The earliest and by far the strongest foreign player in the market is
Bertelsmann, which entered by special dispensation more than a decade ago.
Beginning with a book club in Shanghai, which today has in excess of two
million members, in 2004 Bertelsmann acquired a 40% stake in a joint venture
with 21st Century Book Chain, a national private book retailer, and in 2005, in
the first big Sino-foreign wholesale book deal, took a 49% stake, worth
RMB30 million (£2.07 million – $3.74 million), in Liaoning Bertelsmann Book
Distribution, a joint venture with Liaoning Publishing Group. It is also owns
Bol.com, the internet book retailer.
However, despite the apparent opening up, apart from Bertelsmann, only a
small number of foreign companies have managed to enter the market.
According to Lu Binje, Vice Administrator of the State Press and Publication
Administration (GAPP), by September 2006 the government had ratified 38
overseas-invested publication distribution enterprises to operate in China, with
14 of them entitled to wholesale rights.1
There are complaints that the application process is fraught and that it is
taking up to 12 months to clear. ‘The government is very reluctant to open up
this sector,’ said Jo Lusby, General Manager of Penguin Books in China, ‘It's
been a slow turnaround to get applications approved. It sounds so easy on
paper – but as with everything in China it’s not as simple as it appears. This is
an area of great sensitivity to the government.’
Noted too is the fact that the minimum requirements on floor space and
registered capital favour larger companies ‘A bigger company is typically more
willing to toe the government line,’ Lusby pointed out. ‘The government
doesn’t want to encourage the independents.’2
In addition, some companies may judge it premature to risk a major
investment. In its 2006 report to Congress on China’s WTO compliance, the
US trade representative reported a ‘reduced momentum for economic reform’
in China, speculating that ‘that some Chinese government agencies and
officials have not yet fully embraced the key WTO principles’, resulting in ‘a
lack of consensus within China’s government and competing Chinese
government priorities’.3 This produces an unpredictable environment for
foreign investment.
China Publishing, 2006, ‘Publication distribution, printing areas open to foreign
investors’, October, 2006, pg 1
2
Quoted in Makina, Between Heaven and Earth, 7 January 2006. Retrieved from
www.ahdu88.blogspot.com2006/01/lonely-planet-banned-in-china.html
3
US Government, ‘2006 Report to Congress on China’s WTO compliance’,
11 December 2006. Retrieved from www.ustr.gov/assets/Document_Library/
Reports_Publications/2006/asset_upload_file688_10223.pdf
1
This point was somewhat dramatically made, when, in November 2006, US
entertainment company Warner Bros announced it planned to pull out of its
investment in Chinese movie theatres ‘due to significant regulatory changes to
foreign investment in Chinese cinema.’ While Warner Bros did not cite the
specifics, it was reported in the media to be a result of China’s scaling back of
its 2003 provision allowing 75% foreign stake in cinema, back down to a
minority stake. Such regulatory vacillation would not inspire confidence
amongst international investors.
However, as with all investments, risk must be weighed against potential
benefits and given China’s vast potential, particularly in its under-exploited
book market, it is inevitable that the major international players will continue to
seek entry points.
3.5
Internet, e-books and net literature
3.5.1
Introduction
The internet has the potential to transform the Chinese market for books,
reducing restrictions and conventions on content, focusing marketing effort
and transforming delivery routes. In recent years internet bookstores have
become one of the hottest services of e-commerce in China. This is set to
continue, along with additional radical shifts as e-books and print-on-demand
enter the market, bolstered by China’s rapid technological advances,
enthusiastic young early adopters and by a government for whom such
development is a national priority.
The key driver behind the rise of the publishing and retail sector and the
confident race to e-book technology is the dramatic growth in the total number
of internet users in China. According to estimates, produced by the China
Internet Network Information Centre (CNNIC), around 123 million Chinese use
the internet. When mobile phones users are included in the survey (providing
a younger sample), the figure is closer to 140 million. Access is via a network
of 54.5 million computers and an impressive 77% of users accessing the
internet via a broadband connection. In addition, the Chinese user profile is an
advertiser’s dream, mainly young, under thirty years of age and spending a
whopping 15.9 hours per week online. In comparison, Yahoo, the most
popular internet site in the US, holds on to its average user for just one hour
per week.4
And this is just the tip of the iceberg. While China, with its 140 million users
has now surpassed the US in terms of the number of people on the internet,
this still represents just 10% of the overall population (14% in the east, 26% in
Shanghai, 28.7% in Beijing), leaving a massive untapped market.5
Pace, N, 2006, ‘China Surpasses US in Internet Use’, Forbes, 4 March 2006
China Internet Network, 2006, ‘Statistical Survey Report on the Internet
Development in China’. July, 2006
4
5
3.5.2
Online stores
It is likely too, that this growth will continue to favour the market for books. In a
report by the AC Nielsen Consulting Group in November 2005, 63% of
internet users in China said they had shopped online and 56% of that group
said they had bought reading material that way.6 In addition, a national survey
on people’s reading habits, conducted by Beijing Founder Electronics, an ebook developer, showed that 27.8% of Chinese citizens were accustomed to
reading books and articles on the internet in 2005, up from 18.3% in 2003 and
3.7% in 1999.7
Figure 26: Leading online bookstores in China 2006
Store
Date
est
Ownership
Dangdang 1999 Private Chinese
ownership.
Founders: Peggy Yu
and Li Guoqing
Joyo
Bookuu
Bol
2000 Acquired by
Sales
2005
RMB
450
million
460
Amazon in 2004 for million
$75 million
Owned by Zhejiang
Province Xinhua
Bookstore Group
1999 Bertelsmann AG
Growth
rate %
Details
100-150 New market leader aiming for a
10%+ share of total retail book
market in 2007. Expanded into
sales of other goods. Rebuffed
offer by Amazon of RMB$1
billion for 80% of shares.
50
Original trailblazer; has lost
market share following takeover
by Amazon for $75 million in
2004, slipping to 2nd place.
Run in conjunction with
associated Xinhua chain and
superstores. Building massive
distribution depot in 2007.
Repositioned in 2003 to
concentrate on acting as a
sales channel for its bookclub,
dropping its AV and gift product
lines.
The three leading online bookstores in China are www.dangdang.com, www.bookuu.com and
www.joyo.com. The fourth, www.bol.com, operates a rather different agenda.
Wang Zhenghua, 2006. ‘Internet making an impact on book buying’, China Daily, 4
November 2006
7
Yan Zhonghua, 2006. ‘More Chinese prefer electronic reading’, Xinhua News
Agency, 20 May 2006. Retrieved from http://news.xinhuanet.com/English/200605/20/content_4575951.htm
6
3.5.2.1 Dangdang.com.cn
With estimated sales in 2005 of RMB450 million (£31 million – $56 million),
and a track record on 100% annual growth, Dandang is estimated in 2006 to
have passed its closest market rival Joyo to take first place.8
Dangdang was founded in 1999 by Peggy Yu, Chinese with an American
MBA and a background in mergers and acquisitions, who, along were her
husband, Li Guoqing, a former book publisher, raised $6 million in seed
funding from investors to start up Dangdang. By February 2004, Yu was
rebuffing an offer of $1 billion from Amazon for a 70-90% share of the
company, saying she wanted an investor not a buyer. Dangdang raised a
further $11 million,9 followed in July 2006 by a further $27 million, led by a US
VC group reportedly for a 12% share and a place on the board. It is
anticipated Dangdang will go for an IPO in 2007.
By late 2005, Dangdang had 15.6 million registered users and had expanded
its product line to include non-book items, estimated now to account for about
40% of its total sales revenues.10 There are a number of factors that
contributed to Dangdang’s success, the most obvious being the underlying
growth in the economy and Dandang’s ability, as an online store, to compete
on price with its store-based rivals.
Much of it had to do, however, with its rapid adaptation of the American online
model to local Chinese conditions. This included creating their own Chinese
Books in Print (CNBIP) in the absence of any systematic record of Chinese
books in print; sorting out cash-on-delivery and postal order payment options
to accommodate the low rate of credit card use in China; and dealing with
China’s fragmented delivery system to ensure that Dangdang could reach well
beyond the big cities, Beijing, Shanghai and Guangzhou, where its three
warehouses are now located. They achieved this by striking deals with almost
50 delivery companies as well as couriers that operate in about 100 cities
across China.
OpenBook Consulting, 2006, in ‘The Changing Chinese Publishing Industry’,
Publishing Today, Beijing, 4 October 2006
9
Shu Ching, Jean Chen, 2006, ‘China web bookstore pushes IPO’, The Deal.cn
Retreived from www.fuelcellcarners.com/Companies/ChinaAsiaStocks/Articles/China_Web.asp
10
Jones, Greg, 2006, ‘Dang Dang Closes $27million Round led by DCM’, press
release, DCM, 6 July, 2006
8
In addition to the localisation of the online model, Dangdang’s creative
marketing also contributed to its success, for example:

To keep visitors active and loyal, in March 2000 a ‘Lucky Time Activity’
was introduced and ran for two weeks. Each day a lucky hour was
randomly chosen and books ordered during that hour were given free to
the buyer

In the same year Dangdang ran a writing competition in which users of the
website jointly worked on a book, An E-Love Story, with visitors
contributing stories about leading character, Mei. At the end of each day,
three professional editors would select the three best short stories and add
them to the novel

In 2003, with numbers of visitors increasing, Dangdang introduced a new
membership scheme to reward repeat customers, with Ordinary, Gold and
Platinum cards on the basis of points earned11
With a catalogue of more than 300,000 products, offering door-to-door service
in more than 100 cities in China, orders in excess of two million shipments a
month, a 100% growth rate every year for the last six years (compared to 50%
by Joyo), generous funding and an IPO on the horizon, Dangdang looks set to
be the market leader for sometime to come.
3.5.2.2 Joyo.com
Rival Joyo, once market leader, saw its momentum slacken following its
purchase by US online leader Amazon. Founded in 2000, Joyo, which is
headquartered in the British Virgin Island, was the largest online bookstore in
China when it was acquired by Amazon in 2004, following Amazon’s failed
negotiations with Dangdang, for about $72 million in cash and $3 million in
stock options. With sales revenues in 2005 of RMB460 million (£31.7 million –
$57.4 million), an increase of 50% on the previous year in regard to the
number of books sold, it was surpassed by Dangdang in 2006. Like
Dangdang, Joyo has expanded beyond book sales to a wide product offering.
11
www.icmr.org/casestudies/catalog/
3.5.2.3 Bookuu.com
Bookuu provides a Chinese alternative to the venture capital model. Bookuu
is owned and operated by the state-owned Zhejiang Province Xinhua
Bookstore Group. Merging online and off-line resources, bookuu.com links up
almost 269 sales sites of 78 small-scale, independent and scattered Xinhua
branches within the province as well as an additional eleven chain stores in
cities in other provinces including Shanghai, Shenzhen, Shenyang, Xuzhou,
Wuxi, Changshu, Jiangyin, Fuzhou, and Quanzhou. This gives the site
multiple portals and means that Bookuu’s procurement, delivery and sales, as
well as that of the physical chain stores ‘are conducted uniformly by head
office.’ In 2008, according to General Manager Zhou Liwei, Zhejiang Xinhua
will open a new 140,000 square metres delivery centre, with ‘one million book
items available, over 500,000 of which will be in stock and delivery will take
less than 24 hours, providing online shopping services, door-to-door delivery
services to all industry publishing houses, bookstores, online bookstores,
libraries, enterprises and civil groups and readers.’12 Bookuu points the way
for new technologies to tackle the issue of China’s fragmented and uneven
publishing sector.
3.5.2.4 Bol.com.cn
Bol, the other notable online player, is owned and operated by German media
giant Bertelsmann AG. Started with great ambitions to be a multi-product site,
following massive worldwide losses of its online activities, Bertelsmann
divested itself in most countries and in China, in 2003, repositioned Bol.com
as the online wing of the Bertelsmann book club.
3.5.3
Book search and e-books
Sensitive to its weakness in the international cultural markets, China has set
its sights on leapfrogging, via technology, to an international stage, and views
the e-book as a particularly good bet. This year’s International Publishers’
Forum, held just prior to the Beijing Book Fair, took new technologies as its
theme. Senior government officials, kicking off the seminar, left the assembled
audience of hundreds of publishers in no doubt that online reading and mobile
e-books were the Holy Grail.
Zhou Liwei, 2006, ‘The Application of New Technology in China’s Book Circulation
Industry: Concepts and practices of Xinhua Bookstor, Zhejiang Branch’, talk given at
the 2006 Beijing International Publishing Forum, 26 August 2006
120
Li Bing, Vice Minister of the Information Office of the State Council told the
Forum they should all work towards publishing e-books. By this, he made
clear, he meant not only hand-held reading devices, but all digitised book
content. In contrast to the cautious, frequently hostile reception Google Book
Search received from the publishing communities in the US and Europe,
where they were sued and accused of copyright theft, in China, Li Bing told
the Forum, they should be embraced. ‘For publishers’, he said, ‘it is extremely
important to cooperate with the search engines. What search engines will
bring about are not just ways of increasing popularity, but, more important, the
circulation channels for their global market expansion…this is a wise choice.’
Changing reading habits and new technologies, he told delegates, had made
content king. Quoting a May 2006 survey on Reading in the Internet Era, he
said that book reading data on the Chinese websites reading channels had
grown by 22%, meaning more and more readers are choosing to read online.
At the same time, it showed that ‘ eaders are accepting the online purchase of
paper books, borrowing fidelity e-books and downloading free books online.
Now the internet has become the source of obtaining books for 60% of
readers’, he told publishers, ‘the form of books is no longer important.
Readers prefer to read and duplicate books because the content in the books
is valuable. Readers are actually buying the content of the books’.
Pointing to the future, he reminded publishers that search engines ‘only offer
technical services’. To gain a competitive edge, he noted, these search
engines needed quality content and these publishers were best placed to
supply. Content, he told them, would become ‘ the inevitable target of fierce
competition. ’Far from bemoaning the challenges from new technologies’, he
said, ‘It is the new technologies that have opened up a space for the
innovative development in the publishing industry’.
Li Bing is correct that this is where the future of Chinese publishing lies, but as
will be seen below, with the rise of user-generated net literature, neither the
government nor the ‘official’ publishers might have the stranglehold on the
provision of content this talk seemed to imply.
Wherever the content eventually comes from, Li Bing quoted a survey
released during Shanghai Book Fair in 2005, which estimated that by 2008
over 50% of the Chinese online bookstores will sell e-books; by 2010, more
than 90% of the publishing houses will put out e-books and by 2015, China’s
sales volume of e-books will reach RMB10 billion (£68.9 million – 1.25 billion),
contributing 50% of the profit from book sales.
3.5.3.1 Book search
It is very likely that book search and e-books will launch well in China. First,
these sites play to a very different audience than in Europe or the US.
As noted above, 70% of China’s internet users are under 30 years, use the
internet primarily for entertainment and are used to remaining online for long
periods. Second, book search will be growing out of an enormous general
search market. In 2007, according to investment bank Piper Jaffray, China's
140 million plus internet users are expected to conduct 816 million searches
daily, while annual revenues from advertising on search sites is forecast to
reach $1 billion by 2010.13
The two major players in the book search market in China are the
international search giant Google and the home-grown Baidu.com. On the
B2B front, Xinhua has introduced an interesting Chinese and English Chapter
1 model.

Google
According to China Daily, by July 2006 Google had signed agreements
with four publishing houses in China, including Tsinghua University and
the Children’s Publishing House. In line with its international model,
Google will make their books available online, provide search links and
grant free access to a segment of each book, but readers will have to pay
for full content. It is also reported that in the future Google will permit
publishing houses to sell books through the search service charging 30%
commission on the profit and will take part in production of online
publications, adding pictures and links. Despite stiff competition from
market leader Baidu, Google appears determined to succeed in the
market, and, according to the New York Times, ‘plans to spend hundreds
of ms of dollars to compete in China’.14

Baidu
Baidu, founded in 2001, the fourth most trafficked site in the world, the
most popular search engine in China, locally-owned, governmentsupported and with a market value of US$3 billion, is set to give Google
and Yahoo a run for their money in the Chinese book search business.
Already it has concluded agreements with Peking University Library and
the Library of the Chinese Academy of Sciences, giving it access to 15
million books, potentially the world’s largest online collection of Chinese
books.
13
Bodeen, C, 2007, Yahoo China Portal to be Reorganised, January, 2007.
Retrieved from www.physorg.com
14
Barboza, D, 2006, New York Times, 17 September 2006

Yahoo
Having attempted, since 1999, to operate in the Chinese market on their
own, in August 2005, Yahoo announced the merger of its operations in
China with Chinese internet giant Alibaba.com. Under the deal Yahoo
acquired 40% of Alibaba's shares but only 35%of the voting rights in the
company. Of the four seats on the board of the new Alibaba Company, two
are from Alibaba, one from Yahoo and one from SoftBank, a major
investor in Alibaba. Alibaba gained exclusive rights to use the Yahoo
brand and its operations merged with Yahoo China's. Yahoo China's
assets included Yahoo's search technology, the Yahoo China website, its
communication and advertising business, as well as 3721.com, a Chinese
language search engine. Ma Yun, CEO of Alibaba, remained as head on
the newly-merged company. He said Yahoo China would seek to
capitalise on its appeal with high-income users and entrepreneurs. ‘We
don't want those not interested in business or making money. They can go
to Baidu’, he said. ‘Our main focus is the high-end’.

Xinhua Chapter One ChinaTM
First previewed at the Beijing Book Fair in January 2006, Chapter One is
designed, according to Xianping Wang, president and CEO of Xinhua
China Ltd., to ‘enable book retailers to manage their inventories and better
serve their customers while allowing publishers to gain additional
exposure’. The database, with an initial trial of 7,000 titles, in both Chinese
and English, allows book buyers from the state-owned Xinhua bookstores,
independent bookstores and online bookstores to select the first chapter of
books in the database by title, author, publisher, and ISBN codes for
preview prior to purchase. The American excerpts have been provided by
American Dial-A-Book, Inc Chapter One program. It also plans to form
partnerships with e-commerce portals in China to license the database to
them to support their online book sales and also to supply fulfilment
requirements.15
15
PR Newswire, 2006. Retrieved from www.prnewswire.com/cgibin/stories.pl?ACCT=109&STORY+/www/story/01-11.2006
3.5.3.2 E-book producers
In addition to the two search giants, there are three major e-book producers
on the Chinese market at the moment, making up 90% of the e-book market.
The leading companies are SuperStar, Founder and Scholar.

SuperStar
A private enterprise, SuperStar is the largest commercial e-book collection
in the world. Founded in 1993, it has an online collection of more than
800,000 books published in China since 1949, as well as a host of rare
documents from the Ming and Ching epochs. It made its initial leap into ebooks in 1999 via a partnership with the National Library of China (NLC) to
digitise 150,000 books to put on the NLC website. Today its collection
covers a broad subject range, including chemical engineering, Chinese
history, economics, law, mathematics, medicine, philosophy, politics and
world history. Users purchase reader cards to download books to read on
PCs using SuperStar's own reading software.

Founder/Apabi
Originating as a high tech company under the auspices of Peking
University, Founder is a newer, multi-faceted IT group, with a number of
successful subsidiaries. One of their major IT products is their desktop
publishing software, used by over two-thirds of publishing houses in China,
giving Founder the advantage of obtaining electronic copies with no
additional work.
In 2005 Founder’s online database, Apabi (Aim for Paperless Application
By Internet) contained approximately 230,000 Chinese e-books,16 with
plans to expand it by 30–50,000 titles a year. The company is working with
over 400 publishers (80% of China’s official total) and over 100 libraries in
China producing electronic editions of new titles as well as digitising
classics. Guangxi Normal University Press and the Juvenile and Children's
Publishing House, for instance, in 2005, offered electronic versions of their
publishing output online via the Founder Apabi system. In 2005, Edinburgh
University purchased the Apabi D-Lib database, ‘becoming the first
academic library in Europe after the National Library of Germany in Berlin
to add a substantial online resource to its printed Chinese collection’. 17
Founder is also involved in hardware development for hand held e-book
readers.
16
Founder Company, 2006. Retrieved from www.founder.com/newsshtml/yytw/200611-6101918.htm
17
Edinburgh University website, www.uc.ed.ac.uk/bits/2005/november2005/item10.html

Scholar Digital Technology Co Ltd
Founded in 1995, Scholar focuses on the higher education sector as its
primary market and tailors its products to the needs of academic libraries.
There are in excess of 200,000 titles now on offer and Scholar plans to
increase its online stock by 60,000 titles each year. Scholar offers an
online circulation and collection development system that records the
recommendations of librarians and academics, as well as the borrowing
frequency by students and number of pages browsed for each title. The
system can then generate recommended reading lists and titles on the
lists can be downloaded into the library's server to enable quick access
with minimal data storage requirement. On the other hand the titles that
don't get used will be deselected after a specified time period and removed
from the library server to make way for newer and more used titles.
3.5.3.3 E-book readers
China is also setting its sights on leading in the portable e-book reader
market. Chinese e-book readers include the Jinke-book V2 and V*, the
Argosy EB600 EB683, the Founder E10 and E312, the Matsushita Sigma EBook, Easy Read Personal Digital reader and the E-View E-Book.
3.5.4
Literature sites (wangluo wenxue)
While China’s online bookstores, book search and e-book developments are
looking like promising players in China’s plan to leapfrog their publishing
industry to technologically driven modernity, by far the most exciting
development for the future of new Chinese literature is the rise, particularly in
the last five years, of the enormously popular and increasingly promoted
internet literature – wangluo wenxue. This development is set to change not
only the publishing landscape in China, but to remodel our literary world too.
Net writing is simply huge in China. It has excited the interest of book and
magazine publishers, who harvest from the sites, of bookstores which have
discovered a new marketing segment in net lit, of web portals, which host
writing sites to draw in the numbers, of games manufactures as sources of
content, of mobile phone companies as text content and, in vast numbers, of
readers and writers. It has by-passed traditional publishers, ‘created’ new
stars such as Annie Baby (An Nin Baobei) and been embraced by wellestablished writers Wang Shou. Yu Hua, Wang Anyi, Ah Chen. In 2002,
despite the innate conservatism of the literary establishment and the stinging
criticisms many of the older generation of writers have hurled at net literature
(dubbed 'cesuo wenxue' ‘toilet literature’ by Li Ao and condemned too by Mo
Yan), 45-year-old Ning Ken’s debut novel The Veiled City, posted
online, won him one of the most prestigious awards in the ‘official’ literary
world in China, the Lao She Literary Award.
Created and discovered online, net literature is escaping its base. Already in
2000, one observer in a Beijing bookstore identified over 24 internet sites
available, many in the form of series – The Internet Book Series, The Internet
Literature Series, Selection of the Best Internet Literature, Under the Banyan
Tree: original Internet Works series and Stars of the Internet.18 Now whole
sections of bookstores are devoted to internet literature.
In 2001 instalments of work by an unknown writer, Jin Hezai (a pen name
meaning Where is he now?), called Monkey’s Biography (Wukong zhan)
posted on Sina.com began to attract vast numbers of hits. Based loosely on
the Classic Chinese novel Journey to the West (XI you ji) and its most popular
character, Monkey, it focused on newly invented love affairs of Monkey,
Pigsey and two female demons. Before its completion the novel was famous.
On completion it won the Second National Internet Literature Contest, was
picked up for (very successful) print publication by Guangdong Daily
Publishing House and acquired for film and TV by the China Film
Conglomerate as the basis of a full-length RMB10 million film and a 52-part
TV series. With results like this for all sides of the equation, it was not long
before readers, writers and media businesses recognised the potential of
literature sites.
18
Kong, pg 211
It is difficult to determine just how many literature sites exist in China today;
they exist at national and provincial level, by genre, by age, by portal, but a
quick search for net literature on Sina.com turns up 526 pure ‘net novel’ sites,
in addition to 2,849 literature sites and 15,425 fiction sites and they are
growing exponentially. The level of interest and activity is high and a few
extremely powerful players are emerging, including Sina.com.cn, Netease
(the search engine that launched the First Internet Literature Award),
163.com.cn, 21red.com, Rongshu.com and Qidian.com. Net literature in
China is beginning to mean big business. A look at the latter two forms is
instructive.
3.5.4.1 Rongshu.com
Rongshu.com, formed in Shanghai in 1999 by Chinese American Wil Zhu and
joined early on by writer Chen Cun, is one of the leading creative writing sites
in China. Originally known as Rongshuxia (‘Under the Banyan Tree’),
shortened now to Rongshu (Banyan Tree) the site now claims to have more
than two million registered users, a daily page view in excess of five million,
and more than 500,000 unique IP addresses. Over 1.9 million original literary
works have been posted on the website.
From the start Rongshu focused on content – happy to use the internet to
generate and distribute it, but happy also to exploit other avenues that could
give the user-generated content legs and ensure a continuous flow. As they
describe it themselves, ‘ Rongshu.com has removed the barriers that existed
between ‘.com’ companies and mass media,’ and they could have added
between literature and both.
Rongshu’s plan was to take a multimedia approach to content and promotion.
In its first year it provided a column in Shanghai’s Literature Newspaper,
broadcast via its site and produced its own radio programmes Passion and
Literature and Evenings under the Banyan Tree for two Shanghai radio
stations. It also ran readers’ and writers’ seminars.
Generating early publicity and highlighting the live instalment quality of net
writing, Rongshu ran the diary of cancer sufferer. Lu Youqing, in the last few
months of his life. This was followed up with an equally compelling diary, The
Last Battle, written by an AIDS patient. As well as raising Aids awareness in a
country where Aids is not frequently referred to, the move boosted the site’s
alternative socially responsible character, directly appealing to its target
audience.
The strategy worked. Two years after its founding, Rongshu’s revenue hit
$3.5–5 million, and the following year, in 2002, it entered a strategic alliance
with Bertelsmann, who at the same time had entered a joint venture with 21st
Century Publishing, a legitimate publisher and now an outlet for Rongshu. By
2004 Rongshu was using its 200 million literature works and 847 ‘contracted
Rongshu writers’ to cooperate with 685 contracted imprint media, provide
content to 30 publishing houses, which produced over 100 books and
supplying content to 40 radio stations. The following year, 2005, Rongshu
formed Rongshuxia Information and Culture Consulting Company to
specialise in trading in books and copyright related to the internet.
In the same year, in a blaze of publicity Rongshu signed bestselling author
Han Han, saying he had been badly marketed by official state publisher,
China Youth Press, in the past. Newspapers swirled with stories of a 20%
royalty fee, compared to the average of less than 10%, and a signing fee of
RMB2 million (£138 million – US$249 million), a vast sum in China. Since the
company has no authorisation to publish books, it works through Jiangxibased 21st Century Publishing House for its print publishing, using their
ISBNs to enter the market.19
Apart from its talent for self-advertising, its acute marketing and brand building
(managing to hold on to its alternative image despite its association with
Bertelsmann), the real key to its success is Rongshu’s ability to find content
that works. This has been achieved by drawing in large numbers of voting
readers to the site and having a strict editing regime that quickly spots talent.
At its peak Rongshu.com can receive 7,000 new writing submissions a day.
To deal with this the site has 500 literature-loving volunteers who trawl this
mountain, selecting the top 5%, or around 350-400 pieces. These are then
referred up to eight paid editors who chose a similar percentage to post up on
the site. Promising writers are signed to exclusive deals, with Rongshu having
the right to online and print publish and to sell the overseas and translation
rights. As works with potential are quickly identified by number of page views,
only work with guaranteed public interest gets published, removing many of
the risk factors associated with traditional publishing.
Boosting content still further, in its very first year Rongshu introduced The
First Internet Literature Award, which has since become an annual event. Its
juries include big name writers such as Wang Anyi, Yu Hua, Ah Cheng and
Wang Shuo, and star internet writers such as Annie Baby (Anni Baobei). The
prize-winning works are collected in three volume anthologies, the Internet
Literature Award Winners Series and published alongside the regular
anthologies of selected works.
Jin Bo, 2005, ‘New release attracts big-money buzz’, China Daily, 14 December,
2005
19
Rongshu’s revenue is generated via book publishing (40%), agenting fees,
workings with other media such as radio and TV and its hardcopy literature
magazine Banyan Tree Digest (Rongshu wenshai).
Run by writers, associated with such literary stars as Han Han and Annie
Baby, multimedia in character, alternative in reputation, conducive to new
writing styles and expressive content, directly linking author and reader and
based on the realisation that the values lies in the content, not the form, and
can be carved up, re-worked and used in multiply environments, mediums,
and markets and endlessly adaptable via new technologies, Rongshu
provides an enormously exciting model, not only for the Chinese publishing
industry, but for publishing worldwide. Big business agrees – as seen in
China’s other leading literature site Qidian Zhongguo.
3.5.4.2 Qidian Zhongguo
Qidian (www.cmfu.com) claims to have more than 60,000 registered writers
active on its site, of whom it has signed contracts with 2,000. In 2006 online
sales and copyright transfer deals generated an income of RMB20 million
(£1.3 million). What is really interesting about Qidian however is that it was
bought in 2004 by Shanghai-based leading interactive media and online
gaming company Shanda Interactive Entertainment Ltd (NasdaqSNDA).
Shanda offers a portfolio of diversified entertainment content, including some
of the most popular online multi-player games in China, forecast for massive
growth, along with chess and board games, network PC games, a variety of
cartoons, music and now, with Qidian, literature. This move places literature
firmly within the multimedia content generating circle.
Shanda is large and hungry for outlets and content. In 2005 it claimed to have
460 million registered accounts, 18.5 million active paying accounts and an
average of 1.2 million players online at any given time and more then 2.5
million total peak concurrent users. In 2005 it bought 20% of Sina.com,
targeting digital media markets. Qidian’s constant supply of new literature
provides it with a happy hunting ground for content and copyright value. While
it is only one envisaged outlet, one of Shanda’s bestselling games titles is
based on the Chinese classic Three Kingdoms. With Qidian, it can grow its
own.
To help this along, Shanda via Qidian (which translates literally as ‘starting
point’) is planning to team up with the Shanghai Academy of Social Sciences
and the Union of Shanghai Writers to create a training programme for the
most promising writers emerging online. The programme will begin in April
2007 offering 40 days of training, running over two years and divided into two
parts. The first is basic writing theory and the second, the larger part, focuses
on subjects such as history, sociology and culture. Enrolment will initially be
limited to 40 writers and cost about RMB21,000 per student. Shanda will be
providing full tuition scholarships.
Shanda is reportedly planning to invest RMB100 million in Qidian to make it
the world’s largest Chinese language internet platform for original literature,
growing the training side ‘to encourage literary creation, the building blocks for
the prosperity of China’s original literature’, and with a clear focus on Qidian
getting involved in publishing, television adaptation, animated cartoon
adaptation, surrounding media and joint development of derivative products.
In addition, Qidian is tasked to actively develop the overseas market and
create the world’s largest Chinese language literature and reading platform.
Recently, the media has been buzzing with a rumour that that Shanda, keen
to have CNFU cooperate with an international brand is talking to Google, with
valuations for Qidian of $400–$500 million being discussed in the investment
pages.
With powerful investment drivers behind what are already vastly popular
literature sites, operating in the context of a raging Chinese economy, with a
large, young, literate, media-savvy and dedicated online user base, a
government bent on supporting and encouraging the creative industries and
particularly their relationship with new technologies, it is not unreasonable to
assume that China will be a key architect in the future model for literature
creation and dissemination, in the future understanding of literary copyrights
and how they are managed, valued and used and in the role and form the
‘publishing industry’ will take in this entertainment, brand and multimediadominated creative digital future.
3.6
Publishing sector trends and characteristics
There are three major characteristics that help shape the context for the
publishing industry in China. The first is the government’s focus on building up
China’s creative industries, which provides the broader policy context for the
sector. Second is the problem of rampant piracy and the issue of the
protection of intellectual property rights. Third is the role of censorship in
determining content.
3.6.1
Creative industries
It is impossible to understand the changes occurring within the publishing
industry in China without viewing it within the broader context of China’s
concerted efforts to develop its creative industries. ‘First there was the new
economy, then there was the knowledge economy, and now we have the
creative economy’, noted China Daily, the government’s newspaper in a
September 2006 article entitled Pressing Need for Creative Economy.20
Along with other developed countries, particularly the US, the UK and, closer
to home, Korea, China has grasped the importance of the creative industries
in the future economy and has set its sights on becoming a major international
player. China is looking to make the shift in fact and in reputation ‘from made
in China to created in China’.
It is not a marginal discussion. In terms of direct, tangible economic value, the
global market value of the creative industries has increased from $831 billion
in 2000 to $1.3 trillion in 2005. The creative industries are now estimated to
account for more than 7% of global GDP and are forecast to grow on average
by 10% a year.21
And as Richard Florida has suggested in his work on creative cities, the value
return on the creative industries goes far beyond this. Creativity attracts not
only more creativity, further enhancing the creative economy and stimulating
innovation, but it also attracts other wealth creating industries as people wish
to live and work in creative cities and countries. Creativity is a talent magnet.
In a global economy where human capital is paramount, this is critical.22
Huang Qing, 2006, ‘Pressing Need for Creative Economy’, China Daily,
12 December 2006. Retrieved from
http://english.cri.cn/3126/2006/12/12/269@173384.htm
21
PriceWaterhouseCoopers, 2003, World Bank, 2003.
22
Florida, Richard, 2004, Cities and the Creative Class, Routledge new edition 2004
20
According to figures released by China’s National Bureau of Statistics in May
2006, the first ever estimate for the sector put the total added value in 2004 of
China’s cultural industries (as it is referred to in China) at RMB344 billion (£24
billion – $43 billion), accounting for 2.15% of China's gross domestic product
and employing an estimated 10m people.23 While this is a remarkable shift
from the pre-reform period, when cultural undertakings were not considered
economic undertakings, it is still far behind the international average for
developed countries.
In addition, while China now has the fourth largest economy in the world and
a population of 1.3 billion people, its global cultural impact, in terms of trade
and influence, is far behind. According to reports by the Ministry of Culture,
currently the cultural industries of Japan and South Korea account for 13% of
the international culture market while China and all the other countries in Asia
make up only 6%.24 This is not a situation China is prepared to ignore and
building up the creative industries and competing on an international level in
the creative economy has become a top priority.
Zhao Qizheng, a member of the Chinese People’s Political Consultative
Conference, former minister of the State Information Office, and currently
dean of Renmin University of China’s Journalism School, speaking in March
2006, called on fellow members of the country’s top advisory body to pay
attention to this ‘deficit’ in international cultural exchanges. ‘We should fully
understand the significance of culture as a foundation and pillar for a nation’s
fate,’ he said. ‘Rejuvenation of a nation should start from a renaissance of its
culture. Culture’, he said, is ‘an important part of a country’s overall
strength’.25
In China’s dash to the front, the roles and ambitions of science, technology,
arts and business are inextricably linked. China wants to use technology to
leapfrog up the evolutionary ladder; to do this it needs creative inventive
minds, grown in a creative culture and trading in a world where China’s
reputation for creativity precedes it.
On the international stage, China’s National Program on Cultural
Development, states, ‘China not only needs strength in economy, science,
technology and defence, but also cultural strength to be ahead of international
competition.’ China’s approach to building up its creative industries is
comprehensive and cross-domain.
Lu Hui, 2006 ‘Cultural Industry Potential’, China Daily, 25 May 2006.
Retrieved from www.chinaview.cn
24
Bezlova, A, 2006 ‘China’s New Cultural Revolution’, Asia Times, 29 July 2006.
Retrieved from http://www.atimes.com/atimes/China/HG29Ad01.html
25
Xu Binglan, 2006 ‘Cultural deficit cause for concern’, China Dailly, 10 March 2006.
Retrieved from www.chinaview.cn
23
In its recent 11th Five-Year Plan (2006-2010) the Chinese government laid
out its programme:

In the Science and Technology Development Plan for the 11th Five-Year
Period (2006-2010) the Ministry of Science announced efforts ‘to raise the
proprietary innovation capacity’, strengthen ‘the technical innovation part
of industry, with a focus on acquiring proprietary intellectual property’, thus
‘laying a foundation for making China part of innovation economies in the
world’.26

In the cultural arena, the government’s National Programme on Cultural
Development, part of the 11th Five-Year Plan, and jointly issued in
September 2006 by the General Office of the Communist Party of China
Central Committee and the General Office of the State Council, the
government committed to increasing investment in cultural projects,
reforming the way they operate, expanding the quantity and quality of
cultural products and services to meet the rising demand and increasing
the global competitiveness of Chinese cultural merchandise.
To help achieve this ambition, localities and departments were instructed to
carry out a program designed to boost the creative environment, including:

Introducing calligraphy, painting and traditional handicraft onto the
curriculum in China’s elementary schools to help bring culture to youth

Making museums and art galleries free of charge or discounted to young
people

Expanding museum storage space by 300,000 square metres

Ensuring state-owned art performance troupes and theatres hold
performances at low rates for low-income residents

Encouraging urban organisations and residents to donate televisions,
radios, computers, books, audio and video products to farmers

Setting up online libraries, online theatres and online systems to provide
distance learning of cultural activities

Enhancing intellectual property rights’ protection and efforts to curb piracy.
26
The Ministry of Science and Technology, 2006, China Science and Technology
Newsletter, N0.456, 10 November 2006. Retrieved from
http://www.most.gov.cn/eng/newsletters/2006/200611/t20061110_37960.htm
The Five-Year Plan also called for cultural exchanges with the rest of the
world to be boosted to improve understanding of China overseas, including:

Mutual visits and exchanges between sister cities and holding of cultural
activities abroad

Promotion of Chinese cultural products and services through famous
overseas film festivals, television festivals, art festivals, book fairs and
expositions

Adjusting the style of radio and television programmes to meet the
demands and tastes of overseas listeners and audience.
In addition the government has focused efforts to boost the creative
environment and stimulate talent including:

Educational reform: Conceptual and systematic moves away from rote
learning and exam dominance and towards a system designed to
encourage inquiry, creativity and initiative. This is described in detail in
section 1.4

Creative clustering: Development of creative clusters in cites to enhance
economies of scale and ideas exchange (eg the new media avenue in
Beijing’s Xuanwu District, designed to become a comprehensive
community of industries involved in journalism, publishing, film, television,
Internet, as well as conventions and exhibitions). By February 2006
Shanghai had 18 creative industry clusters (with another 16 under
construction) housing over 800 creative and design companies from 30
countries and regions

Annual forums and fairs: Supporting forums such as the National Book
Fair, the Beijing International Book Fair and the China Beijing International
Cultural and Creative Industry Expo (ICCIE)

Organisational reform: Continuing organisational reform of creative
industries to move them from cultural institutions to commercial
enterprises, including, as we have seen, conglomerate formation and a
call for ‘national champions’ that are responsive to international
competition.
And with a view to directly help build international profile, policies including:

Chinese Language Expansion: In a massive drive to popularise the
Chinese language the government plans to set up 100 Confucius Institutes
around the world. Unlike its European models (the Goethe Institute or the
Alliance Française), the Confucius Institutes will be partnered with and
located at leading international universities, who will share the cost. One
London partner is the School of Oriental and African Studies (SOAS), at
the University of London
‘With cultural glamour and language popularity, a nation can gain prestige
and consolidate its position as a global player’, says Xu Lin, head of the
National Office for Teaching Chinese as a Foreign Language27

‘Go Global’ Campaign: Government-driven campaign, aimed at the arts,
and particularly determinedly pursued in relation to the publishing industry,
to support the exporting of cultural product, including subsidies, facilitation
and pressure. This is explored in greater detail in section 4.
If the scale of the effort is impressive, so too is the pace. Just as its neighbour
South Korea successfully used the Olympics to announce its arrival as a
creative economy player, China is looking to the 2008 Olympics to do the
same, with host city Beijing taking the lead.
As part of this determined drive for a creative economy, the government views
the publishing industry as one of the most critical and promising sectors. In his
introduction to the Publishers Forum held just prior to the Beijing International
Book Fair in September 2006, Yu Yongzhan, Deputy Administrator of GAPP,
told delegates that according to a survey conducted in 2004 for the first time ‘
the total added value of the industry was estimated at RMB193.97 billion in
2003, accounting for 1.7% of the national GDP and 5% in added value for the
tertiary industry. At present, he told delegates, ‘the publishing industry has
become one of the most promising industries in China’.28
However, he noted, with low per capita reading compared to developed
countries and a negligible role in the international market, ‘all we can say at
present is that China is a large publishing country but not a strong publishing
country, China’s publishing industry still has a long way to go in the future’.
People’s Daily, 2006, ‘Can Culture be China’s Next Export?’, 29 December 2006.
Retrieved from http://english.cri.cn/2242/2006-2-21/67@298299.htm
28
Yu Yongzhan, 2006, speech at the International Publishers Forum, Beijing
International Book Fair, August 2006
27
This has put the publishing industry in the spotlight and under significant
pressure to reform. China has set it sights on being a valued and influential
player in the global creative economy and a major figure on the world’s
cultural stage. It is within this vast project that changes in publishing must be
understood. This is a work in progress with drivers on a global scale.
3.6.2
Copyright and intellectual property
Piracy is a key characteristic of the market for books in China. It affects the
sales and hence profitability of publishers and creators; it affects what
reaches the public; and it affects international perceptions of the market in
terms of potential investment and partnerships. The phenomena is not
confined to the publishing industry, but is replicated across all the creative and
new technological industries. While it has devastating affects on these
industries, draining revenues from legitimate producers, but leaving them to
face the associated high research and development costs, the situation is
complicated by the fact that the effects of piracy are not wholly undesirable. It
has opened up the population to global cultural output and new technologies
that would otherwise be beyond their reach, helping China to catch up and
move to participate in the shaping of the global digital and cultural future.
However, despite accusations from international voices, particularly the US,
that the Chinese government, recognising these benefits, does not do enough
to tackle the problem, piracy is now an area of determined government focus
as China looks to build a solid foundation for its nascent creative and
technological industries, key elements in China’s view of its future. It is this
ambition, coupled with consistent cooperative international support that will
drive solutions to the problem of piracy rather than heavy-handed adversarial
international pressure.
3.6.2.1 The scale of piracy
Piracy is rampant in China. It is not confined to the publishing sector, but is a
feature across all creative and new technological industries. Pirated
publications – books, films, music CDs and software – accounted for 45.5% of
media product purchases in 2005, according to a national survey conducted
by the China Institute of Publishing Sciences. Audio-visual products were the
most frequently purchased pirate products, followed by books, software and
reference books.29
Books: Pirated books are estimated to account for up to 80% of all sales of
bestsellers. The Association of American Publishers conservatively estimates
losses to US publishers in China in 2005 at $52 million, not including losses
due to piracy on the internet.
29
Nearly half the publications bought by Chinese are pirated
Book piracy in China has taken a number of different forms over the years:

Commercial scale photocopying of academic textbooks
Commercial photocopies, frequently professionally bound with colourful
covers and even the university crest. Sometimes made by copy shops
located on or close to campus, sometimes distributed out of the official
campus textbook centre.

Print piracy
Unauthorised reprints approximating the quality and appearance of the
original – particularly affects bestselling titles. Thanks to China’s welldeveloped printing industry, these books are cheap to produce and of
good quality. With the decreasing cost and improving quality of
photocopying, the latter is now overtaking print piracy
Print piracy can exist in two ways. The first is that the Chinese publisher of
a legitimately licensed title just prints an extra amount for some profit on
the side. The second is straight piracy by an entity that has no licence to
print the book at all. This can include translating a foreign language text

Internet piracy
The fastest growing area of piracy. This includes offering illegally scanned
books (sourced from hard copies not e-books) for download, peer-to-peer
trading and unauthorised access to electronic journals and other database
compilations

Trademark counterfeiting
Especially with regard to books produced by university presses or under
the name of famous international publishing houses

Passing off – fake books
Books bearing titles and fictional author’s names similar to bestselling titles
or genres are marketed, sometimes at the expense of the legitimate
author, but always with the danger of damaging the reputation of the
author or genre
In 2004 a book entitled No Excuse, published by China Machine Press, a
leading business title publisher, roared up the bestseller list feeding
China’s insatiable hunger for international management titles. The book by
West Point graduate Ferrar Cape advocated the philosophy that
employees should show absolute obedience to their leaders and had ‘No
Excuse’ to refuse any of their bosses’ orders. It was a massive hit, with
companies buying copies for every member of staff to read. China
Machine Press reprinted 24 times and sold two million copies. It was later
exposed that Ferrar Cape did not exist and that the book was a local
fabrication.
Music: Illegal sales of music in China is valued by the International Federation
of Phonographic Industries (IFPI) at around $40 million, with around 90% of
all recordings being illegal.30 Piracy has made the digital leap and according
to John Kennedy, head of the IFPI, ‘now threatens to strangle the fledgling
legitimate digital music market before it has hardly evolved’.
Film: According to the Motion Picture Association of America, over 90% of
films sold in China on DVD are pirated.31 DVD sellers are on every street
corner with a vast array of titles, including a number of pre-release films.
Software: The US lobby group the Business Software Alliance estimates that
more than 90% of software used in China is unlicensed. Chinese officials
argue that such numbers are grossly inflated. However, while probably an
exaggeration for overall sales, for certain key products such as Windows
operating systems it could well be the case. On a visit to Beijing in March
2006, the US Secretary for Commerce, Carlos Guiterrez, noted that China
ranked second in the world for PC sales but only 25th for software.32
Until recently Tsinghua Tongfang, China’s third largest computer manufacture
shipped all its computers with no software installed. Customers could then
buy a pirated version of Windows and almost any other software for $1, at
least $99 less than buying the real product pre-installed. Given an average
urban income of RMB10,493 (£723 – $1,309), price differences of this nature
are a serious consideration. Pirated copies of Windows sell for about RMB10
or $1.25, real versions for RMB600.
Brands: Piracy is not confined to the creative or computer industries. Anything
with a valuable brand, from Gucci bags to Viagra to airplane engines, may be
pirated.
Global leak: Piracy is susceptible to the forces of globalisation too. In 2004,
63% of all piracy-related seizures at U.S borders originated in China. In
Europe the figure is an estimated 67%.33 This adds extra urgency to
international calls for the Chinese government to step up their anti-piracy
activities.
Kennedy, John, 2006. ‘Unlocking the Music Market in China’. Speech delivered at
the China International Forum on the Audio Visual Industry, Shanghai, May 25 2006;
personal interview London, September, 2006.
31
Fang Bay, 2006. ‘Hollywood studios sue Chinese stores for movie piracy’, US
News, 13 June 2006. Retrieved from www.usnews.com
32
Lague, D, 2006, ‘Small steps in a long fight against piracy’, International Herald
Tribune, 17 May, 2006
33
Berman J, 2006, ‘Testimony for IFPI’, US-China Economic and Security Review
Commission, US Congress
30
3.6.2.2 The cultural context of piracy
Piracy is ever-present in life in China. It is simply part of the fabric of life and
the government will have a major task on its hands to educate the population
on the downside of piracy, particularly in the light, from the consumer’s point
of view, of its very obvious upsides.
In an illuminating local study of piracy purchasing patterns and attitudes in the
city of Nanjing, a number of interesting characteristics emerged:34

Of the total 552 respondents only 24 had never heard of piracy

Almost half had knowingly purchased pirated goods and a further 12%
unknowingly; there was little difference between genders

By age, the 20–29-year-olds were the largest purchasing group,
accounting for 28.3% of all purchasers of pirated goods and representing
69.6% of their age group amongst the 552 who had heard of piracy. The
30–39-year-old group were second

Surprisingly, the study showed that the higher the level of education the
higher the percentage of people that purchased pirated products. 78.6% of
people with a masters degree or higher purchased pirated goods; 65.8%
of those with bachelors degrees have done so; 52.5% of those with junior
college; and 50% of high school students. The conclusion was that as
people’s educational level rose so too did their demand for cultural product
that pirated products satisfied

The higher the income, the more respondents purchased pirated goods –
leading the report writer to conclude ‘income is absolutely not the main
cause of piracy’, and probably related to the reasons given above for rises
with educational level

The largest purchasers were those who worked in technical fields (80% of
those who had heard of piracy). Of those who worked for the press or for
publishers, 46.2% had purchased pirated goods

Purchasing was spontaneous and opportunistic. Most said the low price
was the determining factor (91.3%), followed by speed to market (43%)

Of those who had purchased pirated goods 37% had purchased a book or
periodical, spending an average of RMB18.38 per month
Zhang, Zhiqiang, 2006, ‘A Study of the Piracy in Contemporary China’, The
International Journal of the Book, Volume 3, Number 3, 2005/06
Retrieved from http://www.book-Journal.com
34

Of those who head heard of piracy 89.6% understood it to be illegal, but
79.7% said they were not embarrassed about buying it. Only 35.6%
agreed with the statement ‘Purchasing pirated products helps others
dispose of stolen goods’ and only 37.1% that purchasing pirated products
was ‘dishonourable’.
It is clear from these figures that not only is piracy a regular part of every day
life, but it exists in a morally ambiguous context.
In the past, it has been argued, and still is by some, that there has been little
heart in the efforts of the Chinese government to pursue and stamp out
piracy. Part of the explanation offered was that it understood knowledge and
technologies, building blocks for China’s future, could circulate. Cut piracy off
and you would cast China adrift in the wilderness, just at a time when China
had set its sights on catching up.
Certainly piracy has broadened the cultural perspective of millions of Chinese
and opened avenues to some of the world's great literature. For academics,
too, whose business is knowledge, piracy presented a particular harsh
dilemma resulting in the widespread piracy on campus. This exposure to
piracy from a revered institution probably goes some way to explaining the
moral ease with which the more educated respondents purchased pirated
goods.
3.6.2.3 The legal context of intellectual property rights (IPR)
One of the early moves of the new Communist government following the
founding of the People’s Republic, was to abandon copyright protections with
its underlying notion of private property. For over thirty years China did not
recognise any notion of copyright.
Following the start of reform and the embracing of the market economy,
China, from the mid 1970s, reinstated copyright protections. China is now a
signaturory to all major copyright agreements, including the Berne Convention
for the Protection of Literary and Artistic Work and the Universal Copyright
Convention. In addition, in 2001, it joined the WTO, requiring it to uphold IP
rights.
However, according to a leading Beijing legal firm specialising in intellectual
property, there are a number of popular misconceptions held by international
publishers in relation to China’s protection of IPR.
These include:

China has no IPR protection, so registration in China is not worthwhile.
In fact, as seen above, and in figure 27 China has a complete IPR legal
system

We have international trademark registration, so we do not need to
register in China. In fact, even if a publisher holds an international
trademark it must be specifically registered in China with the Chinese
authorities before it has any validity in that country. In addition, China runs
a ‘first to register’ system that requires no evidence of prior use or
ownership, leaving registration of popular marks open to a third party

Copyright will be protected under the international treaties and registration
with the National Copyright Administration is not a mandatory procedure.
However, as a belt and braces approach, registration, as a public
announcement of ownership, will help copyright owners to enforce their
IPR in some circumstances

Enforcement of IPR in China is a mission impossible. In fact there is a
relatively high percentage of prosecutions

In terms of enforcing IPR in China a civil action against the infringer in a
people’s court is the most popular method for copyright owners to protect
their IPR. It is often instigated when administrative authorities are unable
to make a determination of infringement

To support UK publishers fighting infringements the UK Publishers
Association provides a copyright protection toolkit – essentially an
escalating series of pre-prepared letters threatening action against
copyright infringements for use by publishers.35 However, under Chinese
law, the complainant is responsible for collecting evidence of infringement.
If such a letter is sent before sufficient evidence, acceptable by the court to
prove infringement, has been gathered, the warning may simply give the
infringing party time to destroy it, thus preventing the case going to court.
More worrying, the Chinese judicial system has established precedent of
declaratory judgement. This would allow the party receiving the alert letter to
bring a suit against the sending publisher if that publisher does not bring an
infringement suit against the alleged infringing party in a reasonable time after
the letter.36 Badly handled, the UK publisher could be the one being sued.
Bone, Alison, 2006, ‘PA spies pirates ahoy’, The Bookseller, 9 September 2006.
Retrieved from www.bookseller.com
36
Jihong Chen, 2006, How to Protect Your Intellectual Property Right in China, Talk
at Frankfurt Book Fair, October, 2006
35
Figure 27: China’s IPR legal system
Intellectual property rights legal system
Paris Convention for the Protection of Industrial Property
Patent Cooperation Treaty
Budapest Treaty on the International Recognition of Patent Procedure
Lugarno Agreement Establishing an International Classification for
Industrial Designs
Madrid Agreement Concerning the International Registration of Marks
Nice Agreements Concerning the International Classification of Goods
and Services for the Purpose of the Registration of Marks
Agreement on Trade Related Aspects of Intellectual Property Rights
International Convention for the protection of New Varieties of Plants
Berne Convention for the protection of Literary and Artistic Works
Universal Copyright Convention
Convention for the Protection of producers of Phonograms Against
Unauthorised Duplication
Source: Zhonglun W&D Law Firm, Beijing
Chinese businesses account for 90% of all lawsuits filed against Chinese
copyright and trademark violations, but international companies have taken
their cases to court, including a number of high-profile landmark cases:

In 2005 the music industry sent 1,000 warnings requesting ISPs to take
sites down, proceeding against internet giant Baidu, which was found
guilty of copyright infringement in the Chinese courts. Yahoo is constantly
under close watch with the threat of similar action

Six major Hollywood studios, Twentieth Century Fox, Walt Disney,
Paramount Pictures, Universal Studios, Warner Bros and Columbia
Pictures teamed up in 2006 to sue two Beijing stores for allegedly selling
illegal copies of their films

Louis Vuiton and four other international designers won a major victory in
April 2006 when the Beijing People’s Court upheld a lawsuit against the
landlords of the Silk Market, a vast market notorious for fake designer
goods. This is the first time a property landlord has been held responsible.
The government too is pursuing the pirates. According to official government
figures, in the first half of 2006 government agencies investigated more than
12,000 cases of copyright violation and piracy; confiscated 55.538 million
copies of illegal publications, including 3.611 million pirated textbooks and
complementary reading materials; fined 22,000 publication stores and booths
and closed 15,000 more; and shut down 743 illegal printing enterprises.
In the second half of that year, in a high-profile gesture aimed partly at the
international community, they introduced the ‘100 days campaign’ – a major
coordinated clamp-down on pirates. By the end of August, the police
announced that they had confiscated more than six million pirated
publications and, according to the Ministry of Public Security, police around
the country raided more than 32,000 publishing and distribution companies.
However, international grumbling continues, particular from the US, where the
overriding feeling is that China is not taking copyright seriously enough, and
indeed in some cases, some in the US allege, is using it to protect domestic
industries against international competition. In autumn 2006 it seemed very
likely that the United States, together with the European Union, Japan and
Canada, would bring a complaint against China at the WTO because of
inadequate enforcement of intellectual property rights. It was just adverted at
the last minute, some suggest due to the United States need to maintain
China's support in dealing with the North Korean nuclear problem rather than
any leap of faith on the part of the US.
According to John Kennedy, interviewed for this report at the time, and head
of the International Federation of Phonographic Industries (IFPI), an industry
with a vast stake in the outcome and the clout to be a powerful driver of
change, such a move risks being counter-productive. There is a good chance,
he believes, the Chinese are more likely to pursue a much higher standard of
intellectual property protection on their own, particularly if encouraged and
supported rather then threatened with penalties, which they can easily get
around on paper presentation of their system. In essence, Kennedy thinks
forcing a WTO compliance decision risks lowering the bar.
Given China’s well-publicised ambition to become an innovative force in the
global economy and to become a serious creator and exported of new
technologies, educational and cultural product – a recurring theme through
this report – it seems logic is on Kennedy’s side.
It is inevitable that the Chinese will very quickly reach a tripping point where
the good strong IPR protection can do for their nascent creative industries far
outweighs any other consideration.
3.6.2.4 Strengthening IPR
While the Chinese government may be committed to IPR and while China has
a complete IPR legal system, the real problem is that it is backed, in the
words of a leading Chinese IP lawyer, by relatively weak enforcement
measures. This results from local interest protectionism, a lack of public
awareness of IP rights, a lack of trained and experienced personnel,
inadequate penalties, weak judicial enforcement, a lack of powers to enforce
judgements and a lack of consistency in enforcement. To deal with these
issues as part of its energised commitment to IPR, in early 2006 China issued
an Action Plan on IPR Protection. The Action Plan covers nine areas:
legislation, law enforcement, mechanism building, propaganda, training and
education, international communication and cooperation, promoting business
self discipline, services to right holders and subject research. Major elements
of the action plan included:

Legislative planning. Drafting, formulation and revising laws on trademark,
copyright, and patents, identifying areas of weakness in protection and
identifying action plans for cures

Law enforcement. Focused crackdowns aimed at specific areas; more
rapid and robust trial action and speedy advice from the Supreme People’s
Court; investigation and prosecution by the Supreme People’s
Procuratorate (SPP) of ‘those crimes involving the abuse of power by
government officials behind the IPR infringing crimes in a stringent
manner, resolutely rooting out such ‘umbrellas of protection’

Institutional building. Setting up centres in 50 cities, with phone hotlines, to
handle domestic complaints on IPR infringement, provide consulting
services, collate information and statistics and publicise IPR

Promoting cross-regional coordination in enforcement and information
rewards. Setting up rewards for helping the war against IPR infringements,
for example, US$37,000 for any tip-off that exposes an underground
DVD/laser disc production line, providing information internationally on IPR
activity, increasing the transparency of IP judgements – publishing cases
online and via nationwide press releases.
In addition the government moved to:



End the sale of ‘naked computers’. Domestic PCs must now ship with
licensed operating systems pre-installed (March 31st 2006). Some
analysts predict this will just mean computers are loaded with open-source
Linux
Schools’ programme. IPR knowledge will feature in Chinese primary
school textbooks to raise awareness from childhood37
Ending of textbook copying. Targeting one of the major publisher irritants,
in November 2006, the Ministry of Education circulated a strongly worded
statement stating clearly that ‘All foreign textbooks used in Chinese
universities and colleges should be the original or the authorised domestic
edition’.38
While US lawyers almost immediately attacked the new initiative as not being
clear on the budget and manpower allocations needed to make it work,
Premier Wen Jiabao asked for some faith. Speaking in September 2006 he
told foreign journalists ‘Frankly, it is only in recent years that we have given
priority to the protection of intellectual property rights as a matter of strategic
policy. This has something to do with the level of development China has
achieved and China should be given more time. But what I want to stress is
that no one should fail to see the Chinese’s government’s commitment to
protecting IPR and the steps it has taken’.39
37
Yang Lei, 2006, China to include IPR knowledge in primary textbooks
Retrieved from http://English.goc.cn/2006/04/11/content_251395.ht
38
Yangtze Yan, 2006, ‘Photocopying or forging textbooks forbidden in schools’,
Xinhua News Agency, 11 November 2006
Retrieved from http://english.gov.cn/2006-11/11/content_439868.htm
39
Reuters, 2006, ‘China needs more time to deal with piracy’, 6 September 2006.
Retrieved from www.chinadaily.com.cn/com/2006-09/06/content_682213
3.6.3
Censorship and restraints on creativity
3.6.3.1 Introduction
Article 35 of the Chinese Constitution states that Chinese citizens enjoy
freedom of speech and freedom of the press. This does not operate in the
way such a statement might imply. In China, what is said, written and seen
may be controlled by the state via a number of overlapping organisations,
legal instruments and protocols.
However, despite popular Western notions to the contrary, this does not add
up to a well-organised bureaucracy of professional censors, a consistent
understanding of what is forbidden or a centralised censor’s office overseeing
its operation. Instead, early in the state’s history, the Party dispersed
responsibility for censorship among cultural and propaganda institutions
throughout the nation.
This has led to an informal and unpredictable system of censorship in which,
as well as the few professional censors (in the case of literature those at the
Party Propaganda Department and GAPP), censorship works via the editors
and via the authors themselves, who operate a system of self-censorship.
In addition, this diffuse operating system is further complicated by the vast
changes occurring in post-reform China. This has highlighted three additional
considerations. First, it has resulted in indecision among the political elite
about what to allow, preventing consensus and further confusing the issue.
Second, the new commercial pressures have challenged the old rules and
criteria on what makes a good publication, pitting the need for commercial
appeal against the need to heed the prevailing winds of the accepted cultural
policy, part of which, ironically, is to show market success. This has
introduced a strong element of pragmatism and opportunism into the
equation. Third, it has led to a loss of consensus within the writing community
itself on the role and responsibility of the writer.
3.6.3.2 Self-censorship and negotiation
Perhaps the most effective outcome of this diffuse system of censorship is to
create an atmosphere of uncertainty and caution, in which an editor or author
is constantly forced to guess where the boundary of acceptability and
unacceptability lies, in which every work ‘is a kind of miner’s canary in the
caves of China’s cultural politics’.40
40
Kraus, RC, 2004, The Party and The Arty in China: The New Politics of Culture,
Rowman and Littelfield, pg 121
Because of this, the pattern of censorship in China is not a series of highprofile or identifiable clashes of state vs. speaker, although they do occur, but
rather a general pattern of ongoing pervasive and usually invisible selfcensorship. ‘If you want to censor me, give me a standard’, Ma Jian said
earlier this year at the Hong Kong Literary Festival. ‘It feels terrible because
you don’t know anything’.
Hu Shuli, the editor of Caijing magazine, a powerful and thriving business
journal that manages to tackle difficult stories of stock market manipulation
and corruption without falling foul of the censors, told the New York Times last
year ‘I know how to measure to boundary lines…We go up to the line – and
we might even push it. But we never cross it’.
The business sector, however, is given maximum latitude. For literary writers
defining the boundary is more difficult. Yan Lianke, one of China’s greatest
living authors, finds the process traumatic. Having spent three years
researching the blood selling scandal in his native Henan province, Yan
began his book, The Dream of Ding Village, planned as a biting critique of
China’s ruthless dash to development. Fearful of a ban however he removed
the features he thought might cause trouble, the notion of a blood pipeline
from a developing country to the US, a critique of national politics, a link with
global trade.
His fear was understandable. His first novel, Xia Riluo (1994), was banned.
His 2004 novel Shouhuo (Enjoyment) caused him to be asked to leave the
army and his 2005 novel Serve the People! was also banned. This prompted
his own scaling back of his next book, The Dream of Ding Village. ‘This is not
the book I originally wanted to write’, he told The Guardian newspaper in
October 2006, ‘I censored myself very rigorously. I didn’t mention senior
leaders. I reduced the scale. I thought my self-censorship was perfect’.
GAPP did not agree and issued a ‘three nos’ order: no distribution, no sales
and no promotion. ‘My greatest worry’, Yan told The Guardian, ‘is that selfcensorship has drained my passion and dulled my sharpness’.
However, he sees improvements in the situation for censorship. In 1994 when
his first novel was published he was forced to write self-criticisms for four
months. Now there are no personal repercussions. ‘My work has caused more
disputes than those of any other author in China. But the attacks on me have
become fewer. I think this shows that in many respects, society is improving,
reforming, developing.’
Ma Jia, now resident in the UK, is not so sure. ‘It’s the same today. A
publisher and his family could be destroyed because of a single word’, he said
in an interview earlier in 2006.41
And it is not just the unwritten rules that have to be felt out and negotiated. As
noted above, with the new commercial considerations and government
pressure to show results, pragmatism and opportunism can mean that even
the elements of creative control that are clearly laid out by the government in
the form of laws and regulations can become negotiable and fluid too, adding
to the blurring of boundary lines and the constant need to make personal
decisions about how far you can go.
According to Mark Magnier, the New York Times correspondent in Beijing,
‘China often depends on a patina of legality that allows companies or
individuals to get things done while ensuring that those in power don’t lose
face’. But this is a fine line, he notes, ‘Push things too far, …and you risk a
backlash’.42
Given the plethora of unwritten rules, the tolerance levels surrounding the
ones that are written and the cultural importance of face and personal
relationships, its not surprising that some works you would expect to see
censored, such as Brothers, are unmolested and others, apparently
innocuous, are banned.
Leading author Yu Hua, whose stories, as seen in section 2.3, revolve around
supposedly sensitive topics such as sex, violence and political upheavals, has
always managed to get through the censors. In To Live and Chronicle of a
Blood Merchant, Yu describes the brutality of life from the Civil War and the
Great Leap Forward to the Cultural Revolution. In Brothers, his latest series,
he draws analogies between the madness of the Cultural Revolution and the
madness of the rapid dash to cash today, yet none of the books have been
censored. Brothers is a current and vast bestseller and the earlier two are
included on a list of China’s ten most influential books in the 1990s.
‘I don’t really know why it passed the censors’, Yu says, ‘Maybe because it’s a
novel. If it had been written from an academic point of view involving opinion, I
guess there would have been some controls’. The situation is further
complicated by the fact that the novel To Live passed the censors as a book,
but was banned when it was made into a film.43
Hui, Sylvia, 2006, ‘Chinese writers take their banned books out of China, find new
readers in the West’, 21 March, 2006. Retrieved from www.freemexican.com
42
Magnier, M, 2006, ‘China says it will close new Rolling Stone magazine’. The Los
Angeles Times, 29 March. Retrieved from www.latimes.com
43
Kwok, Kristine, 2006 ‘China: bestselling author escapes the censors’, South China
Morning Post, 29 May, 2006
Retrieved from www.Asiamedia.ucla.edu/aricle.asp?parentid-46914
41
The mechanisms, shifting sands and negotiations behind censorship are
perhaps more clearly seen in journalistic writing where the interplay between
author and censor is more immediate. There are, of course, high-profile
clashes. Paris-based Reporters Without Borders Worldwide Press Freedom
Index, shows that in 2005 China had 32 journalists in jail and was ranked 159
out of 167 countries on the Index, ahead of only Nepal, Cuba, Libya, Burma,
Iran, Turkmenistan, Eritrea and North Korea.44
However, most of the barriers are dealt with via a combination of selfcensorship, personal relationships and face-saving diplomacy. According to
David Bandurski, a researcher at the University of Hong Kong’s China Media
Project, quoted in the Wall Street Journal, the system relies on a process of
‘prior censorship’. Rather than come in with a black pen, Bandurski says,
China’s propaganda officials usually rely on editors to censor publications
themselves, based on a growing collection of government missives. As for
authors, there is no conclusive central database of subjects considered off
limits by the government. Government censorship ‘is very nuanced, across
the board from “absolutely not” to “report it a little more this way”,’ Bandurski
says.45 This makes the editors job harder and self-censorship extremely
effective.
Peggy Yu, the founder of Dangdang.com, the leading internet book retailer,
talking to the BBC in 2004, said that her way of dealing with bureaucracy and
censorship in China's constantly changing regulatory environment is to ‘never
ask for permission, only for forgiveness afterwards’. ‘We do whatever
customers need, and what is right for the business. If that conflicts with certain
regulations, we communicate with certain regulators, we come up with ways
of complying with them after the event.’ 46
Perry Link, Professor of East Asian Studies at Princeton University who has
written on the Chinese media, says editors and writers have to be careful.
‘They may have flexibility, but its flexibility with a leash.’47 Trouble occurs
when the threat is too overt or face impinged. Philip Qu, an attorney with
TransAsia Lawyers in Beijing, talking to the Los Angeles Times in 2006, said
of the regulators, ‘If they believe something is too aggressive that challenges
their authority, they will show their real power by stopping it’.48
Paradise, JF, 2006, ‘China’s conservatives usher in more restrictive media
environment’, Asiamedia, 21 April, 2006. Retrieved from www.asiamedia.ucla.edu
45
Fowler, GA, 2006 ‘Rolling Stone Tests the Water’, The Wall Street Journal
10 March 2006. Retrieved from www.post-gazstte.com
46
BBC, 2004, ‘Riding China’s Internet Wave’, BBC Online, 6 March 2004
Retrieved from http://news.bbc.co.uk/1/hi/technology/3537367.stm
47
Barboza, D, 2005, ‘Pushing (and Toeing) the Line in China’, New York Times,
18 April 2005. Retrieved from http://travel2,nytimes.com
48
Magnier, M
44
When Rolling Stone magazine was closed down after only its first issue,
commentators picked up problems with content, but, more importantly one
mentioned ‘their not pretending to follow the rules’.
Pretending to follow the rules is critical, backed by personal relationships that
can negotiate the alternative routes. According to a Beijing-based UK
publisher, who knows the situation well, the real story behind Rolling Stone’s
close down, was not any major state-planned shut down as was implied in
much of the foreign press reports, but a personal clash between the magazine
editor and a local official in GAPP Shanghai, a problem of status, face and
personal relationships.
In China, the number of official magazine titles are limited. To publish, foreign
publishers need to work under an existing title. While all are aware that this is
a façade and that the magazine has in reality changed hands and purpose, to
satisfy the theoretical legal situation, publishers must publish the old title
alongside the new title on the magazine cover in type face of equal or greater
portion to the new title. Vogue, Cosmopolitan and the other large international
bands have accorded to this face-saving convention, but Rolling Stone did
not. The local official in Shanghai felt his authority questioned and decided to
make a point by suspending publication.49 In the end, despite a plethora of
articles in the West saying the shut down was part of a government move
against foreign publications or central state censorship, Rolling Stone sought
a new publication licence belonging to the Guizhou Artists’ Association, away
from the Shanghai office of GAPP and under the authorities in Guiyang, and
continued publication, now with the all important reduction of font size for the
Rolling Stone title and the inclusion, in larger font of the Chinese title.
Branding was maintained, however, by the clever use of a cover picture of the
Rolling Stones.
Relationships between publishers and GAPP are critical. No book can be
published in China without an ISBN and GAPP is the only authority that can
issue them. It is a system designed to maintain firm control over what titles
are published. However, given the number of new titles published each year,
it is impractical for GAPP to read all prior to approval. Instead publishers
submit a list of titles they wish to publish each period and are issued a block
of ISBNs to cover them.
49
Interview Jo Lusby, Penguin Books, China, Oct 2006; industry press reports
If a publisher submits a title that later turns out to be problematic, the error
could cause an immediate shut down, a loss of career for the publisher or a
reduced or zeroed allocation of ISBNs next time around. Without ISBNs a
publisher cannot survive, so making sure submitted titles do not cause any
later trouble is critical to survival. Again the system is relying on selfcensorship, this time by the publisher who must take care not to produce
content that will offend the Communist party leadership or cause ‘bad social
influence’ and which, even if it does not cause immediate trouble has any
prospect of coming back to haunt their career at a later date.
As we have seen above in section 3.3.4 however, pragmatism and the
pressure to show commercial results frequently overrides this concern, with
publishers selling their ISBNs and imprimatur for use by ‘culture studios’ who
operate with fewer of the same concerns.
3.6.3.3 The burden of duty
But not all of what is suppressed creativity in China is censorship in its usual
definition, but arises from cultural preferences and long-taught prejudices and
understandings about what art and literature should do and about what it
should be concerning itself with – big themes, big ideas, not the private and
personal.
According to Yen, ‘Contemporary Chinese literature is gripped by a desire for
popularity… It is like a soft bone disease’. Coming from a poor background,
Yen finds this an impossible choice. ‘Anger and passion are the soul of my
work’, he says.
Ma Jian, the exiled Chinese writer, author of Red Dust and London resident,
in 2004 offered a similar view in The Guardian. ‘There is a saying that the
further you stand from the mountains, the more clearly you see them…China
is completely lacking in self-awareness and as someone who has stepped
outside that society, I have a responsibility to write about it as I see it.’ 50 Most
China-based writers, he says, ‘write stories. But there are two sides to a
writer; writing a story, and taking an intellectual stand… Chinese writers’, he
believes, ‘lack that second strand, so although the publishing industry seems
very active and flourishing, these books are just entertainment. There’s no
spiritual or intellectual weight to them’.
Merritt, S, 2004, ‘Home Truths from the Exile’, 2 May 2004
Retrieved from http://book.guardian.co.uk.
50
But for some, this sense of responsibility, this need to champion a cause, a
way of life, the state, or the nation’s history, can be just as serious a restraint
on creative freedom as what is traditionally understood as censorship. Xiaolu
Guo, writer and film-maker, felt the need to leave China for the UK to find a
space for her voice. ‘In China’, she told The Guardian in 2006, ‘we adore big
historical novels. To write – that is to dedicate your own little life to the big
party, to China, to the big continent. We sacrifice ourselves to it’.
In contrast, Xiaolu Guo, along with a number of contemporaries, chose to
write about the personal, the private. But in a country where ‘great art was art
dedicated to others’ the critical response to this new generation of writers was
frequently one of dismissal or shock: ‘They say, “Oh God, she never looks at
other people’s lives”.’ Despite having five published novels in China, Xiaolu
Guo’s requests to join the Chinese Writers’ Association, the traditional
bestower of status as a writer, were brushed aside. Now in London, Xiaolu
Guo feels free to ‘to discover myself, to see my reflection… Because when
you are in China’, she explains, ‘the big, big Chinese voice overwhelms your
own’.51
Wang Shuo, author of Playing for Thrills (1998) and Please Don’t Call Me
Human (1989) and one of the first young ‘hooligan’ writers, says he is the
freest-minded writer in China. While he admits that there are many restrictions
on what Chinese authors can write about, ‘I can’t mention Mao, the CCP or
Muslims’, when asked, in 2003, by fellow author Annie Wang if Mo Yan or Li
Rui, two older more traditional writers, are as free as he is, he answers no.
‘They both love the peasants so much that they start to beautify them. Are the
Chinese peasants really that nice?’ he asks. ‘Mo Yan and Li Rui are both
nostalgic about the poor days of China. But I think poor Chinese people have
the right to be corrupted by material wealth. To me, freedom means being
unbiased and original. Authors shouldn’t stereotype a group of people. In that
regard, they aren’t nearly free.’52 Elsewhere Wang Shuo has rejected
demands to protest ‘A writer is a writer’, he says, ‘He should stay away from
politics’.53
Barton, L, 2004 ‘The Rise and Rise of Little Voice’, The Guardian, 13 May 2004;
personal interviews with author, London, October, 2006
52
Wang, Annie, 2006. ‘A New Chapter’, Time Asia, 20 January 2003
Retrieved from www.time.com
53
Kraus, RC
51
‘Writers and artists should emancipate their minds and explore diverse styles’,
Chinese Premier Wen Jiabao told delegates in a November 2006 speech to
25,000 artists and writers attending a conference organised by the China
Federation of Literary and Art Circles (420,000 members) and the Chinese
Writers’ Association (7,700 members). But there was a context. ‘Developing
Chinese literature and promoting the cultural qualities of the Chinese people
to help boost economic and social development is a crucial task’, he said. He
urged writers and artists to have a strong sense of social responsibility and for
their work to ‘reflect people’s life, social progress and promote social
harmony’.54
While this need to have a moral purpose to art is readily identified within the
socialist state, and, as seen with Ma Jian on the other side of the coin, with
those who oppose it, in China it predates this and is rooted deep in the
cultural life and expectation of art. In his study of the politics of culture, The
Party and the Arty in China: The New Politics of Culture, Richard Curt Kraus
points out ‘Chinese artists, their audiences and their censors share the belief
that art must be suffused with morality, that high art has an ethical
content…its source in China, lies deep in Confucian civilisation, which holds
that an artist is a kind of public figure – not a celebrity but a moral guide to the
nation.’ It is this idea of artist as guide that makes ‘the party anxious that
without controls, artists will make moral demands for dissent art’.55
The desire to ensure the moral purpose of art and to dismiss, block or censor
that which does not conform can come from the most unlikely quarters. Mian
Mian, the writer whose work Candy was banned for its sexual candor, drugworld references and tale of social alienation, called in a 2004 interview for
the government to limit the ‘bad influences’ from the ‘big garbage’ coming to
China from Hong Kong, Taiwan and Hollywood – specifically, ‘the
straightforward adaptation of the sentimental, commercial, lowest-commondenominator approach’ she said.56
Mu Xuequan (ed), 2006, ‘Chinese premier urges writers, artists to speak the truth’,
Xinhua News Agency, 13 November 2006
Retrieved from http://english.gove.cn/2006-11/13/content_441421.htm
55
Kraus, RC pg 119
56
Mackey, M, 2004 ‘Banned in China for sex, drugs, disaffection’, Time Asia
29 April 2004
54
Reverse censorship
When the three volume, collected works of former head of state Jiang
Zemin was published in 2006, it was hailed, pre-publication, as a sure
fire bestseller.
Not an unlikely bet noted The Guardian’s Beijing writer, given
‘promotion that puts Harry Potter in the shade: rave reviews, frontpage headlines, lead stories on TV and a must have recommendation
by the president’. In addition ‘Add the distinct possibility of demotion,
imprisonment or the withdrawal of publishing licences for any critic,
and there is every reason to believe… [it] will be a bestseller.’
And there were some major sales; ‘75,000 copies of the first run were
reserved for the military. The newspaper of the People’s Liberation
Army, said ‘Officers and men were absolutely elated to receive their
elegantly bound copies, and one after another vowed to diligently
study it in order to fully grasp its spiritual essence.’
The Guardian
3.6.3.4 Censorship and the market
But in post-reform China there is another factor influencing how censorship
and creative restraints work – the power of the market. This causes authors
and publishers to weigh towing the line with the needs of the market and can
invest a title with a ban with an added market value, causing authors, if not to
seek a ban out, at least not to be so averse to the notion of one. This, added
to the government’s ambiguity and to international politically-driven
interpretations, can lead to a distortion of what a ‘ban’ actually means.
Historically GAAP and publishers only had to serve one master, the Party.
Keep the Party happy, avoid offence and careers were safe. In the new
commercialised publishing industry, careers are measured in terms of market
success allied with acceptable content. According to Yang Kai, an editor at
the Writers’ Publishing House, ‘making the Ministry of Propaganda happy is
the most important thing. We need books with the correct political tone to win
government awards. Once we are awarded some prizes, we can get benefits,
like unlimited ISBNs. It simply means money. Besides appealing to the
government we have to take aim at the market, our books must sell’.57
Wang, A, 2006, ‘A New Chapter’, Time Asia, 20 January, 2003
Retrieved from www.time.com
57
There is an inherent tension between these two requirements – between the
need for publishers to succeed in a customer-driven market economy while at
the same time toeing the government’s line in terms of acceptable content.
Talking as far back as 1999, Mo Luo, essayist and author of Notes from a
Loser: A Free Thinker’s Life Experiences, said ‘In the current consumer
environment you can’t survive publishing books that are dull and boring. So
the liveliness of the publishing world has opened up; there is wider space for
speaking out’. Shi Tao, managing director of the then newly founded
independent second channel publisher, Alpha Book Company, told the New
York Times, ‘we do a lot of critical books because people want to read them.
And we want to make money’.58
A trusted publisher will have a lot more latitude with what can be published,
but when a line is crossed, whether because it has pushed the boundaries or
done so in too aggressive or high-profile a way, there can be consequences.
This happened to An Boshum, editor-in-chief of Chunfeng Art and Literature
Publishing House and the creator of the extraordinarily successful Cloth Tiger
series and Golden Cloth Tiger, the romantic book series based on the US
Harlequin romances. Following the publication in 1999 of a winner of the
competition for the Golden Cloth Tiger title, the sexually explicit novel by Wei
Hui, Shanghai Baby, was condemned as ‘filthy pornographic content’. The
Beijing News and Publishing Bureau ruled that any unsold copies in
bookstores would be confiscated and that the publisher must destroy the
printing plates and stop business for three months to ‘clean its ranks’. The
Beijing office of the Chunfeng Art and Literature Publishing House was
permanently closed down.
This highlights another pressure. In some markets not only do the twin goals
of selling in numbers and avoiding the censors operate in tension, but they
work in reverse ratio to each other – the more you upset the censors the
better the sales. By the time of its ban in April 2000 Shanghai Baby was
already a bestseller, thanks to expert marketing both by the publisher and by
the author herself. With the ban, however, Wei Hui’s books immediately
turned into the hottest commodity on the book market with all five of her back
titles hitting the bestseller lists and catapulting Shanghai Baby and its author
on to iconic status.59
Rosenthal, Elizabeth, ‘New Grey Market In China Loosens Grip on Publishing’,
New York Times, 27 June 1999
59
Kong, S, 2004, Consuming Literature: Bestsellers and the Commericalization of
Literary Production in China, Stanford University Press, USA, pp 110–111
58
Better still for the ambitious author, the incident shot Shanghai Baby onto the
international stage, with eighteen foreign publishers, including one from the
UK, purchasing the copyright. The book was marketed with ‘Banned in China’
slogans across the cover, a slogan with international market cachet. Speaking
in 2001, Toby Eady, the authors’ agent, said ‘If you really want a Chinese
bestseller, here’s how: get the list of banned books from a friendly policeman,
download them off the internet, get four chapters translated, and sell them. I
was in China when the authorities moved in on Shanghai Baby, and believe
me, you couldn’t ask for better publicity… In total 19 countries have bought
her and with film rights, book rights and royalties, we’re talking $2 million
easy. Yet would her novel have been noticed if it had not been banned?’60
So commercially useful is the ‘banned in China’ slogan that, coupled with a
level of historical political bias, its appeal can serve to mask the true nature of
what being banned in China actually means.
Because China lacks an institution that blocks publication based on a prior
review of the book, books generally go to market on the basis of just their title
as one of many on a list submitted by a publisher seeking a block of ISBNs.
With 128,578 new titles published in 2005 such cursory glances are not
surprising. In addition, any notion of prior review is further diluted by the fact
that an estimated 5,000 private publishers unofficially obtain ISBNs from the
572 state publishers to get their titles to market. This means that banned
books will generally have to have gained enough profile to come to the
attention of the authorities and secondly, once banned, must be recalled from
distribution, a difficult and in reality impossible process for an already
established title.
Here, commercial pressures work against censorship. Since ending stateowned Xinhua Bookstore’s monopoly of distribution and sales of books, China
is now served by a network of 160,000 state-owned, private, foreign-funded
and joint venture distribution enterprises and outlets, an estimated 80,000
shops, 80% of which are private, as well as the rapid increase in online
stores. This is an unwieldy chain to empty and control.
In addition, even if the authorities can clear the shelves of the legitimate
bookshops, market stalls and pirated editions will fill the void. When Chen
Guidi and Wu Chuntao, published the unlikely bestseller A Survey of Chinese
Peasants, an exposé of the plight of China’s 800m agricultural poor, reprints
were banned by the government, but it went on to sell an estimated eight
million copies in 30 pirated editions.61
Eady, Toby, 2001, ‘The Writing on China's Great Wall’, Publishing Trends, July, 2001
Retrieved from http://publishingtrends.com/copy/01/0107/0107china.htm
61 MacIntyre, B, 2005, ‘The American banned list reveals a society with serious hang-ups’,
The Times, 24 September 2005. Retrieved from www timesonline.co.uk
60
As Kraus has commented, ‘The cultural market simply generates new stuff
faster than the state can regulate it’. With over 570 official publishers,
thousands of second channel ‘unofficial publishers’, 2,000 newspapers, over
8,000 magazines, 282 radio stations, 374 TV stations, 114.7 million
households hooked up to cable TV and more than 140 million people online
the ability to generate and spread content is exploding.
Apart from this expansion in outlets and the growing impossibility of control,
outright bans for literature are in fact rare and generally not permanent. Part
of the reason the Serve the People! ban attracted so much attention is
because it was the first book to be banned by the authorities in years. 62
According to Richard Curt Kraus, author of The Party and the Arty in China:
The New Politics of Culture, a major impediment to understanding censorship
in China is the way the Western media hype the ‘banned in China’ theme,
sometimes motivated by an anti-communism mindset, but sometimes by
‘efforts to make cultural products seem more significant, and therefore more
attractive to purchasers’.
He cites the example of Penguin’s US publication of Howard Goldblatt's
translation of Mo Yan’s novel The Garlic Ballads, on the rear cover of which
he reports Penguin wrote ‘The Garlic Ballads, banned in China, a powerful
and apocalyptic vision of life for the innumerable people of China who exist at
the mercy of an uncaring state’. In fact, Kraus points out, by the time of the
1995 Viking-Penguin publication, Mo Yan’s novel was readily available in
Chinese bookstores. It had been banned for a while on publication in 1989 by
a government overly-sensitive following the Tiananmen Square events that
year, but by 1993 the book was back on the shelves, albeit, in a revised
version. Mo Yan had added a preface saying the book should be taken as a
warning not a model; he removed a quotation by Stalin and added a final
chapter using the device of a newspaper report to sum up the events of the
book. However, from the Penguin blurb Kraus argues, ‘the reader might well
imagine Mo Yan a non-person, a dissident artist who writes underground and
at great peril’. In fact Mo Yan is a professional writer for the People’s
Liberation Army, his employer since 1976, ’his books are in all decent
bookshops; he has won every major Chinese Literary award and his place in
China’s literary life is central not peripheral’.63
Lim, Benjamin Kang, 2005, ‘China axes novel for satirising sacred Mao slogan’,
Reuters, 21 March 2005
63
Kraus, RC
62
3.6.3.5 Censorship and the internet
Along with an explosion of other outlets, the rise of the internet is presenting
some unique challenges to the censors. When in 2005 Yan Lianke's satirical
novel Serve the People!, trailed in its entirety by the literary magazine
Huacheng, was banned, it quickly transferred to the internet where the novel,
which includes a soldier and his lover smashing up images of Mao Zedong as
part of sexual foreplay, became a sensation.
The government makes great efforts to control the internet, a difficult line
given their goal of using technology and mastery of the information society to
feed the Chinese economic boom. According to the Open Net Initiative, a
partnership between the University of Toronto, Harvard, and the Universities
of Oxford and Cambridge, China’s internet filtering regime is the most
sophisticated effort of its kind in the world, censoring content transmitted
through multiple methods including web pages, web logs, online discussion
forums, university bulletin board systems and email messages.
Its filtering system comprises multiple levels of technical control, implemented
primarily at the backbone level using specially configured routers, which as
well as being effective are designed to make the censorship of content
discreet. For example, the ONI researchers found, through forensic analysis,
that China’s backbone routers are configured such that requests for banned
content result in a network timeout error rather than a censored page
notification. The routers then send packets to the user’s machine effectively
blocking that user’s unique IP address for an indefinite period of time such
that any further requests for any web content on the same server results in
another network timeout error.64
This is supported by a system that involves numerous state agencies and
thousands of public and private personnel, backed by a dense web of legal
restrictions. Since 2000 content providers are held responsible for information
published on their sites and in 2005, as part of the Golden Shield (Jin Dun)
Project, the government introduced regulations requiring all websites,
including individuals’ sites and blogs, to register with the government. The
Chinese authorities also gained agreement from the major international
search engines such as Yahoo and Google to curb their content and internet
cafes are required to register the ID numbers of users and monitor sites
visited.
Deibert, R, 2006, ‘The Geopolitics of Asian Cyberspace’, Far East Economic
Review, December, 2006
64
According Xia Qiang, director of the China Internet Project at the University of
California, Berkley Journalism School, the most important result of all this is to
make people aware that they are being watched, ensuring they play safe.
‘The best censorship’, he told Time magazine in 2005, ‘is self-censorship, and
China relies on solid work by the secret police to make people censor
themselves and keep the internet under control’.65
In general however, cultural output is not the target. More importantly, as the
New York Times pointed out earlier this year, controlling the internet is a
losing battle. China already has in excess of 13 million bloggers with thousand
and thousands of new blogs being introduced each day. Shut one down and
another pops up.
3.6.3.6 Censorship conclusion
Censorship is a major obstacle to be negotiated in China. However it is not an
identifiable set of solid black and white rules. This can make its existence
more destructive, causing artists to second-guess what they write and self
censor their words before they arrive on the page.
All this muddying of the waters can cause international publishers to simplify
the situation, over-exaggerating the rigorous nature of censorship, but
underestimating its insidious role in infiltrating the very act of creativity and
warping its output.
A final caveat: when considering censorship in China two contextual situations
need to be born in mind. The first is the note that needs to be attached to
descriptions of all facets of Chinese life today – it is a moving target. The
situation changes week to week and almost any in-depth look at an issue will
be out of date by the time of its publication.
The second context that needs to be noted is that the prism through which the
West views censorship in China is also changing. While China is slowly
moving away from censorship (mainly under duress from the market and from
technology), the West, under the threat of terrorism and religious tensions, is
moving towards it. Between 2002, the first year of the Reporters Without
Borders’ Worldwide Press Freedom Index and 2005, the US slipped from 17th
position to 53rd, France from 11th to 35th, Germany from 7th to 23rd and the
UK from 21st to 27th. The line in the sand, both within and without China, is in
a state of flux, uncertainty and negotiation and it requires a degree of subtly
and appreciation of perspective to understand the mechanics of its true and
corrosive effect on creative output and reception.
65
Forney, M, 2005, ‘China’s Web Watchers’, Time, 30 October 2005
Figure 28: Organisations involved in censorship in China
Organisation
General Administration of
Press and Publication
(GAPP)
Authority and sphere of influence




State Administration of
Radio, Film & TV

Legal authority to screen, censor and ban any print,
electronic or internet publication in China
Issuer of publishers’ licences without which a
publisher (print or virtual) cannot operate
Power to revoke licences and shut down wayward
publishers
Issuer of ISBNs, required for the legitimate
publication of all individual titles in China.
Controls the content of all radio, television, satellite
and internet broadcasts in China.
Ministry for the Information 
Industry
Controls the licensing and registration of all ‘internet
information services’ (‘internet content providers’).

Promotes Chinese media to publicise China to the
world, including introducing China's policies,
stands, economic development, history and culture
Registers news websites wishing to engage in news
publishing operations
Administers the operations of all sites engaging in
posting news.
Monitors content to ensure that China's publishers
do not print anything that is inconsistent with the
Communist Party's political beliefs
Screens all books and articles on important topics
Issues notices on unacceptable stories
Trains journalists in acceptable ideological
approaches to news topics.
Responsible for filtering and monitoring the internet.
State Council Information
Office


Central Propaganda
Department




Ministry of Public Security

Customs Authorities

State Secrecy Bureau

Judiciary

Can confiscate any publication that is ‘harmful to
the government’.
Designates what constitutes a state secret.
Encourages self-censorship by passing sentences
that names the relevant law, but not how it was
violated or how realistic a threat actually existed.
3.7
Conclusions of the publishing sector overview
The publishing industry in China is undergoing rapid, fundamental and, for
many, traumatic change. As elsewhere, the key driver for change is China’s
embracing of the market economy. This has resulted in a general loosening of
control on economic activities, encouraging a new entrepreneurial spirit, the
creation of a burgeoning middle class hungry for entertainment and the entry
of China into the World Trade Organisation requiring it to open up its markets
to foreign competition. A secondary driver, rising to the fore, is, as elsewhere,
the rapid development of new technologies.
Broad economic reform in the publishing sector has led to the withdrawal of
government subsidies from publishers and authors, forcing them to encounter
and adapt their practices and output to the new market pressures. Structural
reform had also required a shift in the role of the government ‘from an
operator to a regulator of cultural industry’.66
It has placed publishers under significant government pressure to transform
themselves from government-owned and subsidised cultural institutions into
independent cultural enterprises, with a government set target for all 572
state-owned publishers, with the exception of the People’s Publishing House
in Beijing and the provincial People’s Publishing Houses, to have achieved
this transition into business enterprises by the end of the decade.
It has created an irresistible opportunity for second channel publishers,
knowledgeable about, and with the skills and capacities to succeed in the
market, hampered only by the continuation of the legal impediment. It has
seen deregulation and competition in the retail and distribution sectors,
resulting in the growing dominance of private retailers, the introduction of
international players and a move to large superstores, branded retail chains
and online shopping.
It has created cultural and entertainment markets and a frustration with
traditional outlets, encouraging the growth of online literature, both e-books
and original writing sites, hastening the positioning of literature as a central
content hub surrounded by multimedia outlet opportunities, including books in
print, film, TV, games, cartoon adaptations, merchandising and advertising.
It has placed constraints on the government’s ability to censor literary output
and diminished consensus on acceptable limits, leading to a two steps
forward one step back approach to control by the government, resulting in
self-censorship for the more timid, a policy of sending in the canary for the
cautious and a ‘never ask for permission, only for forgiveness afterwards’
attitude for the confident.
Beijing Review, 2005, ‘New Chapter for Chinese Publishing’ 9 May 2005.
Retrieved from www.bjreview.com.cn/En-2005/05-09-e/09-china.htm
66
These developments have had, and will continue to have, profound effects on
China’s publishing industry and will, over the next few years, result in an
industry and art with vastly changed characteristics and players. This requires
those with an interest in Chinese literature and publishing constantly to reappraise the situation and ensure they are addressing the rapidly emerging
structures and talents and not engaging exclusively with the hollowed out
shells of the past regimes. Such diligence promises benefits, not only in terms
of understanding the future shape of the publishing industry in China, but,
importantly, in understanding its potential role as an important contributing
architect of ours.
4
China: opening up & going global
4.1
Introduction
In China, the import and export trade in books and copyrights has been
subsumed into a much larger arena, positioned at the sharp edge of the
Chinese government’s determination to launch their cultural product on the
world stage. This determination is driven not only by their desire to build up
their creative economy, necessary to compete internationally for talent, ideas
and markets in the new knowledge economy and not only as an important
contributor to their domestic economy, but, importantly, as a key tool in their
soft power building. Culture, and literature in particular, has a new job
description, roving ambassador for China’s cultural diplomacy. The problem
for China is that so far this new ambassador is proving a reluctant traveller
and the efforts to balance the flow increasingly shrill and worryingly shortterm.
4.2
Book import and export
4.2.1
Introduction
Due to high differentials between currencies and overseas book prices, most
books are brought into China via copyright licensing and translation rather
than importation of copies. However, for some educational or specialised
areas, such as computer manuals or scientific textbooks, foreign language
learning and collectable items such as Harry Potter (in English), trade in
finished product books occurs.
As stipulated by The Regulations on Management of Publications importing
and exporting books requires a special business licence in China and trade
can only be done via approved agents of whom there are about forty. All are
state-owned and are affiliated to large publishing corporations or to
publication administrations.
The largest is the China National Publications Import and Export (Group)
Corporation (CNPIEC), based in Beijing with branches in six cities, including
Shanghai, Xi’an and Guangzhou, as well a number of branches overseas, in
New Jersey, London, Frankfurt, Moscow, Tokyo and Singapore.
Other important organisations include the China International Book Trading
Corporation, the China National Publishing Industry Trading Corporation, the
Beijing publications Inport and Export Corporation and Shanghai Book
Traders.
4.2 2
Book imports: volume and value
Total book imports to China in 2005, running to just over four million copies,
were valued at $41.97 million (RMB336.5 million – £23.2 million). This
represents a 19% increase on the previous year’s unit total of 3.4 million
copies, and an 8.44% increase on the 2004 value of $38.7 million (RMB310.2
million – £21.4 million). Imports in 2003 totalled 2.7 million copies, valued at
$37 million (RMB296.6 million – £20.4 million).67
4.2.3
Book imports: sources and segmentation
4.2.3.1 Sources
The UK is the largest source of book imports to China, ahead of the USA, by
value. UK-US export and Chinese import figures show some discrepancy,
with either the Chinese authorities undervaluing imports or the US/UK
overvaluing them, but the trends and segmentation are clear and indicative.
Figure 29: Book exports to China, UK and USA 2000–2005 by value
Measurement
2000
2001
2002
2003
2004
2005
UK exports to China
(millions)
£4.7
£5.6
£8.2
£8.9
£11
£13.7
USA exports to China
(millions)
£6.1
£5.4
£5.9
£7.8
£9.2
£8.3
($12.0)
($10.7)
($11.7)
($15.5)
($18.1)
($16.5)
Source: UK Department of Trade & Industry; US Department of Commerce; ROE mid-rate 31/12
each year
Exports to China from the UK, while representing only a small fraction of total
UK Book exports, 1% in 2005, their highest to date, have risen over the past
five years, showing a 191% increase between 2000 and 2005, compared to a
much lesser rise of 20% in the UK’s total book exports.
Publishing Today, 2006, ‘Chinese Publishing World Opportunities’ 27 August 2006.
Retrieved from http://publishingtoday.com.cn
67
Figure 30: Growth of book exports to China from the UK 2000–2005 by value
Measurement
UK exports to China
(millions)
% increase
% of total UK book
exports
2000
2001
2002
2003
2004
2005
£4.7
£5.6
£8.2
£8.9
£11
£13.7
7
19
46
9
24
25
0.4
0.5
0.7
0.7
0.8
1.0
Source: UK Department of Trade & Industry; US Department of Commerce
4.2.3.2 Segmentation
Not surprisingly the two largest categories of book imports to China are
related to specialist and educational titles. The largest category of book
imports is science and technology, including computer titles, which to-date
has represented a significant segment, with the total category accounting for
43% of total import value, or a quarter of all individual titles and unit volume
and valued in excess of $18 million (RMB144 million – £9.95 million). The
second leading category is also related to education, with cultural and
educational titles representing just over a quarter of unit imports and a further
17% by value, or $7.16 million (RMB57.4million – £3.96 million).
Over 664,000 literature and art books, comprised of just over 90,000
individual titles, accounted for just over 16% of unit and title sales, and 11% of
value at $4.7 million (RMB37.7 million – £2.6 million). Foreign language
literature serves the large ex-pat community in China, sold via the foreign
language and superstore retail outlets. It also supplies the university literature
courses and language learners, as well as those who wish to read titles in
their original language, either in principle or rather than wait for the Chinese
translation, which may follow months or years later, if at all. Harry Potter’s
English language imports, despite having a hefty price tag compared to the
domestic editions, have caused queues around the block.
Figure 31: China book imports 2005
Number
of titles
Total book imports
Number
Value % share % share % share
of copies
($ millions)
titles volume
value
(millions)
553,644
4.037
$41.97
-8.1
19.4
8.44
84,574
0.437
$5.78
15.3
10.8
13.8
133,687
1.105
$7.16
24.1
27.4
17.1
90,189
0.664
$4.70
16.3
16.5
11.2
141,835
1.027
$18.05
25.6
25.4
43.0
Children's
43,368
0.391
$2.11
7.8
9.7
5.0
General
59,991
0.412
$4.16
10.8
10.2
9.9
553,644
4.037
$41.97
100.0
100.0
100.0
% Change 2005/04
Philosophy & Social
Science
Cultural,
Educational
Literature, Art
Natural Science &
Technology
Total
Source: GAPP basic national press and publication in 2005
4.2.4
Book exports: volume and value
In 2005 China exported 5,1768 million copies of books worth $29.21 million
(RMB234 million – £16 million), representing a growth of 105% and 40.2%
respectively compared to the same period the previous year. Measuring 2005
exports against imports, valued at $41.97 million (RMB336.4 million – £23
million), shows a trade deficit of $12.76 million (RMB102.3 million – £7.05
million).68
4.2.5
Book exports: destinations and segmentation
4.2.5.1 Destinations
Traditionally the majority of sales go to countries with large Chinese-speaking
populations (Singapore, Taiwan, Korea, etc), but increasingly the worldwide
growth of Chinese language learning has spurred growth in Europe and North
America. It is estimated that over 30 million people in the world are studying
Chinese, including students at 2,500 universities teaching Chinese in 100
countries, with Chinese course books moving into primary schools in the US
and in increasingly in the UK. This is a key driver for future exports.
68
Ibid
Figure 32: China book exports 2005
Number of
titles
Total book exports
Number
Value % share % share % share
of copies
($ millions)
titles volume
value
(millions)
1,148,11
0
5.177
$29.21
% Change
2005/04
Philosophy &
Social Science
Cultural,
Educational
37.3
10.5
40.12
290,405
1.139
$7.54
25.3
22.0
25.8
203,618
1.198
$5.58
17.7
23.2
19.1
Literature, Art
251,353
1.082
$5.85
21.9
20.9
20.0
Natural Science &
Technology
210,375
0.745
$3.66
18.3
14.4
12.5
Children's
106,810
0.544
$1.24
9.3
10.5
4.2
85,549
0.458
$5.34
7.5
8.9
18.3
1,148,11
0
5.167
$29.21
100.0
100.0
100.0
General
Total
Source: GAPP basic national press and publication in 2005
4.2.5.2 Segmentation
The largest export category, by value, was philosophy and social science (see
figure 32), followed closely by literature and art. The other significant driver for
exports in the future is likely to be linked to IT technology as e-books and
international online sales, two priority areas for China, increase.