Technology, released on July 25, show that the number of people reading on mobile phones has increased by 229%, to 57 million, within the last six months. Even though mobile-based e-reading was made available only within the last year, every month the platform boasts 45 million readers and earns RMB0.1 billion.

“I also read on my mobile phone,” sa i d X i Guohua, t he new secretary o f t he Party Leadership Group and vice-president of China Mobile, at the contract-signing ceremony between his company and GAPP on June 5.

The contract i s not unique. On June 21, 2010, GAPP had a strategic m e m o r a n d u m o f c o o p e r a t i o n t o promote digital publishing with another te l ecommunication company, China Telecom.

On July 5, Liu Binjie, director of GAPP, and Wang Jianzhou, president of China Mobile, signed a memorandum o f c o o p e r a t i o n t o d e v e l o p d i g i t a l publishing industry in Beijing. According to the memorandum, GAPP will work w i t h C h i n a Mob i l e t o p r o v i d e t h e required technology and digital services t o Ch i n e s e p u b l i s h i n g c ompanies. GAPP will also help publishing houses collaborate with China Mobile, assist CMRead in building and operating the digital reading platform, and get more e-books onto CMRead.

Xi Guohua said that China Mobile, as a major strategic partner of GAPP, will provide the necessary support to get China’s digital publishing industry up and running while operating within t he country ’s l egal f ramework and market rules.

Private hands in the e-book industry This year, the biggest news in the digital publishing industry concerns China’s biggest e-commerce company, Jingdong Mall, an online retailer. The n ew c ompany t h a t eme r g e d f r om this buy-over is called 360buy, and it is going all out to provide discounts on printed books while putting more e-books i n i t s mix. Meanwhile, two other well-known book and electronics retailers, Dangdang and Joyo Amazon, are quietly building up their e-book services as well.

In August, L i Guoqing, general director of Dangdang, announced that the company is moving into the e-book arena, and will work on reducing the price of e-readers that it offers through its Web site by about RMB500 (about $80). The latter is l ikely to increase sales of the e-reader and encourage more e - book s a l e s . Dangdang and Joyo Amazon have already collaborated with many publishers and are moving aggressively into the e-book segment.

Li Guoqing said that his company is working on streamlining e-book pricing and prof i t- sharing with publishers. Basically, Dangdang gets 40% while the publisher gets 60%. Negotiations to get the pricing right have started. Dangdang is hoping that publishers will price their e-books reasonably, as high prices that are too high will of course drive away customers.

Joyo Amazon has stricter terms than those offered by Dangdang. It takes 55%, with publishers getting 45%. Joyo Amazon controls the pricing also. In fact, once the agreement is made between Joyo Amazon and the publisher, the latter must provide the retailer with a l l content and d i g i ta l r ights. Additionally, i f Joyo Amazon creates the digital format, the profitsharing ratio will be adjusted to 60:40, as Joyo is beating the production costs.

Over at 360buy, there is no clear indication yet if it will move into the e - book market. But many i ndustry watchers say that it is just a matter of time. Suffice to say that with these t h r e e b i g e - c ommerce c ompanie s l o o k i n g i n t o e - b o o k r e t a i l i n g , t h e Chinese digital publishing industry will get a considerable boost.

Flourishing digital publications

Besides partnering w i t h t e l e c o m munications companies, GAPP has also established various initiatives to help publishers build their digital publishing units. In July 2011, GAPP approved nine new national-level digital publishing units in addition to those in Shanghai, Chongqing, Hangzhou, Hunan, Shaanxi, Hubei, Tianjin, and Guangdong. More publishers have sent in their requests a n d p r o p o s a l s , a n d a r e a w a i t i n g approval from GAPP.

In total, GAPP is looking to create around 10 national digital publishing bases—or digital parks—by the end of the 12th Five-Year Plan in 2015. GAPP is determined to increase the gross output of China’s digital publications, with a target for the segment set at 25% of the country’s total book market. By 2020, GAPP aims to make sure that all publishing houses digitize their lists and have more digital products and services in the market.

However, several provinces have been acting according to their own five-

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Sept.26,2011 One of China's largest digital publishing cloud computing centers, the Tianjin National Digital Publishing Base, began operations in August.

year p l ans. Shanghai, for i nstance, has a buzzing digital publishing and new media industry. At Shanghai Press and Publication Bureau, its 12th FiveYear Plan contains, among others, the establishment of an expert group to promote digital publishing industry. S h a n g h a i h a s a l s o p l a c e d d i g i t a l publishing at the top of its to-do list. In fact, the Shanghai provincial government has supported numerous e-publishing projects, including Xinhua e-Bookstore and e-schoolbag. By the end of 2015, Shanghai aims to have three to f ive leading digital publishing companies with annual revenues exceeding RMB2 billion, and to grow the digital publishing market to hit RMB70 billion.

Over in Hunan Province, one of China’s important cu l t ural centers, d i g i t a l p u b l i s h i n g i s a l s o a n i t em i n i t s own F i ve-Year P l an. In fa c t , the provincial government wants to develop print and digital publishing s imultaneously, and to have d i g i ta l publishing revenues hitting RMB5 billion by 2015. More than 100 projects are in the pipeline at its digital publishing base, and these include products for mobile phone, educational products, and e-commerce initiatives.

O v e r a l l , t h e C h i n e s e d i g i t a l p u b l i s h i n g i n d u s t r y w i l l n o d o u b t change and grow over time, thanks to government support and the inevitable introduction of new technologies. For now, there is no clear leader among the publishing companies in terms of digital publishing, and the income from digital products remains insignificant. Admittiedly, progress so far has been rather slow, especially compared with t he ra p i d ra t e s o f c hange i n o t he r countries. However, as is clear, the market potential is huge.

Certainly, the Chinese i ndustry can learn a good deal from overseas publishing companies, whose industries are far into their own digital revolutions in both products and e-commerce. As the digital parks and the pioneering provincial efforts continue, there i s great potential for growth.

Privately Owned Houses and Government Support Privately owned publishing companies are fast becoming a new force in China’s book industry. There are more than 5,000 such companies right now working on book packaging. Such companies do not have the right to publish books, but by partnering with state-owned publishing enterprises, they can grow and play a major role in the industry.

I n r e c e n t y e a r s , p r i v a t e o r independent publishing companies have been given a tremendous boost by the government. Instead of focusing on simple production of books, they have broadened their business models to include media production and digital publishing.

The right to publish will take some time to happen Since 2009, a series of guidelines have been issued that offers private p u b l i s h i n g c o m p a n i e s a w a y t o recognition and operational legitimacy. O f f i c i a l s f r om va r i ous government b o d i e s a l l i n d i c a t e t h e i r s u p p o r t fo r p r i vate pu b l i s h i n g . Du r i n g t h e National People’s Congress and the Chinese People’s Political Consultative C o n f e r e n c e i n 2 0 1 1 , A l l - C h i n a Federation of Industry and Commerce put forth a proposal to gradually open publishing rights to private publishing houses. Its intention is to promote and support such publishing entities.

Several suggestions were made in the proposal. Firstly, i ssuance of ISBNs can be made after GAPP has evaluated the private publishing house that will handle the specific publication. Secondly, GAPP can set the strategic

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