Shanghai Street View: Reclaiming the Entertainment Crown

Dear readers: Today marks the launch of Shanghai Street View, a new series of commentaries with a flavor of Shanghai, the city where I live and work. Shanghai Street Views will cover a range of topics, many of them centered around business themes in keeping with the broader tone of Young’s China Business Blog. My aim in writing is to try and capture some of what makes the city special, both the good points as well as the less-than-perfect, as Shanghai tries to reclaim its place as one of Asia’s financial and cultural hubs.

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Even as Shanghai reeled this week under the double-whammy of lashing rains from Typhoon Haikui and an Olympic disappointment from hometown hurdling superstar Liu Xiang, the city was basking in a more subtle glow as it moved yet another step closer to reclaiming its long-lost title as the Asia’s entertainment hub. News that the city would soon be home to a new $3 billion, western-backed theme park may have been lost in city’s top headlines, which instead focused on the Haikui’s pounding winds and rains and Liu’s stumble in a qualifying race that ended his quest for gold at the London Olympics.

But a deeper delve into the business pages bore the news that US entertainment giant DreamWorks Animation (NYSE: DWA) was joining hands with its 2 Shanghai partners to build a massive 20 billion yuan entertainment center in Shanghai’s bustling Xuhui District. (English article) Announcement of the new complex came just a half year after DreamWorks announced it would set up a major new animation studio in Shanghai under a new joint venture, Oriental DreamWorks, with the same two partners, including Shanghai Media Group, China’s second biggest media company headed by ambitious Shanghai native Li Ruigang.

Concurrent with their announcement of the new mega-park, Oriental DreamWorks also said the next installment in DreamWorks’ popular “Kungfu Panda” series would be produced in Shanghai, a big deal for the city’s movie industry and a move that will hopefully quiet some of the noisy Chinese critics who argue that only Chinese people can make good Chinese-themed movies. People who follow the China entertainment scene will know that this latest series of DreamWorks announcements is really just an encore to the main attraction, which came in 2009 when entertainment juggernaut Disney (NYSE: DIS) announced it would build a $3.7 billion Disneyland in Shanghai’s Pudong New Area, capping years of lobbying for the mega-project. The new Disneyland is set to open in 2015, while the DreamWorks park, tentatively dubbed the Dream Center, will open the following year.

The opening of not just one but two major new theme parks and animation studios backed by premier names like Disney and DreamWorks should provide a nice shot in the arm for Shanghai, whose historic ties with the west have made it natural mixing place for Eastern and Western culture, in contrast to Beijing where traditional forms tend to influence the local culture scene. Part of Shanghai’s “Paris of the East” moniker of the early 20th century stemmed from its reputation as Asia’s movie-making and entertainment capital that saw the city play host to many of China’s earliest film studios.

The city maintains that foreign flavor to this day, and that tradition appears to be continuing with these 2 new massive theme parks, which should instantly earn Shanghai a spot as a major stop on the Asia entertainment map alongside more established destinations like Hong Kong and Tokyo.

As an interesting aside, these 2 new theme parks seem to be part of a growing rivalry in China by Disney and DreamWorks Animation, which are increasingly moving in lockstep in their China development strategies. Perhaps that’s not too surprising, since DreamWorks Animation is the brain child of Jeffrey Katzenberg, the man credited with revitalizing Disney’s lackluster animation business in the 1990s before leaving to co-found DreamWorks after falling out with then-Disney chief executive Michael Eisner.

While Disney was the first to announce its theme park, Katzenberg trumped his former employer by announcing the formation of his Oriental DreamWorks animation joint venture in February, two months before Disney announced a similar venture in Beijing. Both companies clearly have shown a preference for Shanghai over other cities for their biggest China endeavors, and Shanghai is no doubt happy to play the role of host city for Disney, DreamWorks and any other foreign entertainment leaders with Chinese aspirations. When all is said and done, Shanghainese may be feeling gloomy this week over typhoon Haikui and Liu Xiang’s Olympic letdown, but they have plenty to look forward to over the next few years as their city prepares to serve up an impressive new lineup of world-class entertainment.