The DreamWorks Animation, which created the series of “Shrek,” “Kung Fu Panda” or “Puss in Boots,” will create a film production studio in China, in partnership with local groups, announced the company in a statement Friday.
The announcement comes as the vice president and a likely Chinese future number one Xi is present in Los Angeles, the last leg of his visit to the United States.
The new company, called Oriental DreamWorks, will focus on “the development and production of Chinese films with original high quality, animated or live action, both for the Chinese market and the rest of the world,” said the statement.
“Besides creating content, the joint venture will operate in the fields of performing arts, theme parks, mobile technology, Internet and games,” says DreamWorks Animation.
Oriental DreamWorks will be owned 55% by Chinese state companies China Media Capital (CMC), Shanghai Media Group (SMG) and Shanghai Alliance Investment (SAI), the remaining 45% returning to DreamWorks Animation.
The new studio will receive an initial capital of $ 330 million and should be operational this year, DreamWorks Animation said.
“We are extremely proud of the creation of Oriental DreamWorks with CMC, SMG and SAI, a revolutionary and historical alliance to create a flagship company in the family entertainment industry,” said Jeffrey Katzenberg, CEO of DreamWorks Animation in a statement.
“We intend to create, with our Chinese partners, a new company of its kind, to locally design and produce high-quality content and experiences of family entertainment, not only for the Chinese but also foreign markets,” he added.
DreamWorks films are very popular in China, including the series “Kung Fu Panda”. The first phase in 2008 was the most profitable animated film in China, and last year’s second part became the most profitable animated film in history in China, with revenues of nearly $ 100 million.
DreamWorks Animation is just the latest in a long list of Hollywood studios want to try their luck in China, attracted by a market that is growing exponentially.
“Majors” Warner, Disney, Sony, Fox, and those “mini-majors” Relativity Media Entertainment and Legendary are already engaged in the production of films for Chinese audiences with local partners.
Also it provides a way for these studios to circumvent strict quotas in Chinese market: only 20 foreign films per year can be distributed in the country. Many had to make many compromises on the artistic scenario.
With its films focus on family audiences, and the power of its partners, DreamWorks Animation, however, should avoid these pitfalls.