Audiobook Lights Up e-book Market and Boosts Publishing Industry
The audience base of China's audiobook is expected to increase to 478 million, and the market value will expand to 6.36 billion RMB in 2019, according to a survey from China Network Security and Information Committee. This advanced function might boost the ebook market, whilst the copyright issue and government policies could obstruct the growth of this sector.
Audiobooks are an extension of ebooks as they can read out the content of ebooks, providing a new experience for users. Electronic audiobooks have become the growth engine of the publishing industry. Base on the data from American Publishers Association, the country's electronic audiobook revenue in the first half of 2018 increased by 35.4% over the same period in 2017, performed better than other book formats, including hardcover books and paperback books, which were up 5.8% and 1.1%, respectively.
In the first half of 2017, the revenue of electronic audiobooks also increased by 32% from the same period of 2016, far exceeding the growth in other book formats.
Taiwan-listed mobile company TWM (3045), which provides adjunctive mobile reading application "MyBook" with "Listening Mode" function, has built up a user network of over 2.3 million.
Ebook is more sensitive to market changes than traditional books. “After the Lunar New Year Holidays, the average daily reading of English learning books soared, up around 20%, and the average daily reading time per person grew by more than 30%,” said TWM deputy general manager Li Peng Jun.
Mr Li also said that members use MyBook's "Listening Mode" function increased by 40%. The content of business English and multi-test books are most popular, and the sales of these ebooks are 30% higher than usual. “I think this data reflected a change job trend after the lunar new year,” she added.
It seems that audiobook would be the major engine for ebooks, but some industry insiders pointed out that Hong Kong may not pick up the trend simultaneously.
“In the Hong Kong market, there are not many choices for audiobooks in Cantonese. Apart from the limited market size, Cantonese is a spoken language, it is not advisable to transfer the book from words to audio directly under current technology,” said Victor Lam, a management officer in Hyread (Hong Kong Brand), an ebook company.
Hong Kong government promotes "Bi-literacy and Trilingualism" in the city's education system, which would also slow down the audiobook development in the city, Lam said. “Although the development of audiobooks in Cantonese is not easy, the current boom in the English and Mandarin audiobook markets will continue,” he said.
China Literature Limited (772), a publishing company listed in Hong Kong, reported revenues of 2.28 billion RMB in the first half of 2018, up 18.6% quarter-on-quarter; operating profit jumped 142.2% to RMB567 million; operating profit margin increased by 12.2% to 24.9% quarter-on-quarter.
Despite the considerable profitability of ebooks and audiobooks, there are some lingering concerns in the industry. “User traffic is critical to the web platform," said Zhao Wen Li, the chief strategist of China Merchants Securities (Hong Kong) Corporation Limited(CMS). It has been difficult to realise the willingness of users to pay, and "now the proportion of users paying is down, which is equivalent to directly reducing revenue for the reading group,” Mr Zhao said.
From the 2018 interim report of China Literature, operating income increased by 18.6%, much lower than its revenue growth of 60.2% in 2017. Meanwhile, the average monthly paying users dropped from 11.5 million to 10.7 million.
Piracy is one of the factors that affect the profitability of China Literature, Zhao said. “Limited by regulatory factors and others, low-cost website construction and content crawling are difficult to control in the short term," he added.
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