The Man Who 'Saw the Great Wall From a Plane' Is Gone — This Is the Tuition Wang Jianlin Paid Hollywood

Wanda paid a high price for Legendary Pictures back then, and a large part of the reason was one man named Thomas Tull.

There is no one else to blame for any of this.

A little over a year after Wanda acquired Legendary Pictures, the studio's founder and CEO, Thomas Tull, announced he was resigning. According to The Hollywood Reporter, the reason was that Tull's management style, and several recent film projects — The Great Wall and Pacific Rim 2, now shooting — had displeased Wanda.

The Great Wall was probably the spark. The film's budget ran to $150 million, and its cast ranged from Matt Damon and Willem Dafoe to Andy Lau and Eddie Peng. Add the selling point of being the most deeply collaborative "US-China co-production" yet, and it is obvious how much was riding on it for both Wanda and Legendary.

The results fell far short. As of 9 p.m. on January 18, the film had taken 1.14 billion yuan in China and just $194 million worldwide. It had yet to open in North America, the other market that mattered, and there was little reason to expect much enthusiasm there either.

"The situation is grim," Peter Loehr, CEO of Legendary East, Legendary's joint venture with China Film Group, told The New York Times in a story published on December 22 of last year. "Of course I want it to succeed, but I can't say for sure."

Worse than the box office was the film's reputation. The people who panned it mostly attacked the thin plot and the poor fit of Zhang Yimou's familiar mass-calisthenics aesthetic. But the film stirred up more trouble than perhaps any other film ever released: critics and the studio quarreled in public, China Film News — a newspaper run by the film regulator SAPPRFT — stepped in, and Maoyan shut down the sections of its site devoted to film critics.

Wanda had expected a great deal from this "US-China blockbuster collaboration." Zhang Yimou told Guangming Daily: "If The Great Wall hits its global box-office target, Hollywood will launch many more projects like it. By then one Zhang Yimou certainly won't be enough, so there will be younger Chinese directors and more Chinese actors on this stage, and more varied Chinese cultural elements appearing in all kinds of genre films." He was not talking only to the film industry.

As it turned out, none of those hopes came true.

The Great Wall was seen as Tull's project from beginning to end. According to a story on Mtime, the film site Wanda already owns, "Tull had heard since he was a child that the Great Wall of China was the only man-made structure visible from space... Once, on a plane, looking down at the Wall from high in the sky, Tull had the idea of turning it into a film."

No one has verified this account, but the story fits the impression Tull left on people. Anyone who knows Legendary even slightly will label him a comics fan and a lover of monster movies. A 2009 Wall Street Journal story called Tull "the producer of superheroes" and said he owned "about 100 action figures, plus hundreds of comic books in his basement."

Tull's childhood was steeped in games and comics, and both became a source of ideas once he grew up. He led Legendary into Watchmen, The Dark Knight and 300. When Watchmen director Zack Snyder brought that project to Tull looking for money, Tull greenlit it simply because he liked the comic.

In recent years the films Legendary has led have taken a monster turn: Godzilla, Pacific Rim and The Great Wall all feature enormous creatures. That is another element Tull loves. Legendary's plans also included Kong: Skull Island and Godzilla 2, a "monster movie universe" treated as a development priority.

This is the film business, and because film projects cannot be predicted, failure is never fully avoidable. The first film Legendary took part in, Batman Begins, co-produced with Warner Bros., missed its box-office target and cost Legendary several million dollars.

But The Great Wall was no ordinary failure.

In October 2016, Wang Jianlin went to Hollywood. Facing the president of the Academy of Motion Picture Arts and Sciences and executives from Warner Bros., Sony, 21st Century Fox and Lionsgate, he coached them patiently: "If you want a share of the Chinese market, if you want to make money there, you have to understand Chinese audiences and you have to find ways to please them. So the best method is to add Chinese elements to American films, especially Hollywood blockbusters. How do you add them? That's for you to work out — it means joining up with China. You can't say, 'I've only come to scoop money out of the market, and I don't care about your tastes, I don't care about your audience.'"

After some general remarks on "why China's box office will reach $30 billion in ten years," Wang passed on more of his "life experience," instructing Hollywood on how to get a slice of the Chinese film pie.

"How did Hollywood, the world's best storyteller, turn into a place that cares too much about technology and spectacle? Has Hollywood forgotten how to tell a story? So it relies entirely on continuing IP, on spectacle, on technology. That worked in China a few years ago, but Chinese people are gradually getting smarter, so they're not so easy to fool now. If you want to share the Chinese market pie, you have to know how to tell a story. Hollywood needs to get back on the track of telling stories."

Now, thanks to The Great Wall, the company in Wang Jianlin's own hands has become the cautionary example.

In January 2016, roughly a year earlier, Wanda announced that it would buy Legendary Pictures for no more than $3.5 billion in cash, about 23 billion yuan, and signed the deal with Legendary in Beijing.

The New York Times described the deal at the time as one that "made sense." "Wanda, owned by China's richest man, can offer Tull cash, an ever-growing audience and an advocate inside China, which would let more Legendary films into China's tightly controlled market."

There was no shortage of doubt, either. To the skeptics, a $3.5 billion valuation was no bargain, because Legendary was losing enormous sums at the moment Wanda bought it.

According to figures Wanda later disclosed, Legendary's total revenue in 2014 was 2.63 billion yuan, against losses of 2.43 billion yuan and total liabilities of about 9 billion yuan. In 2015 the losses widened to 3.63 billion yuan. The Hollywood Reporter quoted a studio executive saying that Wanda's purchase of Legendary raised two unavoidable questions: whether Wang Jianlin was merely the latest investor to charge recklessly into Hollywood, and whether Legendary would burn through, in one go, all the money it had made from its 2014 partnership with Universal Pictures.

Legendary's own explanation for its finances was that executives had cashed out: expecting Wanda's purchase, they had rushed to turn their shares into money. But another reason cannot be ignored — Legendary had not been running its business particularly well in those two years.

Seventh Son, which cost $95 million in 2014, took only $114 million. Blackhat, made for $70 million in 2015, did not even reach $20 million. Crimson Peak, which followed, did badly too.

This has to do with what Legendary is. Because of Tull's own tastes, most of what Legendary made was big — high budgets, and correspondingly high risk. One flop could drag down a studio of its modest size. Legendary's films also leaned heavily toward superheroes and monsters, and that narrowness added to the risk.

Being small, Legendary makes only four or five films a year. That makes it likelier for every film to flop at once, which can easily finish off a small or mid-sized studio. This is in fact a common story in Hollywood, which is why independent studios there rarely escape being bought: Disney took Miramax, Warner Bros. took New Line Cinema, Universal took DreamWorks Animation. Small companies withstand risk poorly, and that makes them easy targets.

Wang Jianlin is not one to let himself be fleeced. One reason he paid $3.5 billion for Legendary was its glittering record. Christopher Nolan's The Dark Knight trilogy and Jurassic World both carry Legendary's name.

Legendary won those projects mainly on the strength of Tull's good relations with the big Hollywood studios. In 2004 he and a group of other Wall Street investors put Legendary together. It was essentially a $500 million investment fund that joined film projects by striking investment agreements with Hollywood studios.

Tull did not want Legendary to stay an investment fund. He hoped that working with Hollywood would turn it into a film production company in its own right.

The early years did not go smoothly. After reaching a deal with Warner Bros., Legendary put out films in 2005 such as The Ant Bully, an animated feature with Julia Roberts and Nicolas Cage, and the thriller Lady in the Water. Neither did what the studio had hoped, and Legendary's results came under pressure.

The turning point was 300. Director Zack Snyder came to Tull with Frank Miller's graphic novel 300, about the Battle of Thermopylae. Snyder had tried selling the idea to other studios, and had been told either that the genre was out of date or that the studio already had something similar in the works.

Tull, a fan of Miller's comics himself, signed Snyder at once. The film, released in 2007, took nearly $500 million worldwide and eased Legendary's financial pressure. Snyder thought highly of Tull as a backer: "I think Tull can tell whether a piece of work will make money, because he looks at it from a fan's point of view."

Beyond all that, Wanda paid a premium mostly because of its confidence in the Chinese market — the very subject of the lecture Wang Jianlin would later deliver to Hollywood.

In 2015, the year before Wanda bought Legendary, the Chinese film market boomed as never before. Box office for the year reached 44 billion yuan, up 48.7% on the year before. In early 2016 everyone, plenty of American outlets included, cheerfully set the year's target for China's total box office at 60 billion yuan, and expected China to pass the United States by 2017.

Instead, after a frantic Spring Festival season, 2016 fell back step by step and closed at 45.7 billion yuan. Growth came nowhere near the forecast, and the future of the Chinese film market looked much less certain.

That was not the only problem Legendary faced. Its loss of invention had begun even before the Chinese film market hit the brakes.

The reason, most likely, lies with Legendary itself. Its best films were never its work alone. Amblin Entertainment, Steven Spielberg's studio, helped produce Jurassic World; behind the Batman films and Inception stands Syncopy, the studio run by Christopher Nolan and his wife.

Before 2013 Legendary had never produced a film on its own, and when it finally had to stand by itself, the only word for the results is threadbare. Seventh Son, mentioned earlier, is the highest-grossing film worldwide that Legendary has produced alone. Blackhat, the total loss, is another it made by itself.

Still, Legendary's Pacific Rim, released in 2013, took $111 million in China, more than the $102 million it made in the United States. That result seemed to foretell the Chinese market's appetite for spectacle with a weak plot — and it may be where Legendary's determination to make a sequel came from.

Pacific Rim 2 appears to have been approved inside Legendary quite early, but in practice that may have been no more than an intention. It only really got going after Wanda bought the company, for a simple reason: the acquisition finally made it possible to raise enough money for a film that size.

At the time Pacific Rim 2 looked like a good project — blockbusters, after all, seemed the surest way to pull in an audience. Looking at it now, the risk has risen sharply.

The Chinese market has changed faster than anyone imagined. The abuse heaped on The Great Wall, which reached cinemas first, showed that Chinese audiences have tired of hollow spectacle. Even Zhang Yimou damaged his own name with it. Wanda has clearly seen the risk, and Legendary's old strategy of betting on blockbusters, monsters and superheroes looks due for a change.

It was time for Tull to go. Gao Qunyao, senior vice president of Wanda Cultural Industry Group and CEO of its international division, will take over as Legendary's interim CEO.

Perhaps because it still values Tull's own creative eye, Wanda said in a statement that although he would no longer be CEO, he would continue to work on the monster-universe films and on an adaptation of the classic science fiction novel Dune. Legendary bought the rights to Dune for both a film and a television series.

Tull issued a statement of his own: "Building Legendary has been the most fulfilling experience of my life. After a year of transition, I know the company is moving forward steadily under excellent leadership, so this is the right moment for me to leave and pursue new interests and new ventures I have been planning for some time."

He is going back to being an investor. He still has Tull Investment Group, which invests in media and technology companies such as Pinterest, the augmented-reality firm Magic Leap, and Oculus Rift.

As for Legendary's future, that is Wanda's to carry now.

Cover image: a still from The Great Wall.