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Chinese entertainment stocks: ban on celebrity ranking leaves fan culture idle

Chinese business & finance updates

Fans of Chinese pop stars were once dominated by star-struck teenagers. As celebrity fan culture went mainstream, a cohort of older, wealthier supporters joined in. The increasingly lucrative market in celebrity merchandise has become the government’s latest target in its crusade to crack down on business.

Beijing has banned social media platforms from publishing celebrity popularity rankings and has begun to regulate fan merchandise sales. TV shows are no longer allowed to charge fans to vote for their idols (as stars are known) in popular competitions. Local reports that the fan club page of one of China’s most popular actresses, Zhao Wei, has been taken down add to concerns for the industry’s outlook.

The fan economy is a driving force in China’s entertainment sector. The size of the local idol market was Rmb100bn ($15.4bn) last year, according to government figures. Avid fans — there are 20bn active on social media platform Weibo alone — splurge on concerts, merchandise and streaming music. Their spending determines the commercial value of stars. This was once visible in the now-banned popularity lists social media platforms published.

The so-called clean-up will protect children, says the government. But it will also limit the influence of popular celebrities and reduce Beijing’s censorship workload. Regulators struggled to censor fan groups of Canadian-Chinese pop star Kris Wu, who was detained by Beijing police on allegations of sexual assault last month.

Such moves have provided the government with justification for tighter regulation. But it comes at a price. The entertainment industry was already suffering from declining revenues following the cancellation of concerts and fan events during the pandemic. Shares of local entertainment group Huayi Brothers Media are down 46 per cent in the past year. Alibaba Pictures Group’s share price has fallen a fifth. Shares of iQiyi, known as China’s Netflix, which broadcasts the country’s popular idol competition, are down 50 per cent this year. The clampdown on idols means declines in the sector are likely to continue.

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