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Web literature turns a page with profitable storyline

By Jiang Xueqing and Lian Mo (China Daily)
Updated: 2011-03-28 07:58
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 Web literature turns a page with profitable storyline

Murong Xuecun sells his book about lawyers in Wuhan, Hubei province, in this 2008 photo. Wu Han / for China Daily

Web literature turns a page with profitable storyline

Surge in users helps plot a new chapter for online reading, Jiang Xueqing and Lian Mo report in Beijing.

Huang Wei's day starts at 10:30 am. Relaxed after a good sleep, he surfs the Internet before lunch and takes his laptop to a cafe. The 26-year-old works there for three hours in the afternoon. For the rest of the day he's free to do whatever he likes.

The three-hour job brings him more than 1 million yuan ($152,500) a year, while most of his fellow graduates from Jiaozuo University, Henan province, are working overtime for just a fraction of his salary.

Thanks to the growing demand for Web literature in China, Huang became one of the first dozen millionaire writers to publish fiction on the Internet.

China Internet Network Information Center (CINIC) said in its latest report, in January, that readers of Web literature surged to 194.8 million in 2010, a yearly rise of 19.8 percent.

They account for 42.6 percent of the 457 million Internet users in China.

"The Internet helped lower the threshold of publication and provided a lot more opportunities for the general public to read and write," the report said. "As Web literature began to flourish, publishing houses scoured literature websites for potential best-sellers. More and more Internet novels are being adapted to show on the big screen, and an increasing number of traditional writers have turned to the Internet to promote and publish their works.

"With the expansion of authors and distribution channels, the influence of Web literature keeps growing due to a large increase in the number of users."

Annual revenue of the industry has reached 5 billion yuan, which includes copyright sales of derivative products such as online games and movies adapted from the fiction, estimated Zhang Yunfan, CEO of Zongheng.com. Zhang, who runs a website that provides original fiction and cartoon installments, said the industry is likely to grow 10 times in the next five years.

The First . . . a first

The history of Web literature in China can be traced to 1998 and a romance novel called The First Intimacy, but then it was more like a hobby and playground for creative and imaginative young people who thirsted for writing but had very limited channels to publish their stories.

The first generation of Web writers wrote for fun and for free. Only a small number of them, including Ning Caishen, Anne Baby and Murong Xuecun, rose to fame and turned into screenwriters and best-selling authors.

It took at least five years for Web literature to develop into an industry with an innovative profit model.

In 2003, Qidian.com, a leading website devoted to original fiction, set a rate of 2-3 yuan (30-50 cents US) per 100,000 words for its readers. People who signed up as writers on the site could publish their stories in serial form. If their works happened to attract a large group of readers, Qidian.com editors would call the writers and ask if they would like to sell their copyrights to the website. After they signed a contract, their works would be displayed in the site's VIP section, where readers could read a certain number of chapters for free and then be charged for the rest of the novel. Later, the website would split the profit equally with the writers.

This model was soon adopted by other literature websites and the charging rate remains the same today.

Most readers are 20-35 years old, about 69 percent of them have a college degree and 45 percent make more than 3,000 yuan a month. The majority live in relatively prosperous cities and provinces such as Beijing, Shanghai, Guangdong and Zhejiang, said Hou Xiaoqiang, CEO of Shanda Literature.

Established in July 2008, Shanda owns seven original literature websites and three publishing houses. It claims 85 percent of the readers of Web literature. Hou said that in the last quarter of 2010, more than 1.46 million registered writers published 4.1 million volumes of fictions on Shanda's websites.

"We have at least 10 million users every day and 70 million unique visitors every month," Hou said.

Low cost, fun reading

Many readers said they are happy to pay for Web novels. The price is low and they believe the writers deserve the money.

Sun Xuebin, a 26-year-old computer engineer who works in Beijing, has been reading novels online since 2003. One of his favorites is The New Song Dynasty, a popular historical fantasy published on Hjsm.tom.com. He paid 50 yuan for more than 200 chapters.

"It's not a big deal," he said. "The cost is reasonable and the author is serious about his story. He writes precisely and provides the readers with rich information. It helps to enlarge my knowledge of history. I think a potential writer like him should be encouraged to produce better works."

Ma Li, who works for a daily newspaper in Fujian province, has been reading Web novels on her computer and mobile phone for more than 10 years. She likes romance novels and alternative history fantasies, for they are so casual in style that she feels no pressure at all while reading.

She started paying for Web literature in September when a friend recommended a popular novel. After finishing the free chapters, she decided to pay to read rather than wait a couple of days for a pirate printed version.

"I love following a serialized novel and reading the updates every day. It's more fun and pleasant than reading a piece of work that's already finished."

Ringing the till

User payment isn't the only way Web literature sites profit. Advertising and copyright sales play bigger roles. Shanda Literature has many novels, such as Summer's Desire, My Belle Boss and Legend of Immortal, that were successfully adapted to TV series and online games.

"We have made huge progress in transforming Web novels into books, games and TV series," said Lin Hua, Shanda's vice-director general. "Good Web novels can fill the lack of original screen stories. As many producers and investors are interested in cooperating with literature websites, more games and TV scripts will be released this year."

Other Web literature companies are also exploring the possibility of turning their popular works into animations and videos. Zongheng.com has been making animation based on Tales of Tarsylia, a well-received fantasy comic strip, since it formed a visual team in April 2010.

Just getting going

Those familiar with the industry believe that the real "pay to read" age of Web literature is yet to come, as the mobile Internet is still booming.

By December, mobile Web users in China had reached 303 million, increasing 69.3 million year-on-year. They accounted for 66.2 percent of all Web users, said the CINIC report.

With 124.5 million people using mobile phones to read novels online, the phones have become the second most popular equipment used to access Web literature. Personal computers rank first.

E-readers are also gaining popularity among consumers. More than 1 million e-readers were sold in China last year and sales are expected to reach 1.46 million this year, according to Enfodesk, a business information service provider for new media.

In July 2010, Shanda Literature launched its own e-reader called Bambook, which took 10.29 percent of the e-reader market and ranked second in sales in the fourth quarter. A survey by the information center has found that 45 percent of e-reader users are willing to pay for Web literature.

"Mobile media users are getting used to paying for various applications, so they have a much stronger will to pay for Web novels than PC readers, who have no such habit," said Zhang, the Zongheng.com executive.

Daily PC page views of Zongheng.com run 1.6 million to 2 million, but its mobile Internet site, which was launched just three months ago, has attracted more than 1 million page views a day.

"An increasing number of users have access to our Web novels on telecom platforms and they can choose various packages, including pay by month and pay by words," said Wang Haiying, assistant director of Shanda Literature's wireless department, who has been cooperating with the Top 3 telecom operators in China.

Mobile reading applications are bringing a fortune to telecom operators. China Mobile is expected to make more than 1 billion yuan this year from the mobile reading service alone.

As one of the biggest revenue sources of the mobile Internet, mobile reading made about 3 billion yuan last year, according to Analysys International, a provider of information service and solutions to the Chinese Internet market. Experts predict the revenues will keep going up this year.

"With the development of mobile terminals and the decrease of costs on wireless Internet, reading online via mobiles will become mainstream," said Wang Jingjie, analyst at CINIC.

What's next?

Other than helping spread the content of Web literature to a larger group of readers via more channels, digital mobile media could also spur changes of the content.

"New forms of Web literature are likely to arise as mobile media develop," said Hou, Shanda's CEO. For example, mobile phone literature is popular in Japan, and Web novels there are usually shorter, more concise and faster in pace.

"During the past 10 years, Chinese Web literature has evolved from prose and realistic novels to fantasies and romance novels due to commercial interests," Hou continued. "I wonder what will come next."

Su Zhou contributed to this story.

Web literature turns a page with profitable storyline

Web literature turns a page with profitable storyline

(China Daily 03/28/2011 page1)

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