Other revenue-generating literature providers under Cloudary have four revenue sources, paid content, print book sales, copyright licensing and online advertising. Rongshuxia hardly made any revenue until September 2011 by publishing print books and selling content for film adaptation. It was then the site became capable of sharing revenues with authors – 80% of print book sales and 50% of content licensing fees go to authors. So far it has published over four hundred print books and sold over twenty works for film adaptation.
Before making a profit, the site plans to spend more money to improve the charging and revenue-sharing systems in 2013. The management want to make the charging system slightly different from the one their sister sites are using, for the realistic theme of the works on the site works differently for the audience from other novels sites’. Rongshuxia will set prices based on titles or roll out monthly subscriptions so that authors won’t be motivated to make works longer and longer – most other sites set prices based on Chinese characters that the longer a work the more authors and platform owners can earn.
Founded in 1997, Rongshuxia was one of the earliest literature websites and longest operating ones in China. The site was in trouble before Cloudary took controlling stake in it in 2009. It took about two years to re-gain some traction and began monetizing content in 2011.
Zhang Enchao, its general manager, believes realistic theme of the site fits in well with film adaption and print sales. Also the site hopes to make some revenue from mobile reading through the partnership its parent company reached with telecom operators.
Cloudary, the parent company of Rongshuxia, is the absolute online original literature leader in China. Its six original literature sites totaled 1.6 million authors and 6 million titles as of March 31, 2012, according to its F-1 with SEC. Subsidiary companies were set up to help monetize its content, marketing content, publishing print books, selling content for film adaption, etc. It plans to go public on the New York Stock Exchange and the exact time is reportedly set for April 2013.
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