Shanda’s Stunning Success

By Wen Huang

(This article originally appeared in the Publishing Perspectives’ Frankfurt Edition on October 16)

In Chinese, the word Shanda means “grand and big” and the namesake company Shanda Literature Ltd. (SDL) certainly lives up to its name.

The company runs three popular literary web sites of user generated fiction: Qidian (www.qidian.com) is targeted at young men and features kung-fu stories, science fiction, military and general history, while Jinjiang (www.jjwxc.net) and Hongxiu (www.hongxiu.com) publish romance and is read primarily by young female readers. Together, the three sites attract more than 500 million page views a day.

CEO Hou Xiaoqiang, 34, says this kind of traffic makes it the most popular literary web site in China, if not the world.

What’s more, the company continues to grow, with Shanda’s users posting 50 million words—or the equivalent of thousands of new books—per day.

The company is a subsidiary of Shanda Interactive Entertainment Limited, a firm best known for its online games. Shanda Interactive acquired Quidian in 2004 and Jinjiang and Hongxiu in 2007, bringing them together under the umbrella of Shanda Literature only last year.

Collectively, Shanda has a database of 2.7 million user-generated titles. In all, some 700,000 writers have contributed to Shanda’s sites.
“We have a unique business model in digital publishing,” says Hou, who worked for Sina.com, one of China’s largest internet portals, prior to joining Shanda. Users accessing the sites can read the first half of a book for free and then pay a small charge (about 3 cents per one thousand characters) for the rest of a book. The company splits the profits with the author.

Any writer can register with Shanda and post their fictional works on any of the three sites they choose. Shanda editors look for titles that have commercial potential and may subsequently sign them to a contract to published their work as a traditional book or modify it for other types of media, such as films, cartoons or games.

So far, the strategy is working. Shanda has put some 1,500 books into print, and according to Hou, approximately 90 of the top 100 most popular Chinese books searched by readers on Chinese Google and Baidu (another popular search engine) are from the Shanda websites.
“Our literary sites have brought together the most talented writers in Chinese online literature,” boasts Hou, who sites Zhang Wei as one example. Known to his online fans as Tangjia Sanshao (The Third Boy of the Tang Family), Zhang is one of the most successful Shanda writers. At 29, he’s the author of nine bestselling book series (comprising ten to 14 titles per series), with each selling about 400,000 copies.

A former web engineer, Zhang started to post his work on Qidian in 2004 and caught the attention of Shanda editors after his first novel became an online sensation. “I always had a passion for fantasy novels,” said Zhang. His books, with titles such as Crazy God, Son of the Light and the King God of Death, star heroes who live on alien planets and save their world through the use of magic and superpowers.
“Shanda has made it possible for me to become a professional writer,” Zhang said. “It would have been difficult with the traditional print publishing.” He tests his stories by posting them first online to gauge reader reaction before committing them to print and produces about one new series per year.

Shanda CEO Hou has big ambitions for his writers. On his way to meet his US counterparts in Hall 8 at the Frankfurt Book Fair, Hou said he was on his way to soliciting partners to publish and distribute Shanda literary works worldwide. “We hope to create our own Harry Potter-like phenomenon,” he said.