Future

Despite having 90% of the market dominated by Japan and the US, the Chinese animation industry is in a unique position. The industry is growing significantly for the first time since the pre-cultural revolution days. The number of kids in mainland China exceed the US by about 80 million, and the technology gap between home and professional studios is narrowing. An example of a 1-person production with a successful fan base would be the 2002 Japanese anime Voices of a Distant Star. While this has been proven possible in Japan, China needs to figure out better ways to economically equip their youth, especially in a generation that might later be dominated by user-generated contents.

On the contrary, colleges in China are producing animation graduates and postgraduate students, but not in large numbers. China needs 150,000 talented animation experts for film and television and 100,000 for game animations, but there are just 300 animation majors graduating each year. SARFT have also announced it has opened up domestic cartoon industry to private investors as of late 2004. By 2005 the division has approved 15 animation production centers in Shanghai, Hangzhou, Dalian and other cities. Other trends like cosplay are picking up in animation festivals around mainland

Flash animation market

On September 15, 1999 FlashEmpire became the first flash community in China to come online. While it began with amateurish contents, it was one of the first time any form of user-generated contents was offered in the mainland. By the beginning of 2000, it averaged 10,000 hits daily with more than 5,000 individual work published. Today it has more than 1 million members
In 2001, Xiao Xiao, a series of flash animations about kung fu stick figures became an Internet phenomenon totaling more than 50 million hits, most of which in mainland China. It also became popular overseas with numerous international artists borrowing the Xiao Xiao character for their own flash work in sites like New Grounds.

On April 24, 2006 Flashlands.com was launched, hosting a variety of high quality flash animations from mainland China. The site is designed to be one of the first cross-cultural site allowing English speakers easy access to domestic productions. Though the success of the site has yet to be determined.
In October 2006, 3G.NET.CN paid 3 million RMB (about US$ 380,000) to produce A Chinese odyssey, the flash version of Stephen Chow's A Chinese Odyssey in flash format

Conventional animation market

From the demographics perspective, the Chinese consumer market has identified 11% of the audience are under the age of 13 with 59% between 14 to 17 and 30% over 18 years of age. Potentially 500 million people could be identified as cartoon consumers[6]. China also have 370 million children, one of the world’s largest animation audience[7].
From the financial perspective, Quatech Market Research surveyed ages between 14 to 30 in Beijing, Shanghai and Guangzhou and found that over 1.3 billion RMB (about US $163 million) was spent on cartoons every year, but more than 80% of the revenue flows straight out of the country. Further studies show that 60% still prefer Japanese anime, 29% prefer Americans, and just 11 percent favor those made by Chinese mainland, Taiwan or Hong Kong animators.
In 1999 Shanghai Animation Film Studio spent 21 million RMB (about US $2.6 million) producing the animation Lotus Lantern. The film earned a box office income of more than RMB 20 million (about US $2.5 million), but failed to capitalize on any related products. The same company shot a cartoon series Music Up in 2001, and although 66% of its profits came from selling related merchandise, it lagged far behind foreign animations

One of the most popular manhua in Hong Kong was Old Master Q. The characters were converted into cartoon forms as early as 1981, followed by numerous animation adaptations including a widescreen DVD release in 2003. While the publications remained legendary for decades, the animations have always been considered more of a fan tribute. And this is another sign that newer generations are further disconnected with older styled characters. Newer animations like My Life as McDull has also been introduced to expand on the modern trend.
In 2005 the first 3D CG-animated movie from Shenzhen China, Thru the Moebius Strip was debuted. Running for 80 minutes, it is the first 3D movie fully rendered in mainland China to premiere in the Cannes Film Festival[9]. It was a critical first step for the industry.

In November 2006 an animation summit forum was held to announce China's top 10 most popular domestic cartoons as Century Sonny, Tortoise Hanba's Stories, Black Cat Detective, SkyEye, Lao Mountain Taoist, Nezha Conquers the Dragon King, Wanderings of Sanmao, Zhang Ga the Soldier Boy, The Blue Mouse and the Big-Faced Cat and 3000 Whys of Blue Cat[10]. Century Sonny is a 3D CG-animated TV series with 104 episodes fully rendered.

Terminology

Chinese animations today can best be described in two categories. The first type are "Conventional Animations" produced by corporations of well-financed entities. These content falls along the lines of traditional 2D cartoons or modern 3D CG animated films distributed via cinemas, DVD or broadcasted on TV. This format can be summarized as a reviving industry coming together with advanced computer technology and low cost labor[3].
The second type are "Webtoons" produced by corporations or sometimes just individuals. These contents are generally flash animations ranging anywhere from amateurish to high quality, hosted publicly on various websites. While the global community has always gauged industry success by box office sales. This format cannot be denied when measured in hits among a population of 1.3 billion in just mainland China alone. Most importantly it provides greater freedom of expression on top of potential advertising.


Characteristics

In the 1920s, the pioneering Wan brothers believed that animations should emphasize on a development style that was uniquely Chinese. This rigid philosophy stayed with the industry for decades. And animations were essentially an extension of other facets of Chinese arts and culture, drawing more contents from ancient folkores and manhua. An example of a traditional Chinese animation character would be Monkey King, a character transitioned from the classic literature Journey to the West to the 1964 animation Havoc in Heaven. Though the concept of Chinese animations have began loosening up in recent years without locking into any particular one style. One of the first revolutionary change was in the 1995 manhua animation adaptation Cyber Weapon Z. The style consist of characters that are practically indistinguishable from any typical anime, yet it is categorized as Chinese animation. It can be said that productions are not necessarily limited to any one technique. That water ink, puppetry, computer CG are all demonstrated in the art.