Entertainment Providers Vie to Address Shifting Consumer Behaviors
FinancialBuzz.com News Commentary
Jan 21, 2020, 09:00 ET
NEW YORK, Jan. 21, 2020 /PRNewswire/ -- The U.S. media and entertainment (M&E) industry is the largest in the world. It represents a third of the global M&E industry and includes various subsegments like motion pictures, television programs and streaming content, music and audio recordings, broadcast, radio, book publishing, video games and more. Globally, shifting consumer behaviors help shape and influence the industry. And thanks to new technology and a growing number of streaming services like Netflix, consumers are embracing the opportunities to enjoy media experiences that are uniquely tailored to their own personal preferences. On the other hand, Hollywood also makes an effort to bring consumers back to theatres as major studios focus on releasing mega-budget films and popular franchises. In addition, membership business models at movie theaters can soften the impact of increased admissions for cinemagoers and are expected to become more popular over the forecast period. Overall, revenues for the global E&M industry are projected to continue to rise steadily. And according to Global Entertainment & Media Outlook 2019–2023 by PwC, total global E&M revenue is set to register a 4.3% CAGR from 2018 to 2023, with the figure rising from USD 2.1 Trillion to USD 2.6 Trillion by the end of the forecast period. This pace is close to historical trends, despite the shifting consumer behaviors. AB International Group Corp. (OTCQB: ABQQ), The Walt Disney Company (NYSE: DIS), Sony Corporation (NYSE: SNE), Netflix, Inc. (NASDAQ: NFLX), Comcast Corporation (NASDAQ: CMCSA)
In the meantime, China's total growth in E&M will exceed that of the U.S. for the first time. In that period, the U.S. will add USD 71 Billion (a 2.5% CAGR), while China will add USD 84 Billion (a 7.7% CAGR). And in terms of total cinema revenue, China will overtake the U.S.A. in 2020. China's remarkable growth in this market is driven by policy, the internet and major investments. A research conducted by Deloitte explains that internet companies and real estate developers have used resource advantages to gradually enter the entertainment industry and build an ecosystem. For example, Wanda Group, a Chinese property developer, has merged its culture and property resources, taking advantage of its commercial property to build movie theatres, and expanded into the upstream film industry with its channel advantage. On the film consumption front, China's film industry maintained rapid growth, with combined revenue of RMB 66 Billion in 2014, and according to Deloitte's forecast, by 2020, China's film industry will reach revenues of RMB 200 Billion.
AB International Group Corp. (OTCQB: ABQQ) announced yesterday, "its unaudited financial results for the three months ended November 30, 2019. The financial results have been filed in a 10-Q with the U.S. Securities and Exchange Commission (the "SEC")
Key Financial Highlights:
- Revenues for the three months ended November 30, 2019, increased 111% to $156,405, as compared to $74,240 for the three months ended November 30, 2018.
- Gross Profit for the three months ended November 30, 2019 increased 239% to $104,358, as compared with gross profit of $30,792 for the same period ended November 30, 2018.
- Net loss for the three months ended November 30, 2019 decreasing 72% to $63,354, as compared with a net loss of $228,554 for the same period ended November 30, 2018.
- As of November 30, 2019, ABQQ had $4,474,427 in total assets, has total current liabilities as of November 30, 2019 were $264,033. Total shareholders' equity is $4,210,394.
In November 2019, the company acquired two movie copyrights at a price of $256,000 for "Lushang" and $115,200 for "Qi Qing Kuai Che." The estimated earliest release date of these two movies will be in the third quarter of FY2021.
Chiyuan Deng, AB International Group CEO, stated, 'I am excited to execute investments in China film market, creating this business line will increase revenues in upcoming years. It's also a beneficent result of the synergies with the WeChat official account performing matching platform.'
China's total box office increased by 5.4% to reach a record high of RMB64.266 billion (US$9.2 billion) in 2019, domestic movies took 64.1% of the market. With the box office in North America declining by 4.8% last year, according to data from Box Office Mojo, China further narrowed the gap in box office revenues with the North American market.
2019 China film market highlights:
- The total box office in China reached a record high of RMB64.266 billion (US$9.2 billion) in 2019, up 5.4% over 2018.
- Of the total box office in 2019, 64.1% was generated by domestic movies and 35.9% came from imported movies.
- The total number of movie tickets sold last year reached 1.727 billion in China, a slight increase of 0.5% over the previous year.
- Six movies grossed more than RMB2 billion in box office in 2019, accounting for 36.9% of total revenue.
- The average age for movie attendees reached 29 in 2019, and the population with age 25 to 34 accounted for more than half of all moviegoers in China. According to data from Maoyan's 2019 China Film Market Report.
About AB International Group Corp: AB International Group Corp. is an intellectual property (IP) and movie investment and licensing firm, focused on acquisitions and development of various intellectual property. We currently have a Patent License Agreement pursuant to which Guangzhou Shengshituhua Film and Television Company Limited, a company incorporated in China, granted the AB International Group a worldwide license to a video synthesis and release system for mobile communications equipment, in which the technology is the subject of a utility model patent in the People's Republic of China. We recently launched new business applications through smartphones and official social media accounts based on Tencent's WeChat platform, utilizing Artificial Intelligence, it is a matching platform for performers, advertiser merchants, and owners for more efficient services. It generates revenues through an agency service fee from each matched performance. Currently, there are hundreds of active members, which is increasing daily as new companies and performers are registering for membership. In 2019, we are also actively exploring investments in Chinese movies copyright and release rights."
The Walt Disney Company (NYSE: DIS), back in November 2019, had commented on the box office success of Frozen 2, which had a record-breaking opening weekend, earning USD 358.4 Million globally. This gives the film the No. 1 day-and-date global animated debut of all time. Domestically, Frozen 2 set a November animated record with USD 130.2 Million, the biggest opening ever for Walt Disney Animation Studios, as well as for any animated film outside of summer. Outside the U.S, the film has opened for an estimated total of USD 228.2 Million from 37 material markets, led by China, where it earned USD 53 Million. It was the third-highest opening weekend ever for an animated title in China and the highest opening weekend ever for a Disney Animation/Pixar title in Japan, China, Spain and Germany.
Sony Corporation (NYSE: SNE) through its subsidiarity Sony Pictures Entertainment, has been working to expand its presence globally including in China. A few years back, in 2017, Sony announced that, in a first for the studio, it is establishing a Shanghai-based licensing office with Sabrina Gu leading direct deals in the territory as Director of Consumer Products, China. The program furthers Sony Pictures Entertainment's (SPE) ongoing global reorientation, and commitment to bolster its presence in international territories. "Now more than ever there is a world of opportunity in China for consumer products, which Gu will help to realize," said Jamie Stevens, EVP Worldwide Consumer Products. "From a box-office standpoint and an ancillary business perspective, China has become increasingly important to the growth and long-term vision of our intellectual property, and in managing a brand's lifecycle. As Sony Pictures broadens the global appeal of its film and television properties in a substantial way, our new China-based licensing office will support that growth."
Netflix, Inc. (NASDAQ: NFLX) continues to expand its international appeal. Recently, the Company announced that beginning on February 1st, 21 films from Studio Ghibli, the Academy Award®-winning Japanese art house, will be made available on the service globally (excluding U.S., Canada, Japan), through distribution partner Wild Bunch International, as part of the company's continued efforts to grow its best-in-class library of animated films. For the first time ever, this expansive catalogue of Studio Ghibli films will be subtitled in 28 languages, and dubbed in up to 20 languages. Aram Yacoubian, Director of Original Animation at Netflix, said, "This is a dream come true for Netflix and millions of our members. Studio Ghibli's animated films are legendary and have enthralled fans around the world for over 35 years. We're excited to make them available in more languages across Latin America, Europe, Africa and Asia - so that more people can enjoy this whimsical and wonderful world of animation."
Comcast Corporation (NASDAQ: CMCSA) through its subsidiary Universal Studios Beijing, recently unveiled the Universal Beijing Resort, which will include a signature Universal CityWalk Beijing entertainment complex and two resort hotels. "We will immerse our guests in incredible experiences that bring their favorite stories and characters to life in entirely new ways," said Mr. Tom Mehrmann, President and General Manager of Universal Beijing Resort. "Our theme park will showcase the best Universal rides, as well as all-new, unique experiences specially created to reflect China's rich cultural heritage. We are looking forward to sharing these exciting experiences with millions of visitors." Located in Beijing's Tongzhou District, this phase of Universal Beijing Resort will occupy about 169 hectares (approx. 420 acres) of a 400-hectare (1,000-acre) site in the strategic central area of its Cultural Tourism Zone.
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