Scale of Development of Digital Publishing Industry in China
(Original article in Chinese by Zhang Li, translated by Xiang Isabel, APPREB correspondent)1. Scale of publishing website sector
According to the annual statistics by the Chinese General Administration of Press & Publications (GAPP) to Internet publishing units in 2006, the total assets of 50 internet publishing units in 2005 reached over 5.8 billion RMB and their liabilities were more than 1.4 billion RMB. In 2005, the total revenue of internet publishing industry was over 7.7 billion, in which the prime operating income was 4.8 billion RMB with the growth of 4.45% than last year. The non-main operating income was over 2.8 billion RMB, with an increase of 20.76%. The total profit was 5 million RMB, and the increase was 17.71%. The retained profit was more than 1.4 billion RMB, 57.67% more than last year. The net income increased the most, which showed that the development momentum of the publishing website looked bright.
In terms of data uploaded to the website in 2005, the data in the social and scientific category was about 6.05 million MB; in the technological category, 9.17 million MB; in literature, 17.66 million MB; in art, 300,000 MB; in education, 2.2 million MB; and in audio and video, 210,000 MB. The total number of people registered in 2005 was 840 million.
Total Assets
(Unit: 10,000 RMB)
Total Liabilities
(Unit: 10,000 RMB)
Prime Operating Income
(Unit: 10,000 RMB)
2004 2005 2004 2005 2004 2005
559666.95 586777.30 182579.99 141042.30 467457.44 488244.26
Non-prime Operating Income
(Unit: 10,000 RMB) Total Profits (Unit: 10,000 RMB) Net Income (Unit: 10,000 RMB) 2004 2005 2004 2005 2004 2005 232893.64 281246.27 46503.78 54737.73 88830.83 140059.29
Number of Registration (Unit: 10,000 people)
Number of Paid Registration (Unit: 10,000 people)
Social and Scientific
（MB） 2004 2005 2004 2005 2004 2005 55823.09 83840.26 5618.71 10273.70 5556986.45 6049543.53 Scientific Technology （MB） Literature （MB） Art （MB） 2004 2005 2004 2005 2004 2005 6571151.43 9167890.77 15023963.50 17660437.34 26674.81 34665.90
Education（MB） Audio and Video （MB） Game（unit: item）
2004 2005 2004 2005 2004 2005 2074973.54 2195274.28 63516.40 208312.20 38 19 Registered Capital (Unit: 10,000 RMB) Total Staff Number Internet Technician Number Staff with Senior Title Staff with Middle Title Staff with Primary Title 156997.99 8334 1259 351 367 435
By the end of November 2006, 158 websites had been approved by the Internet Bureau of the State Council Information Office. Among them, the central news units had ten websites, the news organisation of the central government had thirty-nine, the news organisations of the provinces, autonomous regions, municipalities directly under the Central Government had 72, and there were also thirty-seven websites of comprehensive non-news units.
On December 21, 2006, our working group did a search with “publishing house’ s website” as the key words. As a result, we found 161 websites, of which 70 websites were in Beijing, 20 in Shanghai, and 71 in other regions. Up to 2006, China had 560 publishing houses. Therefore, at least 28% of publishing houses already have their own websites. Actually, the number should be higher than this because there must be some Chineses publishing houses websites which cannot be searched by the key words “publishing house’s website”. Among the 161 websites, 67 ones used itld. .com, 82 websites used the domain name .cn after .com and .net, and twelve websites just used the Chinese domain name .cn. According to the comprehensive ranking by Alexa on that day, the top ten publishers’ websites in China were those of Beijing University Press(2778), Guang Ming Daily(7220), South-east University Press (19656), Beijing Jiaotong University Press (30062), Dong Hua University Press (35274), Higher Education Press (35659), Beijing Normal University Press (47668), Publishing House of Electronics Industry(66951),. Fudan University Press (198342) and Fujian Education Publishing House (225317). From the ranking, we can see that university presses have more influence than others.
2. Scale of internet periodicals
Up untill 2006, China Academic Journal Full-text Database of Tsinghua Tongfang co. Lltd. had already collected over 6990 periodicals, and the website www.cnki.com embodied 7,582 periodicals (except popular science periodicals and yearbooks) in 2006.
Up to 2006, the website www.cqvip.com had collected 400 Chinese newspapers, 8200 Chinese periodicals and 5000 foreign periodicals. By the end of October in 2006, the documents in it had already reached 16 million with a new increase of 2.4 million annually. It had over 2000 fixed users. From its statistics provided by the web, the click rate of its homepage has already reached 20,000 per day.
The web www.wanfang digital.com already holds 5607 periodicals. Its feature is that it manages resources including patents, standard and business information.
At present, www.qikan.com of Dragonsource group has 1600 mass periodicals, covering politics, party building, management, finance, literature, art, philosophy, history, society, science popularisation, military, education, family, sports, leisure, health, fashion, career and other fields.
The development momentum at present is that technology providers for digitalising traditional periodicals don’t only digitalise periodical content but also analyse, process and integrate information resource to form a new database of a great deal of information. It reflects the fact that internet periodical publishers have already broken the traditional concept of whole periodical publishing. The traditional periodical in China is moving towards modernisation as in some foreign countries.
The most famous universities around the world always use digitalised Chinese periodicals. The American National Library, and the universities of Harvard, Cambridge, Oxfor, Chicago,
periodicals. Some foreign large-scale libraries also use e-journals, such as Brooklyn Public Library, Toronto Public Library, Queens Library, Winnipeg Library in Canada and etc.. As a whole, most of the foreign organisation users are universities, which account for eighty percent, while libraries and research institutions are relatively few.
In terms of economic benefit, Tsinghua Tongfang co. ltd. had sales of 140 million RMB in 2005 with a profit of 26 million RMB, of which there 32 million RMB was from sales abroad. Nowadays, the company has already accumulated assets of 190 million RBM. The sales of
www.wanfang digital.com almost reached 200 million RMB and the operation of the website
cqvip.com became better and better in recent years. From 2003, the sales of the website
www.cqvip.com exceeded 20 million RMB, nearly reaching 30 million RMB, with the profit at
about 1 million RMB.
3. Scale of ebook sector
There was no easy way for the development of the ebook industry. Through several grey years, it achieved breakthrough development in 2005 eventually.
（1）The market for ebook grows by scale. Due to publishing houses’ active participation, by Dec. 31, 2005, the number of Chinese ebook titles had already reached 210,000, which exceeded that of American ebooks. China became the biggest nation which had digital ebooks. Take Beijing University press as an example. Ebook titles the press published in 2005 were equivalent to the sum of paperbacks in the past seven years. Another example is the Higher Education Press, where the number of ebooks in 2005 was 1.64 times that of paperbacks in the same year. The growth is an incentive for Chinese publishing houses to enter into the ebook world. At present, Chinese large-scale publishing houses and publishing groups have already got involved in network publishing. One of the reasons is that some publishing houses have begun to publish ebooks as well as paperbacks at the same time. There are about 160 publishing houses which do such synchronised publishing. Sichuan University Press used the Apabi technology of Tongfang to publish 441 ebook titles from 2003 to 2004, while it published 450 paperback titles during that period. The proportion reached 98%.
(2) Libraries use ebooks universally. At present, the number of library users has already exceeded 1900. Ebooks are not only popular in the domestic market, but also in the foreign market. The demand for ebooks in American university libraries is very strong. In terms of the application of ebooks, English ebook titles are the most often used.
(3) The mobile electronic reading industry is growing. In 2004, the sales of ebook readers were about 50,000. Two types of readers were widely used. One was the Hanlin M-type handful readers of Tianjin Hanlin, the other was the E312 reader of Fangzheng Company. At the same time, the myth of e-ink gradually turned into reality. The definition and comfort of the browse screen could archieve the effect of reading paper. The reader can be made just as thin as the paper.
(4) Network reading become popular. Network reading appeared in 2003 and became popular in 2004. Reading online on web portal was very hot. According to an inadequate statistics, reading online on the website sina, sohu and apabi provided free download service for digital Chinese books, which had nearly ten millions of ebook reader groups. It provides good basis for the development of ebook.
(5) Ebook got good economic return. By the end of 2006, the revenue of Chinese ebook almost has reached 150 million RMB. Fangzheng got the revenue about 50 million RMB from ebook.
4. Scale of internet game sector
In 2005, internet game was still the most focused application area of internet. The number of players of internet games almost reached 26.34 million. Among them, 13.51 million were paid players. Sales of China’s internet game sector were 3.7 billion RMB in 2005, with the increase of 52.6% than the last year. China’s internet game got good development. China’s domestic game accounted for 60% of the whole market.
In the internet game market of 2005, MMORPG was still the main-stream, while leisure game just began. The game World of Warcraft, World of Legend, Journey to the West and other MMORPG game were still warmly welcomed by players. However, Popogame, Adventure Island,
Charming Baby and other leisure games became new favorites of players. The future of internet
game is bright.
In 2005, the business model of the internet game industry had some change and innovation. In the past, internet game companies used to sell game card to gain profit, while in 2005, the sale of virtual product and value-added service become their main business model.
In 2005, the sales outlets were more various and the competition became keen.
Most of internet game players were at the age of 19-25. Young players below 16 years old just accounted for 3.4%, and players between 16 years old and 18 years old accounted for 10.4%. The aim to play internet games was for amusement. The cost of players was in the scope between 30 RMB and 50 RMB. 4% of players spent almost 200 RMB on games.
The development of internet games brought new market for other industries, such as telecommunication industry, information industry, retail industry, media industry, publishing industry, manufacture industry and exhibition industry(E3、GAMESHOW）.
According to a survey, the sales of China’s internet game market were 3.77 billion RMB in 2005, with an increase of 52.6% than 2004. The direct revenue of telecommunication industry was 17.34 billion RMB, which was four times as much as that of internet game industry. The direct revenue of IT was 7.16 billion RMB, 1.9 times as much as that of internet game industry. Publishing and media industry got the direct revenue of 3.71 billion RMB, which didn’t cover the advertisement revenue. In 2006, the income of internet game industry would reach 5.52 billion RMB.
5. Scale of music industry sector
According to a research by an institution iResaerch, in 2004, there were 780 million online music users, accounting for 83% in all of the internet users. And in 2005, the rate rose to 85% and the number of online music users reached 100 million. The main groups of the users were at the age of 18 to 25. The popular music was the hottest sales, 86.1% out of all users for it. Other hot music were folk and rock music.
Online music users spend at average of 30 RMB per month on music. The consumption lever of users with the salary at 2500-3000 RMB was the highest, over than 41 RMB. Most of the users spent lower than 20 RMB, accounting for 33.8%. So, we have the reason to believe that most of
online music users were low-income group. The high-income group had relatively strong consumption capability, while there was just a few.
Another data showed that more than 60% of the users would like to pay for online music service, while 39.4% not. So if online music service was charged, then over 60% would pay for it.
The survey by iResearch showed that online music users always spend at average of 67 minutes on listening to the music. 50.8% users spent 10-60 minutes on listening.
Meanwhile, iResearch hold this view that it was in 2003 and 2004 that online music developed the fast and the increase rate reached 200%. In 2004, the value of market scale was over 45 million RMB, while in 2004-2005, the increase rate fell down. The value was nearly 80 million RMB.
6. Scale of mobile phone publishing sector
Mobile phone publishing is made up of wireless music (CRBT，mobile phone ring tone，mobile phone music), mobile phone pastime(games, cartoon and caricature through mobile phone), mobile phone reading matters (newspaper, novel, magazine, blog, short messages sent in groups by mobile phone), mobile phone publishing technology platforms (mobile phone search engine, mobile phone two-dimensional bar code, etc).
First, Wireless Music. Mobile phone ring tone and “Cai Ling” (CRBT) are two primary
business of wireless music. Mobile phone music is a new form and still is in the test period. The concept of “Cai Ling” (CRBT) has been brought forward firstly by China Mobile in May, 2003. Later, it began to run in Beijing, Shanghai, Guangdong and Zhejiang in October. And then it extended in other places. The other telecommunicate company China Unicom began to supply the same CRBT service called “Xuan Ling”. China Netcom and China Telecom began to supply their own CRBT downloading service to the telephone and PHS by their platform. In 2005, 20% mobile phone user applied the CRBT. It means that the scale of CRBT users has been beyond 60,000,000. Only the number of Chinese mobile CRBT consumer was more than 20,000,000. The value of the market scale was up to 1 billion RMB.
The statistics coming from China’s MII shows that the income of CRBT service in 2005 would be up to 2.5-3 billion RMB, and the sale tax would be 75,000,000-90,000,000 RMB. In 2006, CRBT service stepped into the mature period. The value expected of the market scale would be up to 5 billion RMB, and the sale tax would be 150,000,000 RMB.
At present, CRBT consumer group is mainly 16-30 year-old young person. The unlimitness of mobile phone model and diffuse communication way are two primary reasons of the CRBT′s rapid development. CRBT has become the second bigger added-value business. Content-making business, added-value service providing business, telecom operators and the terminal users are forming a Chinese CRBT industry chain.
The differences between the ring tone and CRBT are their different service objects and getting way. Simply speaking, the ring tone applies to the phone receiver while CRBT applies to the phone caller. The user can download the ring tone charged 2 RMB per song from the network on his or her needs, and the song downloaded has no time limit; the CRBT user needs to order it from the telecom operators, charged 3-5 RMB a month, and if the user still wants to enjoy the service when the month is up, he or she needs to continue to pay the fee. Introduction by the insider is that the value of the ring tone market scale in China should be beyond 1 billion.
game, action game, RPG and shoot game, etc; marked from the technology platform, it involves Java game ,Brew game and smart phone game. China Mobile began to charge for “Bai Bao Xiang” , the mobile phone game service, based on the Java platform in September, 2003. Hereafter, China Unicom also carried out the “Magic Bao Dian” service based on the Java and Brew platform. It was forecast in 2005 that the Chinese mobile phone game market scale would grow swiftly in the following 3 years. In 2006, the value of the market scale would be up to 1.85 billion RMB. In 2007, this business would keep increasing fast, and the user scale would be larger. In 2008, this business would step into the steadily developing period and the value of market scale expected would be up to 3.1 billion RMB. The value of the whole Chinese market scale has been up to 1.2 billion RMB, but only when 3G is applied to the commercial purpose and the speed problem is solved, would the mobile phone pastime become a real precious investmnet.
Thirdly, Mobile Phone Cartoon & Caricature. Mobile phone cartoon & caricature is a
service using the interactive vector figure technology to produce the content of the multi-media cartoon and supplying the downloading, broading, transmitting function. It is also named Shan Xin or Mobile Phone Cartoon. China Mobile began to operate it by using the Digital Chao Zhi′s terminal broadcasting technology and operation platform from Dec.1, 2005. It is another new service supplied by China Mobile after SM and CRBT. It is regarded as one of the better digital businesses based on the 2.5G broadband network and the focus businesses based on 3G, because it has big data capacities and rich manifestation. The investigation of IPSOS shows that 80% of mobile phone users were likely to use the mobile phone cartoon and caricature; in the case of not caring about charge, the possibility of the interviewee to use it has been up to 80%.Annual Comprehensive Report on Mobile Cartoon and Caricature in China: 2006, issued by Yi Guan Guo Ji, shows that the value of its market scale has gone beyond 720,000 RMB and the registered consumer scale had been up to 120,000 in 2005. It was forecast that the value of its market scale would be up to 31,660,000 RMB and increase to 4300% compared to the same period last year.
Beside, novels, newspapers and periodicals, these publications based on the traditional publishing classification by mobile phone begin to come into mobile phone publishing. But the industry chain has not formed. They are only in the initial stage. We do not know whether the real industry scale can come into being in the future. Because the new carrier, the mobile phone, is different from the traditional publishing medium, we need more time to tell whether they will keep the traditional publishing mode and scale.
7. Scale of digital printing industry
The technology of digital printing is having a deep effect on the traditional publishing industry. The digital printing machine breaks through the border between the original printing and
publishing. Publishing houses begin to print from just editing. At present, the printing business can be separated into two parts. One part is the ordinary digital printing industry; the other is POD which can show the advantage of publishing houses.
In 2005, there were 182,717 printing companies across China, with a revenue of 150 billion RMB, in which digital printing accounted for 7% in the whole market. The growth rate of digital printing was about 5%. Compared with 2004, the printing market put more focus on quality in the Chinese mainland in 2005. The number of digital printing machines increased continuously. Digital printing enterprises began to make profit. The application of digital printing became
In terms of the quantity of digital printing numbers, Inkjet Printing Equipment increased the fastest. There were 30,441 Ink-jet printing machines in the three companies Kodak Encad, Kodak Versamark and Epson. From 2005 to 2006, digital printing business kept good development momentum in three aspects of commercial documents, personalised Printing and advertisement design. Nowadays, the areas of development of digital printing in China are mainly in east China, north China and south China with the centers in Beijing, Shanghai, and Guangzhou. Moreover, in various kinds of digital printing business, personalised printing and variable-data printing ranked the top two in 2005, as well as in 2006. It shows that the exclusive advantage and variation of digital printing would play a more important role in the future.
In 2005, there were 220 publishing houses at the central level, while less than ten publishing houses use the POD technology, accounting for about 5%. From 2005 to 2006, the POD business went well in the aspects of digital journals, standard and patents in China, although POD of books was strictly restricted by the ISBN. Besides the limitations of ISBN, the immature market and relatively low balance point of digital printing have been the main factors which have restrained the POD business from developing in China’s mainland in recent years.
Actually, whether digital printing or POD, both are supplements to traditional printing and publishing. They cannot replaced them.
