China plays fast and loose at the B.O.

'Yang Shanzhou'Some Chinese theatergoers paid $12.50 to see hit 'Transformers: Dark of the Moon' but also received tickets for local propaganda pic 'Yang Shanzhou,' which boosted the local film's B.O. numbers. BEIJING -- China's box office looks like it will top $2 billion this year, fueled mostly by the success of "Transformers 3" and the last "Harry Potter" film.While "Transformers 3" has taken a staggering $154 million in its first 25 days of release, and "Harry Potter and the Deathly Hallows: Part 2" has grossed more than $30 million since its Aug. 4 release, suspiciously healthy numbers from some poorly received propaganda movies are bemusing B.O. watchers.Indeed, according to sources within the exhibition business, cinema operators in some cities are under pressure from local authorities to boost the performance of domestic movies relative to overseas blockbusters.Just as the state uses quotas on foreign movies and blackout periods to encourage local films, so too are local cinema chains "bundling" tickets to make the domestic movies look better. Some theatergoers in China who went to see "Transformers: Dark of the Moon" paid 80 yuan ($12.50) and received two tickets: one valued at 60 yuan ($9.40) for a small propaganda pic about a Communist Party figure called "Yang Shanzhou," which was playing at the same time; the Hollywood blockbuster ticket cost just 20 yuan ($3.10). U.S. studios get roughly 15% of their films' B.O. receipts in China.The B.O. target for 2011, set out by the government's offcial "blue book" cultural report on the entertainment industry, is set at $2 billion, and this is looking eminently doable; however, it just a handful of foreign films will account for most of this figure, and the pressure is on to make sure that domestic product is also strongly represented.The only domestic pic that made major waves in the first half of 2011 was "Beginning of the Great Revival," a propaganda epic that took $58 million by the end of June."Kung Fu Panda 2" took in $92 million in the first half of the year. "Pirates of the Caribbean: On Stranger Tides" grossed $73 million.B.O. stats from Entgroup, which compiles B.O. data in China, make for startling reading.In the week to end of Aug. 14, the patriotic film "Yang Shanzhou" generated $2.65 million in a week. Its cume so far has been $6.64 million and it's been showing for nearly four weeks -- longer than "Transformers 3."It has screened 7,864 times with admissions of 523,890 -- an average of 66 viewers per show, and 30 more viewers per show than "Harry Potter and the Deathly Hallows: Part 2."Another domestic movie, "Wentian," suddenly making similar advances."The domestic movies 'Yang Shanzhou' and 'Weitian' appear to be bouncing back, which must be due to ticket bundling, Entgroup stated on its website.Entgroup declined to comment when contacted about the data. But a source says the government has an open policy to encourage exhibs to promote party-related films, especially in this anniversary year.Despite a delay in the release dates to give the propaganda pics a better run, "Transformers 3" and "Harry Potter and the Deathly Hallows: Part 2" still won at the wickets.Data from the State Administration of Radio, Film and Television (SARFT) showed that in the first half of the year, domestic films took in 450 million, an increase of 38% over the same period last year, while foreign films grossed $430 million, up 1.6%, in the first six months.B.O. growth is expected to be slower this year, with last year's figures skewed by the outsized success of "Avatar." Contact the Variety newsroom at news@variety.com