SHANGHAI • The future of the book is being written in China as smartphones revolutionise the way people consume literature.
Last year, 333 million Chinese read fiction written for their phones and other devices, government data showed.
Some is written by hobbyists and some by professionals. Increasingly, though, it is hard to tell the difference as China's "online literature" morphs into a US$1.3-billion (S$1.8-billion) industry.
Investors have taken note. Today, China Literature, the country's biggest online publisher, will go public in Hong Kong, with a market value expected to exceed US$6 billion.
For decades, China's publishing industry was dominated by government-owned companies that steered clear of issues such as politics, sex, romance and violence.
Then, the Internet offered a back channel. In the late 1990s, authors began posting serialised novels to online forums and bulletin boards. It was an informal and largely uncensored way to publish. Some of the early books - especially romances - became sensations.
Among other factors turning these early serials into hits were the online forums themselves. They were the social media of their time and parallel commentaries and discussions organically sprang up around this new literature, becoming as much a part of the experience of reading as the story itself.
In many cases, these commentaries influenced how the authors wrote and thereby drew in even more readers, eager to be a part of the story-making process.
With the rise of social networks and the rapid proliferation of mobile phones in China, online serials became a full-blown phenomenon.
In 2011, two well-regarded serials, Empress In The Palace, which recounts life in China's imperial harem, and Scarlet Heart, a time-travelling drama, became hits. Since 2012, the online literature market has been growing by more than 20 per cent a year.
For all their popularity, though, the serials did not immediately make much money. Some publishers tried paywalls. Others tried selling advertising and accepting micropayments. None was successful.
In recent years, though, some entrepreneurs have hit on a new way of thinking about serials - as an entertainment industrial chain that happens to start online. The chain now includes films, TV, games and books.
Zhang Wei, China's best-selling online author, made US$16.8 million in 2015 - only 2 or 3 per cent of which came from people paying directly for his online literature.
China's biggest technology companies - including Alibaba, Baidu and Tencent - have invested in platforms intended to attract talented writers and turn their work into multimedia franchises.
Zhang, who started out writing for free online, put it succinctly in an interview last year: "My goal is to make a big franchise like Disney. Disney has a lot of characters whose popularity is reinforced through movies and cartoons."
China's entertainment companies are hoping that, sooner or later, someone now writing free stories for smartphones will become the Chinese J.K. Rowling. And with 6.4 million authors and 9.6 million works on offer, China Literature is a good place to start looking.
That makes it the rare opportunity to bet on China's grassroots directly. For authors and investors alike, that is almost certainly a future bestseller.