Disney is learning the meaning of the "L-Word" in China. L as in localization.

Company today unveils its first Chinese-made feature, "The Magic Gourd," as part of a bid to get closer to consumers in the world's most populous market.

Timed to line up with the beginning of Chinese school holidays, "Gourd" goes out on a 300-print release in the mainland handled by China Film and is expected to gross 30 million yuan to 50 million yuan ($3.95 million to $6.6 million) theatrically.

"We want to be regarded as the Chinese Walt Disney Co. We don't want to be regarded just as the Walt Disney Co. operating in China," said Stanley Cheung, executive VP and managing director of the Walt Disney Co., Greater China. "To do that we have to go beyond lifting the stuff we've done internationally and putting it into China."

Company has been distributing movies in the country since 1995 when it started with "The Lion King." Recently it has enjoyed success with sales of TV series "Lost" and "Desperate Housewives."

In other sectors such as consumer goods and theme parks Disney has gone much further. But in film sector, while it dubbed pictures for mainland auds, extent of localization was limited.

"Knowing that our core values are appreciated, the next step logically was for us to start making them locally," said Jo Yan, Buena Vista Intl. VP sales. "That means creating good wholesome entertainment using Chinese stories, Chinese actors and Chinese talent. These contents are primarily being made for the Chinese-speaking markets."

"Gourd" certainly fits the family values mold. Based on a bestselling book from the late 1950s by Chinese author Zhang Tianyi, the moralistic story describes a lazy boy who discovers a magic gourd that grants all his wishes. But he soon discovers that everything he gains comes at a price to somebody else.

Film was initiated by Hong Kong's Centro Digital Pictures and is co-produced by Buena Vista Intl., Walt Disney Studios and Chinese government offshoot China Film Group.

A mix of live action, 3-D animated characters and a hefty dose of digital effects, pic lensed in Hangzhou and spent over a year with Centro working on the effects in Hong Kong.

Centro boss John Chu said the original story needed very few changes.

"Zhang had great imagination. We've kept all the major chapters and incidents but the use of computer effects can make that more enticing for today's audiences," he said. "We did not want too many dateable elements and deliberately sought some kind of timelessness and have avoided showing television sets turned on, computer screens and mobile phones. But on the other hand we have modernized things to reflect how modern-day Chinese people behave and the kinds of things they wear."

Shot in Mandarin (the dominant language of mainland China), pic uses mainland voice star Chen Pei-si. The dubbed Cantonese version for release in Hong Kong leans on thesp and Cantopop star Gigi Leung.

Theme song is sung by Zhang, a "Super Girl" contest winner who has since had a successful singing career. She was the face of the Mengniu Dairy brand that sponsored the talent show and subsequently became a Disney partner company in China.

"The whole company its putting its weight behind this film," Cheung said. "Honest to God, this is the biggest effort behind any picture we've ever done."

Disney support includes a line of "Gourd" consumer goods, publication of six books, the May 15 release of Baby Zhang's musicvideo and a succession of events in shopping malls around the country. The Walt Disney Internet Group has also bowed ringtones and downloads and will follow the movie preem with a "Gourd" game.

"(Localization move) started with Bob (Iger) who believes that international is a huge growth market. He believes that local culture, local values and local stories resonate very well with the audience of that market," Cheung said.

There is financial support at the corporate level too. Thomas Staggs, chief financial officer, has reportedly earmarked $100 million for locally made Disney movies.

Cheung said the decision in China has everything to do with market opportunity and little with the country's tough restrictions on import of foreign films or its tough censorship and certification regimes.

"We want to go local even where there are no regulations, as we are doing in India," he said.

"Magic Gourd" represents only a baby step. Disney has picked up distribution rights in Taiwan, Singapore, Malaysia, Philippines, Thailand and Malaysia to third party Chinese-language movies including "Fearless," "Curse of the Golden Flower" and upcoming Ang Lee pic "Lust ... Caution."

But so far no other Chinese production has been greenlighted by Disney since Cheung and Mark Zoradi gave the go ahead to "Gourd" in fall 2005. Cheung and Yan said the Mouse House is addressing that by hiring acquisitions and script development staff in China.

Company's localization strategy in China has some way to go to catch up its Indian operations. There the company operates Disney Channel, Toon Disney and the Hungama net and is now involved in producing local shows including "Vicky aur Vetal" and "Dhoom Machao Dhoom."

Earlier this month Disney committed to a joint venture pact with Yash Raj Films to co-produce one animated movie a year, starting with "Roadside Romeo."

© Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

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