It's not just U.S.-based media companies searching for intellectual property to turn into TV shows and movies: China is also having a gold rush for content.
Online video platforms like iQiyi, Tencent Video, and Youku Tudou are all increasing investments to create original programming to attract more customers. Similar to U.S. trends, comic books and graphic novels are providing some promising source material.
"These are well-established IP, which represents brand awareness (easier for marketing success) and good stories (better chance for good-quality movies)," said Xiaofeng Wang, Forrester senior analyst. "These two are good starting points for movies that may achieve business success."
The Motion Picture Association of America expects China, which is the world's second largest film market, to take the lead from the U.S. in the near future. Though sales slowed down in 2018, Chinese box office sales still increased 9 percent year-over-year to $8.9 billion, according to state media and government reports. Meanwhile, U.S. theatrical ticket sales are declining.
In October 2018, Hong Kong-based Vanguard Visionary Associates partnered with, and invested in, U.S.-based Dark Horse Entertainment. The deal was intended to help the comic book company develop more titles for the screen as well as acquire additional properties. It also opened the door for Dark Horse to enter the Asian market.
"We're looking to move our company, the entertainment side of things, to a visible international profile with film fund development," Dark Horse CEO Mike Richardson explained.
Stan Lee's Pow! Entertainment, which was acquired by Chinese company Camsing International in 2017, also has plans for the continent. Pow! expressed interest in China's large population base, which has already shown interest in superhero content.
"Now that it's a global market and through the various means of distribution, you can reach such a wide audience," said Pow! Entertainment co-founder and president Gill Champion. "You now have fans in many of these countries and continents that have grown up with Stan's stories, and you have four or five generations of fans that are following it."
Meanwhile, Marvel introduced its first Chinese superheroes in May 2018 through a partnership with Chinese internet gaming company NetEase. However, it also caused a controversy in the country later that year when it announced that its first Asian superhero film would be about Fu Manchu's son Shang-Chi. Fu Manchu historically has been seen as a symbol of anti-Chinese stereotyping.
Still, investing in China can also pay dividends stateside. "The Meg," which was based on a U.S. science-fiction horror novel by Steve Allen, was initially intended for Chinese audiences but found success in America as well. The shark b-movie was a co-production between U.S.-based Di Bonaventura Pictures, Apelles Entertainment, and Maeday Productions, along with Chinese-production houses Gravity Pictures and Flagship Entertainment, in association with Beijing Digital Impression Film. Gravity handled distribution in China, where the film was initially released, while Warner Bros. Pictures was in charge of the rest of the world.
Despite the potential in the Chinese market, some analysts wonder if government involvement may restrict potential.
"China is a very protected market, and I don't see much opportunity at this point for U.S. media companies there," said Michael Nathanson, senior research analyst at MoffettNathanson. "There is little government support for that."
Chinese audiences are also growing less fond of foreign brands, according to a recent Forrester study. The trend may extend to films as well, Wang pointed out. Out of the top 10 movies at the Chinese box office in 2018, six were made specifically for Chinese audiences and not imported. (Four out of the top five were Chinese productions.)
However, when you look at the four U.S. movies that broke the top ranks, they generated more than $922 million the Chinese box office last year, Wang added.
"It's definitely a profitable business," she said.