Chapter 1130: A change of the weather in the Hong Kong film market

After the sniper failed in 'Blade Runner,' the major Hollywood film companies knew that 'Alien E.T.' was unstoppable and the might of the lion had erupted.

The studios, which had been hoping for a fluke, could only delay the release of their recent blockbusters.

This choice was extremely beneficial for MGM Pictures. With no good movies being released at the same time, audiences naturally flocked to Alien E.T., a movie with excellent word-of-mouth.

In addition, MGM Pictures once again cooperated with some cinemas that were positive about the movie, and the number of cinemas in North America alone reached more than 1,250.

This allowed E.T. to remain the weekend box office champion and set a new box office high.

In its second week, it set a new global box office record, reaching 846.9 million US dollars!

The total box office for the two weeks was 158.23 million US dollars.

Because they did their own publicity and distribution, the costs were lower and the box office share was higher.

Not to mention that Universal Cinema was the number one exhibitor, and the profits were pouring in.

So in fact, the costs of investment in filming and publicity and distribution were long ago recouped, and a certain profit was made.

The box office revenue is pure profit!

Historically, the total box office revenue of the movie 'E.T. the Extra-Terrestrial' was 360 million US dollars in North America and more than 792 million US dollars worldwide.

However, the production cost of this generation of 'E.T. the Extra-Terrestrial' is 20 million US dollars higher, and the publicity and distribution power is also stronger.

Therefore, surpassing the original trajectory is absolutely not a problem, and the total box office revenue breaking through 800 million US dollars is a breeze.

This means that Alien E.T. will be able to earn Xia Yu a net profit of more than 450 million US dollars at the box office.

Coupled with the value of various copyrights, it will definitely be possible to create a value of 600 million US dollars!

...

In the days that followed, Alien E.T. continued to be released to great acclaim, while in Hong Kong, Shaw Brothers Pictures became the laughing stock of the industry, because after the box office of Blade Runner plummeted, it was unable to recover.

As for the losses of Shaw Brothers, many media outlets had roughly estimated them. Not to mention the loss of reputation and future, just in terms of cash, the losses exceeded 130 million Hong Kong dollars.

This is equivalent to losing the annual net profit of a top 100 listed company in Hong Kong!

Soon, another piece of explosive news came out: the Shaw family was preparing to completely admit defeat, withdraw from the film industry, and sell Shaw Brothers Pictures and Shaw Theatres.

This news was really explosive, and many people couldn't believe it. The Shaw Brothers Film Company, the former overlord of the Hong Kong film industry and one that had made outstanding contributions to the industry, was going to disappear?

Who would get the huge assets of the Shaw Brothers Film Company and Shaw Theatres?

What would become of the Hong Kong film market?

For a time, discussions about these issues became very heated.

In this situation, Wu Siyuan and Jiang Zhiqiang once again came to Xia Yu's office together.

Xia Yu read the newspaper every day, so of course he was also aware of the situation at Shaw Brothers.

Looking at Wu Siyuan and Jiang Zhiqiang, who were sitting upright in front of him, Xia Yu asked with a smile, 'What? Do you have any ideas about Shaw Brothers Pictures and Shaw Theatres?'

Wu Siyuan and Jiang Zhiqiang looked at each other and both smiled awkwardly.

Wu Siyuan patted Xia Yu's back and said, 'Chairman, you are so wise, we really can't hide anything from you!'

Xia Yu laughed quietly, scolding him, 'Don't give me all this nonsense, just tell me what's going on.'

'Are you 100% sure that the Shao family is preparing to withdraw?'

Wu Siyuan looked at Jiang Zhiqiang, who had done the legwork and knew better.

Jiang Zhiqiang nodded and said, 'Chairman, the news can be confirmed. This is personally released by Shao Weiming, the son of Shao Yifu. I asked someone else to make the call and Shao Weiming admitted it on the phone.'

'Shao Weiming would never joke about something like this, and no one in the Shao family has come forward to deny the rumours.'

'Moreover, the quality of the films produced by Shaw Brothers Pictures in the past two years has indeed been poor, and the probability of other film companies producing outstanding films is also low. Therefore, Shaw Theatres is basically operating at a loss.

'This time, Shaw Brothers Pictures lost more than 100 million Hong Kong dollars, and the Shaw family is still continuously increasing its stake in TVB. There is not much spare money left to invest in the film company, and the banks are not sure if they dare to lend to them.'

'I think the Shaw family is going to retreat to TVB and prepare to concentrate its resources to compete with President Wong in the television field.'

Xia Yu smiled and nodded, as if agreeing with Jiang Zhiqiang's analysis.

In fact, in the previous life, under the competition between Golden Harvest and Cinema City, Shaw Brothers Studio could not hold out, and Shaw Yifu later rented the Shaw Theatre Circuit to Dickson Poon. Although Shaw Brothers Studio did not cease production, it could not even maintain an average of one film a year after 1985, and did not make a film for several years after entering the 1990s.

Although in this life, under the influence of Xia Yu, Lei Juekun did not enter the film industry, Huang Baiming and Mai Jia were at Universal TV and Galaxy Studios respectively, so there was no New City Entertainment.

And Cheng Long and Hong Jinbao were also incorporated into Galaxy Studios, so there was no D&B Films.

However, Xia Yu's Galaxy Movie Company was a giant, exerting more pressure on Shaw Brothers Pictures than the combined pressure of the previous era's Golden Harvest + New Art City + D&B.

And it made Shaw Yifu unable to see a way out.

Moreover, Xia Yu's Global TV also exerted strong pressure on TVB in the television field, putting the Shaw family's finances under great strain.

It is therefore understandable that Shaw Yifu decided to withdraw decisively from the film market.

'So, do you want to acquire Shaw Brothers Pictures and Shaw Theatres separately? Or do you want to acquire a part of them?'

Xia Yu asked with a faint smile.

Wu Siyuan spoke first: 'Chairman, I want to acquire Shaw Brothers Pictures in its entirety.'

'Although we now have the Xiangjiang Culture and Media School to provide talent, it takes a long time to train people. It's better for performing talent, but it's difficult to train behind-the-scenes talent.

'Although Shaw Brothers Pictures has been losing talent to us and Golden Harvest, it still has a very strong foundation. If we can take all these people over, then we can easily double our annual film production and improve the quality of our films to a certain extent.'

'The Hong Kong film market is currently described as a situation with one superpower and two strong powers. We are the superpower, Shaw Brothers Pictures and Golden Harvest are the top powers, and then there are other second- and third-tier film companies.'

'I think if we don't take over, and Shaw Brothers Studios falls into Wrinkly's hands, it will narrow the gap with us. At that time, the competitive pressure will be even greater, and if our rear is unstable, it will be somewhat unstable to fully break out into the Asian market.'

'So we might as well eat it up and completely consolidate our dominant position.'

'Oh, and another thing, Shaw Brothers Studio has the largest film library in Hong Kong, which I think is a huge asset that we can use at any time.'

'These are my reasons.'

Xia Yu nodded slightly.

But he didn't immediately express his opinion, instead looking at Jiang Zhiqiang with a faint smile on his lips.

'Zhiqiang, what was your original intention for wanting to acquire Shaw Brothers Studio? Won't Shaw Brothers Studio overlap with Universal Studios in some locations?'

Jiang Zhiqiang replied truthfully, 'Chairman, Shaw Circuit currently owns 16 self-operated cinemas in Hong Kong and more than 130 self-operated cinemas in Southeast Asia. Together with the cinemas that distribute on its behalf, its distribution network covers more than 200 cinemas, making it the second largest cinema circuit after ours.'

'There is definitely some overlap in terms of locations, but since Shaw Circuit established its presence earlier, many of its cinemas are located in prime locations. Even if we overlap with them, we are not afraid.'

'The Asian film market is growing rapidly every year. The number of cinemas is currently sufficient, but it will not be enough in the future. According to Universal Circuit's plan, it is prepared to continue to build or acquire cinemas in the future to expand its scale. Therefore, it is not a bad idea to acquire Shaw Circuit in advance now, and we can get it done in one step.'

'As for the other consideration, it is the same as President Wu's. Shaw Circuit is the second largest cinema circuit after us. If it is taken over by Golden Harvest, their profits in overseas markets will skyrocket, which will also be a big problem for us.

'Even if it is not acquired by Golden Harvest, but by someone else, it is still a very unstable factor.'

'Why not be acquired by us, and completely stabilise our dominant position in the Asian film market!'

'Chairman, these are my reasons.'

After saying this, both Jiang Zhiqiang and Wu Siyuan looked at Xia Yu with burning eyes, waiting for his orders.