Hollywood and the Chinese Communist Party: The Hidden Cost of Box Office Millions

What do the films Brokeback Mountain (2005), Shang-Chi and the Legend of the Ten Rings (2021), and Top Gun: Maverick (2022) all have in common? At first glance, these movies share very little with each other. They were not released by the same studio, nor did they cast the same actors. There are few discernible overlaps in their themes, plots, and characters. Even their critical reception and success varies across the board. The answer to this puzzling riddle is that none of these films saw a theatrical release in China. More importantly, they were deliberately denied access to the Chinese box office by the Chinese Communist Party (CCP). 

The reasons for the bans were, funnily enough, different for each film: Brokeback Mountain explores a homosexual relationship; Shang-Chi’s titular hero was played by actor Simu Liu, who has previously criticized the Chinese government; Tom Cruise’s “Maverick” wears an iconic bomber jacket featuring the Taiwanese flag. Not to mention, Top Gun: Maverick successfully re-glamorized the United States military. While none of these factors sit particularly well with the Chinese government, the average moviegoer is left to wonder why China’s approval matters at all. A Hollywood filmmaker would state the facts: China has a 17% market share in the film industry. With 14,000 domestic movie theaters and 1.4 billion people, it is one of the biggest box offices in the world (Thomala 2023). As the numbers suggest, the CCP has significant influence over global film, which is manifested in Hollywood’s dedicated pursuit of the Chinese dollar. However, recent events suggest that despite the long legacy of Chinese censorship in film, the pendulum that is the Hollywood and the CCP’s relationship may be swinging in the other direction.

From Point A To Point B: How Did We Get Here?

Erich Schwartzel, a reporter for The Wall Street Journal, describes the events that led to China’s unique authority over the film industry in his book, Red Carpet: Hollywood, China, and the Battle for Global Supremacy. After the Cultural Revolution, Chinese theaters struggled to draw out their domestic audience. Movies during this period were oversaturated with state-sponsored propaganda. It would not be until The Fugitive (1994) starring Harrison Ford that a limited number of Hollywood films were allowed theatrical release in China. The Fugitive grossed $3 million and kickstarted the Chinese demand for Western media. Titanic grossed $50 million in 1999 and Avatar (2010) brought in an impressive $200 million. 

In 2007, the World Trade Organization ruled that China violated international trade by restricting the import of films from the United States. A few years later, then-Vice President Joe Biden met with Xi Jinping (China’s current presidential leader) to resolve the issue. They agreed to an annual release of 34 foreign films and raised the United States’ stake in ticket revenue from 13% to 25%. Following the success of Avatar and the trade agreement in 2012, Hollywood saw an opportunity. As Erich Schwartzel told Vox, “studios started to realize how much money was to be made in the Chinese market…they also thought to themselves, ‘How can we maximize revenue or our interests there?’” (Wilkinson 2022).

The Chinese Communist Party: Dos And (Mostly) Don’ts

The first and most difficult step for a film is to earn approval from the CCP, whose demands range from short clips on the cutting room floor to extensive reworks of story concepts. Schwartzel maintains that “no studio is going to get in a movie about the Dalai Lama, or that has any Tibetan characters, or any reference to Chinese history that the authorities would rather their people not see” (Wilkinson 2022). Politically speaking, there are three topics that China will reject any reference to: Tiananmen, Tibet, and Taiwan (Doescher 2018). In 1989, the Chinese government massacred a student-led protest in Tiananmen Square, which claimed the lives of thousands of peaceful demonstrators and is a blight upon China’s international reputation. The CCP has forbidden any discussion of the event and censored its textbooks with a state-approved record that severely downplays the tragedy. Tibet was annexed by China in 1951 and has since been under strict authoritarian rule. Whispers of human rights violations and Tibetan unrest continue to make the region a sensitive topic. Finally, Beijing has a controversial territorial claim on the island of Taiwan despite having no historical basis of past governance. To avoid these three subjects, among others (ie. the Uyghurs and Hong Kong protests), China is generally more receptive to big blockbusters like Transformers and Jurassic World, which tend to circumvent political commentary. 

The CCP has also been known to reject films on conceptual grounds. Schwartzel has suggested that movies involving time travel imply that there is an alternative history than the one the party presents (Wilkinson 2022). There is a constant rejection of any homosexual elements and even characters that usurp a system. Schwartzel notes that “cinema has trained us over time to reflexively cheer for the underdog…and in China, the authorities have every reason to keep that kind of theme or character out” (Wilkinson 2022). The rejection of the feel-good film, In Good Company (2004), demonstrated this philosophy; China did not approve of the main character undermining his boss, the established authority.

Cinema is a form of soft political power, meaning that it can positively shape the global community’s perception through appeal and attraction. If China can closely manage its global perception by displacing the power of Hollywood, then they can similarly displace a positive impression of the United States with its own. Schwartzel notes that “the movies have become a proxy for the broader rivalry forming between the US and China” (Wilkinson 2022). What makes China different from other US competitors is that they have the ability to inflict real consequences. According to Schwartzel, “Chinese authorities made it clear…that if a studio made a film that angered officials, it was not going to be about punishing that studio, but it would be about punishing its parent company” (Gross 2022). Sony’s Seven Years in Tibet (1997) resulted in the company’s brief ban in China, losing revenue beyond its film department. The film was not even seeking a Chinese theatrical release.

When Does Censorship Become Self-Censorship?

Chinese censorship has left its fingerprints all over Hollywood blockbusters of the last two decades. Rumors circulate that Doctor Strange (2016) rewrote a canonically Tibetan character as Celtic to preemptively placate the CCP. Warner Brothers cut a 6-second clip in Fantastic Beasts: The Secrets of Dumbledore (2022) that implied homosexual relations between Albus Dumbledore and Gellert Grindelwald. Bohemian Rhapsody (2019) cut every homosexual scene, including any explicit vocalization of the word “gay” before its Chinese release. Mission: Impossible III (2006) edited out clotheslines from the backdrop of Shanghai so as to not present a “backwards” image of China (Gross 2022). In fact, the country’s image in Hollywood is more positively represented than one would expect. The Chinese government rescued all of humanity in the film 2012 (2009) due to their ingenious life-saving arcs. Sandra Bullock survives in Gravity (2013) by reaching the Chinese Space Station. There are even instances of subtle product placement, like in Transformers: Age of Extinction (2014) when Mark Wahlberg buys Chinese protein powder in Chicago. It became the highest grossing film in China at the time of its release, bringing in over $300 million. The long list of examples reveals a deep-rooted legacy of Beijing in Hollywood, which has affected the way the US film industry operates.

In 2015, the US-China Economic and Security Review Commission released a brief which reported that “with an eye toward distribution in China, American filmmakers increasingly edit films in anticipation of Chinese censors’ many potential sensitivities” (Toh 2022). Hollywood shifted from being subjected to censorship before theatrical release in China, to actively self-censoring with Chinese profits in mind. With the collapse of the DVD market in the 2000s, studios turned to the East to make up lost revenue. In 1991, Hollywood made 30% of their box office internationally, but that percentage doubled in 2016 (Council on Foreign Relations 2017). Schwartzel surmises that “even on some of the biggest films that make tons of money around the world, like a Fast & Furious film or a Marvel superheroes movie, getting into China and making money there…can mean the difference between profit and loss” (Gross 2022). Movies like Transformers: The Last Knight (2017) flopped in the United States ($69 million) but found financial success in Beijing ($123 million). Dependence on the Chinese box office appeared as a reality after the country overtook North America as the largest film market in 2020.

According to Robert Cain, founder of Pacific Bridge Pictures, studios were “doing anything and everything to make sure their films got in, including debasing their films and themselves” (Toh 2022). Dreamworks used a dashed line to mark the contested South China Sea on a world map for their children’s animation, Abominable (2019). In 2009, MGM spent $1 billion to re-edit Red Dawn (2012) in order to change the antagonistic invaders from Chinese to North Korean. Most notably, Disney’s then-CEO Michael Eisner flew to Beijing in 1998 to personally apologize for the making of Kundun (1997), a story about the Dalai Lama. China called for a Disney ban after learning of its connection to Tibet. Despite Martin Scorsese’s involvement as director, Disney stunted the film’s domestic release. In a rather unusual supplication to Chinese officials, Eisner explained “the bad news is that the movie was released. The good news is that nobody saw it” (Gross 2022).

The Cost Of Profit: Drawbacks In Representation

Why should anyone care about Hollywood’s subservience to the East? Blockbuster films continue to rake in millions of dollars from the global box office. Well, there are several drawbacks to the practice of American self-censorship. The refusal to touch storylines involving different cultures and events not only limits the creative range of filmmakers, but relegates these narratives as unimportant. It leads to discriminatory marketing practices when Black American actors are removed from Star Wars and Dune (2021) promotional posters in China. It also has resulted in a two-fold pressure. The United States’ domestic audience has recently been pushing for more progressive representation in film, whether it be exploring homosexuality or minority cultures. However, this has created tension for studios trying to access the Chinese market. Do they continue to appease China or risk alienating part of their original audience? Either way, it is possible to incur a loss. 

Even films that seem to strike a perfect balance between these demands have faltered. Eternals (2021) was directed by Chloe Zhao, a Beijing filmmaker. She was originally touted as “the pride of China” following her success with Nomadland (2021), for which she won the Academy Award for Best Director. However, both Nomadland and Eternals were denied a Chinese theatrical release after old comments showed Zhao criticizing the CCP. Similarly, Crazy Rich Asians (2018), which featured an all-Asian cast, flopped in China after grossing only $1.5 million. These movies were expected to perform well in both box offices due to their representation and connections to Asia. Clearly, they did not do as promised. Hollywood is at a crossroads, but the call for representation is not the only new development pushing for change.

Hollywood Says “No More!”

The last few years have seen a remarkable development in Hollywood. Studios have chosen to include scenes that would offend China’s censors and have even refused to edit them out, denying themselves a theatrical release in the country. China requested that Disney cut a same-sex kissing scene from Lightyear (2022), which the studio declined. Sony Pictures decided against minimizing the Statue of Liberty at the CCP’s behest in Spider-Man: No Way Home (2021). As a result, it failed to show in mainland theaters. Studios seem to be rethinking whether the risk is worth the reward. This turnaround is associated with two significant events: the COVID-19 pandemic and the inflammation of tensions between the US and China.

The Scars of COVID

Chris Fenton, author of Feeding the Dragon: Inside the Trillion-Dollar Dilemma Facing Hollywood, the NBA, and American Business, explained that “pleasing Beijing no longer guarantees big revenues in China” (Toh 2022). In 2022, the United States reclaimed the title of biggest movie market after China’s strict “Zero-Covid” policy decreased theater attendance. The lockdown measures made affordable home cinema and streaming preferable alternatives. Moreover, Chinese filmgoers are accustomed to lower ticket prices than in the US. Theaters reported a $2.7 billion revenue in 2022, which was a notable drop from $3.6 billion the previous year. Chinese conglomerate, Wanda, sold AMC in 2021 after its $2.6 billion acquisition in 2012. Other deals with Chinese film companies have sunk from over 50 to 15 in number. The sum of foreign films permitted for release have also dropped from 36 in 2018 to 20 in 2021. Today, there is an increasingly small chance of a Hollywood film gaining access to China and it is not worth the risk of losing domestic audiences, especially as it becomes harder to predict the whims of the CCP. Megahits like Top Gun: Maverick (2022) proved that China may no longer be a necessary player after grossing over $1 billion (Toh 2022). Domestic politics have also become conflated with the new economic skepticism of China.

US-China Relations: It’s Getting Hot in Here

China’s financial success and growth following its introduction to the World Trade Organization in 2001 has made them a major competitor for the United States. The US-China trade war, which began under the Trump Administration in 2018, remains an ongoing arena of economic conflict between the two superpowers. Not only are they competing in the market, but the United States, a democracy, and China, a communist state, are ideologically opposed. In the political sphere, tensions are rising with Beijing’s threat to forcefully annex Taiwan, who shares democratic values with the US. In fact, many of China’s political interests (control over the South China Sea, the suppression of Hong Kong, and supporting Russia in the Ukraine War) run directly against the United States’ agenda. Relations only continue to heat up, especially after the US Air Force shot down a suspected Chinese spy balloon earlier this year (Council on Foreign Relations 2023). 

How does this relate to the movies? As Fenton describes, “there has been more scrutiny placed on Hollywood by politicians, journalists, critics and even movie fans in terms of anything viewed as pandering to Beijing” (Toh 2022). This scrutiny has even led to federal action, with bills like the “SCREEN Act” being introduced to Congress. The “Stopping Communist Regimes from Engaging in Edits Now” Act was sponsored by Representative Mark Green, Chairman of the Homeland Security Committee, following the news of Top Gun: Maverick’s potential censorship (Blaff 2023). The bill required studios to “provide written agreements pledging they will not edit their own films at the request of censorship from the Chinese Communist Party” (Toh 2022). While it ultimately failed to pass, the “SCREEN Act” is a huge indicator of the political pressure currently resting on Hollywood, especially when American films embody national pride. Filmmakers are being asked to choose between dubious Chinese millions or adherence to American values. It appears that they have opted for the latter.

Food For Thought

While the most likely reasons for Hollywood’s change in attitude towards China are COVID-19 and US-China relations, there is another small development that is worth noting. China’s domestic filmmakers have become increasingly competitive with higher content quality and variety in their discographies. Moviegoers have renewed their interest in “homegrown” movies, strengthening the domestic market. The Battle at Lake Changjin (2022) raked in 5.8 billion yuan to become the most successful film in China to date (Thomala 2023). The Chinese audience now eschews foreign films in favor of more patriotic works like The Battle at Lake Changjin (2022), which deal with national identity (Thomala 2023). In a subtle reverse, it may be that China no longer needs American films for big box office revenue. This is reflective of Xi Jinping’s “Made in China 2025” policy that aims to eliminate reliance on the West (Thomala 2023).

But, But, But: The Surrounding Skepticism

Some observers have suggested that COVID-19 is actually lessening Chinese restrictions on film. The CCP permitted the release of Black Panther: Wakanda Forever (2022) and Ant-Man and the Wasp: Quantumania (2023), the first Marvel movies approved since 2019. Shazam! Fury of the Gods (2023) and Avatar: The Way of Water (2022) were also greenlit for Chinese audiences. However, it is more likely that this is just a method to provide brief economic relief to Beijing’s film industry. It also takes advantage of the sudden reversal of “Zero-Covid'' policies, since citizens are more likely to attend theaters (Strumpf and Liang 2023). Avatar: The Way of Water (2022) alone earned $221.4 million. Regardless, China is still trending towards tighter film restrictions. Companies, such as Disney, have blamed underperforming projects on the loss of Chinese revenue (Strumpf and Liang 2023). The movie industry remains in decline with a 36% drop in performance in 2022.

Another point to consider is whether Hollywood censorship is disproportionately attributed to China. Disney is one studio that has a complicated relationship with representing homosexual relationships in their media. As many as 8 films, including Onward (2020) and Strange World (2022), have boasted the “first” gay character (Lang 2022). The company reportedly donated generous funds to Florida’s controversial “Don’t Say Gay'' bill, which incited employee walk-outs and letters of discontent (Lang 2022). Pixar accused the Mouse House of cutting “nearly every moment of overtly gay affection” from its films (Lang 2022). Clearly, the fight for LGBTQ+ representation permeates domestic politics. It is similarly a disputed subject in countries outside of China. Lightyear (2022) has been banned in 14 Middle Eastern and Asian countries for its same-sex kiss (Wei 2022). Despite the universal effort to grapple with a new social landscape, the political undertones of Chinese censorship are not misrepresented, nor should they be dismissed. China’s economic prowess establishes them as a global superpower. Although it may not seem overtly obvious, their choices have a serious impact on industries like film. It would be naive to ignore the stake the CCP has in cinema or to underestimate the value of film’s soft power.

What Happens Now?

So China, as one of the largest box offices in the world, poses an interesting challenge to Hollywood filmmakers. After a long history of censorship and self-censorship, it appears that the CCP and the US may be establishing more independent audiences and markets for film. It is not as profitable to appeal to China, and patriotic sentiments would further advise against submitting to Beijing’s requests. Should this trend continue, a new door will open itself in Hollywood. 

Now, US filmmakers have the opportunity to produce movies with more creative freedom. They can present fresh stories of different sexualities and cultures (like Tibet) as well as explore American culture and values without Chinese oversight.  80% of Hollywood movies are starting to show LGBTQ+ characters with significant screen time (Wei 2022). This opportunity similarly extends to Chinese studios. Domestic filmmakers like Shuli Huang, director of Will You Look at Me (2022), have presented queer projects at local and global film festivals (Wei 2022). Chinese filmmakers have also increasingly explored their own values and sentiments on a greater scale. Part of Crazy Rich Asians' (2018) meek performance in the East was because moviegoers did not feel that the film was truly “Chinese” (Yu 2018). 

Anxieties continue to hover around US-China relations and a myriad of variables still affect or limit global cinema, from politics to culture and beyond. However, a potentially new wave of Chinese and Hollywood movies (albeit for separate audiences) might offer a welcomed escape into an untold adventure. The idea affords an almost poetic relief and excitement for the next face of film.

“We don’t make movies to make more money. We make money to make more movies.” - Walt Disney

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