Positive Reviews: The Rise of Online Revenue Sharing Reconstructs the Film Industry Ecosystem, and Small and Medium-sized Projects Usher in New Survival Opportunities
A notable change in the Chinese film market in 2025 is the deep integration of theatrical films and online revenue sharing. From The Wind of Death achieving over 32 million yuan in online revenue sharing, far exceeding its theatrical earnings, to The Proof of Bi Zhengming achieving a “dimensionality reduction strike” through online video-on-demand, and then to films of different scales such as The Runaway and A Cool Fish 2 “recovering losses” through online revenue sharing, this phenomenon marks that the Chinese film industry has officially entered the era of “dual-channel revenue”. This transformation is not only a passive choice under market pressure but also an active exploration of industrial upgrading, and its positive significance is mainly reflected in the following three aspects.
First of all, online revenue sharing breaks the “monopolistic revenue” of traditional theaters and broadens the survival space for the film industry. For a long time, the Chinese film industry has highly relied on theatrical box office. If small and medium-sized films fail to reach the “100 million yuan box office” during the theatrical release period, they often face the risk of losses. As mentioned in the news, projects with a cost of 10 – 30 million yuan need to achieve a box office of over 100 million yuan to break even. However, The Wind of Death achieved 32 million yuan in revenue through online revenue sharing alone, directly lowering the break-even threshold from “30 million yuan in theatrical box office” to a lower level. This diversification of revenue models essentially brings the Chinese film industry closer to the mature model of Hollywood, where the theatrical revenue of Hollywood blockbusters usually only accounts for one-third of the total revenue, and the rest comes from streaming media, derivatives, overseas copyrights, etc. By adding the “streaming media revenue” through online revenue sharing, the investment risk of small and medium-sized projects in the Chinese film industry has been greatly reduced, making film producers more daring to start development and enhancing the “hematopoietic ability” of the industry ecosystem.
Secondly, online revenue sharing activates the long-tail value of “high-quality content” and promotes the transformation of films from “one-time consumption” to “continuous monetization”. The life cycle of traditional theatrical films is concentrated within 1 – 2 months of the release period, and the box office performance basically determines the upper limit of revenue. In contrast, the “video-on-demand revenue sharing” model of online platforms (such as iQiyi’s “theatrical film revenue sharing cooperation model”) allows films to be retained on the online platform for a long time and continuously generate revenue through user-paid video-on-demand. For example, The Proof of Bi Zhengming was released on the Internet while being screened in theaters, which not only retained the “ritual consumption” in theaters but also covered users who missed the theater schedule and preferred to watch movies at home through the Internet, forming a “dual-track traffic”. In this model, the value of high-quality content is no longer limited by theater screenings and schedule competition. Instead, it achieves long-tail dissemination through the “infinite shelf” of the Internet and may even experience a “second spring” on the Internet due to the fermentation of word-of-mouth. For example, The Runaway, which was unpopular in theaters due to its stylized style, obtained 11 million yuan in revenue sharing on the Internet among its targeted audience, which is a typical example of the long-tail value of content.
Finally, online revenue sharing accelerates the “de-bubbling” of the film industry and forces the content to return to its essence. In the past few years, some films have fallen into a vicious cycle of “high cost, high publicity and distribution, and high risk” due to their excessive reliance on theatrical box office, and even the phenomenon of “content alienation” (such as piling up popular stars and ignoring the quality of the script) has emerged. With the rise of online revenue sharing, film producers have to re-evaluate the “content suitability” of projects. Internet audiences pay more attention to content with “low viewing threshold and high emotional value”, which forces film producers to focus more on the core of the story, type innovation, and audience resonance at the project planning stage, rather than simply pursuing large-scale productions and big-name casts. For example, The Wind of Death, as a small and medium-sized genre film, broke through on the Internet with its compact narrative and strong genre characteristics, which is the result of the content returning to “audience needs”. Under this trend, the resources of the film industry will be tilted towards “high-cost-performance content”, promoting the industry to shift from “scale expansion” to “quality upgrading”.
Negative Reviews: The “Double-Edged Sword” Effect of Online Revenue Sharing, and the Industrial Pattern May Face a Deep Impact
Although online revenue sharing has injected new vitality into the film industry, the hidden concerns behind it are also worthy of vigilance. This trend of “transforming theatrical films into online big films” is essentially a passive response to the sluggish theatrical market. If the industry relies too much on online revenue sharing, it may lead to problems such as a shift in creative orientation and an imbalance in the industrial pattern.
Firstly, the nature of “passive choice” may weaken the “ritual sense” and artistic value of films. As the “seventh art”, the charm of films lies not only in the content itself but also in the “public space” attribute of theaters. The large screen, surround sound, and immersive experience of collective viewing in theaters cannot be replaced by the Internet. However, the current explosion of online revenue sharing is largely due to the intensified differentiation in the theatrical market: blockbusters (such as Ne Zha 2 and The Nanjing Photo Studio) occupy most of the market share, and small and medium-sized films have difficulty getting screenings and attention during the theatrical release period and are forced to turn to the Internet for “backup”. This “second-best” strategy may lead to a decrease in the emphasis of the creative team on the “theatrical attributes”. When online revenue sharing is sufficient to cover the cost, film producers may no longer pursue the “audio-visual upgrade” in theaters and instead lower the production standards (such as reducing special effects investment and simplifying scene design). In the long run, the “ritual sense” of films will be diluted, and the space for artistic exploration may also be compressed. For example, The Runaway, as a stylized work by the well-known director Cao Baoping, should have received more artistic discussions in theaters, but due to its poor box office performance, it was forced to rely on online revenue sharing. This misalignment between “artistic expression and market return” may dampen the enthusiasm of creators.
Secondly, the “Internet-savvy” creative orientation may lead to content homogenization and squeeze out genre diversity. The preferences of Internet audiences have a clear characteristic of “instant gratification”: a short, fast-paced narrative rhythm, strongly conflicted plot design, and emotional resonance close to reality are the “traffic passwords” for online movies. When film producers find that the online revenue sharing is profitable, they may actively cater to these preferences during the project development stage, causing the film content to tilt towards the “Internet-savvy” style. For example, they may reduce the investment in art films and experimental films and increase the production of “Internet-compatible” content such as suspense, comedy, and realistic themes. Although this trend can increase online revenue sharing in the short term, it may lead to the simplification of film genres in the long run. For example, A Cool Fish 2, as a sequel with both good word-of-mouth and high box office in the previous installment, was unpopular in theaters because it failed to continue the “down-to-earth” style, but it obtained revenue sharing on the Internet through a “down-to-earth narrative”. This “success story” may further strengthen the film producers’ dependence on the “Internet-savvy” style, ultimately forming a vicious cycle of “Internet audience preferences → film producers’ catering → content homogenization” and weakening the artistic diversity of films.
Thirdly, the “ecological uncertainty” of online revenue sharing may affect the long-term health of the industry. The current explosion of online revenue sharing relies on the platform’s revenue sharing rules (such as iQiyi’s “theatrical film revenue sharing cooperation model”) and the cultivation of users’ paid viewing habits, but the sustainability of this model is still questionable. On the one hand, the platform’s revenue sharing ratio and settlement rules may be adjusted according to market competition (for example, if multiple platforms compete for content in the future, the revenue sharing cost may increase; if the platform reduces its content investment, the revenue sharing ratio may decrease). On the other hand, there is an upper limit to users’ acceptance of “paid video-on-demand”. When the number of online films surges, users may reduce their willingness to pay due to information overload, resulting in a decline in the revenue sharing of individual films. In addition, the “time difference” between online revenue sharing and theatrical revenue sharing may also cause conflicts. If film producers release a film online in advance to quickly recoup the cost, it may affect the theatrical screenings (for example, The Proof of Bi Zhengming was released simultaneously in theaters and online, which may have led to a reduction in theater screenings due to the “outflow of content”), ultimately forming a negative cycle of “mutual exclusion between theaters and the Internet”.
Suggestions for Entrepreneurs: Balance the “Dual-Channel” Strategy and Build Risk Resistance with Content as the Core
Facing the trend of “transforming theatrical films into online big films”, film entrepreneurs need to have a clear understanding: online revenue sharing is a “survival tool” rather than an “ultimate goal”, and the real core competitiveness still lies in the quality of the content. Based on the current market changes, the following suggestions are provided for reference:
- Plan the “dual-channel distribution” strategy in advance and clarify the content suitability: At the project development stage, factors such as cost, genre, and audience should be considered to predict the revenue potential of both theatrical and online channels. For example, small and medium-budget genre films (suspense and comedy) are more suitable for “simultaneous theatrical and online release” or “quickly moving to the Internet after the theatrical release” to increase revenue through the long-tail effect of the Internet. However, big-budget films with strong audio-visual experiences (such as science fiction and action films) still need to focus on theaters to maximize the initial revenue through the “ritual sense” of theaters, and the Internet can serve as a “supplement”. At the same time, attention should be paid to the platform’s revenue sharing rules (such as the revenue sharing cycle and user payment model), and cooperation should be sought with platforms that match the project type (for example, the user preferences of iQiyi and Tencent Video are slightly different).
- Balance the “Internet-savvy” and “artistry” to avoid content alienation: The core of online revenue sharing is “user payment”, but the underlying logic of user payment is “content value”, rather than simply catering to traffic. Entrepreneurs need to find a balance between “meeting the needs of Internet audiences” and “maintaining artistic expression”. For example, the Internet compatibility can be enhanced through a strongly genre-based narrative (such as a compact rhythm and clear conflicts), and at the same time, the author’s expression (such as in-depth character portrayal and social observation) can be incorporated into the details to prevent the content from becoming a “traffic tool”. Referring to the successful experience of The Wind of Death, its suspenseful genre attracts Internet audiences, and the metaphor of social reality gives the content depth, ultimately achieving a win-win situation between “commerciality and artistry”.
- Control the cost structure and improve the “risk resistance ability”: The core advantage of online revenue sharing is to “lower the break-even threshold”, but entrepreneurs should avoid blindly increasing the cost due to the “revenue sharing backup”. It is recommended to plan the cost based on the target revenue sharing. For example, if the expected online revenue sharing is 20 million yuan and the theatrical revenue sharing is 10 million yuan, the total cost should be controlled below 30 million yuan (leaving room for publicity and distribution expenses) to avoid losses even with dual-channel revenue due to high costs. In addition, the cost can be reduced through “modular production” (such as reusing scenes and choosing cost-effective actors), and more resources should be invested in script polishing and post-production to improve the content quality.
- Pay attention to data feedback and dynamically adjust the distribution strategy: The “user behavior data” on the Internet platform is a valuable basis for decision-making. Entrepreneurs can analyze the advantages and disadvantages of the content through data such as the video-on-demand rate, completion rate, and user profile provided by the platform, and then adjust the publicity and distribution strategy (such as targeted advertising for the audience with a high completion rate) or the development direction of subsequent projects (such as strengthening the genre elements preferred by users). For example, the high completion rate of The Proof of Bi Zhengming on the Internet may be related to its “social reasoning” genre, and entrepreneurs can increase the development of similar themes accordingly.
- Explore the “derivative value” and build an IP ecosystem: Online revenue sharing is not only a “one-time income” but also the starting point for IP incubation. Entrepreneurs can explore the derivative potential of IP through user interaction on the Internet (such as comments and secondary creations). For example, they can develop novels, comics, and short dramas with the same name, or launch peripheral products (such as character figurines and movie soundtrack albums), expanding the revenue of a single film into an “IP ecosystem revenue”. For example, the A Cool Fish series can develop derivative short dramas or spin-offs through the high popularity on the Internet to further amplify the IP value and reduce the dependence on a single revenue sharing model.
Conclusion: The “rise of online revenue sharing” in 2025 is not only the “survival wisdom” of the Chinese film industry in response to market differentiation but also a crucial step in the industry’s transformation towards “multi-channel revenue”. For entrepreneurs, they need to take “content as the core”. While leveraging the advantages of online revenue sharing, they should be vigilant against the risk of content alienation caused by the “Internet-savvy” trend. Ultimately, through “dual-channel collaboration” and “IP ecosystem construction”, they can promote the Chinese film industry to move towards a healthier and more sustainable future.
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