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Chinese theme parks buy up content

News, 09 August 2016

HONG KONG: Competition between China's theme park operators has heated up since Disney opened a new resort in Shanghai in June, with Chinese companies responding by exploring intellectual property deals and global alliances.

They are tapping into a rapidly growing leisure market, which fits the Chinese government's drive to increase domestic consumption, and they see quality content as key to their success.

No fewer than 21 theme parks opened in China last year and there are another 20 under construction, but Disney's recent debut into mainland China – the US company already has one park in Hong Kong – is reported to be making its Chinese rivals more aware of the value of having access to original content.

"Disney's arrival in China will really impact the market as it will show Chinese companies the advantage of having original IP content," said Ronald Merriman, a specialist consultant, in comments to the South China Morning Post.

That message has not been lost on Wanda, the Beijing-based conglomerate owned by billionaire Wang Jianlin, which is probably Disney's most powerful competitor.

After opening its first theme park in Nanchang, the company has ambitious plans to build another 14 parks across China by 2020 and is looking overseas to gain access to original content.

For example, Legendary Entertainment, the US film studio responsible for producing movies such as "Jurassic World" and "The Dark Knight" was acquired by Wanda for $3.5bn earlier this year.

"We are looking to acquire more quality content abroad, like the Legendary deal, to boost our culture business," a source from Wanda told the Post.

Shimao Property, a Shanghai-based theme park developer, is another Chinese company looking to the US for content. It has teamed up with Dreamworks, the animation studio, to create a theme park in Nanjing that is expected to open in 2020.

Shao Liang, VP of marketing and sales at Shimao, said that the alliance would allow the company to use various famous characters, such as "Kung Fu Panda", to attract Chinese visitors.

Commenting on these developments, Tim Mackey, a corporate lawyer with law firm Paul Hastings, said they reflected changing preferences among Chinese consumers.

"Chinese consumers are now more globally aware," he said. "One only has to consider the growing number of Chinese tourists in almost every destination around the world to understand that the culture, and therefore the brands of the countries being visited, will make an impact and change tastes."

Data sourced from South China Morning Post, Bloomberg, Variety; additional content from Warc staff