Premier Wen Jiabao cut the 2012 growth target to 7.5 % (see X. Zhou and Yao 2012 ).

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In his study, Lynch argued that “thought work” had lost its influence in society
because of technological advances combined with administrative fragmentation and
property-rights reform, which created an un-institutionalized and chaotic public sphere,
seen as “praetorian,” entailing corruption, bribery, and violence from both above and
below (Lynch 1999, 1–17). Certainly this is a fair conclusion, but his study has at least
two shortcomings:
First, regarding ideological control, although there is a Central Propaganda
Department, which is supposed to be the highest authority to transmit the Party’s
thought work, other departments, such as the Ministry of Culture and SARFT, are also
responsible for transmitting the state’s polices. It has been fragmented since the
beginning. Second, property-rights reform certainly made a big change in China.
However, the property-rights of media products were not completely reformed. Directors
and filmmakers did retain the right to own their products, but the state still invests in a
lot in film productions directly or indirectly. The finished film is rarely completely owned
by a single entity.
I propose that the state’s influence is still enormous in the Chinese media,
particularly in the film industry although with advancing technology and fragmented
administration. Although it looks like the film industry is gradually growing financially
independent from the state, the state is advancing its management and controlling
techniques via three mechanisms: ideological control, bureaucratic control and
protection policies – the first two represent “hard control” while the protection policies
are a type of “soft” control – to create a distinctive media management system where the
state could use its monopoly to produce entertainment products for the public, and at the
same time strictly control ideological liberation. Under this system, the film industry is
transformed from state-controlled media to a systemic-regulated enterprise (SRE). This

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control does not directly point to producers, directors, or actors, but it’s a mechanism
that has been internalized as a mainstream value in the film industry’s structure – which
is, do not shoot anything that might anger the state government, or you might be
suppressed. In fact, soft control is not invented by the state intentionally; instead, it is
the result of the struggle between filmmakers and the government.
6.3.1 Ideological Control
6.3.1.1 China’s peripheries: Hong Kong and Taiwan
Since 1978, China has shifted from totalitarianism to state-capitalist
authoritarianism in which the state has tolerated the separation of political and economic
dynamics. The market is structurally intertwined with the state policy, rather than
separated from the state.
Its entry into the WTO made the Chinese government promise to further open its
market to foreigners. The Chinese government made four major agreements regarding
the film industry: 1. Increase import quotas for revenue-sharing films from 10 to 20 and
up to 50 in 2005; 2. Allow foreign capital to participate in the ownership of theaters and
in film production, with ownership limited to 49 percent. However, in some cities,
foreign entities are allowed to own up to 75 percent of a theater; 3. Allow foreign
companies to distribute film-related products, but not the actual films; and 4. Allow
foreign enterprises to establish local units in China but not for profit-oriented activities.
Investors from Hong Kong, Macau and Taiwan have enjoyed more privileges than
foreign investors thanks to the Closer Economic Partnership Agreement (CEPA). In the
exhibition sector, investors from these three regions are allowed to build theaters and
own up to 75 percent of a theater anywhere in China. They are also allowed to distribute
their own films and other domestic films. Films produced and made in these three

209
regions are considered “national films” if their casts include at least one-third Mainland
actors and actresses. Such films would not be counted towards in import quotas.
After China’s entry to the WTO, Hollywood did not have an easy time expanding
its market in China. First, although imported film quotas were raised to 50,
5
this simply
meant the Chinese government was required to import 50 foreign films – not necessarily
50 Hollywood films. The Chinese retained its ability to limit the number of Hollywood
films. Second, foreign investors were still completely banned from distributing imported
films, which means the Chinese government is able to seize a large portion of box-office
revenues through its patron companies. Due to multilayered and complicated
regulations, Hollywood studios usually could only share about 13 percent to 15 percent
6

of the total box-office revenues from the Chinese market, which is far lower than other
world markets, where Hollywood usually takes up to 50 percent (Miller 2007). Foreign
investors are not allowed to own a theater or participate in the production sector. Only
in 2003 and 2004 were the prohibitions of theater ownership and film production
partially relaxed in some regions.
Thus, institutional innovations have not been promoted by an external force
(namely, the WTO), but remain limited by the state’s ideological guidelines. The CEPA
agreements offered to Hong Kong, Macau and Taiwan represent strategic sovereignty
over “separate customs territories” through the acceleration of bilateral economic
exchanges.

5
Here it refers to the total number of imported foreign films. People commonly refer to the quota of 20,
which are films imported on a profit-sharing basis, and China Film buys the rest with a flat-fee rate. The quota
of the profit-sharing has increased from 20 to 34, although these 14 additional films must be 3-D or IMAX
versions, in 2012 (Hennock 2012).
6
The Chinese authorities have promised the Hollywood filmmakers they will receive 25 percent in 2012
(Hennock 2012).

210
6.3.1.2 The production sector: Licensing
Since the economic reform, the government has arranged for many Shiye danwei
(public institutions) to be transformed into Qiye danwei (enterprises). From a micro
perspective, the film industry has been transformed from completely state-owned to
studio-owned to individually-owned. The distribution rights have been transferred from
a central state distribution company to provincial-level distribution companies, down to
private distribution units. The path of institutional progress can be found in two
documents: “Regulations Concerning Reforming Feature Film Shooting Management
Work” in January 1995 (Guanyu gaige gushipain shezhi guanli gongzuo de guiding) and
the “2002 Regulations on the Administration of Films” (2002 Dianying guanli tiaoli).
From the macro perspective, different departments have managed the Chinese
film industry. SARFT is supposed to be the only government organ to supervise all film
industry activities, from the central to the provincial levels. SARFT is responsible for
screening all completed films, for issuing notices to guide film production, and for
holding different orientation sessions for film workers to attend. SARFT is a counterpart
to the Central Propaganda Department, which is primarily responsible for monitoring
news content. Besides SARFT, the Ministry of Culture, the Ministry of Commerce
(MOFCOM), the Ministry of Foreign Trade and Economic Cooperation (MOFTEC), the
National Development and Reform Commission, the Ministry of Information Industry
(MII), the State General Administration of Press and Publications, the State
Administration for Industry and Commerce (SAIC), and the State Council and
Information Office (SCIO) all have the right to manipulate resources, construct polices
and issue documents to control the film industry.
Although at the micro-level the economic reform has created considerable room
for film industry liberation, film producers and investors have to apply for a permit to

211
shoot. Films need to be censored before distribution, exhibition, import and export. All
co-productions need to apply for “Sino-Foreign Licensing Feature Film Productions”
(Zhongwai hezuo shying dianyingpian xukezheng). Films related to “important
revolutions and history, special themes, government-funded films and co-produced
films” all need to provide a full script to SARFT prior to shooting. In many cases, film
directors do not have absolute creative control, especially for state-funded films. The
authorities have veto power over everything from the beginning of script writing to the
final stages of editing the film. Films could be completely banned from public screening
or could be removed from theaters arbitrarily.
Film production in China is risky not only because of the unpredictable market
demands, but also because of state policies, especially the licensing system. Film
producers have expressed complaints about this system; however, their concerns have
rarely accumulated to the point of forcing the government to change the system (see
Chapter 7). The Chinese film industry and the state have been interdependent for so long
that the sustainability of the film industry is highly dependent on state subsidies and
special protection policies. Currently, the state is sponsoring various film production
advancement projects, such as the China Film Digital Project, the renovations of theaters,
and tax exemption privileges. Some film productions still need the state to create a
“market” (i.e., organize screenings for workers, students, and the general public vis- à-vis
administrative orders), such as The Founding of a Republic and Confucius. On the one
hand, all of these policies help maintain stability; on the other, they also prevent
institutional innovations. Thus, the interdependence of the film industry and the state
has limited the quest to terminate the licensing system, and has further deepened the
cooperation between the state and film investors and producers.

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6.3.2 Bureaucratic Control
6.3.2.1 The distribution sector: Duality of government roles
CFG was appointed as the only distributor in China in 1949. In 1993, the state
decided to break CFG’s monopoly, and in 1994, the State Council announced that all film
studios had the right to own their films and were therefore free to distribute their films
on national, provincial, city and district levels – within the four-level distribution system.
The nationalized distribution system had finally been abolished. The implications of this
change were enormously significant. Among all the sectors of the film industry,
distribution represented the most important area, as it determined whether a movie was
profitable or lost money. The political cost of this institutional innovation was very low,
as most filmmakers welcomed this change. And indeed, the termination of the CFG
monopoly on film distribution should be regarded as a bottom-up process. The Chinese
government’s decision was a response to the film industry’s development since the
beginning of the reforms. Producers had more incentive to earn a great deal of money
because the directors and their staffs held extensive property rights to their own
products. Many directors spent only 40 percent of their working time producing
propaganda films. They spent the rest of their time working on expensive or
transnational projects co-produced with either domestic private investors or
transnational enterprises. Their talents and labor were rewarded in ways that were
absent before the reform, as the state had then exercised near-total control. The
distribution companies and theaters were now more flexible to choose the films to be
distributed and screened (Lynch 1999).
The CFG’s monopoly over domestic films had been removed, but it preserved its
monopoly over film imports. On August 8, 2003, the establishment of the Huaxia Film

213
Distribution Company broke the CFG’s national monopoly over distributing foreign
films. However, both companies were state-owned and their shareholders overlapped, so
as Professor Yin Hong said, the change did not bring about “competition” between the
two companies; rather, it was just a tactic for the state to comply with WTO requirements
and eliminate a monopoly. The Motion Picture Association (MPA) had long requested
access to enter the Chinese market by setting up its own distribution companies;
however, the Chinese government refused to change the system (K. Chu, 2010).
The year after the entry of Hollywood, box office revenues were nearly triple those
of 1994. Hollywood’s success in China reached its peak in 1997 when the box office
receipts of Titanic accounted for one-third of the national gross. Through 2000, 10
imported films each year accounted for an average of more than two-thirds of China’s
annual box office receipts. However, in the production sector, total feature film
production in China plunged from 133 in 1990 down to 88, 87, and 70 in 1997, 1998, and
1999, respectively (illustrated in Figure 6.1). One film scholar even claimed that the
number of feature films produced in 1998 was only 37, far lower than the official figures.
Hollywood films did lure moviegoers back to theaters; however, the local film industry
did not benefit. Instead, the demand for local films further diminished.

214

215
For this reason, the government required to have special policies protecting the
local film industry by monopolizing the imported films quota. This policy could be
regarded as cultural protectionism from the intervention of cultural imperialism, but it
could also be seen as a response to the over-suppressed local film production sector. The
licensing system repressed the creativity of filmmakers and in turn harmed moviegoers’
desire for local films. In order to stabilize this “chaos,” the government had, on one side,
opened the door to domestic distribution companies’ profit-sharing, and on the other
side, the government also needed to be a gate-keeper to block competition from the
outside through the imported film monopoly of two appointed film enterprises. So, the
government played a dual rule. Although nearly two-thirds of domestic films could not
be screened publicly, the state, in effort to encourage and support national film
production, formed the “Film Industry Development Special Fund” (Diangying shiye
fazhan zhuanxiang zijin); in 1997, it introduced “Measures on the Management of
Chinese Film Industry Development Special Fund” (Guojia dianying shiye fazhan
zhuanxiang zijin guanli banfa), and in 2000, “Film and TV Mutual Fund” (Yingshi huji
zhuanxiang zjin). Additional regulations required theaters not to devote more than one-
third of screen time to foreign films, and to allow at least 15 percent of screen time for
domestic “key films.” An understanding of the duality of the government’s “open-door”
and “gatekeeper” roles is crucial for understanding the film industry in the reform era.
The development of the film industry depended on maintaining the proper balance
between these two roles.
6.3.2.2 Exhibition: Centralized dominance
If the above polices represented a bottom-up process in the distribution sector for
the state to change its policies, the exhibition sector offered the opposite model. In 2001,

216
SARFT and the Ministry of Culture jointly issued “Details of Implementation on Reform
of Film Distribution and Exhibition Mechanisms” (Guanyu gaige dianying faxing faying
jizhi de shishi xize) and “Several Opinions on Speeding the Reform of the Film Business”
(Guanyu jiakuai dianying chanye fazhan de ruogan yijian) which required a mandatory
theater chain system to set up in 2004. These two documents required the entire country
to set up theater chains. Because of the compulsory enforcement, within two years China
had set up 36 cinema chains with a total of 1,188 theaters and 2,396 screens. By 2008,
there were a total of 1,545 theaters and 4,097 screens, together with 800 digital screens.
The development of these theaters was the fastest development ever seen in the nation’s
film industry, with 1.7 screens built per day. The pace further increased to 4.7 screens
per day in 2010 (CFAIRC 2011, 3) and 9 screens per day in 2011 (Sina 2012). However,
the development of theater chains was considered conservative, as it only changed the
“four-level distribution system” to a more diversified system, which could not be
regarded as extraordinary progress, and never could compare with America’s Big Five –
Warner Bros., Paramount, RKO, Metro-Goldwyn-Mayer, and the Fox Film
Corporation/Foundation – which owned production facilities and distribution systems.
Moreover, the construction of theater complexes was primarily concentrated in big cities,
which were also the first-tier movie markets – Beijing, Shanghai, Guangzhou, Shenzhen,
Chengdu and Chongqing. Media reforms were a process of exclusion and inclusion,
which further marginalized poor people, although the media outlets had a strong
incentive to achieve global market success (Zhao 2008). This leads us to another state-
driven policy in the exhibition sector, which is the village market.
According to various documents, such as “Notice on Digitizing Film
Development” (Dianying shuweihua fazhan gangyao de tongzhi) issued in 2004, the
core policy for the government is currently the building of village theaters and second-

217
tier movie markets. The government was not only responsible for constructing high-
quality theaters in the villages, but also for promoting a policy called “at least one movie
a month screened in each village,” meaning the government would screen a movie to all
villagers each month for free. As Gao, President of EntGroup, observed,
On one hand, the Chinese government regulated the screening of
imported films in big cities in order to create a quasi-liberal movie
market. At the same time, it also rigorously invested in the second-tier
markets in order to promote the further development of the industry.
(Interview 8)
Yet, due to the unexpectedly changing regulatory environment, Time Warner Inc.
withdrew its investment in China in November 2006 (Miller 2007). The motivation for
Hollywood companies to invest in Chinese theaters stemmed from their desire to expand
the Chinese market for Hollywood films, and they fully expected that the film quota
system would eventually be dismantled. However, from the perspective of the Chinese
government, the importance of imported film quotas was equal to the censorship and
licensing systems, which determined its capacity to control the film industry. Thus, in
the foreseeable future, the number of imported films and the number of foreign
distribution companies may steadily increase, which will continue to demonstrate that
the Chinese government is willing to liberalize its movie market. However, it is expected
that some areas, such as the licensing system and the monopoly on imported films, will
remain unchanged. Imagining the potential vulnerability of Chinese film industry’s
development, Gao considered protection of the film industry to be “required,” asserting,
“It is still not yet mature. It is just the beginning” (Interview 8).

218
6.3.3 Soft Controls
Whether film is a “tool” to educate the masses, a commodity, or an art, it needs
audiences and capital investment. Because of these two shared components,
marketization of the film industry has created uneven development, for some studios
have risen as giant enterprises and some are losing ground. For example, in 2008,
China’s film industry produced 406 films, but only 124 films were screened publicly.
That means about 70 percent of films, either produced by the state or individual
directors, were shelved. In the same year, the top five movies earned a total of 45 percent
of total movie ticket revenues. The total box-office revenue was RMB 4.341 billion, and
films produced by the CFG – the dragonhead in China’s film industry – earned RMB 3
billion (USD 440 million), which accounted for 67 percent of total box office receipts.
Among the top 20 films of 2008, 15 of them were distributed by CFG. Half of the top-
earning theaters were owned by CFG (Yin 2009, 256). Among total box-office revenue,
directors Zhang Yimou and Feng Xiaogang accounted for 90 percent, and the remaining
100 directors shared the other 10 percent in revenues (A. Li and H.-Q. Li 2008).
This uneven development requires the state to step in and provide certain
protections. Protectionism of the national film industry is not an unusual approach in
many countries. The idea of “soft control” had two distinct perspectives. The first is the
state used its administrative power formally or informally to implement a series of
policies or guidelines to support the national film industry. This type of control is direct
and straightforward. The first type of soft control can be further divided into three types:
i. Formal regulations — Extended quota systems to theaters and
imported films

219

ii. Individual documents — Issued by several related departments,
guided CFG and CCTV Chanel 6 policies
iii. Special Funds — Established for national films and tax-
free policies, granted among several
studios
The second type of soft control is relatively indirect, and, most often, that kind of control
is already embedded in the structure of the film industry.
The “2002 Regulations on the Administration of Films,” Article 24, required all
theaters to show national films no less than two-thirds of the time. Then, in 2006, a
document “On Strengthening the Awards and Examining the Distribution and Exhibition
of Chinese Films” (Guanyu jinyibu wanshan guochan yingpian faxing fangying de
kaohe jiangli banfa de tongzhi) was issued, requiring CFG and Huaxia Co., to distribute
at least 60 locally made films, including 30 films recommended by SARFT, and required
that the films they distributed earn at least RMB 100 million in total box office revenues.
All theaters are required to screen at least 60 Chinese made films each year, among them
at least 40 films are to be recommended by SARFT. No theatre could earn less than 50
percent of total box office revenues from domestic films. If theaters and distribution
companies fulfilled these requirements, a 2 percent reward would be given to CFG and
Huaxia Co., and a 5 percent reward would be given to the theaters. If the theaters and
the two distribution companies did not achieve the goals, however, they would lose the
right to import or screen imported films, not be allowed to receive benefits from the
“Chinese Film Industry Development Fund” and be denied other tax-free privileges.

220
Additionally, CFG funded national film production. Zhou Tiedong outlines CFG’s
activities, including,
i. Granting Changchun Film Group and Shanghai Film Group RMB
10 million every year for film productions
ii. Distributing RMB 10 million every year for the production and
distribution of children’s and minority films
iii. Earmarking RMB 30 million every year for other national film
productions and distribution
7

The document “Several Opinions on Speeding Chinese Film Industry
Development” (Guanyu jiakuai dianying chanye fazhan de ruogan yijian) issued in
2004, together with the Ministry of Finance and the General Administration of Customs
co-issued document in 2005, “Notices on the Tax Policies on Cultural Industry
Institutional Development “ (Guanyu wenhua tizhi gaige shidian zhong zhichi wenhua
chanye fazhan ruogan shuishou zhengce weti de tongzhi) provided various tax
exemption privileges to the film industry, particularly for certain appointed film
enterprises.
The Chinese government set up two types of Special Funds for national films:
“Film Industry Development Special Fund” and “Film and TV Mutual Special Fund.”
According to the “Implementation Policies of China Film Industry Development Fund”
(Guojia dianying shiye fazhan zhuanxiang zijin sshangjia de shishi xize) in 1996 and
“Measures on the Management of Chinese Film Industry Development Special Fund” in
1997, government required film theaters to submit 5 percent of their revenues to the Film
Industry Development Special Fund. The “Film and TV Mutual Special Fund” required
the CCTV to turn in 3 percent of total commercial earnings, and not less than RMB 30

7
Like CFG, CCTV Chanel 6 also had to return 3 percent of their profits to support the production of
domestic films (Tang 2007, 98; T. Zhou 2002).

221
million each year. The funding was used to produce propaganda films, and the state-
owned film studios were allowed to apply to the fund for capital to produce films.
There were a number of important reasons for these policies. The film authorities
wanted to monopolize the imported film market and generate substantial box office
revenues in order to support local film production, particularly propaganda films.
Further, as opposed to other countries, China’s film industry earnings largely depended
on box office revenues. It was extremely important for the state to channel revenues
from theaters and regulate the screening time of national films. While this was no doubt
partly motivated out of cultural protection instincts, the real goal was to maximize profits
(Interview 10 and 27). As Zhang Zhao, President of Enlight Media, states plainly,
“Making profit, of course, is the biggest concern for the government” (Interview 27).
The second type of soft control came from the production sector of the film
industry. Producing a movie, whether on a large or small budget, is a complex logistical
exercise, requiring the collaboration of a large number of creative artists and a significant
amount of capital.
8
The marketization of the film industry has made it so that filmmakers
are more flexible to aggregate capital for their projects. Since 2002, individual producers
have been allowed to raise capital through private equity investors or lenders, or by
licensing distribution rights in advance of production and borrowing against these
licenses. However, banks have lending preferences for state-owned-enterprises and
state-friendly companies. Therefore, for private producers who want to make a film in
China, there are few options for financing their films. Capital either has to be provided
by the government, co-produced with domestic or foreign lenders, or through producers’
own savings.

8
The average production cost of a film in 2008 was approximately USD 5-6 million (compared with the
cost of $71 million in the US, with blockbusters and franchise titles costing upwards of $200 million; even
small budget films cost no less than $15 million).

222
If the government funds a film, creative autonomy will be largely limited. If the
film is co-produced with other investors, a longer collaborative process will be required
and the room for creativity will again be restricted. Certainly, producers enjoy the most
freedom if a film is completely privately funded; however, there is still another obstacle –
the strict censorship and licensing system. Even after the film is completed, it will not
necessarily be shown theatrically. Producers could earn 38 percent (up to 43 percent by
the end of 2008) of the total box office revenues. From those profits, 5 percent had to be
turned in to the Chinese Film Industry Development Fund and 25 percent had to be paid
as income tax. This further suppressed the income of the production sector.
Although a lack of capital was the first motivation in encouraging the state to open
the film industry to foreign investors, the current “uneven development” of the film
industry was still caused by a lack of capital available for the creative individual to make
films. Further, the structure of the film industry was transformed to enable the
government to easily distribute resources and capital to produce films that fit its
preferences and complied with its ideology. The state government not only fully
channeled domestic capital into its own agents, like CFG and other state-owned film
studios, but also, through the control of capital flows to trap most foreign investments
into its system (by, for example, suppressing profit sharing with film producers, and a
series of theatrical regulations). This explains why even though film attendance and box-
office revenues increased dramatically in recent years the real winners have been very
few. Although there were about 300 film studios registered in China in 2008, only about
50 of them were still making films. Marketization of the film industry, indeed, was a way
for the state to provide a security bell for certain film enterprises, as well as provide a way
for the state to capture capital, both political and economic. The more box-office
revenues grew, the more the government could obtain.

223
In conclusion, first, although the film reform started in 1978, regulations on the
administration of films were only issued in 1996 and finalized in 2002. It took the
Chinese government more than 20 years to figure out how to formally regulate the film
industry. Also, the two core issues – censorship and the licensing and rating systems –
remained unchanged. Thus, the development of the Chinese film industry is still highly
determined by politics and ideology, rather than by the market. Although most of the
state-owned film studios have been transformed into self-reliant enterprises, the state’s
investment in film production remains large. Since 2005, state-owned enterprises
usually invested an average of 60-70 percent in film production.
9
Second, by using
policies such as subsidies, quotas and monopolies, the Chinese government successfully
protected the national film industry from foreign challenges. Moreover, the Chinese
government also successfully limited filmmakers’ entry into the industry, by suppressing
the production sector, which might have created chaos in the system. On the other hand,
however, these policies have been used to allow a very few enterprises to capture a great
deal of the available social resources. CFG, for instance, is the biggest beneficiary of the
reforms. Third, the control-and-management mechanism remains a top-down process.
Besides cleverly capturing foreign capital, the Party is also empowering its administrative
agents such as SARFT to reinforce their control over the film industry by instituting
comprehensive regulations. Moreover, SARFT is allowed the freedom to issue specific
notices to restrain or enlarge censorship. The latest example is the ban on Lust, Caution,
starring Tang Wei, after the film had been shown widely and 7 minutes of graphic scenes
had been cut. SARFT ordered the star to cease all TV and print advertisement
appearances by suddenly issuing a statement saying it had renewed the prohibitions on

9
This includes different types of co-production (ChinaFilm).

224
“lewd and pornographic content” and other related issues (Callick 2009; Danwei 2008).
Although the statement did not single out Lust, Caution or Tang Wei herself, all shows
involving Tang Wei, both on air and in print, were deleted. Therefore, the
transformation of the Chinese film industry did not eclipse the state’s dominant
influence, but its power advanced through the operation of three mechanisms for
controlling the film industry: ideological control, through the traditional state
sovereignty concept as well as the licensing system and censorship; bureaucratic control,
or the empowerment of administrative units such as SARFT; and soft controls, which are
both direct regulations (such as subsidies, the quotas system and the monopoly of
imported films) and indirect structural transformation.
The Chinese film industry has been reformed under the above framework.
Scholars have assumed the market has the power to contest or counterbalance the state.
Marketization, however, is only a neutral mechanism to distribute and redistribute
resources among players. Whether China – an authoritarian regime – could transform to
a democracy depends not only on the volume or diversification of media products or the
motivation of media employees, but also on the capacity of the state to maintain control
over media workers. If an authoritarian state is strong enough to compel or attract
people into the system, even if the market is liberalized to encourage a variety of capitalist
activities, the industry workers in the media systems might simply comply to state’s
regulations without demand political reforms.

225
6.4 Soft Power and the Chinese Film Industry
The State Council launched a film industry development plan enhancing film
industry development in 2010.
10
Some might argue that the plan looked like an
“ideological backdrop to the development of the biz rather than a formal road map”
(Coonan 2010), but the plan stated clearly that the government was ready to increase
investment and promised to provide a more favorable regulatory environment in the
domestic film industry for the sake of increasing its international competitiveness and to
enhance China’s “cultural soft power” (Back 2010). A document was issued by the State
Council, rather than by SARFT, as a step to further solidify the state’s emphasis on
cultural industry development since the Party’s 16
th
National Congress in 2002. At that
meeting, Jiang Zemin urged the entire party membership to recognize the “strategic
significance” of culture in the “competition” of “overall national strength” (Jiang 2002).
This policy, I have argued, not only implies that the state equates the development of
culture to the economic, military, and political dimensions, but it also means the state’s
core thinking about the future remains “realistic” in the sense that cultural control, as
soft power, is parallel to the conventional hard power – military foundations and other
material capabilities – in determining the survival of the state. Moreover, this policy
does not imply that the state has changed its interpretation of films – a propaganda tool
to educate the masses (K. K. L. Chu 2010, 115). As Hu Jintao once said, “All those
working with China’s film industry should stick to the correct political direction all the

10
On January 25, 2010, the State Council issued a document, “Guiding Suggestions for Enhancing Film
Industry Prosperous Development,” which outlined 10 key policies: (1) improve the quality while keeping the
growth of quantity; (2) transform state film production companies into shareholding enterprises; (3) grow
cross-regional theater chains; (4) establish more digital theaters; (5) increase financial support for the movie
industry; (6) push technological innovations; (7) implement digitalization in the countryside; (8) enhance
international influence with the “go out” strategy; (9) improve the governing laws and policies; (10) enhance
the work of building a talent pool (State Council 2010).

226
time, and keep their sense of social responsibility to further the prosperity of China’s film
industry” (The Independent 2009). Although studies have already shown that it is easier
for a country to gain a negative image and much harder to reverse it in global public
opinion (Kunczik 1997; Wang 2003), for a country like China, which is highly dependent
on the global market, a favorable image is strategically useful and even necessary. The
film industry as an instrument in image building and selling, however, is frequently
overlooked (Rosen 2011).
In short, using the film industry is an approach that captures the essence of soft
power. If culture, values and institutions can be used for attraction and appeal, the
question should be how the resources of power are used, rather than associating sources
of power as soft and hard. Moreover studying film reform and industry development
helps us to understand why the discussion of soft power breaks the boundary between
domestic and international politics. Domestic political values, institutions, and political
systems are important considerations for a state’s soft power, because all these things
demonstrate how the ruling elite in that state uses power on its own people. Such use of
power in the domestic context can resonate in the international arena. Third, to gain soft
power, a state only attempts to display the good part of its culture to the outside world.
This careful selection of images is exactly suited to the process of filmmaking. For
example, the movie The Founding of a Republic (dir. Han Sanping and Huang Jianxin,
2009) is a reworking of the history of the country’s myths. This only serves the Party-
state at the hub of all history making, remaking and unmaking (G. Davies and M. E.
Davies 2009). As Ken Kesey observes,
We are all of us doomed to spend our lives watching a movie of our
lives—we are always acting on what has just finished happening. [...] The
present we know is only a movie of the past, and we will never be able to
control the present through ordinary means. (G Davies and M. Davies,
2009)

227
Film opens the possibility for Chinese filmmakers and policymakers to use
cinematic representations to cross the global culture boundaries and speak to the world.
It is, thus, worth examining films and how the state translated its image of Chinese
experiences to Chinese and non-Chinese audiences, and repackaged its history to sustain
its legitimacy both domestically and abroad.
6.5 Soft Power and the Film Industry: China on the Rise
China’s film industry has boomed in recent years. Box office revenues have
soared from RMB 130 million (USD 19 million) in 1993 to RMB 6.2 billion (USD 909
million) in 2009 and almost doubled in 2010 to RMB 10.2 billion. The number of feature
film productions increased from 87 in 1998 to 456 in 2009 and 558 in 2011, which made
China the third largest film production center in the world, surpassed only by Bollywood
and Hollywood, and the biggest film producer in Asia. Moreover, its international box-
office grosses have increased gradually from RMB 5.5 billion in 2003 to a peak RMB
27.69 billion in 2009, while decreasing slightly to RMB 25.8 billion in 2010 (see Table
6.1). In fact, the “success” of the Chinese film industry does not imply it could match
Hollywood’s box-office “success.” Yet, Stanley Rosen suggests that Chinese films have a
“higher penetration rate than other foreign films” (Rosen 2010, 40) and “Chinese films
have been among the most successful foreign language films not only in the American
market, but also in at least some other overseas markets” (Rosen 2010, 49).
11
This
sounds very encouraging for Chinese film industry reform. In addition, Mark Leonard
argues that although Jackie Chan and Confucius are no match for McDonald’s and
Hollywood, China is “very attractive” to “middle-income and developing countries,

11
Although he also recounts that their last real success at the North American and Western box office was
Jet Li’s Fearless in 2006 and that the boom in martial arts films seems to have passed.

228
particularly those which have been subject to Western colonialism (in other words, 90
percent of the world’s countries)” (Leonard 2008, 98). In the long run, this would allow
China to gain significant legitimacy.

229

Table 6.1: Growth Export Films, 2004-2011
12

12
Data source: http://gcontent.oeeee.com/c/91/c913303f392ffc64/Blog/aa9/ea5d27.html
Year
# of
Production
Units
# of
Export
films
# of
Co-
Productions
# of
Countries
Export
Total # of
Prints
Overseas
Distribution
Incomes
(RMB K)
Post-
Production
Incomes
(RMB K)
2004 51 12 17 1151365 17621
2005 18 69 27 24 1642899 736.6
2006 18 73 33 44 204 1837141 77136.1
2007 31 78 53 47 314 2020314 146170
2008 19 45 29 61 285 2501220 311374.7
2009 22 45 34 63 185 2769423 355350
2010 34 31 30 32 120 2581137 1000
2011 52 50

230
Furthermore, a rising China has indirectly changed the landscape of the world
movie business, and China’s censorship board has already deeply affected what
Hollywood produced, according to a leading Hollywood producer. As co-productions
between China and Hollywood have dramatically increased in recent years, references to
China are now more frequent in films. Some filmmakers say this trend is intentionally
“designed to satisfy Chinese business partners and court audiences in the largest movie-
going market outside the US” (Interview 1). However, most argue that these references
are “simply organic reflections of the fact that China is a rising political, economic and
cultural power” (Interview 35). Thus, more movies have been produced with more
Chinese good guys, and less Chinese bad guys; some even alter the movie by changing the
script or locale from Chinatown to another ethnic enclave in order to avoid the censorship
from the Chinese government. As Rosen expresses in an interview, he worries that “a
generation of moviegoers could emerge with a skewed, sanitized view of China in which
human-rights abuses and even the grittiness of everyday life are swept under the rug.”
He warns,
I don’t think the average US filmgoer is hugely aware of all of these small
decisions. […] But subliminally, it can start to have an effect. (Zeitchik
and Landreth 2012)
Another way to think about Chinese film is its capacity to have an effect on the
ethnic Chinese who live outside of Greater China – the Chinese Diasporas. The
marketization of the film industry first took off in the late 1970s, and until the end of
CFG’s monopoly over distributing domestic films in 1994; the Chinese film industry
remained strictly controlled by the state. Especially after the military suppression of
1989, the film industry was the first propaganda organ to be subsidized, encouraged and
instructed to fulfill its social responsibility by producing correct direction products to

231
unite, educate and arouse people’s enthusiasm for the socialist system.
13
The
commercialization of the film industry accelerated only after the global success of
Crouching Tiger, Hidden Dragon in 2001 and China’s entry into the WTO in 2002. As
discussed above, the film reform made China a magnet for foreign capital in the Chinese-
language regions. Hong Kong has become the hub for accumulating capital for the
Chinese film industry. In 2005, among all co-produced films, about 70 percent were
from Hong Kong (H. Zhang and Yu 2006). In 2007, the figure increased to more than 80
percent (Liu and Han 2008, 40). Perhaps more significant, those co-produced films
succeeded in generating large box-office returns. Among the top ten box-office Chinese
films in 2008, all were co-produced with Hong Kong. In addition to Hong Kong, other
regions, such as Taiwan, Singapore, South Korea, Japan, and the US, all contributed to
the rise of the Chinese film industry. For example, Ang Lee’s Lust, Caution (2007)
gathered capital from the US, Hong Kong, Taiwan and China. A Battle of Wits (dir. Jacob
Cheung, 2006), based on a Japanese popular manga by Ken’ichi Sakemi, which was in
turn inspired by Warring States period history in China (around the fifth to third century
B.C.), attracted investments of USD 16 million from the US, China, Hong Kong, South
Korea and Japan, with stars and crews from various regions, including the most popular
pan-Chinese Hong Kong superstar Andy Lau, the National Best Actor of Korea, Ahn
Sung-kee, and well-known Japanese music composer Kenji Kawai. The film opened
nationally in China on November 23, 2006, in Korea on Jan 17, 2007, and in Japan on
Jan 28, 2007 (Tang 2007, 108). John Woo’s 2008 Red Cliff collected an investment of
USD 80 million from the US’s Summit, Japan’s AVEX, Korea’s Showbox and from
Taiwan and Hong Kong, which made it the most expensive film in China’s history up to

13
For further discussion, please see Chapter 4.

232
that time (Q. Zhang 2009, 164). China has steadily become the center of the Asian film
industry. By cooperating with talented creative artists and celebrities in the region, these
pan-Asian co-production may not challenge Hollywood’s global hegemony, but they
should be able to compete successfully within Asia. And China’s influence is no doubt
increasing. Moreover, the growth of the Chinese film industry might be enough to
enhance China’s overseas identity, such as in Malaysia, Singapore, Indonesia, North
America, and Europe. Among these regions, Asia accounted more than 60 percent of the
total overseas box office returns in 2010. Among them, Hong Kong, Taiwan, Malaysia,
and Singapore constitute a total of 26 percent of the overseas box office revenues from
Chinese films.
14
The US’s contribution to Chinese film’s overseas box office returns totals
nearly 35 percent (EntGroup 2011, 208).
Second, in the past few years, by taking advantage of the market created by
Crouching Tiger, Hidden Dragon, a never-ending supply of historical films has been
exported to the world. Several reasons could explain this phenomenon. It is low-risk to
invest in this genre with a basic formula:
KUNG FU
+ EYE-CATCHING, EXOTIC SCENERIES
+ SUPERSTAR TALENT
+ BIG-BUDGET MARKETING
+ HIGH-TECH POST-PRODUCTION

SATISFYING RETURNS
15

14
The 26% total among Hong Kong, Taiwan, Malaysia, and Singapore comprises 10%, 5%, 6%, and 5%,
respectively.
15
However, the international returns have declined in recent years.

233

Further, historical films are not relevant to contemporary Chinese society, and
thus, it is easier to get state approval. This genre fits the national policy of promoting
Chinese culture aboard. By producing these historical films, such as Hero and Confucius,
the Chinese government is attempting to produce a unified and single ancient Chinese
experience to the world, although one might doubt whether today’s China, under the CCP
regime, could adequately represent an “authentic” Chinese culture, especially when one
knows how the Communist Party sabotaged the traditional culture during the Cultural
Revolution. As a matter of fact, the Chinese government’s strategy to elevate the film
industry as an important component for its “go abroad” project is a step toward reducing
the plurality and multiplicity of fantasy and imagination of the Chinese past to a singular
representation of China dominated by the CCP and situated in Mainland China.
16
By co-
opting the transnational capital and creative talents of the Chinese peripheries, the
Chinese government is now able to produce high-concept Hollywood cinema with the
characteristics of authoritarian political ideology to speak and sell to global audiences.
As Mark Harrison contends about films like Hero,
It might possibly represent the invention of a new kind of globalized
propaganda. Like all propaganda, it conveys a profoundly reactionary
message as it excludes the possibility of a plurality of views through a
totalizing version of socio-political life. But it does all this with a full
grasp of the techniques of the most sophisticated global image making.
Like an expensive global advertising campaign for a multinational
company, it dazzles with the spectacle of its saturating imagery, but
rather than a product, it is promoting a state-sponsored political
ideology. (Harrision 2005)

16
One might argue that many historical films also appear unrelated to the CCP regime. Yet some, such as
Hero and Confucius, do promote state-sanctioned values. Furthermore, certain national films, such as Ip Man
(2008) cater to mainland audiences as well as the government.

234
Although China’s film industry has expanded its international market since 2003,
it is hard to argue that China’s soft power or national image has been on an upward curve.
A successful international market, however, is the first and foremost condition for a film
to be treated as an instrument for a nation to build and sell its image.
So, what exactly have China’s films tried to sell these past few years?
Unfortunately, examining Chinese blockbusters such as Hero, Curse of the Golden
Flower, Warlords, Red Cliff, art house films like Lost in Beijing, Summer Palace, The
World, Blind Mountain, and low-budget but commercially successful films, such as Big
Shot’s Funeral and Crazy Stone reveals that all these types of films failed to build and sell
a positive national image abroad. Through a realistic aesthetic, art house directors
tended to emphasize the unpleasant aspects of contemporary Chinese society, which both
the state and the market typically turned a blind eye. These films were either banned by
the state government or shunned by the domestic moviegoers. Although international
film festivals might award them, these films are difficult for the state government to
honor as a means to promote the national image. Additionally, despite their success in
China, it was difficult for low budget local films to break out into the West. As an
example, Rosen describes Feng Xiaogang’s 2001 picture Big Shot’s Funeral, an enormous
hit featuring well-known actors from Mainland China, Hong Kong, and the US Industry
titan Sony Classics distributed the film in the US, where it opened on January 17, 2003.
The fan favorite ran for just six days, grossing a startling $820 (Rosen 2010, 51)!
Moreover, although some of the Chinese blockbusters conquered the American market,
the messages they offered contained little in the way of substance. Zhang Yimou, Chen
Kaige, and Feng Xiaogang are regarded as the superlative triad within today’s Chinese
cinema, and their extravagant budgets and eye-popping special effects films were duly
dazzling. However, the question remains: will Americans see a film with subtitles?

235
Besides China’s intricate 5,000-year history, stunning natural landscapes, and globally
popular martial-arts genre — all part of a resourceful mine of exotic stories to satisfy
foreigners’ Chinese mythical imaginations — what else can these films offer to foreign
audiences? How can they go beyond enticing audiences with aesthetics — e.g.,
calligraphy, swords, and dazzling colors – to actually provoking thought? If these are the
images of traditional China, then it was exactly a reflection of the current authoritarian
regime. It is even harder to believe that these mega-films are successful at promoting
China’s national image. However, the growth of the Chinese film industry remains a
major component for the Chinese government to promote its culture and soft power.
6.6 Conclusion
This chapter has provided context for understanding China’s challenges in
managing its international image during the film reform, between 2002 and after
entering the WTO. Among a variety of instruments – such as the expansion of CCTV
Chanel 6 coverage and the spread of Chinese language classes – to improve its
international image, the chapter has focused on one instrument, the film industry that
rarely appears as an analytical framework in the study of China’s soft power. Indeed, as
Nye argued, “China does not have a cultural industry like Hollywood,” but its film reform
since 1978 could be described as transformative (Nye 2005). Film has been
transformative as a propaganda tool in educating the domestic masses. It has been
particularly successful in reaching international audiences, especially those among the
“Chinese diaspora,” through emulating Hollywood’s studio structure and cinematic
techniques and co-opting transnational capital, creative talents, film crews and stars from
Hong Kong, Taiwan, Singapore, Korea and Japan, China has been able to produce its own
brand of blockbusters. By reforming its film industry, the Chinese government has not

236
only constrained Hollywood’s influence on China’s territory, but also increased China’s
visibility on the global cultural stage, strengthening the bond between overseas Chinese
communities and the nation of China.

237
C H A P T E R 7
How Big is the Cage?
Rapid Industry Commercialization and Filmmaker Strategies for Survival

7.1 Introduction
Although the policy environment for producing films has improved since the late
1990s, filmmakers nonetheless continue to confront a variety of operational and political
challenges. The distribution sector is dominated by state-owned enterprises, censorship
remains strictly in place, and the exhibition sector remains biased in favor of the
government’s “main melody” films. On a day-to-day basis, independent filmmakers in
China still face a variety of regulations and rules that constrain their creative freedom
whereas those filmmakers in advanced capitalist economies have generally overcome.
Yet many constraints on China’s film industry have in fact been alleviated since the late
1970s. By examining how China’s government had dealt with the increasing number of
transnational co-productions and looking at how different groups of filmmakers have
handled disputes, we gain insight into how authoritarian durability has been associated
with the rapid commercialization of the Chinese film industry.
First, China’s political institutions have proven to be flexible and responsive to the
various challenges that filmmakers and studios have created over the course of the reform
era.
1
Second, contrary to the expectations of structural theories of democratization,
commercialization of the film industry, and, more broadly, of the media industries in
China, has not created a pro-democratic class of media elite. To illustrate the logic of the
latter argument, I propose a typology of filmmakers’ political behavior, which explains

1
As previously discussed in the Chapter 6.

238
how film-industry talent relates to the state in very different ways depending on
proximity to and sociability with state officials, capital gathering ability, and aesthetic
inspiration and filmmaking sensibility. These attributes shape the attitudes of
filmmakers and determine the resources available to them when they face various
challenges. We will see that very few filmmakers have the ability or desire to confront the
state to defend their interests. The number of private filmmakers may be growing, but
they are not likely to participate in political activities that could contribute to a
democratic transition.
7.2 Filmmakers: A Typology
Filmmakers
2
can be classified into four broad categories, depending on their
coping strategies; these categories are: loyalists, rebels, local champions, and
opportunists. Filmmakers may choose to avoid confrontation with the state agents; they
may insist on creative freedom and produce films without the approval of the censors, or
they may demonstrate their cooperation with the system by complying with regulations,
either willingly or reluctantly. According to the classic structural arguments, media
workers must engage in politically aggressive activities to undermine the authoritarian
regime and push for democracy. This means media workers must be neither politically
nor economically dependent on the state. By “politically dependent,” I mean that
filmmakers possess some social and political resources bestowed upon them by the state,
such as close connections with the government bureaus or they originally worked within
the system (tizhinei), to articulate their concerns to the state officials. Although they
have the ability to express their concerns to the government, they have no desire to

2
This chapter uses the broad term filmmaker(s) to describe producers, directors, scriptwriters, and other
workers related in the process of making film.

239
change the system. Thus, the more resources they have, the more loyalty they will show
the system. Being economically independent of the state means filmmakers are able to
gather capital individually without the support of the state apparatus, and that their
productions are sustainable in a market that has not been created by the state’s
protectionist policies, like special organized screenings and special public screening slots.
If filmmakers are economically independent from the state, they are more willing to
defend their interests in an assertive manner, and directors who are economically
independent are mostly unsatisfied with the current circumstances.
The relationship I described above can be imagined in a two-by-two matrix of
filmmakers’ attitudes toward the state’s regulating of filmmaking activities (see Table 7.1)
Loyalists in Quadrant I are both politically and financially dependent on the state, rebels
in Quadrant IV have neither political nor financial support from the state. Quadrants II
and III encompass two types of independence from the state: first, in Quadrant III, local
champions have the ability to gather capital to fund their film productions on their own
and they might not need the state’s special policies to distribute their films because they
are already famous enough to attract audiences domestically and internationally.
Politically, these directors are outside the system, but since they have been working in the
industry for a long time before they actually worked independently, most of them have
developed a close relationship with the authorities, meaning they were originally part of
the system but, with economic development, they “plunged into the business sea”
(xiahai). Due to this, they choose not to confront the state even though they have the
ability to do so. Second, in Quadrant II, opportunists are outside the system, and mostly
they are foreign, often from Hong Kong, Taiwan and Hollywood, so they lack the political
resources to voice their discontent directly to the authorities. They choose to stay loyal to
the system in order to enjoy supportive policies from the state, such as the opening of the

240
Chinese film market to distribute their films and gain assistance for their productions in
Mainland China.
In this typology, I focus on the implications of filmmakers’ dependence on the
state to demonstrate that although the economy has developed and commercialization of
media outlets has improved, political democracy remains stagnant. In the following
sections, I will illustrate how the activities in which filmmakers engage in have varying
levels of political impact, as measured by policy changes.

241

Figure 7.1: Types of Filmmakers in China

P O L I T I C A L L Y D E P E N D E N T O N T H E S T A T E
F I N A N C I A L L Y D E P E N D E N T O N T H E S T A T E
YES
YES NO
T Y P E I

Loyalists
T y p e I I

Opportunists
Produce main melody
films
Work at state-owned
studios
Almost 100%-funded
by the state
government
Receive special
protection
Mostly engage in
co-production
Work outside the
system, mainly coming
from Hong Kong,
Taiwan, and foreign
countries
Make transnational
investments
Highly dependent on
government’s economic
policies

NO
T Y P E I I I

Local Champions
T Y P E I V

Rebels
Well-known directors
Outside the system but
cultivate good
relationships with the
state agents
Able to gather both
private and state
capital investments for
their productions

Some did not get
approval for their
productions and avoid
interacting with the state
agents
Have a hard time
funding their projects
and distributing their
films
Receive investments
mostly from foreign
countries, private
sources, and family

242
7.3 Loyalists
Filmmakers who are “loyalists” are unlikely to become democrats or to push for
democracy. This group of filmmakers is also the most difficult to study because most of
them either came from the government or are directly connected to government
authorities. Based on my interviews, I would conclude that this group of filmmakers is
unlikely to voice real complaints about the system, although it is difficult to determine
whether they are really content with the present circumstances. Such a close relationship
with the state makes it impossible for the filmmakers to voice complaints or apply
democratic pressures.
Feng Xiaoning, the director of many main melody films, such as The Sino-
Japanese War at Sea 1894 (2012), Super Typhon (2008), Basic Interests (2004), Red
River Valley (1999), and Grief over the Yellow River (1999), and Han Sanping, director
of some of the most famous main-melody films, such as The Beginning of the Great
Revival (2011), The Founding of a Republic (2009)
3
and The Story of Mao Zedong
(1992), both proudly call themselves loyalists, and of course in their propaganda they do
not mean anything sinister. They simply assume that they possess some true instrument
for understanding social change and socialism, and that this instrument allows them to
interpret past, present, and future. It is their responsibility to help the country bring its
people the “truth,” and they know this “truth” is the precondition for proper socialist
development. They do not mean to delude; they mean to educate. Feng Xiaoning says,
“It is our duty to convey heroism in films. […] And I want to produce films for all Chinese
intellectuals and for people with a conscience. I want to use film as a tool to raise the

3
The Beginning of the Great Revival (2011) and The Founding of a Republic (2009) are co-directed with
Huang Jianxin.

243
consciousness of the public, which will result in their greater concern for our society”
(Zheng and Pan 2004).
They also want to make this propaganda more interesting to their fellow
countrymen. They understand that if you do not have any entertaining elements, you do
not have any credibility, so they have pushed to be able to produce more commercial and
big-budget films in recent years. Gao Yang, manager of the Chinese Communist Youth
League Central Film and TV Center, told me, “We want to make films to attract
audiences. And now with more funding from the government, we hope our films can be
accessed by foreign audiences too” (Interview 38). Gao elaborates:
First, we need to write a story that can be easily understood by ordinary
people. We are no longer just telling a big story with conceptual ideas in
a lively style. So, be simple. Second, we want to coproduce with other
film companies outside China, such as those in Hong Kong and
Hollywood. They know better than we do how to promote films and
operate the film business. So, be open. Third, via cooperation with
foreign partners, we want to innovate our filmmaking techniques. Film
is used for propaganda elsewhere, too—not only in China. There are a
lot of Hollywood films that promote the greatness of America. We
believe every film does carry a significant meaning to its audience. The
problem for Chinese main-melody films is we too often express our ideas
awkwardly. So, the third point is being smart. (Interview 38)
Patrick Zhang, sales manager for the CFG Marketing Corporation, explained that
the failure of Chinese main-melody films did not lie in their quality, but in the poor
marketing, especially in second-tier cities and rural areas. “Nowadays,” he recalled,
“main melody films hit the box office. We have a variety of movie stars in the movie and
it’s not difficult to promote the films in big cities. However, there are still a lot of areas
we cannot reach” (Interview 6). In response, vice president of EntGroup Consulting Amy
Liu remarked, “Currently we can access almost every big city’s box-office data, and that
of some major town-cities. However, this is far from enough to have accurate data.
Compared to the US, we are still in a primitive stage” (Interview 7). Both Zhang and Liu

244
both imagine the future of the Chinese film industry as hinging on the development of
second-tier film markets and rural areas. Gao observed that the government had already
began developing rural film markets, though he contended that the most effective way to
reach audiences in those areas is via the TV. While loyalist filmmakers are producing
big-budget main-melody films to fulfill demand in the cities, they are also making a lot of
small-budget main-melody films targeting rural populations (Interview 38).
Loyalist filmmakers do not participate in any activities associated with protests
against the government. When I asked Gao what he thought about the 1989 Democratic
Movement, he wagged his head and did not say a word. A professor from the
Communication University of China concluded that main melody films were often
politically conservative, arguing that while they exposed lurid examples of corruption,
they generally present the state as benign and celebrate many hardworking and well-
intentioned officials and police. “Don't bother to think they [the main melody films] will
say anything about democracy. It would be encouraging if they do not condemn it”
(Interview 30).
In any case, loyalist filmmakers contribute very little pressure to change policy.
The more directors who turn into loyalists, the less encouraging it will be for the state to
relax its control over the media sectors.
7.4 Local Champions and Opportunists
Filmmakers who exhibit cooperative behavior are unlikely to initiate change and
they are more likely to be on the same bandwagon as the government. These two groups
of filmmakers account for the majority of filmmaking talent. They comply with most
official requirements, meaning they have tailored their work to satisfy the censors, jointly

245
produce films with state-owned enterprises, and generally accept changes to scripts as
requested by the authorities.
Although these two groups of filmmakers comply with most of the official
requirements for producing films, my study takes into account the fact that they may
differ in their attitudes toward the government. Some of the local champions are media
elite who believe the reforms and the system generally work for them. Some have started
their own business in other industries, such as in real estate or Internet technology, and
later started to invest in the film industry. This group of filmmakers has the resources to
complain to state entities, because they have established networks and interactions with
the staff of the state, accumulated either through past experience in the film industry or
nurtured through social networks in other fields. However, they rarely confront state
entities directly because they are generally satisfied with their current situation, and they
believe the current system works in their favor. Most importantly, some individual local
champions share a positive view of the reform process and of the national government in
general.
Unlike the local champions, opportunists comply with the regulations somewhat
reluctantly. In many cases, opportunists feel despair toward the system; however, they
have no other options available to generate income. Opportunists typically come from
outside China, most often from Hong Kong, and usually have some resentment but lack
the political and social resources to do anything about it. This group of filmmakers note
that they “feel powerless” (Interviews) and ask friends, relatives and other personal
networks for assistance when encountering disputes with the authorities. Overall,
opportunists account for half of the producers of the top 30 box-office hits in 2011
(CFAIRC 2011, 49). Cases of local champions and opportunists are presented below.

246
7.4.1 Local Champions
Wang Hui, chairman of a TV and Film Company in Beijing, is the typical local
champion filmmaker (Interview 5). He is proud of what he has done with his business
and is grateful to the government for giving him the opportunity to do so. Wang entered
the film industry in the late 1990s. Before that, he worked in a local plastering factory in
Shandong and then gained some experience in house building in the 1980s. In the mid-
1980s, he resigned from his position and started forming his own property development
company, having noticed a rising demand for houses in rural areas. Some years later, he
went to Beijing to invest in commercial real estate. In early 2002, he started to invest in
film and TV production. Wang attributes his involvement in film to the rapid real estate
development and government policies, but he also stresses that his success has relied on
his own hard work, although the rapid real estate development has nothing to do with
making him decide to enter the film industry.
Last year, he came to the US to start a company and plans to have his first
coproduction with Hollywood. Although he did not tell me what the project was about,
he shared that the Chinese government had been encouraging him to explore the
overseas market and co-production possibilities with Hollywood, by way of treating him
to banquets and offering him loans. Wang’s positive attitude toward the government is
best summed up in his own words:
I have no complaints about the government. It’s developing and
improving. There are a lot opportunities and support. We want to
produce more films to entertain everyone! (Interview 5)
Like Wang, Caroline Guo also started her own business in real estate in the early
1990s in Beijing. She entered the film industry when she noticed that the government
was offering preferential policies to gear up the filmmaking business, which made
investing in films less risky than in the real estate, as the government was trying to reduce

247
investment in the housing market by administering more restrained policies to curb the
hype (Interview 3). She describes her business, including dozens of housing properties
and shopping malls in Beijing and other cities:
Investing in a film costs me tens of millions of RMB, but investing in a
home building project in Beijing might now cost billions. It’s a lot
cheaper, and much less risky. Why don’t I join the film business club?
[…] The only thing I need to do is to empty a couple of floors in some
buildings or malls and remake them into cinemas. I don’t need to pay
rent because I own the places. I have my own theaters to screen my
films and I am planning to open a new cinema circuit in the future. All I
am going to do is to have a one-stop service for the film business,
beginning with production, and continuing with distribution and
exhibition.
Optimistic about the future, she adds,
Everything is going better. Government supports the film business. As
an investor, I have the advantage of joining this club. Staff officials offer
great help, even though I had no background in the industry. But now I
am learning and operating it like a real estate business.
Interviewee Meng Ji, who was once an independent film director and now works for local
TV stations, proclaims,
It’s so easy to make films in China nowadays. Although you have to
apply for a lot of permits, most of time [government officials] are not
rigid; they are quite flexible. When I compare it to the shooting
experience in Canada, I’d prefer to stay in China rather than in Canada.
Echoing Meng and Guo’s experiences, Zhou Jing and Luo Hongtao from CCTV
both noted that the government has changed significantly in its approach to both the TV
and film industries. “It is very open now,” Zhou said (Interview 15). “I don’t feel any
pressure working at CCTV. The editor did not intervene much on my shows,” Luo
recounts (Interview 16).
Local champions are not limited to those with large-scale business interests like
Wang and Guo. A number of individual film industry workers are also local champions
with a very positive view on the current situation (Interviews 2 and 9). Consider, for

248
instance, the experience of Wang Win, mentioned above, who opened a small retail VCD
shop in Hunan and has developed it into a national distribution and exhibition Film and
TV Company in Beijing and Shenzhen. Wang did not want to say a lot about his
background, but he told me his career was launched because of Deng Xiaoping’s opening
policy. He explained, “Without Deng Xiaoping, I would not be here to talk to you, I would
not have as much confidence as I have now” (Interview 2).
Song Zhixing, a computer scientist, first opened his own company in early 2000
in Hunan with a focus on an online movie ticketing system (Interview 4). “The online
movie ticketing system in China has just started and we still don’t have a lot of
knowledge, but we’ve got the support from the government,” he said. When asked what
kind of support has been offered by the government, he explains vaguely, “A lot of policies
have supported me, including from the banks and from related departments. In general,
without assistance from the government, it would take a long time.” Song thinks that
other cities in China may be better for his business than his current location, but he does
not intend to move, simply because he does not have the networks outside of Hunan. He
appreciates the opportunities he has had to make a living and is confident that the policy
environment will continue to improve for the film industry.
In addition to those described above, local champions also include filmmakers
who started their film careers in the 1980s and earned their success in the early 1990s.
Film policies issued since 2002 have created a more open and accommodating
environment for domestic players, who have shored up the domestic film industry locally
and “in competition with Hollywood in the world market” (Rosen 2006). After the
release of Zhang Yimou’s Red Sorghum (1988), this generation of filmmakers, including
others like Chen Kaige and Feng Xiaogang, moved from their marginalized status to
center stage and became part of mainstream, commercialized culture. Their films

249
marked the advent of mass-produced, profit-oriented films, which aimed for
commercialization, entertainment and consumption. At the turn of the century, such
works as Not One Less and The Road Home by Zhang Yimou, and The Emperor and the
Assassin by Chen Kaige, have further confirmed the penetration of “dominating speech”
(Zhudao huayu) in their works. A recently released film called The Flowers of War
(2011), directed by Zhang Yimou, was seen by many people as hate-mongering, anti-
Japanese propaganda (McCarthy 2011; Xu 2011).
In short, these filmmakers have a keen sense of the size of their “cages.” They
know what the government wants, and what the country needs in order to progress. They
have to choose a way to make money for themselves by allying with the Chinese
government. The issue with the current Chinese film industry is not that artists cannot
criticize the regime; indeed, this group of filmmakers, especially the famous ones, quite
often criticizes government policies. For example, Zhang Yimou describes,
There are all kinds of practical challenges we are currently facing, but in
the future I think the single most important thing we will have to face is
a major revolution of the entire system around which the film industry is
organized in China. We need to give filmmakers more space and make
room for national cinema to develop and unfold. System reform is the
most pressing need for us in the film industry. I’m not sure if I will see
it happen in my lifetime. I’m not sure if I will live to see true creativity
in China and be able to realize my dream of exploring the Cultural
Revolution through cinema. I don’t know. But I do know that this is the
single most pressing problem. (Berry 2004, 136)
However, the primary requirement to be successful in China is to depict an altogether
unreal world that is in no way connected to real Chinese life, in most of the cases.
4

4
Although some films such as Feng Xiaogang’s films If You are the One? and Jiang Wen’s Let the Bullets
Fly have some elements that reflect real life, or uses the past to reflect some realties of the present.

250
7.4.2 Opportunists
In contrast to the local champions who are basically satisfied with current
conditions—or relatively successful in using their talents to enter the Chinese film
market—opportunists from Hong Kong or, generally speaking, filmmakers who come
from outside China, have many complaints but choose to bear them silently. Typically,
they complain (privately) about censorship and state intervention (Interview 29). A
Hong Kong director named Derek Yee Tung-Sing says, “When shooting a movie in China,
the question is not ‘What do I want to shoot?,’ but ‘What can I shoot?’” (Law and Yee,
2012).
When Hong Kong films entered the Chinese market, they faced a lot of
constraints. Unlike local champions, however, opportunists have a tougher time
communicating with local film investors who might not quite understand the concerns
and priorities of filmmakers in Hong Kong. For example, Stanley Kwan Kam-pang,
director of Everlasting Regret (2005), said in an interview that the producer of the
Shanghai Film Studio rejected the art designer he had picked, William Chang Suk-ping,
because of the high cost of recruiting the designer, ignoring the importance of William
Chang’s work to Kwan’s aesthetic demands (K. M. Chan 2011, 136). A Hong Kong film
critic
5
explained that, while investors in China mostly have limited experience in
filmmaking, they have money and curiosity about the film industry. As they are not
professionals in the field, their involvement usually translates to interference in the
process. “Hong Kong filmmakers need to deal with these people, although it is
exhausting” […] But this is the tradeoff to co-produce with China” (Interview 33).

5
A Hong Kong film industry blogger, this interviewee wishes to remain anonymous.

251
Kwan also pointed out that film content is severely censored by the Shanghai Film
Studio; they removed footages of the Cultural Revolution, the death of Zhou En-Lai,
political reforms and the opening up of Mainland China (K. M. Chan 2011, 137).
Furthermore, depictions of Hong Kong film have to be altered. There are plenty of
examples of re-editing, including in the recent film Life without Principle (dir. Johnnie
To, 2011), in which the protagonist originally went unpunished for her crimes at the end
of the film. Ultimately, it was changed so that she surrendered herself to the police.
Other re-editing examples can be found in Infernal Affairs, PTU, and Running on
Karma, both of which had to remove the depictions of careless police officers and the
scenes about fate and predestination.
Filmmakers who did not begin their careers in China, such as Clifton Ko Chi-Sum
6

and Alfred Cheung Kin-ting, feel relatively helpless when it comes to the increasing trend
of Hong Kong coproduction with China (Interviews 36 and 37).
7
Notes Ko, “Personally, I
think after ten or so years, when the Chinese film market becomes more open, the term
‘Hong Kong films’ will not exist anymore.” Cheung prescribes, “Hong Kong needs to melt
into the paradigm of China. Probably, it still could have some Hong Kong characteristics
or the film story might still happen in Hong Kong, but they will no longer be called ‘Hong
Kong films.’” Film director Stanley Tong expresses frustration with the identity of
filmmakers in Greater China, especially after the handover of Hong Kong to China in
1997:
Since Hong Kong returned to the motherland, the [Chinese] government
has opened its mainland market to Hong Kong movies and also Hong
Kong filmmakers. […] This has brought up a new trend: we are no longer

6
Hong Kong film director, actor, producer and scriptwriter. He has directed more than 40 Hong Kong
films, including, Chicken and Duck Talk (1988), It’s a Mad, Mad, Mad World I, II and III (1987, 1988, and
1989, respectively) and It’s a Mad, Mad, Mad World Too (1992).
7
Hong Kong film director, actor, writer and producer. He directed, wrote and starred in the movie Her
Fatal Ways, a 1990 Hong Kong crime-comedy film.

252
divided into Mainland directors, Hong Kong directors and Taiwanese
directors. We are all under the purview of China, we are all collectively
referred to as Chinese directors, and the movies we produce are all seen
as “Chinese- language films. (Ren 2008, 192).
“Cultural China” – a term borrowed from Tu Weiming (1991) -- organizes “China”
into three spheres:
Sphere 1 — China, Hong Kong, Taiwan, and Singapore
8

Sphere 2 — Chinese communities throughout North America and
Southeast Asia
Sphere 3 — Encompasses those people who understand China and
speak Chinese, including scholars, Chinese specialists,
journalists, and businessmen
The members of all three spheres compose the concept of “Cultural China” (He and Chen
1998, 2). Regarding the role of different places in promoting “Cultural China,” Lee Chin
Chuan continues the discussion of “Cultural China” with a special focus on Hong Kong:
The most inner sphere – China and Taiwan, are ruled by dictatorships.
Both of them have politicized the “culture” where the cultural space was
suppressed until it was almost non-existent. Some of the academic
culture [in these two places] was treated as the synonym of ideology
propagation and political propaganda. The only exception is actually
offered in Hong Kong. But unfortunately this colony emphasizes the
economy but refuses to acknowledge the importance of culture. The
commercial market is placed on top with the potential to override the
significance of culture. In the territory of “Cultural China,” Hong Kong
has played a pivotal role, which is indispensable; however, its own
cultural contribution is clearly not enough to become a climate. (He and
Chen 1998, 3)
Lee’s observation is profoundly insightful. Crippled by the financial crisis in 1998
and the influx of pirated VCDs and DVDs, Hong Kong’s film industry has faced a period
of stagnation since the mid-1990s. Despite the fact that in 2002, the Chinese government
attempted to rejuvenate the Hong Kong film industry by signing the CEPA (Chapter 6),
the overall economy remained sluggish, and the SARS outbreak in 2003 further

8
Chinese people constitute significant populations within all of these regions.

253
undermined confidence. Co-production with China and the entrance into the Chinese
market appeared to be the only path to averting the demise of Hong Kong films. As
Cheung Tung-Joe
9
observes,
Since 2000, co-production has become the most important remedy in
improving the Hong Kong film industry. The essence of this “remedy” is
related to money! (Interview 39)
Although the success of Stephen Chow’s Kung Fu Hustle and Shaolin Soccer
inspired optimism, the credit was attributed to Chow’s popularity and charisma. The film
industry remained cautious and the number of admissions and total number of releases
have dropped by nearly half from 1996 to 2006. However, no one laid any doubt that
Hong Kong would remain a vibrant center of cultural production that would export
virtually all forms of culture to China. The increasing number of Hong Kong filmmakers
joining the Chinese film industry via “co-production” indeed had provided a good supply
of creative talent to stimulate the development of the Chinese film industry. In film, a
medium where Chinese-produced work has found it nearly impossible to compete against
foreign entities, there is ample evidence that Hong Kong’s cooperation with China
actually served China’s interests.
Ng See-Yuen
10
(Interview 28) describes two great uncertainties about China’s film
industry: first, when the rules might change, and second, when the existing rules would
be enforced. “China’s approach toward Hong Kong filmmaking talent and other foreign
investment is to maximize the influx of advanced technology and management skills,” he
said. “Mostly, this helps the state minimize the influence of foreign and Hong Kong
companies in China, as we are all working within its system and playing its game.” Before

9
Honorary President of the Hong Kong Film Directors’ Guild.
10
Hong Kong film director, producer, and scriptwriter. He is Chairman of the Federation of Hong Kong
Filmmakers.

254
the CEPA, Hong Kong investment was mostly banned, or filmmakers had to go through
special middlemen to communicate with the Chinese side. However, there were still a
number of state-approved arrangements that would give Hong Kong investors and film
talents an opportunity to participate in the market. Ann Hui and Tsui Hark are two
prominent examples of directors from Hong Kong who have co-produced a number of
films in China since the 1990s. According to the regulations at that time, Hong Kong
investors could set up joint investment firms with Chinese representatives, such as Hong
Kong-based Sil-Metropole Organization Ltd., to initiate investments in the mainland’s
film industry. Production would then take place in Mainland China. The foreign investor
would harvest returns according to the bilateral agreement. Currently, Chinese films
seek technology and human capital from Hong Kong and other foreign investors.
Foreign investments, according to Ng, is a tool for the Chinese state. “The
government resists ceding profits and control of censorship to foreigners,” he added.
“The rationale for inviting foreign investors and talent and pushing for the
conglomeration of companies and the listing of companies on foreign stock exchanges is
to bring in foreign capital that is no longer under the control of foreign companies. What
the Chinese government needs from foreign investment now is talent and technology.
They have an abundance of cash but they do not know how to utilize it.” He also revealed
in another interview that in Hong Kong, you have more freedom: “You can shoot
whatever you want to shoot, although you need to take the risk,” he said (Lie 2007, 81).
What he was implying is that making films in China is easier nowadays, as the market is
big enough to support the Hong Kong films, and rapid economic development has
created an affluent class of local capitalists. However, owing to the nature of the film
industry in China, the Beijing government has played an active role of controlling the film
production process. Hong Kong and foreign filmmakers are increasingly finding

255
themselves in Beijing’s grip because of this. Therefore, the lesson to draw from
opportunists in China may be that the lure of Chinese markets is sufficient to induce the
filmmakers, who may not be interested in any political change outside the Chinese media
systems, to comply with Chinese censorship and regulations, who maintain the ability to
exclude and control. Hence, as a report in The Wall Street Journal states, while the
Chinese government has made great efforts to lure foreign filmmakers, it still maintains
a tight grip over who participates in its film industry and what they are allowed to make
(Kung 2012).
While the opportunists tend to express fatalistic attitudes about their difficulties
in making films in China, they also demonstrate considerable resilience and a pure
pursuit of capital accumulation. Filmmaker Teddy Chan Tak Sum
11
insists that he does
not mind producing main melody films for the Chinese government. As he explains,
I will continue to make main melodies. I do not think it is right or
wrong. I just wish to produce movies with Chinese characteristics… I
also want to show the strength of China. As a next step, I am going to
shoot a Chinese police story. As long as I have a large investment, I will
produce great movies. (T. T. S. Chan and Law 2010, 88)
Filmmaker Jacob Cheung Chi-Leung
12
also frankly admits that he “will produce
more commercial films [with the Chinese government] with the goal of gaining more
capital” (Wang and Cheung 2009, 36). Given their pure desire of making profits, they do
not see any point in changing the system. Filmmakers who fall into this “opportunists”
category are generally willing to follow formal norms of operation, and unfortunately
they are not likely to initiate any strategy that could lead to democratizing outcomes.

11
Hong Kong film director, producer, scriptwriter, and actor.
12
Ibid.

256
7.4.2.1 Strategically adaptive behavior
The opportunists find the process of negotiating between Hong Kong producers
and mainland censors difficult. But this does not point to the end of co-production, since
the opportunists have demonstrated strategies to overcome this difficulty. In addition to
following the typical norms, filmmakers have been able to negotiate the boundaries of
censorship by framing some issues in different terms and using the shield of political
legitimacy and factual accuracy to contribute to the discussion on some issues. When the
filmmakers make conscious or unconscious decisions about censorship, they mostly
apply either the term “political” – referring to topics that are sensitive – or “soft” – which
points to topics that are not sensitive. This distinction with regard to sensitivity acts as a
shortcut in deciding whether to cover a topic or how to present concerns and interests in
a movie. This is actually a strategically adaptive behavior.
In my interviews, the terms “political” and “soft” are hardly ever defined by the
practitioners; neither is there any commonly accepted definition among film talents.
However, in the context of the film industry, “political” usually refers to those films that
showcase a core national political leader and are most often described as “boring” or
“dry”; in contrast, “soft” films are related to ordinary people, which are usually promoted
as “funny” and “entertaining.” “Political films” usually revolve around a strong theme
about government policies, while “soft films” stick close to ordinary people’s lives and are
about what ordinary people care about (see Interviews 1, 18, 29, and 32). The concepts of
“political” and “soft” illustrate some features of filmmakers’ conception of filmmaking in
China: first, the distinction implies a hierarchy of films’ importance to the government,
even though the CCP censors more often on the topics it regards to be important and
retreats from its role when it comes to topics it considers less harmful to the party-state’s
legitimacy; second, Chinese audiences are perceived to be politically apathetic and

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interested only in entertaining films. Despite the distinction between “political” and
“soft,” the boundary between the two concepts is not as clear as it may appear. For
example, ordinary people are interested in stories about corruption. The censors are very
sensitive to this type of film. Says Chang: “Although those core political topics are under
strict control by the party, many topics we may consider apolitical or soft are in fact
considered politically relevant by the government” (Interview 29).
As I discussed in Chapter 2, Section 2.4.2, the Chinese government has banned
several topics. For instance, the authorities prohibit stories with content about gambling,
gangsters, and ghosts; prostitutes, drug traffickers and criminals cannot have positive
descriptions; bad guys must be arrested; and ruthless characters cannot come from
Mainland China. Below I will explain how each of these principles are related to the
institutional structure in which filmmaking is embedded.
7.4.2.1.1 “Justice cannot be conquered by evil.” The film Overheard (dir. Alan
Mak Siu-fai and Felix Chong Man-keung, 2009) is about a team of Criminal Intelligence
Bureau officers who install interception devices to monitor a financial company and then
use the stock market information for their own benefit. According to director Alan Mak,
the film couldn’t pass the examination process, as the major theme centered on a team of
police officers committing crimes. Later, Derek Yee, the producer of the film, suggested
a change:
[The officers] are committing crimes, but if one of them thinks it is not
right to do that and attempts to correct other officers, the film will
become an anti-corruption film. Although the moral character fails to
prevent the injustice from happening, we just need a character who
refuses to use the information to his own advantage, which is more than
enough to get through the censor. (Chun, et al. 2009, 31)
So, the message becomes “justice cannot be conquered by evil” (Xie buneng sheng
zheng). Films can only move through the censor if their central theme promotes a

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positive attitude and if they portray a world in which justice beats evil, good characters
are rewarded and people are punished when they don’t obey the rules. More than that,
the theme should convey a solid lesson about the miserable consequences of being a bad
man. Indeed, this is exactly the way schools educate their pupils!
7.4.2.1.2 “Talk more about the past.” Another tactic sure to please the
authorities is making films containing stories related to ancient China, which can avoid
the taboos of contemporary China’s politics and social issues. Films such as China 1911,
Shaolin, Detective Dee and the Mystery of the Pham Flame, Swordsmen, A Chinese
Ghost Story, The Sorcerer and the White Snake, Ip Man 1 and 2, The Four, and Painted
Skin: The Resurrection, are stories related to ancient China that perfectly suits the
Chinese authorities. One can interpret this trend as an attempt to please the Beijing
government, but at the same time, it also constrains the Hong Kong film industry’s
development. Stanley Ng, a Hong Kong film critic, believes that increasing the number
of ancient tales is the “best option for Hong Kong filmmakers entering the Chinese
market without much pressure from the censors.” The number of movies focusing on
ancient tales has increased steadily since 2000, especially after 2004 and the signing of
CEPA. Despite this growth, many of these films did not do well at the box office. The
main reason is that they have no freshness of form or content. As a government official
from Shanghai put it, “If you have one type of food every day, it will lose its taste. Chinese
audiences want some new genres; they don’t want us to repetitively provide them with
the same types of films” (Interview 34). However, if one’s aim is to gain approval from
the authorities, talking more about the past is often a successful tactic.
7.4.2.1.3 “Do not show blood and nudity.” The government has encouraged the
production of more film genres in order to improve the industry’s overall quality. To a
filmmaker, filmmaking usually needs to exaggerate visual expression, which often means

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a sufficient number of bloody scenes. “Blood and violence are sensitive to the censors,”
Cheung said, “Since in China there is no ratings system, these scenes are usually
prohibited. But there are some exceptions. For example, The Stool Pigeon (dir. Dante
Lam, 2010) has some supremely violent and bloody scenes, and they are not expressed in
a manner that the Chinese government would conventionally accept. I think this is a rare
case. Maybe the censors think bloodiness is not the main theme.” Cheung continued by
saying, “Generally we don’t show the really bloody scenes, and instead use other special
effects to produce the feeling of fear” (Interview 39). In addition to bloody scenes, erotic
movies and films with adult content are banned in China. “Scenes in Painted Skin just
focus on actors’ and actress’ faces,” director Gordon Chan Ka-Seung said. “Do not show
the full process; just present the result. I think that’s a way for me to avoid the censors”
(Interview 29).
7.4.2.1.4 “Ghosts can only be in the heart.” Gordon Chan said he and other
major Hong Kong directors would continue their co-productions with China, although
they are frustrated by film censorship. He added that in his experience making films,
including Painted Skin (2008), has shown him that there are shades of gray in the
censorship regulations that can be exploited. For example, the “evil spirit”(yao)
character in Painted Skin or the “demons” (mo) in the movie A Chinese Ghost Story (dir.
Wilson Yip Wai Shun, 2011) have been allowed, but “ghost” (gui) characters have been
banned. He describes,
The so-called “horror film” (in Chinese “ghost films”) in China has
morphed into a “non-ghost-type- film.” Directors understand how to
create the horrible atmosphere without the appearance of an actual
ghost. For instance, my film Painted Skin is based on a traditional
Chinese ghost story, but in the end on the big screen, the ghost became a
fox spirit (hu yao). In other films, such as Curse of the Deserted (dir.
Law Chi-Leung, 2010), there are no real ghosts in the movie. The
terrifying atmosphere in the movie is created by the lonely world of

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terror, which cannot be told or seen, and that is the most horrible thing
in the world. (Interview 29)
There may be shades of gray in portraying a ghost story, but this does not mean that
Hong Kong filmmakers feel comfortable with these variations. Indeed, as Chan stressed,
variations do not mean flexibility, “it’s just a representation of Chinese’s rigidness on
censoring films’ content” (Interview 29).
7.4.2.1.5 “Social stability is the key.” There is no doubt that economic reforms
have brought a broad range of social problems, including rampant corruption,
environmental pollution, problems for minorities, and so forth. The party is therefore
very conscious of scenes in films that contains explosions, as maintaining social stability
has become the key to staying in power. “The Chinese government is very concerned
about the explosive scenes, because they might signify social instability,” a professor from
China said (Interview 31). Ng said, “Mission: Impossible III faced numerous cuts when
it screened in China. Most of the cut scenes contained images that are harmful to the city
of Shanghai and even China. Some filmgoers noticed the car chases on Shanghai’s
Nanjing Road were shortened in the Chinese version too because of the explosions”
(Interview 28). So, filmmakers are very careful when depicting explosions in films, as
they know maintaining public order is crucial to the Chinese state, and that the authority
is very likely to avoid allowing scenes that could give rise to social instability or have a
negative influence on society, possibly resulting in worker protests or demonstrations.
The above examination suggests that filmmakers, for the most part, feel relatively
free to produce what they want to produce under the restrictions of the censorship in
China by applying strategically adaptive behavior. As Chan describes,
As filmmakers who are making films in China, we often need to display
creativity and skill in an attempt to win the trust of the authorities. Our
strategy involves complying with the government’s demands and
mission. (Interview 29)

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The above strategies have sometimes succeeded in the push for policy change. As
Cheung said, “Censorship is not an impenetrable great wall, but something that might
possibly be shaped by those filmmakers with the intention and energy to negotiate with
the state. A film such as The Stool Pigeon is a good example” (Interview 39).
13
He adds,
Making a film in China is a process of groping your way through and
testing what is possible by trying what you had not dared to do before.
Although there are a lot of written regulations, no one could possibly tell
you that there is a topic you can now produce which was not allowed
previously. The key point is trying to make some new points and letting
everybody recognize that your attempt is good and new. Consequently,
your practice is successful and gradually accepted by the government
and the public. At least this is my hope for the Hong Kong film industry
and also for the Chinese film industry. (Interview 39)
Institutional change is unquestionably an interactive process. Indeed, as a couple
of interviewees revealed, the days when media regulators exercised full content control
have long passed. Opportunists and even local champions have fumbled their way into
new fields, and have sometimes become more assertive on peripheral issues that the state
does not deem as sensitive. Thus, the media structures are not as deterministic as many
assumed. The cases of Painted Skin and The Stool Pigeon highlight how filmmakers
themselves are engaged in a process of testing the boundaries of the censors. In this
manner, the media can act as independent actors in the process of liberalization.
Although filmmakers are not able to push the envelope on core political or social issues
that are the focus of censorship efforts, they are most likely able to exert influence in
framing peripheral topics.
Although the opportunists applying these strategic adaptive behaviors have
displayed innovations on how to adapt to the Chinese censors, and though the style of
their entertainment might infiltrate the Mainland Chinese cinema, the opportunists have,

13
See Section 7.4.2.1.3.

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to a certain extent, surrendered their local characteristics and have even downplayed the
original nature of their native film culture in the trans-border co-productions. As I
discussed in Chapter 6, the individuality of Hong Kong film culture is being sacrificed in
the process of moving “closer” to China under the influence of CEPA. Nevertheless,
filmmakers in this group are, in fact, clear about their positions in Hong Kong cinema as
well as about the possibilities of developing their careers in China or even on the global
stage.
In conclusion, commercialization of the official Chinese media have technically
occurred to the extent that we could find some private business interests, but personnel,
management, and other networks are still very much locked into propaganda traditions.
The local champions are well aware of the norms and traditions within China. The
opportunists have found a rule of thumb: they feel free to produce any type of movies the
way they want, as long as they are not related to politics. Although the boundaries of
“politics” are vague, they are able to formulate a way to survive. These two groups of
filmmakers are more at risk than the state-owned studios, such as the August 1
st
Film
Studio, because August 1
st
can be seen as a family member within the government. On
the other hand, local champions, especially the opportunists who originally came from
outside the system, could just be told to go away. Thus, while the local champions and
opportunists may be very interesting as individual filmmakers, and still maintain loyalty
to Beijing, the opportunists have at the same time strategically exploited gray areas in
their filmmaking. In the end, however, the state strategically co-opts these two groups of
filmmakers by de-politicizing and commercializing film content to further conform to the
position of the government.

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7.5 Rebels
China does not forbid independent filmmaking, but it does control distribution,
so filmmakers who want their works to be widely seen end up needing to submit to the
capricious censorship process. Therefore, the censors have become the gatekeepers to
money and fame. The fourth group of filmmakers—those I call “rebels”—are actually
non-conformists who represent the direct potential to bring about democratizing reforms
because they are independent from the state politically and economically, and thus they
are more assertive in confronting the state’s influence on their aesthetic pursuits and
creative freedoms. As Sun and Li argue, this group of independent film directors “are
willing to explore creative ways to push open the locked door of film censorship, or at
least to constantly test the limit of tolerance of the censorship system” (Sun and Li 2008,
xiv). Zhang Yuan bravely declares, “Artists sometimes must be shackled to dance” (Liu
2006, 108).
The Sixth Generation of film directors made some confrontational films and thus
their films were mostly banned in the 1990s, and were only shown at Western film
festivals or foreign embassies in Beijing, never entering the mainstream.
14
Their films
try to depict people on the margins of society. They are well trained in the art of
filmmaking, and their work emulates that of Western masters, to some extent. It is not
difficult to find some significant innovation in these films. The forms and themes of their
works are rebelling against the previous and contemporary orthodoxies (Chu 2004). For
instance, Zhang Yuan’s East Palace, West Palace (1997) is the first Chinese film to touch
on the taboo of homosexuals (May 2003). Jia Zhangke’s Xiao Wu describes the life of a
thief in a rapidly changing time. Xiaowu lost his illusions about friendship, love and

14
See Appendix 8: Film Periodization.

264
family. Wang Chao’s The Orphan of Anyang tells of the rough lives of a prostitute, a
gangster and a laid-off worker and their acceptance of their distorted fates. Li Yang’s
Blind Shaft realistically depicts the rough and tough environment of the mining area and
the fidelity and melancholy of the hero, who sacrificed others’ lives to raise his family.
From these movies, we can see a rarely found passion. These marginalized groups,
strange and undeniable, seize the attention of the audience and provide another
viewpoint from which to assess Chinese society. However, the government does not feel
comfortable with these films and decisively banned their public distribution.
The hostile relationship between this group of directors and the government
began to unfreeze by the end of 1999 when SARFT invited several banned directors to
attend the “Symposium on Young Directors’ Films.” Zhang Yuan was back in the
filmmaking business in 1999, making officially endorsed films like Seventeen Years, a
story about the life of inmates in labor camps during China’s reform (Zhu 2003, 167).
Although the film was heavily censored, Zhang Yuan did not feel any regrets:
When I was preparing the script [for Seventeen Years] I knew that no
matter what, I had to get this one released. Moreover, this is the kind of
film that could never be made unless it was going to be approved by the
censors. [...] So even before the screenplay was complete I was already
very resolute that this film must make it to the Chinese theaters. (Berry
2004, 153)
Zhang’s experience reveals that if filmmakers want to show their movies in China, they
have to compromise with the censorship regime. Accepting censorship is not an option
or choice. It is an obligation. According to Zhang, the censorship process lasts for a full
year. Time is spent re-cutting footage, answering censors’ questions, and explaining
scenes to bureaucrats. Rebel Gao Xixi explains her discontentment with censorship:
I have shot films, TV dramas, and also TV films, but couldn’t find
anything perfect. [...] Censorship happens in all places […] I can’t really
express my real feeling; it can’t be put into words. Working in the film
and TV industry in China, it’s hard to follow your heart. (Liu 2006, 121)

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Other rebel directors, such as Zhang Yang, Shi Runjiu, Zhang Yuan and Lou Ye, have
turned back to mainstream social values and mass aesthetic tastes in films such as Zhang
Yang’s Spicy Love Soup (1999) and Shower (1999); Shi Runjiu’s A Beautiful New World
(1999) and All the Way (2000); Zhang Yuan’s Green Tea (2003); and Lou Ye’s Purple
Butterfly (2002). These films take the perspective of the common people and blend some
narrative skills of post-modernism with the typical narrative modes, to which the Chinese
audience is quite accustomed to. The filmmakers paid attention to their niche market
and produced more films on a wider range of topics.
The chilly relationship between the rebels and the government was further
relaxed in 2002 when two symposia were held in Shanghai and Beijing. By late 2003, the
government had officially allowed this group of directors to make “legal” films. For
example, Jia Zhangke developed a close relationship with the Shanghai Film Studio,
which partially financed his movie The World (Sun and Li 2008, 65). In November 2004,
some officials from the Film Bureau contacted some directors, including Wang
Xiaoshuai, about forgiving their past and inviting them to join the system in order to
reform Chinese cinema. They told the director: “From now on film will not just be
propaganda, but film can also be a product. You can sell it and market it” (Sun and Li
2008, 86). Wang’s Shanghai Dreams (2003) and Jia’s The World (2003) were their
first-ever legal films. The government finally released almost all of the banned movies in
2006, including Wang Xiaoshuia’s Beijing Bicycle and Jia Zhangke’s Xiao Wu, though
some other films, such as Lou Ye’s Summer Palace remain banned in China. Since the
government is now friendlier to the rebels, some of the rebels feel the situation is getting
better. For example, Wang Xiaoshuai describes,
In the past, there was a basketball court they did not allow me to enter,
so I stood outside the court to make my movies. Currently, I have not
changed my position; I am still standing outside the court. However, the

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court now is getting larger and it includes me in it. So, that’s why we
said the overall film market has changed. The level of tolerance has
increased and so the size of the court also increased. (Yi 2009, 106)
Li Yang agrees that the situation is improving:
I honestly think the political environment in China is getting better and
better. That is not to say there is still not a lot of room for more
improvement. However, if I made a film like this in the past I might very
well have been sent to prison, whereas today the most they can do is
criticize me, but at no point is my life threatened. So I truly believe that
things are getting better and better. The system is no longer as
intimidating – but that does not mean it does not suppress free thinking.
(Berry 2004, 230)
This generation of rebels was born amidst the trend of mass popularization and
commercialization of films. Profit was not their exclusive goal; they would be quite
willing to risk their own money to shoot what they liked. However, when the government
attempted to improve the relationship and induce them to cooperate under the control of
the system, more rebels became interested in joining the system. Zhang Yuan recounts,
If I were to stick to my previous method of filmmaking, not only would
this film be banned from domestic release, but it would also get my
friends who backed my film in trouble… At the very least, I need to
maintain a sensible connection to where I live. […] Despite the fact that
the time I spend on dealing with the censors is almost equal to that I
spend on filmmaking itself, I will continue to stay “above-ground.” (Sun
and Lee 2008, 91-92)
Another rebel director, Guan Hu, also explains the benefit of compromising with
the government. “If working within the system does not considerably harm your work,
why would you give yourself a hard time by being ‘underground?’” he asks. “Besides,” he
adds, “working within the system would also guarantee you a much broader audience.
[…] You can always find a way to negotiate with the censors” (Sun and Li 2008, 66).
Despite the limited autonomy they have enjoyed within the system, in the course
of my research I did come across some filmmakers who believed that being cooperative
with the government was more meaningful than shooting a film underground. When

267
asked how one should negotiate with the censors, one of my interviewees, Li Yang,
replies,
The present system is quite complicated. So, in dealing with the censors,
sometimes you just need to be smart and know the tricks. But most of
the time you need to change yourself. This is what I meant by ‘smart’
and the ‘tricks.’ As a director, we need flexibility. Of course we have
something we want to stand up for, but we also need to make
compromises. (Interview 22)
Lu Xuechang reveals a similar thought process:
I guess many Chinese filmmakers tend to prepare two versions of a
project: one without a thought for the censors, the other for the censors.
As for me, I still hope I can do what I intend to do and shoot what I love
to shoot. Of course this will sometimes get me into trouble. I think
everything has its bottom line. About that line, I am willing to
compromise, but below it I would simply quit. There are a lot of other
things I can do. (Sun and Li 2008, 77)
The rebels are attempting to balance the censors and their artistic impulse. Hark
Chu, an independent producer based in Shanghai, recounts that he was not happy to see
himself being excluded from the system: “The government knows how to minimize your
influence by giving you a hard time when distributing your films, meaning few people
could see my films” (Interview 12). He showed frank disappointment in the idea of his
films being banned: “For a filmmaker, nothing is more important than seeing audiences
go to see their films” (Interview 12). Wang Linlin, a US-trained independent film director
and producer, revealed, “You can’t survive if the government suppresses you. I have no
resources to handle my production” (Interview 13). When asked whether being
cooperative with the government helps from a filmmaking perspective, independent film
scriptwriter Huang Kaixuan affirms that it does, that being cooperative “serves as a form
of insurance” from official harassment (Interview 17). As Huang expresses,
There are many things we can’t write today. The manager from the
studios or the companies will tell me what subjects are not allowed in a
film. As writers and filmmakers, we will decide to live with this
situation. This is China. We need to learn to adjust ourselves. It would

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be devastating if the film or my script couldn’t be shown to the public.
Some trade-off is always needed. (Interview 17)
Wang confirms that she would definitely give her films to the government for permission
because she needs the Chinese market and she wants her movies to be screened in China.
She stresses that she needs sufficient capital before she can really sustain her creative
imagination and artistic inspiration; she especially admires those films that not only
appeal to the general public but also are acceptable to government censors (Interview 13).
Compared to the well-known local champions, rebels are less likely to be
concerned about various policy issues; the main policy areas that concern them are the
censors and what topics they can produce. Meanwhile, the less famous and smaller-scale
rebels, like Chu, Wang and Huang, are more likely to be concerned about improving
access to the market and ensuring that different types of film productions are treated
fairly. In brief, rebels were more active in voicing their artistic impulses in the 1990s
when they had just started their careers, but their grievances were kept silent when the
government improved its relationship with them at the end of the 1990s, when the trend
of commercialization plunged the rebels into the system. Overall, most rebels are finding
ways to meet their needs without demanding democratic solutions.
In the course of this research, I have found that even when powerful independent
filmmakers have serious grievances against the regime, they rarely engage in activities
that would promote a democratic transition. Their explanations for this are threefold.
First of all, rebel filmmakers think films are just a cultural product and do not carry any
significant ability to change the political situation. As Lu Chuan says, “I don’t think film
is a weapon for student movements or political persuasions,” because it is only a cultural
product, which can always be interrupted and constrained by governments (Sun and Li
2008, 76). Li Yang remarks,

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In the US, investors can always intervene in filmmaking, and the
director has absolutely no right to determine the editing. I think those
directors are not as free as I am now in China. I feel I’m relatively free.
Although the ending [of the movie Blind Mountain] was changed, I think
the film is still quite interesting. (Jin 2008, 78)
15

As Zhang Yuan states plainly, all they want is to make films (Berry 2004, 146). To Jia
Zhangke, cooperating with the government is a way toward improving the quality of his
films: “If I can shoot Platform publicly, it would be much better,” because he can get
assistance from the government in shooting the movie (Yi 2009, 98). Li Yang’s first
movie, Blind Shaft, was perceived as an underground film only because he did not
understand the shooting process in China. To the question of whether the movie banned
because it did not pass the examination, he clarifies,
Actually, no. I did not go through the process at all. When I shot the
movie, I had just come back from Germany and I did not notice that a
movie needed to be examined in China, and that it needed to go through
different steps: first the script needed to be examined before I could start
shooting. Then I needed to submit the finished film to the authorities,
and the film could be distributed only after the political examination.
Since I did not apply for a permit at the very beginning, the film was
illegal as soon as we started it. Now I understand the process, and I’ve
already started my project and I know it will not pass the censors, so I
did not go through the process at all. Now I am shooting my second film
and I understand the rules. I think this time it is legal. (Ouyang 2007,
37)
Another of the three prevailing explanations for the limited political activity
among filmmakers involves censorship. Rebels criticize the censorship system as the
“biggest obstacle preventing Chinese cinema from regaining its glory” (Sun and Li 2008,
86). Most rebels agree that the biggest problem of the Chinese film industry is the
censorship system and, further complicating the issue, there is no set of standards. Since
the system relies on individual decisions, no one knows for sure what will happen, no one

15
The third part of the trilogy, Mang Liu, was effectively killed off by the censors.

270
can explain why this or that film was able to get through, and no one can prevent the
feelings of uncertainty for the next time. However the real concern about the future of
the Chinese film industry is that this censorship system has greatly distracted
filmmakers’ energy from focusing on producing high-quality films. Interestingly, the
rebel is perhaps the “most capable in terms of negotiating with the government, because
for more than 10 years, these directors, both ‘underground’ and ‘above-ground,’ have
been acquiring ample knowledge about what censorship is and where the problems lie”
(Sun and Li 2008, 74). However, they still need to spend a lot of time guessing, which
sometimes causes them to overcorrect, while at other times they might find themselves
underestimating the censorship thresholds. In any case, these worries are harmful to the
film industry. Hence, in addition to the first point previously noted — that the rebels are
aiming at a very simple goal, to produce films – filmmakers also want to produce a film
that can be screened in a regular theater. If their films can be seen by audiences,
censorship is not their singular concern. As Li Xin explains, “Despite the fact that
government was heavily involved in the whole filmmaking process, I didn’t complain”
(Sun and Li 2008, 73).
The third of the three principle explanations for apparent filmmaker inactivity,
some rebels believe the system will eventually change. As Lou Ye remarks,
The current mechanism of film censorship is actually a partial
reflection of today’s political system and economic environment.
If our economic environment continues to improve, or if our
political system becomes more liberal, film censorship will
naturally disappear and be relegated to history. (Sun and Li
2008, 73-74)
Like Lou Ye, Jin Chen also foresees improvements in relation to the system:
My feeling is that this system will continue to exist into the
foreseeable future. […] As long as it survives, we can only accept
it as an unavoidable reality. […] I firmly believe that one day, our
system will become better. (Sun and Li 2008, 69)

271
Likewise, Wang Chao strongly believes that today’s political environment is no longer
intense, and that the “sense of oppression has largely disappeared” (Sun and Li 2008,
85). In contrast to most filmmakers, who often complain about the censorship
apparatus, Wang Chao is more worried about film itself: “What Chinese filmmakers have
never been able to get rid of is precisely what they rebel against. […] They still think film
is a form of propaganda and a powerful tool for political gain.” He also questions the
filmmakers in China, challenging,
Let us suppose you are in the United States. Are you talented
enough to make a film that could attract a large crowd and
emotionally move them? Or, suppose you are in Europe. Are
you able to do the same? (Sun and Li 2008, 84-85)
Wang Chao also proclaims the existence of spaces within which filmmakers may
experience the freedom to produce films:
No matter how ambiguous you feel about this space, it is in this
space that I made my first film and, moreover, I was able to take
it to many parts of the world. If you really understand the reality
of China, you are in a good position in handle things well. (Sun
and Li 2008, 80)
In short, the future of the film industry does not rely on the relaxation of the censorship
system; rather, it depends on filmmakers’ ability to adapt to the system and make films
that are relevant to the Chinese reality. As Zhu Wen, director of Seafood, observes,
The only thing we could do is to adapt, to get used to it. […] The
only goal for Chinese directors is survival. It has already been
very successful if you could have ‘a bowl of rice to eat’ within the
system and if you can survive in these market conditions…
Nothing [in the system] changed; it is me who changed, to be
tolerant, obliging and numb. (Ouyang 2007, 145)
Even though Lou Ye was banned from making films for five years after his film Summer
Palace, he still believes China will become more liberal and the system will change. My
interpretation of this group of filmmakers is that they are not interested in forming an

272
alternative group to defend their interests; rather, they are complying to the system in
order to fulfill their simple wills, and that is to produce films and get them screened
publicly.
7.6 Analysis of Filmmakers’ Strategies
The media class is fragmented by political orientation and behavior. The typology
I have described identifies four behavioral patterns based on independence from the state
politically and economically – loyalists, local champions, opportunists, and rebels. The
above sections show that the different types of filmmakers vary in their interaction with
the state through the films they have made and vary in the ways that they satisfy their
individual interests.
The filmmakers’ varying backgrounds, combined with their competence in
gathering capital, shape their identities in filmmaking. Note that while size and
profitability of a film production, and the ability to collect capital to produce films, affect
the resources that filmmakers have for engaging governmental entities, these material
conditions alone do not tell us much about whether they are likely to use those resources
in an aggressive manner. Owing to the nature of the film business, this is not a one-time
activity. Filmmakers are very unlikely to use their position in a confrontational manner.
Their political dependence on the state is also contingent on their particular proximity to
the state and their filmmaking experiences. Some filmmakers have excellent working
relations with officials and thus have no reason to confront the state. Others used to
suffer from negative official attention and are working hard to improve the relationship
by adapting to the system and adjusting their creative imaginations. Receiving a warning
or negative official attention is bad for the prospects of the films they are trying to market
and to their future careers.

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Given the dynamics of the Chinese film industry, a key question is to what extent
film professionals may shift from one group to another. The logic of modernization
theory expects economic development and the commercialization of the media to
generate a pro-democratic elite media class—that is, a critical mass of media workers who
become and remain both economically and politically independent from the state, then
aggregate their demands to have a wider impact. In the two-by-two matrix of a
filmmaker’s strategies, this would mean those in Quadrants I, II, and III would all move
into Quadrant IV (rebels). I argue, however, that such a convergence is unlikely for
several of reasons.
First, opportunist filmmakers are unlikely to shift directly to becoming
confrontational. Filmmakers in this group rely on pragmatic strategies and tend to lack a
relevant Party network, political resources, and confidence to make claims to the state.
The entry of Hong Kong filmmakers into the Mainland’s market primarily benefit from,
or rather are protected by, the state’s policies (namely, CEPA). Furthermore, this group
of filmmakers generally do not identify themselves as authentic “Chinese” – they tend to
view working in China and cooperating with the government as a short-term strategy.
Therefore, to the extent that opportunist filmmakers end up complying with the official
requirements for conducting their filmmaking business in China, it is more likely that
they will become local champions first, and then acquire the means to act more
assertively. Indeed, many local champion filmmakers start out as opportunists who are
then persuaded to enter the “Chinese blockbuster club” – either due to official pressure
or because they have no interest to voice their political demands and prefer to operate in
the status quo.
Second, if local champions developed the ability to complain to the state and
become confrontational, their concerns still might be resolved through existing state

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channels and social networks, thereby shifting them toward being loyalists. A number of
filmmakers who experienced difficulties in the initial years of their filmmaking careers
have found that being more established has alleviated many of the problems they
encountered earlier on. For instance, they now have better access to investments, better
time-slots for public screenings and other preferential funding policy treatments. The
changing definition of “film,” from a propaganda weapon or an educational tool to an
entertainment commodity, also plays an important role in mediating the extent to which
filmmakers are opportunists or local champions, or loyalists or rebels. And in many
areas, local governments’ stance on filmmaking has shifted substantially over time. The
increasing numbers of film studio parks in different areas have provided an improvement
in the facilities for the development of film industry.
The third reason that most filmmakers are unlikely to move to a confrontational
approach is because, over an extended period, the three groups of filmmakers have
developed ties with one another and, most importantly, ties with the agents of the state.
In turn, these strong networks enable filmmakers to resolve many of their problems
without staging protests or organizing an oppositional party. The loyalists benefit from
maintaining good relationships with various cadres and agencies and promote their
interests and further their careers by striking private bargains rather than becoming
confrontational. A faction of discontented filmmakers — the rebels — may also have
hospitable working relations with some local officials, but when their grievances cannot
be redressed, this group of filmmakers is able to draw on their pre-existing networks –
foreign capital, international film festivals – to engage in filmmaking and even negotiate
with the state. And the state will simply ban their movies, or going further, stop them
from making films for a couple of years. So, the status quo remains. Furthermore, recall

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that when government entities are able to meet these particularistic demands,
filmmakers who were previously rebels sometimes return to being loyalists.
In sum, it is certainly reasonable to expect that filmmakers might shift from one
category to another as their circumstances change over time. However, there is little
evidence to suggest that rebel filmmakers would advocate a transition to democracy as
the most desirable means for satisfying their interests. Instead, the success of China’s
current filmmakers is determined through ties or networks with state officials. As
Dickson concludes, the incorporated private entrepreneurs, and those interested in being
incorporated, are not likely to constitute a force to demand political change (Dickson
2008).
7.7 Conclusion
Results from my research support a proposed typology that gauges the level of
filmmakers’ political and economic dependence on the state, and classifies them into four
categories: loyalists, local champions, opportunists and rebels. Loyalists, local
champions, and opportunists all cooperate with the state and comply with the rules and
regulations to continue their filmmaking. Only those in the rebel category potentially
make direct demands to negotiate with the state government and test the “limit of
tolerance of the censorship system,” which might have an impact on political reform –
and even then, rebel filmmakers are unlikely to scale their discontent into a political
movement. First, they simply possess the desire to produce films, and second, they
ultimately want their films to be screened in a regular Chinese theater. Third, rebel
filmmakers share certain characteristics with loyalists, local champions, and
opportunists, such as wishing to improve their working environment, desiring greater
access to the market, and encountering fewer problems with officialdom. Government

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already appears to have been effective in addressing their concerns, which leads the
rebels to believe the censorship regime will one day be abandoned. Despite their
discontent with the current regime and desire to see China governed by a more liberal
political body, the rebels are active neither in demanding a democracy nor in defending
the rights of independent filmmaking. They are more likely to invest in existing networks
and ties than to advocate political reform. Ultimately — regardless of whether or not they
employ confrontational strategies — filmmakers are invested more in making
incremental improvements to the status quo than in changing the regime.

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C O N C L U S I O N
C.1 Introduction
“Oh,” said Pang,
1
the president of a major Chinese film promotion company in
Beijing, “you want to write about the film industry in China?” Pang continues,
We used to be led by government departments, but now it has changed
and is more and more commercialized. Why? Because the State believes
the film industry is no longer just a propaganda tool, but a commercial
industry meant to both provide entertainment to people domestically
and promote Chinese’s image internationally. If the film industry
doesn’t commercialize, you can’t make money, and if you can’t make
money, you don’t have influence. If you don’t have influence, how could
China call itself a great nation? (Interview 10)
I would later come to appreciate the amount of truth in Pang’s statement.
The primary substantive question in this dissertation has been: How can the
Chinese film industry survive and develop into a large media empire under the stress of
conflict between these three competing forces – namely, government control, the artistic
aspiration and imagination of filmmakers, and the commercial pursuits of both
government and filmmakers? Clearly, government control is paramount in all affairs
related to the Chinese media. The mechanisms of control, in particular the ideological
framework and bureaucratic regulations, have been used to manage the industry;
additionally, a variety of soft controls govern the media sectors. Outlined in Chapter 6,
these controls reveal that, although the Chinese media are increasingly commercialized
and allow Chinese people greater choice than in previous historical moments, the media’s
development is far from the democratic ideal of an independent institution.
To be sure, the argument of “Party Publicity, Inc.” – a way, He (1998) observes, of
using media to maintain the Party’s legitimacy by publicizing its message to the public –

1
A pseudonym is being used in the interest of confidentiality.

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has remained a valid way of describing the media industries in China. This dissertation
has shown that there is a space that allows film talents to shape the institutional
discourse and the dynamic of the film industry. Commercialization and partial
privatization have increased film studios’ dependence on audiences and thus fostered a
diversity of film productions. As a state institution with substantial incentives to
maintain stability and power as well as strong market motivations to engage public
demand, the film industry, and media industries in general, represents a unique
institution in China’s authoritarian system. The Chinese media industries are
simultaneously a political, economic and educational institution. In fact, the tension
within the media industries stem from the dual roles they must play– it aims not only to
please the state but also the public – so its products are usually a reflection of the tension
between the state and society. Given the nature of the film industry, whose goal is to
entertain its audiences, its interests often come into conflict with state goals.
Reading about China’s film industry, one sometimes gets the impression that
everything produced in the film industry is controlled by the state. If one talks to film
industry practitioners, however, one finds that they generally feel free to produce films
the way they prefer, as long as they are not related to politics. So what does this tell us
about creative freedom in the Chinese film industry and the process of institutional
change more broadly? It tells us that “strategically adaptive behavior” is one of the tactics
used by practitioners (as discussed in Chapter 7). Political control shapes film talent’s
behaviors, but commercial filmmakers have been able to negotiate the boundaries of
censorship. State censorship is something that can possibly be circumnavigated and
negotiated. These strategically adaptive tactics can transform the formal institutions.
This study has explored a fundamental dilemma that China faces: whether it is
possible to embrace the commercialization of media outlets and globalization without

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engaging in political liberalization. The national media undoubtedly remain under state
control, though certain aspects have adjusted to meet the demands of varying
constituencies, e.g., industrial workers, government officials, and the general public. This
dissertation has highlighted several documents with the aim of showing how media
reforms are changed in order to cater to key constituencies’ respective tastes. With
respect to the pressures for media reforms after the Cultural Revolution (see Chapter 2)
and the interests of filmmakers pushing for greater media openness (see Chapter 3), the
CCP has developed different responses to address these demands without ceding too
much political control. Although the move toward media openness slowed to a halt after
1989, many filmmakers acknowledge that “entertainment films” remain among the most
liberalized of the film industry (as discussed in Chapters 4 and 5). This indicates that the
state has embraced a regulatory role for the film industry — as long as films do not
challenge the state’s political interests. Pursuing commercial success, particularly
lucrative box office returns, becomes a general motivation for both the state and
filmmakers. In fact, the most famous industrial workers have opted to be main-melody
Chinese commercial filmmakers. Commercial benefits are able to entice film talents and
other media workers, who might have clashing political views, to take the same route –
that is, to ally with the state.
If commercial success is a strong enough incentive for film talents, via cultural
production, to challenge the government, we might presume that creative freedom will be
preserved. However, if the state’s authority is so far-reaching as to quash any potential
for widespread dissent that might result from commercial development, filmmakers have
little choice but to remain submissive to the state. Or, even worse, filmmakers might one
day internalize an attitude of submission to the ruling powers, which could result in

280
complete political indifference and inactivity, in spite of increased access to creative
freedom and a free press.
Finally, this dissertation has suggested that modernization theory, which
postulates that the proliferation of information communication technology and the fast
development of the Internet make it more difficult for the propaganda authorities to
control the media, does not adequately explain the particulars of the Chinese media
industry reform at the center of this study. Arguably, the transformation of the Chinese
film industry did not undermine the state’s dominant influence; rather, it advanced the
state’s power by way of the implementation of three mechanisms for film industry
control: 1) ideological control; 2) bureaucratic control; and 3) soft controls (described in
greater detail in Chapter 6). Ideological control serves to explain the relatively
unchanged institutional and bureaucratic structure in which the film industry enables the
government to retain control over filmmaking. Soft controls are used strategically to
constrain filmmaking on topics that are in conflict with the government’s principles. This
dynamic is especially strong for films intended strictly for entertainment, as film reform
has increased filmmakers’ responsiveness to audiences. The ability of the regime to
constrain filmmaking is effective in ensuring that films generally do not depart from the
government’s position — to wit, the effects of media reforms, particularly the
commercialization of the film industry, were mitigated by institutional control
mechanisms. Moreover, the state strategically depoliticized main-melody films into
commercial hits in which filmmakers and the government converged, because those films
brought in the most revenue at the box office. As a result, even the strongly reformed
commercialized film industry tended to produce films seemingly designed by the
government.

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This study’s findings reveal that media reforms have helped political leaders
influence the industry’s development and audience tastes, with firm controls in place to
ensure film content duly tows the Party line. The state is able to exert control over
commercial media outlets, outlets which function as part of the larger political structure,
continually subject to shooting and screening permit control. Given recent collaboration
between private corporations (both domestic and foreign) that hope to enter the Chinese
film market, it is very likely that private enterprises will agree to conform to SARFT
standards in order to maximize profits. Thus there is room for media reforms, but
without political liberalization. At the same time, it is very difficult for the film
authorities to censor every film production, especially those film studios affiliated with
state organizations lower in the hierarchy, which often face less scrutiny. As a result,
filmmakers making films centered on different issues and within varying genres could
face altered degrees of control at different rungs within the administrative hierarchy.
C.2 State-Media and Market Relations
Studies of Chinese media largely tend to focus on the top-down flow of
information. Although this study examines the top-down relationship between the state
and filmmakers, it investigates the active role of film industry practitioners in negotiating
boundaries vis–à–vis the state. In doing so, however, this study does not capture all
aspects of state-media relations. We must await future studies to investigate the bottom-
up linkages between the media outlets and the state.
There is consensus that the state’s coercive power has weakened since the reform.
Some predicted that China would collapse (Chang 2001; Goldstone 1995). The
predominant view of Chinese politics is that the decision to adopt economic reforms has
constrained Chinese leadership, making it difficult to impose solutions on a complex

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society. However, the state has been able to devise and implement institutional
enforcements that bolster national unity and integration (Naughton and Yang 2004).
According to this view, the most important institution that holds China together is the
nomenklatura system of personnel management (Li 2004; Whiting 2001). This
dissertation finds that the film industry’s largely unchanged institutional structure has
played a key role in enforcing the ability of the state to restrain political dissent amid
Chinese media reforms. Among these institutions, SARFT (or the Propaganda
Department) plays a key role in examining film content. In addition to such institutions,
the state has also strategically organized market forces as a mechanism of media control,
allowing entertainment and commercial films to flourish to satisfy audiences’ demand, as
long as those demands are consistent with the Party line. Market forces can mutually
empower society, as modernization theorists posit, as well as the state.
C.3 Media Reforms and Democracy
China’s call for democracy began circa the end of the nineteenth century and
reached its first peak during the New Culture Movement. Scholars such as Chen Duxiu,
Li Dazhao, Lu Xun, and Hu Shih led the movement with the goal of creating a prosperous,
powerful, and democratic China. They embraced and promoted Western and global
values, particularly democracy and science, to replace Confucianism, a culture viewed as
an impediment to the modern development of China. After more than 100 years, the
CCP, arguably, has achieved two of its three goals: it has developed a prosperous China
with a GDP ranked second in the world, behind the United States, and it has built a
powerful China, with the largest military force in the world and defense spending set to
rise in 2012 to about USD 106.4 billion, the second highest in the world after the United
States (Bloomberg 2012). There was of course also a third goal, the democratization of

283
China. To the question of, Will China become democratic? Pang offers the standard
official response:
Well, you know China’s situation is different from other countries. We,
the Chinese, will take a different route, and we, the Chinese, will not
mimic Western-style democracy because we, the Chinese government,
will develop a type of democracy with Chinese characteristics. (Interview
10)
I posed the same question to a young student in Beijing. Despite my expectations, Lu
Shu, student at the Beijing Film Academy, had a similar view. As he remarks,
Chinese development must have its own Chinese characteristics, which
means China will not follow the path of other countries. Thus the goal of
a “democratic China” will be achieved one day, but the meaning and
content of “democracy” will be different from US democracy. (Interview
21)
Although China’s developmental path might be different from other countries,
can we find any nations that are similar? This study does not focus on “Chinese
exceptionalism,” but emphasizes a key characteristic that defines China: greater media
autonomy and diversity watered down by the complacency of Chinese media workers.
Contrary to conventional expectations, economic growth has not created a free press,
although the trend is away from government control and toward greater media autonomy
and diversity. Indeed, powerful institutions, e.g., SARFT, the Propaganda Department,
and the Ministry of Culture, still stifle media autonomy and politically diversity. A scant
handful of media elite have openly called for political reforms that would guarantee a
genuinely independent cultural sector in China. Overall, media workers in China are
adapting to the existing political system, but are not demanding political change. Media
workers have largely refrained from supporting political liberalization, instead allying
with the state. Within a span of three decades, China’s media industries have developed
within an increasingly market-oriented economy, yet media talents are increasingly
politically passive and the PRC remains authoritarian.

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As discussed in Chapter 1 and throughout the dissertation, we should not assume
economic development will necessarily lead to democracy. The “harmonious”
relationship between media workers and the state depends on two conditions: 1) the
power structure between the two and 2) the potential for media workers and the state to
exploit the power structure in order to maintain industrial productivity and profitability.
Obviously, without the cooperation of media workers, the media industries would
continue to present challenges to the state. For example, during the 1980s, most media
workers were paid by the government; as such, it was assumed that they would follow
directions from the government. However, a large number of filmmakers rejected the
rules of propagandistic filmmaking. They instead developed a new genre, which explored
not only forbidden topics (such as the Cultural Revolution and the Chinese culture) but
also the theme of human nature. Filmmakers in the 1980s strived to locate new angles in
filmmaking, departing from their predecessors in terms of themes, narrative stylings,
figures portrayed, and camera techniques. With this in mind, why have media
practitioners remained willing to work with the state government after 1989?
The commercialization of culture has led to increased concern among media
outlets about profits, which would lessen media workers’ interest in media autonomy. I
present three related observations: First, state power would not be affected after the
commercialization of the media outlets; despite the ability of media workers to use
“strategically adaptive behavior” to challenge boundaries, government ultimately retains
its powerful position. Second, media workers are more concerned about the box office,
TV ratings, and the growth of a newspaper. This means media outlets’ interests have
shifted from broad explorations of social issues, politics, and culture to the narrow focus
on profit maximization. Third, the space for non-government media outlets has
remained limited as the government tightly controls entry into the industry by reserving

285
the productions and exhibition permit system. Based on these observations, we can
deduce that the lack of access to information reinforces the press’s submission to the
government in China, serving to maintain the strong state-weak society structure. The
influence of film industry commercialization has been stunted by the state’s
authoritarianism, capping the potential of commercialization to engender successful
mechanisms for challenging the state’s control.
2001 was a turning point for China’s film industry, when independent filmmakers
were allowed entree into the industry through the single-shooting permit. Since then, the
industry has been officially treated as independent management, subject to the whims of
profits and losses (Duli jingying, zifu yingkui). Film studios were now independent from
the state, no longer eligible for government subsidies. Survival and sustainability in the
marketplace became the most prominent concern for all the filmmakers and studio
owners.
In addition, government now permitted private capital to enter the film market,
signaling the second most important policy change in the Chinese film industry. Based
on these two key institutional shifts, this study posits that the Chinese government has
successfully eliminated the secession of media outlets from state control, instilling
instead a logic centered on financial survival rather than political dissent, thus cultivating
an environment whereby media outlets and the government converged into an alliance.
These government-led media reforms are the primary factor in the shifting
relationship between the state and media outlets; it is also the condition that structured
the state-media relationship. As long as the government strictly holds to its mechanisms
of control, the relationship between the state and the media will not change, regardless of
the furthering and deepening of economic reforms. As discussed in Chapter 7, there is
an apparent lack of conflict between the practitioners and the government; with the

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policy environment for filmmaking improved over the course of the reform era,
particularly post-2000, media workers have lobbied relatively few complaints. Although
they may exist a widespread desire for alterations to the system, cultural sector workers
understand the political risks of related activity. Although an improved relationship
between media workers and the state does not mean practitioners have sided with the
government, the commercialization of the film industry has efficiently co-opted film
talent into its system.
There are four perspectives to explain how this co-optation works. First, the
commercialization of the film industry has disintegrated the unified political force of
media workers. Before the reforms, film studios were state-owned; thus all the workers
in the film industry conformed to common political, economic, and cultural standards.
State control over the film industry lasted even in the 1980s and into the early 1990s; film
practitioners were largely homogenous vis-a-vis identification with the Party. This
unified identity shifted swiftly in the 2000s, however, in the face of industry
transformation that saw film workers split into three classes: 1) the professional and
managerial class; 2) filmmakers inside the system; and 3) filmmakers outside the system.
Each of these groups is driven by its members’ particular collective objectives. The
process of the commercialization of the film industry has, therefore, altered the collective
power of media workers.
The professional and managerial class contains the mid- to high-level managers
in the film enterprises (constituting what I term loyalists, as detailed in Chapter 7).
Entering the film industry in the 1980s, most were educated, having been influenced by
Western ideas about the film industry. Very skillful in operating within the system, this
group comprises government representatives, media industry-related business owners,
and film professionals.

287
Filmmakers inside the system (in my terms, loyalists and local champions)
2
are
those film workers who graduated from film academies or other professional universities
with professional training in filmmaking, or other film-related professions. Filmmakers
outside the system (in my terminology, the opportunists and the rebels)
3
are those who
work independently. They do not enjoy access to the same social welfare programs and
benefits that the filmmakers inside the system receive. This group of filmmakers accounts
for the largest number of workers in the industry, which has been growing since the
2000s with the recruitment of more and more film workers. Despite their numbers, it is
often difficult for them to reach higher echelons of management within film enterprises.
Although the government has continued to exert control over the managerial class in
some of the biggest film enterprises, many film workers work independently. This trend
might be viewed as an indicator of weakening of state control over the film industry.
However, this group of filmmakers has shifted from an association with “opportunists”
and “rebels”— relatively outspoken and willing to contest the party’s authority — to that
of a complacent group.
4
In this increasingly competitive film industry, investors prefer to
employ loyal filmmakers to work for them in order to secure their investments. In an
attempt to avoid sensitive topics, cultural producers are inclined to craft “soft” content to
attract and mollify film audiences. Filmmakers outside the system also depoliticize social
and political issues so that their positions converge with those of the government. Media
workers’ own political views have been sublimated. They no longer feel a need to defend
their creative freedoms; their chief aims shift instead toward survival in the increasingly
competitive film environment.

2
As outlined in Chapter 7.
3
Ibid.
4
Ibid.

288
The decline of filmmakers outside the system has elevated the importance of the
professional and managerial class in the film industry power structure, becoming the
most crucial group in determining the relationship between the state and the film sector.
As the film industry continues to develop and grow, the professional and managerial class
has become the industry’s largest group of investors, and the film talents who work for
them have become loyal workers. As long as film content does not broach sensitive
political issues, the professional and managerial class holds a great deal of influence over
film industry dynamics. As such, they are the group that the government most wants to
co-opt. As Pang comments in our interview,
The managerial class within the film enterprises is the most important
group of people in determining film industry development. From an
industry perspective, they are top-ranking professionals. On the
economic front, they are the managers. As the ruling elites, they are just
like government officials. In terms of social status, they are just like
celebrities who appear in public all the time. (Interview 10)
These three groups (the managerial class, practitioners inside the system, and
practitioners outside the system) have different goals and interests. In this way, “film
talent” by no means refers to a monolithic group. We cannot uncritically assume that, as
previously thought, this group consists mainly of elites interested in reforming the
system. Overwhelmingly, in fact, they tend to keep silent on controversial matters.
On the one hand, film industry commercialization has generally seen heightened
industry productivity; on the other hand, it has also seen a diminishing influence of film
directors. Structuralists posit that as the number of media products increases, the state’s
control over media will weaken or lose its effect. However, in the case of China, this has
not born out. The explanation for this is manifold.
First, the shooting permit and the screening permit system are very efficient in
controlling filmmakers. The permit is a scarce product, and it becomes more difficult to

289
obtain if one has been banned from production or screening activities. In order to avoid
this punishment, filmmakers are inclined to change their behavior in accordance with the
state.
Second, the censorship system is strictly enforced. As I have discussed in Chapter
4, censorship relaxed in the mid-1980s when the authorities allowed the film studios to
scrutinize and produce their own scripts, without first submitting them to the Film
Bureaus. However, after 1989, censorship power was given back to the Film Bureaus.
The organization of the Film Scripts Discussion Board, the Film Examining Committee
and the Film Re-examining Committee (see Chapter 2) were intended as progressive
steps toward institutionalizing the censorship system. The state is engaged at every step
of film production, from the writing of scripts to their production, from film distribution
to the award systems (discussed further in Chapter 6). Although filmmakers undoubtedly
have more freedom to produce films now that more financial resources and human
capital have been invested in the industry, government control over the film industry
continues to advance. Notably, this highly structured, heavily regulated environment
that has witnessed filmmakers producing more films, has also strengthened the state’s
management of the industry.
Third, as argued in Chapter 3, because of long-time repression and isolation
during the Cultural Revolution, media workers during the 1980s were dominated by
liberalism and radicalism, with most of those ideas emanating from Taiwan, Hong Kong,
and the West. This facilitated the rise of commercial films domestically and art films in
the international film market in the 1980s. Although filmmakers in the 1980s possessed
limited familiarity with the West, they eagerly imitated the techniques used in Western
cultural production. The 1990s saw a shift in filmmaking. Following the military
suppression in June 1989, the most radical film industry elites fled to the West, the lesser

290
ones forced into seclusion. In response, the state seemed to adopt a more relaxed
approach toward cultural production, particularly films— while continuing to keep an eye
out for activities challenging its legitimacy. The Anti-Spiritual Pollution Campaign in
1983 and the Anti-Bourgeois Liberalization Campaign of 1986-87 were aimed at attacking
the cultural industry. Such campaigns irritated media workers and intellectual elites,
pushing them toward co-cooperating with foreign investors and divesting from the state-
owned film studio system. In the 1990s, no more such campaigns were initiated; instead,
the state government adopted policies and rewards to entice back dejected filmmakers.
After the Southern Tour of Deng Xiaoping in 1992, China experienced anther economic
boom, inducing a swift change of priorities among filmmakers. As with other intellectual
elites in China, film industry practitioners in the 1990s were commercially motivated; not
professionally invested in directly challenging the regime, they were more focused on
activities that could yield immediate economic benefits. More and more filmmakers
moved away from radical ideas, preoccupied more with making money than with directly
challenging the state.
Last but not least, the legitimacy of the current government is based largely on
performance. Since the economic reforms, living standards and freedom have improved.
More and more people believe the Chinese government is a critical force needed to
reform and revive the country. As the state has changed its ruling methods and boosted
its legitimacy, media workers have slowly relaxed their oppositional stance. Staunch
critiques such as those lobbying for creative independence and freedom of speech have
been quieted. This loss of mission, together with materialistic temptations and the
advancement of the state’s control, have all limited the space for those in the film
industry, and the media industries in general, to effect reform. Amid these factors, media
workers in the film industry have collectively reconciled themselves to compromising

291
their powers in return for material compensation. Although the demand for creative
freedom has not changed, media workers’ resolution and determination in resisting the
state’s intervention has decreased.
Up to this point I have explained how the commercialization of the film industry
has changed the dynamic of the relationship between the state and the media workers. I
will conclude by addressing the four puzzles included in Chapter 1.
5

Shirking administrative responsibilities, especially economic ones, on the part of
groups from the state administration down to the studio owners, has been the
fundamental source of the changing dynamic and reform within the film industry over
the past 30 or so years (Chapter 2). The state has transformed itself from an
ideologically- based revolutionary regime into one that is performance-based and
authoritarian, while the economy began to move from a planned to a market structure,
and media workers began to change from a group that enforced a high uniformity into
one that is poorly organized. As the state’s mentality has changed, its ruling methods
over media outlets have also changed. Secondly, the strong state-weak media
relationship has determined the development of the media industry since the beginning
of the media reform in the late 1970s. Media products, in this case film, are fragile by
nature and vulnerable to a repressive regime. Media workers have no choice but to adjust
their idealism by adapting to the market reforms and ally with the state. Thirdly, the
state has set itself apart financially from the film studios, which has accidentally resulted

5
The four puzzles:
1) Why and how does the state government maintain its tight control over the media industries,
even though media workers enjoy more autonomy?
2) Why are media practitioners willing to work with the state government?
3) How did the media industries manage to survive state censorship and increasingly competitive
markets?
4) Why do audiences continue to flock to state-made main melody blockbusters when they have so
many other options from which to choose?

292
in a convergence between filmmakers and the government, in order to seize more
monopolistic privileges granted by the government. Lastly, a market-oriented reform
does not necessarily lead to political liberalization and freedom of the press. In the case
of China, marketization is in fact a force of anti-democracy, at least compared to the so-
called “Western-style democracy.”
C.4 Institutional Change, Regime Durability
The argument that the state-media relationship has improved which I have
stressed above -- strongly indicates that deeper processes and media reforms have been
at work. The fact that the CCP has accepted that commercial and entertainment films
have become the mainstream genre and opened production, exhibition and distribution
(although partially) to private and foreign capital, all demonstrate how dramatically the
institution has changed. However, this argument does not tell us anything about the
causal mechanisms underlying the institutional change. Moreover, the wide-ranging
reforms that I have discussed from Chapter 2 to Chapter 6 associated with film industry
development since 1978 have raised an important question: How do we explain such
institutional change when China remains authoritarian?
In Chapter 1, I briefly explained the existing literature by examining the above
paradoxes.
6
Here I want to look at the mechanisms underlying the relevant institutional
dynamics. As Mahoney and Thelen argue, institutional change is possible even in the
absence of fundamental transformation (Mahoney and Thelen, 2010). In the case of
China, although China remains authoritarian, it does not mean the country, and its
political institution, has remained static.

6
See Chapter 1, Section 1.4.1.1.

293
I have incorporated a number of explanations to account for the coexistence of
institutional change without regime change. First is the co-optation of the filmmakers—
either filmmakers within the system or outside the system, local or international—as a
classic strategy of adaptation as a means to ensure regime survival. Second, the
government is improving the policy environment for film industry development by
negotiating with film workers on the boundaries of filmmaking. Although the
authoritarian regime does not intentionally encourage political pluralism, my study does
acknowledge the capacity of industrial actors to convey their concerns to the bureaucratic
entities that might issue demands for political pluralization, although this is not
democracy. The single shooting permits system, the signing of CEPA with the Hong Kong
government in helping the Hong Kong film industry, and the negotiation between the
Chinese government and Hollywood are examples of how organized interest groups
succeeded in affecting regulations on the industry.
However, there are some limitations to the above explanations. For example, the
Beijing leadership’s sharp turn in favor of commercial films in the late 1980s and since
2000 might be because of the political pressure from the Party members and the fact that
the leaders viewed this as a necessary step for regime survival. This type of top-down
elitist approach does not engage society as a participant in the decision-making process.
We all know the reversal of the PRC’s founding ideology – the function of film could not
just change in a societal void. Leaders’ decisions should be made after a broad range of
interactions with the industrial actors and the public. Second, in responding to the first
critics, I have highlighted how the negotiation processes between the filmmakers and the
censors could possibly change the institutions. However, stressing the importance of
non-state actors negotiating with the authorities might exaggerate the influence of the
filmmakers, especially when the film workers are far away from the definition of a

294
political interest group or the burgeoning civil society that is commonly viewed as the
foundation for democracy. Moreover, my own research has found that most actors—that
is, film workers in China—are not interested in changing the regime; rather, they are
choosing to cooperate and support the regime. Even if we found that a handful of
individual activist filmmakers have produced some films, which are critical to the regime,
such as Ai Xiaoming, they have not organized their demands and opinions in any
organized fashion meant to provoke political changes. Finally, I have repeated my
argument that filmmakers, regardless of whether they originally come from within the
system or from outside the system, have been co-opted by the official entities because
they generally have convergent interests. But what will happen when their interests
diverge, and does it mean that institutions will change?
Even though my research has the above limitations, film industry workers are still
active in pursuing and defending their interests. The argument of “Party Publicity Inc.,”
proposed by He Zhou, assumes that media workers have been transformed into some
kind of mercenaries who lust only for wealth. I am not as pessimistic as He. I believe
filmmakers, by applying the strategic adaptive behavior in negotiating the boundaries of
filmmaking, may have an unintended effect on transforming Chinese political
institutions. Filmmakers might only want to produce films and hope their films will be
screened nationally. They might not have any intention to change politics. But their
everyday practices with local officials may have broader social and political impact. I
have proposed three processes in the endogenous institutional changes; drawn directly
from Mahoney and Thelen (2010), these are: displacement, layering, and conversion.
These processes can accumulate to levels that alter the system. My argument is based on
the assumption that institutions and rules are not unequivocal, but they are full of the
type of ambiguity that provides some critical openings for creativity. And actors who are

295
constrained by these rules and institutions are able to either reproduce them or
undermine them. Thus, institutional displacement occurs when people believe the
existing rules are irrelevant to the current conditions and both the officials and the
governed agree to remove them and introduce new rules. The introduction of
independent filmmakers in the 1980s and the single-shooting permits in the late 1990s
have steadily replaced the monopoly of state-owned film studios in producing films,
which is a typical example of institutional displacement. Although the underlying
motivation for institutional displacement is to increase the productivity of the film
industry, the point is that encouraging more private filmmakers into the industry has
weakened the influence of the state-owned film studios in nurturing the audiences’ tastes
within film culture.
The second process is the institutional layering, which occurs as new rules are
added to the existing institutional structure. The Film Management Regulations of 1950,
1980, 1994, 2001, and 2011 (Seeking Opinion) have been revised and are being
supplemented with new rules. The two institutional processes – displacement and
layering – are intended to reform the existing systems for the sake of better serving the
interests of both the government and the industrial actors. The abolishment of the
monopoly of state-owed film studios in the production sector no doubt aiming to enhance
the competitiveness of the Chinese film industry in the domestic and global markets.
Ultimately, the goal is to increase China’s soft power in global politics. On one hand, in
the revisions of the Film Management Regulations, new institutions are established
alongside old ones, which might dilute the relevance of the old institutions. By applying
new rules onto the old ones, the system can reform without directly changing. With this
in mind, this process is actually a strategy for the government to generate changes.

296
The third process associated with institutional change in the film industry is
institutional conversion. This process occurs when rules remain the same but their
function is directed to new or alternative purposes and goals. The state-owned film
studios selling credits to some unauthorized private film producers (Chapters 3 and 4) in
the 1980s is an example of this practice. Institutional conversion is actually an
exploitation of the ambiguities in the existing institutions and adapting them for new
ends.
The concepts of institutional layering and conversion both involve the limitations
of preexisting institutions, which have opened up opportunities for industrial workers to
exist within them in creative ways. All in all, these three processes happen in the complex
multilayered institutional settings that have provided actors opportunities through which
to maneuver. Thus, these three processes privilege the industrial workers by reproducing
the existing institutions without effecting official reforms. However, it does not mean we
should not expect these processes to one day deviate from and shape the new institutions
if such practices continue repeating and diffusing. Examining these institutional
processes not only helps us to explain the inefficiencies of certain institutions but also
reveals how existing institutions may inspire reform. Political leaders and industrial
elites are both able to influence institutional reforms, even in an authoritarian regime,
through varieties of negotiations, interactions and cooperation. Indeed, such
negotiations between the state and non-state actors are not identified as a threat to the
regime; rather, the state power is willing to accept these types of expressions from the
film practitioners regarding the dysfunctional formal institutions. Of course, the state
could ban any practices they find unacceptable and punish those violators.
This study aims to contribute to existing theories of endogenous institutional
change. Concepts such as “layering,” “displacement,” and “conversion” have been

297
applied to analyze institutional change in the Chinese film industry in the absence of
exogenous shocks. It is precisely these three institutional processes that facilitate the
self-undermining processes of the institutions, thus enabling regime durability. This
study’s chief underlying interest lies in the internal logic of institutional change—
specifically, the logic of the changing policies of the Chinese film industry. My
explanations have highlighted how some moments provide opportunities for endogenous
institutional transformation. These opportunities enable practitioners to engage in acts
of creativity, while also allowing the government to mitigate tensions during the crisis by
proposing a solution to the uncertainty— the state is able to avert crisis by constructing
new institutions. This is how Chinese film industry institutions has been able to undergo
change despite the absence of regime change.
C.5 Conclusion
This research has sought to contribute to the discussion of institutional change in
authoritarian regimes and the complexity of the Chinese media industry. The study has
contributed to an understanding of state-media relations in at least two ways: First, it
explains how various institutional processes, such as “path dependence,” “displacement,”
“layering,” and “conversion” all take place simultaneously. Second, instead of focusing
on what is static in a political system, the institutional framework draws our attention to
the adaptability and flexibility of political institutions. As Streek and Thelen (2005)
observe, institutional rules are often contested, negotiated, and re-interpreted by those
who implement them in order to meet their needs and demands. That is, institutional
rules are not always uniformly and obediently implemented. Likewise, there is not a
direct linear relationship between state preferences and those who implement them.
Gradual institutional changes are driven by the complexity of society and, particularly in
China, the political contexts and agents tasked with implementing the rules. I assert,

298
then, that institutional change is not a linear progression to democracy, but rather part of
a larger contested process of change. Although I doubt China’s media industry is going
to adopt Western-style media institutions, institutional theory and the commercialization
process help understand the Chinese film industry in the context of the country’s own
unique trajectory. We must not overlook, however, the shift caused by the potential
impact of existing dysfunctional institutions. In sum, the concepts of institutional theory
provide a greater sense in understanding the flexibility and resiliency of institutions,
which have enabled the state to adapt to new pressures from within. Although China is
unlikely to liberalize the cultural sector, it has strategically upgraded its mechanisms of
control in dealing with increasingly unruly media outlets and industrial workers. The
mechanisms of its control have arguably become all the more nuanced.
7

7
For further discussion, please see Chapter 6.

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A P P E N D I X 1
The 17 Internal Departments of SARFT

CENTRAL INSPECTION GROUP, SUPERVISION DEPARTMENT 駐總局紀檢組、監察局
CENTRAL LABOR UNION 總局工會
Coordinates with the Commission of the Communist
Party on political education programming
Educates workers’ labor rights
Organizes worker training, workshops, social activities
Manages labor union fees
Manages workers’ benefits and other forms of social
insurance; provides childcare services
Designs anti-corruption campaigns
Supervises local-level labor union activities
Hosts Central Women’s Labor Union

319

COMMISSION OF THE COMMUNIST PARTY 直屬機關黨委
Leads and implements the Party’s principles across all
departments
Educates members in Marxist-Leninism, Maoism,
Socialism, and Party principles
Constructs and strengthens Party organizations
Guides ideological education at all levels
Assesses the democratic appraisal of Party members
Conducts administrative personnel inspections
Strengthens Party member discipline
Provides leadership among labor unions, the communist youth
groups, and other mass organizations
Guides Party-building projects
Manages education within Party-run schools

COMMUNICATION MEDIA ORGAN MANAGEMENT DEPARTMENT 傳媒機構管理司
Formulates development plans for radio and television
businesses
Manages radio and television stations, TV broadcasts, and
radio transmissions
Assesses penalties for regulatory violations
Issues permits for television drama programming;
production; radio and TV station broadcasting
Manages mobile television, radio, and on-demand
television broadcasting
Monitors radio and television commercials

320
FILM MANAGEMENT BUREAU
1
電影管理局
Formulates film business and industrial development plans
and policies
Oversees work units within film production, distribution,
and exhibition
Manages film file management, technical research, and
development projects
Issues permits for shooting and screening films
Coordinates major national-scale film activities, rural film
screening projects
Monitors programming broadcast on film channels
Undertaking international cooperation and exchange matters
such as co-productions and films imports and exports
Manages the special film fund
GENERAL ACCOUNTING OFFICE 駐總局審計局
GENERAL OFFICE 辦公廳
Coordinates administrative leadership activities
Manages finances, confidential records, government IT
Heads crisis management activities
Organizes the help-the-poor program
Manages major SARFT activities, e.g., ministerial-level
social science research projects
Drafts SARFT documents and reports, resolutions to NPC
and CPPCC
Develops structural reform in RFT areas

1
The Film Management Bureau comprises no fewer than 7 internal units; detailed further in Appendix 2 and Figure 2.1.

321
HUMAN RESOURCES DEPARTMENT 人事司
Coordinates SARFT’s and subordinate work units’ human
resources management
Undertakes leaders’ allotment, education, training, rewards,
penalties, and retirement
Manages internal structures, departmental leadership, and
personnel
Formulates SARFT’s personnel structure, e.g., recruitment,
deployment, resignation, and dismissal; guiding
management policies in subordinate work units
Manages the accreditation of RFT professional titles, the
flow of talent Guides the macro-planning of RFT system
personnel
Supervising RFT’s occupational qualifications
Reviews compensation and benefits, e.g., social insurance,
labor protection
Conducts personnel training and education programs and
seminars
INTERNATIONAL COOPERATION DEPARTMENT 國際合作司（港澳台辦公室）
Regulates Sino-foreign RTV co-productions, cooperation
projects, major projects, and incoming foreign funds;
Researches trends in foreign and Hong Kong, Macau, and
Taiwan RTF
Organizes international RTF festivals, symposia,
exhibitions; and international conferences
Monitors foreign and Sino-foreign radio and television
programming, satellite television programs
Coordinates among foreign embassies; assists government
officials traveling abroad; provides services, e.g., visas, to
foreign production teams and related professionals;
monitors foreign expert recruitment
Issues distribution permits for foreign television drama,
cartoons, and co-produced dramas;
Manages RTF “going out” project

322
LAWS AND REGULATIONS DEPARTMENT 法規司
Formulates guiding principles and policies for the
development of RTF
Manages RTF intellectual property, other SARFT legal
matters
Oversees SARFT administrative permit hearings, major
administrative punishment hearings, administrative redress
and administrative lawsuits
Communicate RTF laws and regulations
NETWORK AUDIOVISUAL PROGRAM MANAGEMENT DEPARTMENT 網絡視聽節目管理司
Manages information network audiovisual (e.g., IP TV,
network radio and TV, and mobile phone) programs,
services, and policies
Monitors information network audiovisual programs
Administers on-demand programs and services, e.g., on-
demand services in hotels
Develops propaganda campaigns to promote internet
audiovisual program services
PLANNING AND FINANCIAL DEPARTMENT 規劃財務司
Formulates economic policies relating to RTF development
Oversees all asset management, budgeting, and
procurement activities
Maintains RTF statistics
Manages administrative funds and fees
Conducts internal audits

323

PROPAGANDA MANAGEMENT DEPARTMENT 宣傳管理司
Oversees radio and television propaganda planning and
policies
On behalf of SARFT, censors radio and television
programming
Manages radio and television propaganda efforts
Assesses penalties for policy violations
Organizes SARFT editorial board and other propaganda
meetings and activities
Monitors production of major national-scale films, radio,
TV documentaries, TV cartoons; supervises the China
Cartoons Association
Publishes books, newspapers, and magazines related to
radio and television
RETIRED CADRE DEPARTMENT 離退休干部局
Implements central committee and state council
retirement policies
Administers retiree benefits, health insurance, postal
services, and other social welfare programs
Maintains retiree records
Organizes senior activities, e.g., the Senior Club
Educates retirees on Party principles

324
SCIENCE AND TECHNOLOGY DEPARTMENT 科技司
Leads science and technology development plans for RFT
and audiovisual media
Manages technical parameters, e.g., radio and television
frequencies/channels, special-purpose frequencies, power
levels
Oversees broadcasting technologies, expands RFT
transmission coverage networks
Manages RFT broadcasting services and other projects
Promotes the scientific development of RTF technologies
Supervises standardization of RTF national technologies
Coordinates with other departments to develop science and
technology, exchange knowledge among foreign units
SECURITY DEPARTMENT 保衛司
Guides RFT systems’ safeguards
Supervises construction projects
Formulates RFT systems’ regulations relating to major
public orders, fire prevention and other emergencies
Oversees SARFT’s security
Safeguards officials traveling abroad
Formulates safeguard regulations and plans for large-scale
campaigns and major propaganda projects; safeguards state
leaders, foreign delegations, and other diplomatic personnel
2

Recruits, trains, and manages security personnel

2
The head of this department is responsible for managing the security of leaders; deputy heads personally oversee the security of other key leaders.

325
TELEVISION DRAMA MANAGEMENT DEPARTMENT
3
電視劇管理司
Enacts policies and regulations on television and radio
drama production, monitoring, and distribution
Plans industrial development
Guides television dramas, both domestic and
international/co-produced
Leads the Television Editorial Board; examines the contents
of domestic, imported, and co-produced television dramas
Issues television drama domestic distribution permits
Manages television drama broadcasting

3
The television drama umbrella extends to cartoons in additional to more traditional dramatic fare.

326
A P P E N D I X 2
The 33 Organizational Units of SARFT
Academy of Broadcasting Science

信息中心
The Broadcasting Communications Group
Co., Ltd.

中國廣播傳播集團有限公司
Cable Television Network Company

中國有綫電視網絡公司
CCTV

中央電視台
Central Newsreel Documentary
Film Group

中央新聞記錄電影集團
The Central People’s Broadcasting Station

中央人民廣播電台
Central Satellite TV Transmission Center

中央衛星電視傳播中心
China Broadcasting Art Troupe
(China Film Philharmonic Orchestra)

中國廣播藝術團（中國電影樂
團）
China Broadcasting Symphony Orchestra
(China Philharmonic Orchestra)

中國廣播交響樂團（中國愛樂
樂團）
China Film Art Research Center
(China Film Archive)

中國電影藝術研究中心（中國
電影資料館）
China Film Group Corporation

中國電影集團公司
China Film Science and Technology Institute

中國電影科學技術研究所

327
China International TV Corporation

中國國際電視總公司
China Radio and Television Association

中國播電視協會
China Radio and Television Design and
Research Institute

中國廣播電視設計研究院
China Radio and Television
International Economic Technical
Cooperation Corporation

中國廣播電視國際經濟技術合
作總公司
China Radio and Television Press

中國廣播電視出版社
China Radio International

中國國際廣播電台
China Television Drama Production
Center

中國電視劇作中心
Chinese Academy of Television Arts
Commission

中國電視藝術委員會
Cinema Satellite Channel Program
Production Center

電影衛星頻導節目制作中心
Digital Film Program Management
Center

電影數字節目管理中心
Film Scripts Planning Center

電影劇本規劃策劃中心
Institute of Film QA Inspection

電影技術質量檢測所
Office of the Special Developmental Fund
for the National Film Industry

國家電影事業發展專頸資金管
理委員會辦公室

328
The Proper Management Center

機關服務中心（物業管理中
心）
Radio Authority

無線電台管理局
Radio, Film and Television
Developmental Research Center

廣播影視發展研究中心
Radio, Film and Television Talent
Exchange Center

廣播影視人才交流中心
Radio Science Research Institute

廣播科學研究院
Radio and Television Planning
Institute

廣播電視規劃院
Supervision Center

監管中心
Training Center

培訓中心

329
A P P E N D I X 3
Functions of the Branches Related to Filmmaking

CENTRAL NEWSREEL
DOCUMENTARY FILM
GROUP
Founded in 2010
Works to enhance quality and influence of domestic and
international Chinese documentary production
1

CHINA FILM ART
RESEARCH CENTER
(CHINA FILM ARCHIVE)
Founded in 1958 to promotes film culture in China
Hosts international film festivals
Publishes film-related literature (e.g., academic
manuscripts, movie catalogues)
Archives film-related magazines, newspapers, and
journals
CHINA FILM GROUP
(CFG)
2

Established in February 1999 to produces films and TV
series
3

Imports films
4

Manages Sino-foreign co-productions

1
Succeeds the former Central Newsreel and Documentary Film Studio (founded in 1938) and the Beijing
Science and Education Film Studio.
2
China Film Group Corporation (CFG) was renamed China Film Distribution and Exhibition Corporation
in 1958. In 1971, after it combined with China Film Archive and China Film Equipment Corporation, its name
was changed to China Film Corporation. In 1999, it further consolidated into the biggest film company in
China.
3
Formed in an alliance between the China Film Corporation; Beijing Film Studio; China Children’s Film
Studio; China Film Co-Production Company; China Film Equipment Corporation; Movie Channels Program
Production Center; the Beijing Film and Video Laboratory; and Chinese Rhyme Video Discs Ltd. Since its
restructuring, the entity comprises more than 20 units.
4
One of only two entities designated by the government and commissioned by SARFT to import films,
CFG is a media behemoth. The corporate giant is tremendously active and influential across the spectrum of
cultural production, including film and television production; media distribution, (including import and
export activities); and exhibition, with its own cinemas, movie channels, film-printing and processing
companies, and a videodisc production outfit. Additional ventures include an advertising firm and a real estate
business.

330
CHINA FILM SCIENCE
AND TECHNOLOGY
INSTITUTE
Publishes monthly journal, “Film and Television
Technology”
CINEMA SATELLITE
CHANNEL PROGRAM
PRODUCTION CENTER
Film database and entertainment news site founded in
2005
Features legal online film streaming
Records film box office figures
5

DIGITAL FILM PROGRAMS
MANAGEMENT CENTER
Digital movie programming platform founded March 18,
2004
Produces, hosts, and transmits films digitally
FILM SCRIPTS
PLANNING CENTER
Screenwriting resource established in 1997
Facilitates creative, social, and professional networking
among cultural sector workers (e.g., screenwriters,
production personnel, artists)
INSTITUTE OF
FILM QA INSPECTION
Inspects screening quality
Oversees film industry technical development and
advancement
OFFICE OF THE SPECIAL
DEVELOPMENTAL FUND
FOR THE NATIONAL FILM
INDUSTRY
Manages fees collected from cinemas to support the film
industry
6

5
See their official website: M1905.com.
6
Cinemas were assessed a fee— a requisite 5 percent of box-office revenues— to sustain local film industry
development [from “Implementation Regulations Concerning the Special Developmental Fund for National
Film Industry” (Guojia dianying shiye fazhan zhuanxiang zijin shangjiao de shishi xize)].

331
RADIO, FILM AND
TELEVISION
DEVELOPMENTAL
RESEARCH CENTER
Formulates industrial development strategies
Conducts data collection and analyses
RADIO, FILM AND
TELEVISION TALENT
EXCHANGE CENTER
Founded in May 1997
Provides education, training, and professional
management for radio, film and television talent

332
A P P E N D I X 4
Local Administration of Radio Film and Television (ARFT) Divisions

The Art Division
(Major Cultural Activity Division)
藝術處（重大文化活動處）
Film Management Division
電影管理處
General Office
辦公室
International Exchange Division
國際交流處
Laws and Regulations Division
(Industry Promotion Division)
政策法規處（產業促進處）
Market Management Division
市場管理處
Media Management Division
傳媒機構管理處
Network Audiovisual Program
Management Division
網路視聽節目管理處
Personnel Division
人事教育處
Planning and Finance Division
規劃財務處
Propaganda Management Division
宣傳管理處
Science and Technology Division
科技處

333
A P P E N D I X 5
Filmography

TITLE
YEAR FILMMAKER(S)
English Chinese
A Beautiful New World
美麗新世界
1999
SHI YUNJIU
A Brilliant Man, Genghis Khan
一代天驕成古
思汗
2000
SAI FU
MAI LISI
A Chinese Ghost Story
倩女幽魂
2011
WILSON YIP WAI SHUN
A Legend about Tianyun Mountain 天雲山傳奇 1980
XIE JIN
A Tale of the Sacred Mountain
紅河谷
1999
FENG XIAONING
A Woman for Two 春桃 1988
LING ZIFENG
A Woman’s Street 女人街 1989
ZHANG LIANG
Aftershock
唐山大地震
2010
FENG XIAOGANG
Age at Nineteen
十九年華
1986
HUA YONGZHUANG
LUO ZHEN
All the Way
走到底
2000
SHI YUNJIU

334
Amannisahan
阿曼尼萨罕
1993
WANG XINGJUN
WANG YAN
An Artillery Major 炮兵少校 1993 ZHAO WEIHENG
Anxious to Return
歸心似箭
1979 LI JUN
Autumn Harvest Uprising
秋收起義
1993 ZHOU KANGYU
Baishe Uprising 百色起義 1989 CHEN JIALIN
Basic Interests 信天游 2004 FENG XIAONING
The Banquet 夜宴 2006 FENG XIAOGANG
Be There or Be Square 不見不散 1998 FENG XIAOGANG
The Beginning of the Great
Revival
建黨偉業 2011
HAN SANPING
HUANG JIANXIN
Beijing Bicycle 十七歲的單車 2001 WANG XIAOSHUAI
Beijing Bastard
北京雜種
1993 ZHANG HUAN
The Big Mill 大磨坊 1992 WU ZINIU
The Big Parade
大閱兵
1986 CHEN KAIGE
The Birth of a New Age 開天辟地 1997 LI XIEPU

335
Black Mountain Road 黑山路 1990 ZHOU XIAOWEN
Black Snow
本命年
1990 XIE FEI
Blind Shaft
盲井
2003 LI YANG
Bloody Morning 血色清晨 1990 LI SHAOHONG
Bodyguards and Assassins 十月圍城 2009 TEDDY CHAN
Border Town 邊城 1984 LING ZIFENG
The Burning of Red Lotus
Temple
火燒紅蓮寺
1928 ZHANG SHICHUN
Burning Snow
燃燒的雪花
1993 YANG TAO
China 1911 辛亥革命 2011
ZHANG LI
JACKIE CHAN
Chongqing Negotiations 重慶談判 1993
LI QIANKUAN
XIAO GUIYUN
ZHANG YIFEI
Confucius 孔子 2010 HU MEI
Country Teachers 鳳凰琴 1994 HE QUN
The Courthouse on Horseback
馬背上的法庭
2006 LIU JIE

336
Crash Landing
緊急迫降
2000 ZHANG JIANYA
Curse of the Deserted
荒村公寓
2010 LAW CHI-LEUNG
Curse of the Golden Flower 滿城盡帶黃金甲 2006 ZHANG YIMOU
The Death for Witness
死證
1985 KE REN
Deng Xiaoping
鄧小平
2003 DING YINNAN
Detective Dee and the Mystery
of the Phantom Flame
狄仁傑之通天帝
國
2010 TSUI HARK
Di Hou Wu Gong Dui
敵後武工隊
1995
KANG NING
LEI XIANHE
Dirt 頭髮亂了 1994 GUAN HU
Dragon Boat Race
賽龍奪錦
1999 WANG HENGLI
The Dream is Alive 東方大港 2007 ZHANG JIANYA
East Palace, West Palace 東宮西宮 1997 ZHANG YUAN
The Emperor and the Assassin
荊軻刺秦王
1999 CHEN KAIGE
The Emperor’s Shadow 秦頌 1995 ZHOU XIAOWEN

337
Everlasting Regret 長恨歌 2005
STANLEY KWAN
KAM-PANG
Fatal Decision 生死抉擇 2000 YU BENZHENG
February 早春二月 1963 XIE TIELI
Fight Back to the Southwest
大進軍：席卷大
西南
1997 YANG GUANGYUEN
First Attraction
第一誘惑
1993 BAO ZHIFANG
The Flowers of War
金陵十三釵
2011 ZHANG YIMOU
The Forest Ranger 天狗 2006 QI JIAN
The Founding Ceremony of
the PRC
開國大典 1989
LI QIANKUAN
XIAO GUIYUN
The Founding of a Republic
建國大業
2009
HAN SANPING
HUANG JINXIN
The Four 四大名捕 2012
GORDON CHAN
JANET CHUN
From Victory to Victory 南征北戰 1974
CHENG YIN
WANG YAN
TANG XIAODAN
The Dove Tree
鴿子樹
1985 WU ZINIU

338
Going East to Native Land 東歸英雄傳 1993
SAI FU
MAI LISI
Grand Decisive Battles
大決戰
1991 LI JUN
Great Advance – Liberation of
the Northwest
大進軍：解大
西北
1997 WEI LINYU
Great Battle in
Ning Hu Hang
大進軍：大戰
寧滬杭
1999
WEI LIAN
SHI WEI
XIAO JIANG
The Great Decisive War
大決戰
1991
YANG GUANGYUAN
CAI JIWEI
WEI LIAN
JING MUKUI
ZHAI JUNJIE
Green Tea
緣茶
2003 ZHANG YUAN
Grief over the Yellow River 黃河絶戀 1999 FENG XIAONING
Half Flame, Half Brine
一半是火焰，一
半是海水
1989 XIA GANG
The Heart-Queen on Pursuit
槍口下的紅桃皇
后
1986 WU TIANREN
Hero 英雄 2002 ZHANG YIMOU

339
Hibiscus Town 芙蓉鎮 1986 XIE JIN
The Highway
大路
1934 SUN YU
House of Flying Daggers 十面埋伏 2004 ZHANG YIMOU
Hurricane over the Sea 大海風 1993 YU XIAOYANG
If You Are the One
非誠勿擾
2008 FENG XIAOGANG
Ip Man 1
葉問 1
2008
WILSON YIP
WAI SHUN
Ip Man 2 葉問 2 2011
WILSON YIP
WAI SHUN
Jiao Yulu 焦裕禄 1990 WANG JIXING
Jinggang Moutains
井崗山
1993 LI XIN
Jiu Xiang
九香
1994 SUN SHA
Ju Dou 菊豆 1990 ZHANG YIMOU
King of the Children
孩子王
1987 CHEN KAIGE
The Knot
雲水謠
2006 YIN LI
Kong Fansen
孔繁森
1995 CHEN GUOXING

340
The Last Clue of the Big Case
世界奇案的最後
線索
1985 BAI HUNG
Lie Hu
獵狐
1995 TUNG WEI
Life After the Departure of
Lei Feng
離開雷鋒的日子 1997
LEI XIANHE
KANG NING
Life and Death of Niu Yu Ru
生死牛玉儒
2005 ZHOU YOUCHAO
Life Without Principle 奪命金 2011 JOHNNIE TO
Liu Tianhua 劉天華 2000 ZHENG DONGTIAN
The Lost Necklace
三寶鬧深圳
1985 LING ZI
Love on Lushan Mountain
廬山戀
1980 WANG ZUMO
Lovers’ Grief Over the
Yellow River
黃河絶戀 1999 FENG XIAONING
The Lu Gou Qiao Incident
七· 七事變
1995
LI QIAN KUAN
XIAO GUIYUN
Lu Xun 魯迅 2005 DING YINNAN
The Magic Braid 神鞭 198 7 WU TIANMING

341

Mama 媽媽 1989 ZHANG YUAN
Mao Zedong and His Son
毛澤東和他的兒
子
1991 ZHANG JINBIAO
Mao Zedong and Snow
毛澤東與斯諾
2000
SONG JINGBO
WANG XUEXIN
Moonlight on Second Spring
二泉映月
1979 YAN JIZHOU
My 1919 我的 1919 1999 HUANG JIANZHONG
My American Grandson 上海假期 1992 ANN HUI
My Days Since Lei Feng
離開雷鋒的日子
1997 LEI XIANHE
My Memories of Old Beijing 城南舊事 1983 WU YIGONG
Narrow Street 小街 1981 YANG YANJIN
National Anthem
國歌
1999 WU ZINIU
Night in the City 城市之夜 1933 FEI MU
Not One Less 一個都不能少 1999 ZHANG YIMOU
On the Hunting Ground 獵場扎撤 1984
TIAN
ZHUANGZHUANG

342
Once Upon a Time in China III
黃飛鴻 3 之獅王
爭霸
1993 TSUI HARK
The One-Man Olympics 一個人的奧林匹克 2008 HOU YONG
The Opium War
鴉片之戰爭
1997 XIE JIN
The Opium Wars
林則徐
1959
ZHENG JUNLI
CEN FAN
Orphan of Anyang
安陽嬰兒
2001 WANG CHAO
Overheard 竊聽風雲 2009
MAK SIU-FAI
FELIX CHONG
MAN-KEUNG
Painted Skin
畫皮 1
2008
GORDON CHAN
KA-SEUNG
ANDY CHIN
WING-KEUNG
Painted Skin: The
Resurrection
畫皮 2 2012 WUERSHAN
Part A, Part B 甲方乙方 1997 FENG XIAOGANG
The Promise
無極
2005 CHEN KAIGE
PTU PTU --- 2003
JOHNNIE TO
LAW WING-CHEONG

343
Purple Butterfly 紫蝴蝶 2002 LOU YE
Purple Sunset 紫日 2001 FENG XIAONING
Raise the Red Lantern 大紅燈籠高高掛 1991 ZHANG YIMOU
Red Cherry 紅櫻桃 1995 YE DAYING
Red River Valley 紅河谷 1999 FENG XIAONING
Red Sorghum 紅高粱 1987 ZHANG YIMOU
Red Turn 走出西柏坡 2001
LI XIEPU
LIANG SHAN
Rhapsody of Spring 春天的逛想 1998 TENG WENJI
Rickshaw Boy 駱駝祥子 1982 LING ZIFENG
The Road Home
我的父親母親
1999 ZHANG YIMOU
Roaring across the Horizon
橫空出世
1999 CHEN GUOXING
Running on Karma
大隻佬
2003
JOHNNIE TO
WAI KA-FAI
Sacrifice of Youth
青春祭
1985 ZHANG NUANXIN

344
Seventeen Years 過年回家 1999 ZHANG YUAN
Sha Ou
沙鷗
1981 ZHANG NUANXIN
Shanghai Dreams 青紅 2003 WANG XIAOSHUAI
Shaolin 新少林寺 2011 BENNY CHAN
The Shaolin Temple
少林寺
1982 ZHANG XINYAN
Sheng Si Qian Li
生死千里
1995 ZHUANG HONGSHENG
Shower 洗澡 1999 ZHANG YANG
Sing-Song Girl Red Peony
歌女紅牡丹
1931 ZHANG SHICHUN
The Sino-Dutch War 1661 英雄鄭成功 2000 WU ZINIU
The Sino-Japanese War at Sea
1894
甲午大海戰 2012 FENG XIAONING
Song of the Fisherman
漁光曲
1934 CAI CHUSHENG
Song of Youth
青春之歌
1959
CHEN HUAIAI
CUI WEI
The Sorcerer and the White
Snake
白蛇傳說
2011 CHING SIU-TUNG
Spicy Love Soup
愛情麻辣燙
1999 ZHANG YANG

345
Stage Sisters
舞台姐妹
1965 XIE JIN
The Stool Pigeon
綫人
2010 DANTE LAM
The Story of Mao Zedong
毛澤東的故事 1992
MAO MAO
HAN SANPING
LUO XING
Summer Palace
頤和園 2006 LO YE
Sun Wen Shao Nian Xing
孫文少年行 1995 XIAO FENG
Sun Zhongshan
孫中山
1985 DING YINNAN
Super Typhon
超強颱風 2008 FENG XIAONING
Swordsmen
武俠 2011 PETER CHAN
Team Spirit
女帥男兵
2000 QI JIA
Third Sister Liu
劉三姐
1978 SU LI
Three Decisive Campaigns
大決戰三部曲 1992
LI JUN
WEI LIAN
Ting Jin Da Bie Shan
大轉折：挺進大
別山 ( 上下集)
1996 WEI LIA
To Be with You Forever
相伴永遠
2001 DING YINNAN

346
To Live
活著 1994 ZHANG YOMOU
Towering Kunlun
巍巍昆倫
1988
JING MUKUI
HAO GUANG
Two Brands
春蘭秋菊
1982 GUO BAOCHANG
War of Annihilation in the
South
南線大追殲 1997
ZHAO JILIE
JIA HE
Warrior Lanling
蘭陵王 1995 SHERWOOD HU
The Way of the Snowstorm
風雪狼道
2007 GAO FENG
The White-Haired Girl
白毛女 1972 SANG HU
Woman Basketball Player
No. 5
女藍五號 1957 XIE JIN
The World
世界
2003 JIA ZHANGKE
Xi Lian
喜蓮
1996 SUN SHA
Xiao Hua
小花
1979
HUANG JIANZHONG
ZHANG ZHENG
Xiao Wu
小武
1998 JIA ZHANGKE
Yang Kai Hui
楊開慧
1995 QIN ZHIYU

347
Yellow Earth
黃土地 1984 CHEN KAIGE
Young Liu Baocheng
青年劉伯承
1996 ZHAO WEIHENG
Zhan Tianyo
詹天佑
2000
SUN DAOLIN
YAO SHOUKANG
Zhang Ga the Soldier Boy
小兵張嘎 1963
CUI WEI
OUYANG HONGYING
Zhou Enlai
周恩來 1992 DING YINNAN

348
A P P E N D I X 6
Glossary of Chinese Names
1

PINYIN CHINESE PINYIN CHINESE
Ai Zhisheng 艾知生 Chen Jingliang 陳景亮
Bai Hung 白虹 Chen Kaige 陳凱歌
Cai Ben 蔡賁 Chen Mengjun 陳孟君
Cai Chusheng 蔡楚生 Chen Ming 陳明
Cen Fan 岑範 Chen Yading 陳亞丁
Chan Teddy Tak Sum 陳德森 Cheng Jihua 程季華
Chang William Suk-ping 張叔平 Cheng Yin 成蔭
Chen Bo 陳播
Cheung Alfred
Kin-ting
張堅庭
Chen Boer 陳波兒
Cheung Jacob
Chi-Leung
張之亮
Chen Daoming 陳道明 Cheung Maggie 張曼玉
Chen Guangzhong 陳光忠 Cheung Tung-Joe 張同祖
Chen Haofang 陳昊芳 Ching Siu-Tung 程小東
Chen Haosu 陳昊蘇 Cui Wei 崔嵬
Chen Huaiai 陳懷皚 Ding Li 丁里
Chen Huangmei 陳荒煤 Ding Qiao 丁嶠
Chen Jialin 陳家林 Dou Shoufang 竇守芳

1
List format: Last name First name.

349
Doyle Christopher 杜可風 Huang Jianzhong 黃建中
Du Youling 杜又陵 Huang Shuqin 黃蜀芹
Fei Mu 費穆 Huangpu Keren 皇甫可人
Feng Xiaogang 馮小剛 Ji Hong 季洪
Feng Xiaoning 馮小寧 Jia Zhangke 賈樟柯
Gao Xixi 高希希 Jiang Yang 江洋
Gu Guoqing 谷國慶 Kang Ning 康寧
Guan Hu 管虎 Ke Ren 可人
Guo Baochang 郭寶昌 Ko Clifton Chi-Sum 高志森
Guo Linxiang 郭林祥
Kwan Stanley
Kam-pang
關錦鵬
He Jingzhi 賀敬之 La Peikang 喇培康
Hong Lin 洪林 Lai Zhiyou 賴志友
Hou Yong 侯泳 Lei Xianhe 雷獻禾
Hu Jian 胡健 Leung Tony 梁朝偉
Hu Mei 胡玫 Li Jun 李俊
Hu Qiming 胡其明 Li Ruihuan 李瑞環
Hua Yongzhuang 華永庄 Li Shaohong 李少紅
Huang Can 黃燦 Li Yang 李揚
Huang Gang 黃鋼 Liang Guangdi 梁光弟
Huang Jianxin 黃建新 Ling Zi 凌子

350
Ling Zifeng 凌子風 Shen Yun 沈蕓
Liu Jia 劉佳 Sheng Jianlun 盛家倫
Liu Miaomiao 劉苗苗 Shi Dongshan 史東山
Liu Zhongde 劉忠德 Shi Fanyu 石方禹
Lou Ye 婁燁 Shi Runjiu 施潤久
Lu Xuechang 路學長 Shui Hua 水華
Luo Jingyu 羅靜予 Situ Hui 司徒慧
Luo Zhen 羅真 Song Chong 宋崇
Mao Yu 毛羽 Su Li 蘇里
Meng Guangjun 孟廣鈞 Su Shuyang 蘇叔陽
Ng See-Yuen 吳思遠 Su Yun 蘇雲
Nie Dahan 聶大汗 Sun Yu 孫瑜
Nie Rongzhen 聶榮臻 Tan Dun 譚盾
Ning Ying 寧瀛 Tang Xiaodan 湯曉丹
Ouyang Hongying 歐陽紅櫻 Teng Jinxian 騰進賢
Peng Hourong 彭後榮 Tian Dawei 田大畏
Peng Xiaolian 彭小蓮 Tian Fang 田方
Qian Xiaozhang 錢筱章 Tong Gang 童剛
Rao Shuguang 饒曙光 Wang Chao 王超
Sang Hu 桑弧 Wang Feng 王楓
Shen Jiming 沈及明 Wang Gengnian 王庚年

351
Wang Jixing 王冀邢 Xu Guangchun 徐廣春
Wang Lianxi 王蘭西 Xu Jinglei 徐靜蕾
Wang Taihua 王太華 Xu Yinhua 徐銀華
Wang Xiaoshuai 王小帥 Xu Zhuang 徐庄
Wang Xingdong 王興東 Yan Jizhou 嚴寄洲
Wang Yan 王炎 Yang Ynjin 楊延晉
Wang Yang 汪洋
Yee Derek
Tung-Sing
爾冬升
Wang Zumo 黃祖模 Yu Lan 于藍
Wei Lian 韋廉 Yu Min 于敏
Wu Tianming 吳天明 Yuan Muzhi 袁牧之
Wu Tianren 吳天忍 Yuan Shuhua 袁庶華
Wu Yigong 吳貽弓 Zhang Hongsen 張宏森
Wu Ziniu 吳子牛 Zhang Junchao 張軍釗
Xi Shanshan 奚珊珊 Zhang Liang 張良
Xia Yan 夏衍 Zhang Min 章泯
Xiao Mu 蕭穆 Zhang Shichun 張石川
Xie Fei 謝飛 Zhang Xinyan 張鑫炎
Xie Jin 謝晉 Zhang Yang 張揚
Xie Tieli 謝鐵驪 Zhang Yibai 張一白
Xin Hanwen 辛漢文 Zhang Yuan 張元
Xu Chonghua 徐崇華 Zhang Zheng 張錚

352
Zhang Ziyi 章子怡 Zheng Zhengqiu 鄭正秋
Zhao Chen 趙晨 Zhong Jingzhi 鍾敬之
Zhao Wei 趙偉 Zhou Xiaowen 周曉文
Zhao Ziyang 趙紫陽 Zhu Li 朱力
Zheng Dongtian 鄭洞天 Zhu Wen 朱文
Zheng Junli 鄭君里

353
A P P E N D I X 7
Glossary of Chinese Terms
PINYIN CHINESE ENGLISH
2131 Gongcheng 2131 工程

2131 Project
Ai wo zhonghua
yingpian zhanbo

愛我中華影片展播
Love Our Chinese
Films Exhibition
Aiguozhuyi he
woguo zhishifenzi
de shiming

愛國主義和我國知
識份子的使命
Patriotism and the
Mission of our
Country’s Intellectuals
Aiguozhuyi jiaoyu
dianying yue
愛國主義教育電影
月

Patriotism Film
Education Month
Aiguozhuyi jiaoyu
shishi gangyao
zuotanhui

愛國主義教育實施
綱要座談會
Implementation of
Patriotism Education
Seminar
Bi kan pian 必看片

Must-see films
Changcheng yingshi

長城影視
Great Wall Film and
TV
Chuangzuo geng
duo wukui yu shidai
de youxiu dianying

創作更多無愧於時
代的優秀電影
Creating more high-
quality films to reflect
the times

354
Dengji piaojia 等級票價

Class price
Diangying shiye
fazhan zhuanxiang
zijin

電影事業發展專項
資金
Film Industry
Development Special
Fund
Dianying fushen
weiyuan hui

電影複審委員會
Film Re-examining
Committee
Dianying juben
lunzheng hui

電影劇本論證會
Film Scripts
Discussion Board
Dianying Shencha
Weiyuan hui

電影審查委員會
Film Examining
Committee
Dianyingpian
gongying
xukezheng

電影片公映許可證

Film Screening Permit
Fazhan shengchan
jijin

發展生產基金
Development
Production Fund
Guangdian zongju 廣電總局

SARFT
Guanyu dangqian
fanrong wenyi
chuangzuo de yijian

關於當前繁榮文藝
創作的意見
Some Opinions about
Enabling the Current
Production of
Literature and Arts to
Flourish
Guanyu hongyang
minzu wenhua de
ruo gan wenti

關於宏揚民族文化
的若干問題

On Promoting the
National Culture and
Related Issues

355
Guanyu yulepian
zhutilun ji qita

關於娛樂片主體論
及其他
About the Subjectivity
of Entertaining Films
and Others
Guanyu zhongguo
dianying de
zhuxuanlv

關於中國電影的主
旋律

On Main-Melody
Chinese Films
Gui 鬼

Ghost
Guojia dianying
shiye fazhan
zhuanxiang zijin
shangjiao de shishi
xize

國家電影事業發展
專項資金上繳的實
施細則
Implementation
Regulations
Concerning the
Special
Developmental Fund
for National Film
Industry
Hong tou wenjian 紅頭文件

Red-head documents
Hu yao 狐妖

Fox spirit
Jiegou piaojia 結構票價

Structure price
Jing pian 精片

High-quality films
Jing pin 精品

High quality
Jituanhua

集團化
Formation of media
conglomeration
Jiu ming tang 救命湯

Life-saving soup

356
Kaizhan zuzhi
wenhua xiaxiang
huodong de jiahua

開展組織文化下鄉
活動的計劃
Sending Cultural
Activities to the
Countryside Plan
Lao shao jie yi 老少皆宜

For Everyone
Liang shou zhua 兩手抓

Twin-fisted policy
Lianhe Shezhi 聯合攝制

Joint production
Luan qi ba zao de
dong xi

亂七八糟的東西

Mere trash
Mianfei gongyi
chang

免費公益場
Free public screening
program
mo 魔

Demons
Nanyang 南洋

Nanyang
Qiye danwei 企業單位

Enterprises
Quan guo gushipian
ticai guihua huiyi
全國故事片題材規
劃會議

Subject Plan for
Feature Film
Quan yi zhi ji 權宜之計

Expedient measure
Quanguo dianying
faxing faying
gongzuo dahui

全國電影發行放映
工作大會

National Distribution-
Exhibition Conference

357
Shang dong xia bu
dong

上動下不動
Policy change to the
upper level but not its
subsidiaries
Shang pin 商品

Commodity
Shanghai lianhe

上海聯和
Shanghai United
Circuit
Shangying chang
guishipian
shenchan guanli
zanxing guiding

上影廠故事片生產
管理暫行規定
Temporary
Regulations on
Managing Feature-
Film Production in a
Shanghai Film Studio
Shehui zhuyi wuzhi
wenming he
jingshen wenming

社會主義物質文明
和精神文明
The socialist material
civilization and
spiritual civilization
Shenhua gaige,
hongguan
diaokong, jiaqiang
guanli, wenchan
gaozhi

深化改革，宏觀調
控，加強管理，穩
產高質
Deepening the reform,
macro-controlling the
reform, strengthening
management of film
production, and
producing high-
quality films
Shiye danwei 事業單位

Public institutions
Tizhinei 體制內

Within in the system
Tonggou tongxiao

通購通銷
Unified Purchase and
Unified Sale

358
Tu chu zhuxuanlv,
jianchi duoyuanhua

突出主旋律，堅持
多元化
Make main-melody
prominent and insist
on diversification
Wanda yuanxian 萬達院線

Wanda Cinema Chain
Wanke 萬科

Vanke
Wei wen 維穩

Maintain stability
Weituo shezhi

委托攝制
Commissioned
Production
Wu ge yi gongcheng 五個一工程

Five-One Project
Wuliao youyu,
xialiu buzu

無聊有餘,下流不足
Too boring and
indecent
Xi xiang zhi biao 四項指標

Four Indicators
Xiahai

下海
Plunged into the
business sea
Xian li pian de ticai
guihua

獻禮片的題材規劃

Tribute Films Project
Xianke 先科

SASTAV
Xie buneng sheng
zheng

邪不能勝正
Justice cannot be
conquered by evil
Xiezuo shezhi 協作攝制

Assisted Production

359
Xitong gongcheng 系統工程

Systematic project
Xuan kan pian 選看片

Recommended films
Yao 妖

Evil spirit
Yao qian bu yao
lian

要錢不要臉

One who has no face
Yi cun yi yue yi
dianying

一村一月一電影
One village, one
month, one movie
Yingpian jiaoyi
shichang

影片交易市場
Film Exchange
Market
Yingshi huji
zhuanxiang zjin

影視互濟專項資金
Film and TV Mutual
Fund
You xiu pian 優秀片

Outstanding films
Yulepian taolun

娛樂片討論
Discussion on
Entertainment Films
Zhigong fuli jijin

職工福利基金
The Workers Welfare
Fund
Zhong dian pian 重點片

Key films
Zhongwai hezuo
shying dinyingpian
xukezheng

中外合作攝影電影
片許可證
Sino-Foreign
Licensing Feature
Film Productions

360
Zhongda geming
lishi ticai yingshi
chuangzuo lingdao
xiaozu

重大革命歷史題材
影視創作領導小組

Major Revolutionary
Historical Film and
TV Creation Leading
Small Group
Zhongda geming
lishi ticai yingshi
chuangzuo lingdao
xiaozu

重大革命歷史題材
影視創作領導小組

Production Team of
the Major
Revolutionary
Historical Films
Zhongguo dangdai
yulepian yantaohui

中國當代娛樂片研
討會

Seminar on Chinese
contemporary
entertainment films
Zhongguo dianying
faxing gongsi

中國電影發行公司
China Film
Distribution Company
Zhongguo dianying
jituan gongsi

中國電影集團公司
China Film Group
Corporation (CFG)
Zhongguo dianying
zhoubao

中國電影周報

China Film Weekly
Zhongguo yingpian
jingli gongsi

中國影片經理公司
China Film
Management
Corporation (China
Film)
Zhongyin xingmei

中影星美
China Film Stellar
Theatre Chain
Zhudao huayu 主導話語

Dominating speech

361
Zi chan zi xiao

自產自銷
Produce films and sell
them directly to the
cinemas without the
involvement of China
Film
Zigong jiangli jijin

職工獎勵基金
The Workers Rewards
Fund

362
A P P E N D I X 8
Film Periodization
Film periodization is a common practice in Chinese film history. Dai Jin Hua
(2002) notes “various discourses on ‘generations’ have become the labyrinthine map of
the new era. In one short decade, periodizing has commenced with proclamations of
beginnings and endings, ruptures and beginnings. Each seeks to predict the birth of an
entirely new culture and social structure. Yet each ‘generation’ steps onto the historical
stage to play its part, only to step right down again. More to the point, the discourse on
‘generations’ is not configuring contemporary China’s cultural map; it is in and of itself
an important cultural scene.” According to Dai, the categorization of film directors starts
from the May Forth generation, which is the generation of liberation. But she argues that
the periodization is not “rational” and that it is “not known who invented the label” (Dai
2002, 71–79). However, another scholar, George Semsel, tries to categorize the first five
generations of Chinese directors. In his book, Chinese film theory: a guide to the new
era, Semsel provides a rough picture of the first five generations. The author outlines the
generations thusly:
First Generation —
Pioneers; pre-1930s
Second Generation —
Produced social realism films during the 1930s
and 1940s
Third Generation —
No formal film study; entered industry circa
1949; made films primarily during the 1950s and
1960s
Fourth Generation —
Studied film at the Beijing Film Academy prior
to 1966; began making films after the Cultural
Revolution

363
Fifth Generation —
Cadre of young filmmakers; mostly graduates of
Beijing Film Academy in 1982
1

As scholar Shannon May (2003) affirms, “The term ‘generation’ has been used by
Chinese film historians to catalogue film directors into periods, taking into account both
the time when a director first began making films as well as directorial style and
production methods. A new generation is marked by an abrupt stylistic change that tends
to coincide with the graduation of a new class of directors from the Beijing Film Academy.
The previous five periods are generally accepted as:
i. 1905-1932
ii. 1932-1949
iii. 1950-1960
iv. 1960-1980
v. 1980-1992
Once labeled as a member of a particular generation, a director is known as being of that
generation regardless of the length of his career.” We can therefore conclude:
FIRST GENERATION —Refers to those directors who were the pioneer of
Chinese film industry mainly working in 1920s. Examples:
Filmmakers: Zhang Shichun; Zheng Zhengqiu
Films: Sing-song Girl Red Peony; The Burning of Red Lotus Temple
SECOND GENERATION — Refers to those directors who were active in the film
industry during 1930s to 1940s. Examples:
Filmmakers: Cai Chusheng; Sun Yu; Fei Mu
Films: Night in the City; The Highway; Song of the Fisherman
THIRD GENERATION — Refers to those who started their career in filmmaking
from 1949 to 1960s. Examples:
Filmmakers: Zheng Junli; Xie Jin; Shui Hua; Cheng Yin; Cui Wei; Ling
Zifeng; Xie Tieli
Films: From Victory to Victory; The White-Haired Girl; Song of Youth;
Zhang Ga the Soldier Boy; February; Women Basketball Player No. 5;
Hibiscus Town; Rickshaw Boy; Border Town; A Woman for Two

1
Semsel 1990.

364
FOURTH GENERATION — Refers to those who graduated from Beijing Film
Academy before the Cultural Revolution but did not begin their career until the
1980s. Examples:
Filmmakers: Wu Yigong; Wu Tianming; Xie Fei; Zheng Dongtian;
Huang Jianzhong; Huang Shuqin
Films: Sacrifice of Youth; Shao Ou; Black Snow; Xiao Hua; My
Memories of Old Beijing; Narrow Street
FIFTH GENERATION — Refers to those who had received professional training
after the Cultural Revolution. Examples:
Filmmakers: Chen Kaige; Zhang Yimou; Wu Ziniu; Tian Zhuangzhuang;
Huang Jianxin; other less famous such as Zhang Junchao, Li Shaohong,
Hu Mei, Zhou Xiaowen, Ning Ying, Liu Miaomiao
Films: Not One Less; Yellow Earth; The Big Parade; King of the
Children; On the Hunting Ground; Red Sorghum
SIXTH GENERATION — Refers to those who received education in mid-1980s
and entered filmmaking in the early 1990s. Examples:
Filmmakers: Guan Hu; Lu Xuechang; Lo Ye; Jia Zhangke; Zhang Huan;
Wang Xiaoshuai
Films: Beijing Bastard; Beijing Bicycle; Xiaowu; Platform; Dirt

365
A P P E N D I X 9
List of Interviews
# Name
1
Job Title
Interviews
Date(s)
2
Location(s)
3

1 Ip, Grace
Chinese Consultant, National Association
of Television Program Executives
2011/11/2 US
2 Wang, Win President, IBO Film Co., Ltd. 2011/11/2 US
3 Guo, Caroline
Executive Director, Great Cinema
Enterprise (Beijing) Co., Ltd.
2011/11/3 US

1
Name format: Last, First.
2
Date format: yyyy/mm/dd.
3
Interviews were conducted in Beijing (BJ); Shanghai (SH); Hong Kong (HK); and Los Angeles (US).

366
4 Song, Zhixing
Chief Technical Officer, Talkweb
Information System Co., Ltd.
2011/11/5
2011/11/6
US
5 Wang, Hui
Chairman, Tang Dynasty TV & Film
Co., Ltd.
2011/11/4 US
6 Zhang, Patrick
General Manager, China Film Group
Marketing Corporation Sales Department
2011/11/3 US
7 Liu, Amy Vice President, EntGroup Consulting
2011/11/5
2012/1/4
US
BJ
8 Gao, Leon President, EntGroup Consulting
2011/11/5
2012/1/4
US
BJ
9 Han, Victoria
Producer, Beijing Hairun Pictures
Co., Ltd.
2011/11/4 US
10 Pang*
4

President of a Major Beijing Film
Promotion Company
2008/4/25
2008/7/3
US
BJ

4
Where noted with an asterisk (*), a fictitious name has been used for confidentiality purposes.

367
11 Yao, Jeff News Manager, TVB 2008/8/1 HK
12 Chu, Hark Producer, Peggie Production Co., Ltd. 2009/7/5 SH
13 Wang, Linlin Independent Producer/Director 2011/10/21 US
14 Au, Vivian Chief Editor, TVB 2008/8/1 HK
15 Zhou, Jing
Editor, Production Center of CCTV
Newsreel & Documentary Film Studio
2011/5/2 US
16 Luo, Hongtao Journalist, CCTV Sports 2011/5/2 US
17 Huang, Kaixuan Author/Screenwriter 2012/1/3 BJ
18 Gao, Chao China Film Promotion International 2008/7/3 BJ

368
19 Li, Shuhong Librarian, Beijing Film Academy 2008/7/1 BJ
20 Pang, Guo Student, Beijing Film Academy 2008/7/1 BJ
21 Lu, Shu Student, Beijing Film Academy 2008/7/2 BJ
22 Li, Yang Independent Director 2008/3/28 US
23 Meng, Ji Director, TV and Independent Film 2008/6/2 BJ
24 Su, Xiaowei
Deputy Director, SARFT Script Center;
Writer of Aftershock
2010/11/2 US
25 Wang, Tianyun Vice President, Shanghai Film Group 2010/11/2 US
26 Yang, Hongtao President, Ningxia Film Group 2010/11/2 US

369
27 Zhang, Zhao President, Enlight Media 2010/11/2 US
28 Ng, See-Yuen
Director; Honorary President, Hong
Kong Film Directors’ Guild
2011/6/8 HK
29
Chan, Gordon
Ka-Seung
Director; President, Hong Kong Film
Directors’ Guild
2011/6/8 HK
30 Anon 1*
Professor, Communication,
University of China
2011/9/30 US
31 Anon 2*
Professor, Communication,
University of China
2011/10/15 US
32 Ng, Stanley Film Critic 2012/1/13 HK
33 Anon 3* Film Critic/Blogger 2011/7/27 HK
34 Anon 4* Government Official 2009/7/16 SH

370
35 Judice, Julie Producer, Orb Media Group 2010/11/1 US
36 Ko, Clifton Chi-sum Producer/Director 2011/6/10 HK
37 Cheung, Alfred Producer/Director 2011/6/13 HK
38 Gao, Yang
Manager, China Communist Youth
League Central Film & TV Center
2011/11/5
2012/1/4
US
BJ
39 Cheung, Tung-joe
Honorary President, Hong Kong Film
Directors’ Guild
2012/12/28 HK

371
A P P E N D I X 1 0
Film Industry Regulations Passed in the PRC

1
Date format: year month day. Unless otherwise specified, refers to the date the law was enacted.
DATE
1

NAME
SIGNIFICANCE
English Chinese
1949
Propaganda Department’s Instructions
to the Special Branch of Deployed
Cadres Army about the Development
of the Film Industry
中共中央宣傳部為
發展電影事業至各
野戰軍政治部抽調
干部的指示
Recognized for having largest reach,
film declared most effective mode of
publicity
1950
October
Ministry of Culture’s Five Interim
Measures on the Film Industry
文化部關於電影業
五個暫行辦法
The first regulation on film industry
post-1949

372

1950
February 15
Guidance on the Standard of
Censorship of Poisonous Films
對有毒影片審查標
準的指示
The first document about film
censorship
1952
July
Instructions on the Strengthening of
Film Screenings and Distribution
關於加強電影放映
與發行工作的指示
Outlined the roles and responsibilities
of China Film
1957
April
Provisions on Shifting the Leadership
from Local Film Distribution
Companies to the Local Cultural
Administration Units
關於各地電影發行
企業劃交地方文化
行政機關領導和管
理的規定
Consolidated leadership within the
Ministry of Culture vis-à-vis the film
industry
1963 February
Circular Requesting Improving
Management of Distribution and
Projection
關於改進電影發行
放映業務管理體制
的試行方案
Local film distribution-exhibition
companies placed under the purview of
China Film and the local branches
Ministry of Culture
1979
July 1
(Effective)
Circular Requesting Instructions on the
Management of Distribution and
Projection (Document No. 198)
關於改革國營電影
發行放映企業管理
體制方案
Allowed exhibition companies/units to
keep 80% of the profit for film
reconstruction, renovation, and
maintenance

373

1979
December 15
(Issued &
Effective)
Trial Measures on Film Scripts,
Film Examination
電影劇本、電影審
查試行辦法

First official law on film censorship
1979
Circular Requesting Instructions on the
Management of
Distribution and Projection
關於改革電影發行
放映管理體制的請
示報告
Reassembled projection facilities
demolished during the Cultural
Revolution
1980 December
The New Settlement Method of
Feature Films and Stage Art Films
關於試行故事片、
舞名藝術片新的結
算方法的通知
Raised prices on films and film
copyrights owned by film studios
1984
August 14
Several Opinions on
Reforming Ticket Prices
關於改革電影票介
的幾點意見
Increased ticket prices from 10 cents to
30 cents
1985
February 15
Notification About Film and TV
Organizations Consolidation Issues
關於電影、電視機
構合併事項的通知
Transferred control over the film and
TV industry from the Ministry of
Culture to SARFT

374

1987
April 1
Reiterate the Use of Standardized
Languages in Radio, Film and TV
dramas.
關於廣播、電影、
電視正確使用語言
文字的若干規定
Required all films to feature Mandarin;
local dialects were banned from use
1989
March 25
Notices on Film Censorships and
Film Rating
關於對部分影片實
行審查、放映分級
制度的通知
The first document addressing film
rating
1990
August 28
Opinions on Strengthening
Features’ Censorship
關於加強故事片審
查把關工作的意見
Required that all film scripts be
examined by the corresponding Film
Bureaus prior to production
1990 September
Provisions on the Production of Major
Revolutionary Historical Films and the
Problems of Censorship
關於重大革命歷史
題材影視作品拍攝
和審查問題的規定
Required anyone wishing to produce a
film about major revolutionary
historical issues to obtain a production
permit
1990 December
Notice on Film Ticket Price
Management and the Establishment of
the Development Fund for the Chinese
Film Business
關於明確電影票價
管理權限和建立國
家電影事業發展專
項資金的通知
Collected a portion of theatre revenues
to support the production of
propaganda films

375

1993
January 5
Several Opinions on Deepening the
Current Chinese Film Industry’s
Institutional Reform & Implementation
Details (Opinion-Seeking Draft)
(also “Document Number 3”)
關於當前深化電影
行業機制改革的若
干意見的通知及
實施細則（徵求意
見稿） ( 或稱 3 號
文件)
Abolished China Film’s distribution
sector monopoly
1993
June 4
Provisional Film Examination
Regulations
電影審查暫行規定
Established examination and permit
procedures, including a detailed outline
of application criteria, required
documentation, general information
1994
July 5
Regulations on Sino-Foreign Film
Co-Productions
關於中外合作攝制
電影的管理規定
Officially defined “Sino-Foreign Film
Co-production” and outlined three
criteria under which foreign entities
could co-produce films in China
1994
August 1
Several Opinions on Deepening the
Reform of the Film Business
關於進一步深化電
影機制改革的通知
Allowed local film companies to
distribute domestic and foreign films
within their own exhibition units

376

1994 August
Details of Implementation on the
Reform of Film Distribution and
Exhibition Mechanisms
關於改革電影發行
放映機制的實施細
則
Outlined 10 steps toward chain system
reform
1994
September 29
Further Reiterate the Use of Putonghua
and Standardized Chinese
關於重申國產影片
必須使用普通話和
規範漢字的通知
Reinforced the Mandarin-only film
language mandate, whereby the Film
Bureau would refuse to process films
featuring local dialects
1995
January 5
Regulations Concerning Reforming
Feature Film Shooting
Management Work
關於改革故事片攝
制管理工作的規定
Opened up the production sector to
private enterprise
1995
September 9
Notice on How to Promote Key Films’
Distribution and Exhibition
關於做好重點影片
發行放映工作的通
知
Required distribution companies to
distribute a set of “key films” to theaters
yearly
1996
March 18
Notice on the Establishment of Special
Funds to Support the “9550 Project” to
Produce High-Quality Films
關於設立支持電影
精品「九五五零」
工程專項資金有關
規定的通知
Extracted 3% of TV-commercial
revenues from TV stations to support
the production of “high-quality films”

377

1996
June
Film Management Regulations 電影管理條例 Updated film law
1996
Implementation Policies of China Film
Industry Development Fund
國家電影事業發展
專項資金上繳的實
施細則
Outlined the Film Industry
Development Fund
1997
January 16
Film Censorships Regulations 電影審查規定 Updated censorship regulations
1997
December 24
Circular on the Licensing for
Single-Feature Film Productions
關於試行「故事電
影單片攝制許可
證」的通知
Began issuing film production permits
among film companies, TV stations, and
TV drama production units
1997
Measures on the Management of
Chinese Film Industry Development
Special Fund
國家電影事業發展
專項資金（管理辦
法)
Encouraged and supported national film
production
2001
December 25
(Issued)
2002 Film Management Regulations
2002 電影管理條
例
Replaced the film law of 1996

378

2003
November 25
Temporary Regulation on Foreign
Companies Investing in Theaters
外商投資電影院暫
行規定
Allowed foreign companies to own
theatres, with a total stake limit of 49%
2004
November
Interim Provisions on Operation
Qualification Access for Movie
Enterprises
電影企業經營資格
准入暫行規定
For the first time, opened up Mainland
Chinese film production and
distribution to foreign investors
2004
Several Opinions on Speeding Chinese
Film Industry Development
關於加快電影產業
發展的若干意見
Provided various tax exemptions to the
film industry, particularly for the
appointed film enterprises
2004
Notice on Digitizing Film Development
電影數位化發展綱
要的通知
Constructed village theatres and
second-tier movie markets
2004
Notices on the Tax Policies on
Cultural Industry Institutional
Development
關於文化體制改革
試點中支持文化產
業發展若干稅收政
策問題的通知
Provided various tax exemptions to the
film industry, particularly for the
appointed film enterprises

379

2006
On Strengthening the Awards and
Examining the Distribution and
Exhibition of Chinese Films
關於進一步完善國
產影片發行放映的
考核獎勵辦法的通
知
Required CFG and Huaxia to distribute
at least 60 locally made films, including
30 films recommended by SARFT; also
required that the films they distributed
earn at least RMB 100 million in box-
office revenues
2008 December
Provisions on the Main Duties,
Internal Organization, and
Personnel Allotment of SARFT
國家廣播電影電視
總局主要職責內設
機構人員編制規定
的通知
Outlined the formation of SARFT
2011 December
Film Industry Stimulation Law of the
People’s Republic of China
(Opinion-Seeking Draft)”
中華人民共和國電
影促進法( 徵求意
見稿)
A newer law intended to replace the
Film Management Regulations (2001)

Abstract (if available)

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