Industry players who closely follow serial publishing aren’t as surprised as some others at the big response to the November 7 debut of the China Literature IPO. Called online literature in China—and frequently discussed in relation to self-publishing in Western cultures—China’s long-running serials have made some of their most popular writers wealthy and kept hundreds of millions of devotees happy for years.
Tencent, China Literature’s parent company, began ebook publishing in 2004. They spun off China Literature in 2013 during a corporate reorganization. The stock enjoyed a first-day gain of 86 percent ($1.1 billion), the largest of this year on the Hong Kong market, per Reuters.
The China Literature offering is being compared to Amazon KDP; it has 9.6 million pieces of content created by 6.4 million authors. As Cheang Ming reports for CNBC, China Literature’s revenue is derived from “intellectual property licensing, the sale of physical books, and charging readers for access to its online content library.” Closest competitors in the region are Alibaba Literature and Baidu Literature, with China Literature asserting in the prospectus for its IPO that it has a 48.4 percent share of the mobile digital literature market—although we’re not sure of the scope of the market to which they’re referring. To get a better handle on the type of author making money from online literature in China, read this New York Times profile.
Bottom line: While the attention to serial reading and writing is welcome, we’re cordially cautious about the China Literature IPO news and the sudden monsoon of articles on the topic. For one thing, the over 100 percent gain on the IPO’s release can hardly be taken as indicating that the endeavor is a sure bet in the book industry. Michael Cader commented (paywall) in Publishers Lunch, “Bear in mind that value is for a company that recorded profit of just $32 million in the first six months of this year, and lost money in the same period a year ago, so these investors are betting heavily on the future rather than the present.” Also, our experience is that internet-powered writing and reading, from the farthest reaches of fan fiction to the much more structured platforms of Wattpad (Canada), Radish (South Korea, US), Tapas Media (South Korea, US), Serial Box (US), and more, can present many formats, approaches, and monetization structures. Some articles on China Literature have pointed out that some Hong Kong investors weren’t as up to speed on the phenomenon of online literature in mainland China as you might expect, given the recent enthusiasm over the IPO and their proximity to mainland Chinese dynamics. If we keep in mind that the business press may not always reflect publishing’s interests and experience, we can keep the energy of this news in context and continue to watch for signs of how stable a context for commercialized content these varied platforms may eventually be.
Jane Friedman has spent her entire career working in the publishing industry, with a focus on business reporting and author education. Established in 2015, her newsletter The Bottom Line provides nuanced market intelligence to thousands of authors and industry professionals; in 2023, she was named Publishing Commentator of the Year by Digital Book World.
Jane’s expertise regularly features in major media outlets such as The New York Times, The Atlantic, NPR, The Today Show, Wired, The Guardian, Fox News, and BBC. Her book, The Business of Being a Writer, Second Edition (The University of Chicago Press), is used as a classroom text by many writing and publishing degree programs. She reaches thousands through speaking engagements and workshops at diverse venues worldwide, including NYU’s Advanced Publishing Institute, Frankfurt Book Fair, and numerous MFA programs.
