Sci-fi IP race intensifies as toy-makers vie for silver screen characters

China's domestic toy-makers are rushing to buy intellectual property rights to merchandise miniatures and other products based on characters and objects relating to Chinese silver screen sci-fi smash hits such as The Wandering Earth.

The rush can be attributed to the booming China sci-fi content. Local toy-makers are desperate to outgrow their image of being long-term original equipment manufacturers for global clients such as The Walt Disney Co or Japan's Studio Ghibli.

Based on a novella of the same name by Liu Cixin, The Wandering Earth generated 20 billion yuan ($2.99 billion) at the box office between Feb 5 and April 13. Its costumes and stage properties like giant trucks, police vehicles, space stations and airships have become prime IP targets of struggling toy-makers.

Sembo Block Toy Co from Chenghai district of Shantou, Guangdong province, and another company announced last month they are now the authorized merchandisers of Beijing-headquartered China Film Group Corp, the producer of The Wandering Earth.

They will make and distribute small granular building-block toys on the Chinese mainland, in Hong Kong and Southeast Asia.

Sembo's first batch of film-themed products, including special vehicles and engineering vehicles, are expected to be sold in these markets by the end of this month.

The company said its dealers are eagerly awaiting the new products, which it will ship as soon as possible, besides exploring online sales channels.

Apart from generating massive public interest, the coming of age of China's sci-fi genre, exemplified by the success of The Wandering Earth, has excited both global and domestic companies in the fields of entertainment, toys and garments. Now, they will likely seek to exploit the merchandise potential of related IP, analysts said.

Cao Chunliu, sales director of China Film Marketing Co, a subsidiary of China Film Group Corp, said there is a lot to learn from merchandise companies in the United States, Japan and Europe. The latter have decades of experience in managing and running such businesses, and have expertise in exploiting IP rights in the authorized merchandise market.

Like in developed markets, China will likely see the advent of IP-protected toys, theme parks, fashion and even holiday packages involving cartoon figures based on film characters, he said.

As much as 70 percent of non box-office revenue of animation or sci-fi film derivative business may come from the local market, with the rest flowing in from overseas markets like the US.

But box-office receipts still account for more than 90 percent of overall income of hit Chinese films, he said.

Agreed Guo Xin, a marketing professor at Beijing Technology and Business University. "China's film derivative market still needs time to evolve. Authorized and IP-protected products relating to films such as The Wandering Earth and Big Fish & Begonia are expected to drive growth from now on, and facilitate the sustainable development of China's niche hospitality, game, book, toy and garment manufacturing businesses."

With more sci-fi films such as The Three-Body Problem, which is based on Liu Cixin's another novel, slated for release soon, Guo predicted that this year of The Wandering Earth will mark the starting point of a prosperous phase for Chinese sci-fi movies.