"The battle to market foreign books has focused on bestsellers.Publishers hungry for quick profits often sacrifice the quality and cultural value of books"Hao Mingjian,Vice-director, Shanghai Literature and Art Publishing House

Readers are skimming at the Book Mall on Fuzhou Lu. The size of the six-floor building is a testimony to the scale of China's publishing industry.

TAKE a stroll around the Book Mall on Fuzhou Lu and you will be impressed with the prosperity of China's publishing industry. All six floors of the building are packed with books and shoppers, pushing trolleys and carrying baskets.

Shopping in the Book Mall makes the 1970s seem impossible - when books were bought with tickets, like bread or other life necessities in short supply.

Around 140,000 different kinds of books are published in China every year, more than any other country in the world.

Bottleneck

However, this is not enough to guarantee success for Chinese publishers. Many problems exist that threaten publishing houses including piracy, disorder of the market, severe domestic competition, and threats from new independent publishing workshops.

Stay a little longer in bookstores and you will get an idea of the problems. "I asked a shop assistant for some books from a certain series and she said they were sold out," said Maggie Zhang, a customer. "But when I searched the shelves myself, I found several of the books."

Finding a copy of a translation of William Faulkner's "As I Lay Dying", she was surprised by the price difference. The book was being offered for sale at a neighbouring bookstore with a 30 per cent discount, while at the Book Mall, the same edition was being sold at full price.

"Marketing is the most urgent problem confronting the industry," said Hao Mingjian, vice-director of Shanghai Literature and Art Publishing House (SLAPH). "We don't lack first-class editors. Printing and book design are both good. Marketing is the bottleneck."

For decades, the Chinese publishing industry has been closely tied to the government. Most books have been distributed through the State-owned Xinhua Bookstore, a nation-wide book-selling system.

In recent years, Xinhua Bookstore started passing the risk to the publishers - Xinhua Bookstore can return any number of unsold books to the publisher. Publishers also must take responsibility for storage risk.

Besides Xinhua Bookstore, there is a "second channel" made up of privately-owned bookstores. "The credibility of the second channel is low," Hao said. These private business owners are only able to handle about 2,000 yuan (US$242) in books from each publishing house and often disappear without paying. "Such small cases are not worth the trouble for the publishing houses," Hao said.

Bestsellers

Another area of tough competition for publishers is obtaining the patent rights to translate foreign books. The number of books translated into Chinese far exceeds the number of Chinese books translated into foreign languages. "It is like an adverse balance in international trade," Hao said. "But domestic publishers are willing to offer high royalties to foreign patent owners, pushing themselves as well as competitors into a very passive position."

"The battle to market foreign books has focused on bestsellers. Publishers hungry for quick profits often sacrifice the quality and cultural value of books," said Hao.

Recently, Shanghai Translation Publishing House (STPH) failed in a bid to obtain the rights to publish the autobiography of Wen Ho Lee, the Chinese American wrongly convicted of spying several years ago. STPH offered a downpayment of US$10,000, which was 10 times the usual sum, but was turned down in the end when a rival offered an even higher amount.

"Suppose the rival publisher offered $15,000. They would have to sell at least 200,000 copies of the book to make a profit," said a staff member of STPH. "Think about it, people will have forgotten Wen Ho Lee by the time the book comes out."

Live with it

Complaints about the high price of books have gone on for years, but Hao said Chinese readers must learn to accept the situation.

Superfluous matters and high operation costs also add to the high price of books. A new organization called an independent workshop has emerged due to these circumstances. Several people with shrewd predictions about the market organize a workshop to design books. They organize writers and edit the text. Then they find a satisfactory printer. All they need from a publishing house is a book number, which is a licence for publishing a book in China.

When they bring their plans to publishers, they often ask for a fairly high percentage of the book's profit, which will be much higher than an editor from a traditional publishing house would get.

These workshops require little investment and are quick to react to market trends. "I am sure I would make a large amount of money if I worked by myself," said several editors from local publishing houses.

To add to these woes, very dangerous enemies are at the gate - China's entry into the World Trade Organization is introducing much more powerful and experienced foreign competitors to the nation's publishing sector. State protection of the industry will last at the most 10 years. Some foreign publishers are already finding ways into the market. Bertelsmann, a multi-national company listed among the Top 500 by Fortune, found its way into the Chinese publishing sector by co-operating with a domestic press. Foreign capital has also been invested in some bestselling books.

Several large-scale publishing groups have found themselves facing fierce international competition. "We are like the Chinese football team," Hao said. "After playing so many years of Jia A between ourselves, we are playing in World Cup at last."

In Shanghai, the goliath Century Publishing Group is made up of six existing publishing houses, including STPH.

"I believe that the incorporation and division of a group is a natural response to a changing market opposed to receiving orders from administration departments," Hao said. SLAPH doesn't plan to join or set up a group, but if the administration departments give the order, SLAPH may need to compromise.