China Business: After lots of lunches, movie deals flow

Auckland animator Trevor Yaxley has made more than 100 trips to China and his persistence has paid off as his business Huhu Studios scoops up movie co-productions.
Huhu Studios staff are presently working on a Chinese co-production, Beast of Burden. Pictured from left to right are: producer Bill Boyce, director Kirby Atkins and producer David Townsend.
Huhu Studios staff are presently working on a Chinese co-production, Beast of Burden. Pictured from left to right are: producer Bill Boyce, director Kirby Atkins and producer David Townsend.

Suddenly, China has become a heavyweight player in the movie box office takings, and the world is opening up for local animation companies.

In February China topped the North American (Canada and United States) box office for the first time, with monthly sales equivalent to US$1.05 billion (NZ$1.50b). North America's take was $797 million ($1.14b). China's box office is growing dramatically. Ticket sales surged 49 per cent last year to $6.7b ($9.6b), while the North American market increased 7 per cent to $11.1b ($15.9b). The Chinese film market is expected to grow a further 60 per cent over the next 12 to 18 months.

"It's a huge developing industry in China," says Auckland-based Huhu Studios chief executive, Trevor Yaxley, who is drumming up plenty of business with the Chinese. "Back in the early 2000s our team did some research on the growth of the movie industry in China and predicted it would become the No 1 box office in the world.

"That's why we started going to China 15 years ago. People took us with a grain of salt then, both in New Zealand and other countries. The growth has happened; it's just enormous," he says.

Entertainment and digital media is one of the main themes at the tripartite summit and the future of animation will play a leading part in the discussions amongst delegates.

Tuo Zuhai, of the China Animation Comic Game Group, will lead a workshop in the AUT conference centre on the high-growth global animation opportunities during the the summit. He will also present a keynote address titled: "Animation Culture".

Yaxley says "everywhere you look, on the television screen and in adverts and movies, there's some form of animation in the live action. The tripartite provides the opportunity of three cities — Auckland, Guangzhou and Los Angeles — to come together as a team to encourage more business and trade between them, and in other markets."

Yaxley, who founded the Huhu animation studio, left on his 107th trip to China when he attended the Beijing Film Festival during the third week of April. He says during the first six years of travelling he had 100 lunches and dinners with prospective partners without ever talking business. "Then one day the representative of one of the largest media companies in the world said 'let's make a deal'. The Chinese won't talk business without getting to know you first. It all comes down to face-to-face meetings."

Huhu studio chief executive Trevor Yaxley.
Huhu studio chief executive Trevor Yaxley.


Huhu Studios, based at Snells Beach, north of Auckland, has completed animation work for television series, commercials and theme parks in China. And now Huhu is moving into animated feature films. "We have put a lot of time and investment in China and we've been waiting for the movie side to develop and grow.

"We are ready to handle that volume of business," says Yaxley.

Huhu, which also has studios in Guangzhou, Beijing and Taipei, is working on the 3D animated family film, Beast of Burden, with a budget of NZ$28 million, due for release in 2017. The movie is financed by China Film Group's animation arm, China Film Animation, Beijing Qi Tai Culture Development Group, Guiyang Chili Culture and Media, Beijing Chunqiubona Cultural Communication, and Huhu.

Beast of Burden is the first official feature film co-production between New Zealand and China, and will lead to producing other movies. Huhu and China Film Animation own the global IP rights for Beast of Burden.

Huhu has also struck up a $NZ86 million deal with Qingdao's DeZerlin Media to co-finance and co-produce five animated movies over the next three to four years — the first is Watch the Skies, an action film about an alien stranded on Earth. Huhu had previously worked with DeZerlin on television projects.

The new deal will create more than 70 jobs and double staff numbers at the Snells Beach studio.

Huhu expects to announce more co-production deals this year.

It is also developing a creative media centre in the new Guangzhou Knowledge City in partnership with a Guangdong firm. The centre will include animation studios, an animation software research and development facility, and an animation training academy. The partnership will also sell branded animation merchandise in new stores throughout China.

"This deal will bring a lot of work to ours and other studios in New Zealand," says Yaxley.

The work completed here and in Guangzhou will be used in the international market, as well as in China."

He says if everything is lined up with the Guangzhou Municipal Government, the media centre development will be formally signed at the Tripartite Economic Summit in Auckland, and details of the joint venture will be released.

He says the centre will be managed by Huhu and then handed over to a local team after 18 months to two years. Huhu would initially have 15 to 20 of its own staff working at the centre and then the number would be reduced to about six people.

The media centre will be part of an exciting innovation ecosystem in the Sino-Singapore Guangzhou Knowledge City. The city, housing knowledge-based industries, will eventually cover an area of 123sq km in an undeveloped part of Guangzhou.

Ng Kok Siong, chief executive of the Sino-Singapore Guangzhou Knowledge City Investment and Development Office, will provide an update on the development during the Auckland Conversations: Shaping Future Cities session that close the two-day summit on May 17.

- NZ Herald

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