According to its 2019 annual report, online reading, copyright operation and other businesses are the two main businesses of China Literature Group, accounting for 44.5% and 55.5% of revenue respectively, while in the previous year, the two accounted for 76.0% and 24% of revenue respectively.

Revenue from online reading business was 3.71 billion yuan, down 3% from 3.83 billion yuan in the same period last year. Copyright operating income and other income were 4.68 billion yuan, up 286.8% from 1.21 billion yuan in the same period last year. The above data shows that the online reading business has declined to a certain extent, both in terms of revenue contribution and growth rate.

For the decline in China Reading Group's online reading revenue, the earnings report said that this was mainly due to the decline in Tencent's product self-operated channel revenue and third-party platform revenue, Tencent's product self-operated channel revenue fell from 952 million yuan last year to 836 million yuan, and third-party platform revenue fell from 663 million yuan last year to 449 million yuan. The self-operated platform of China Literature Group rose to 2.425 billion yuan from 2.213 billion yuan last year. China Literature said the decline was due to a decline in paid reading revenue from Tencent's own product channels, as well as the termination of cooperation with several distributors.

That may be why the management team is stepping down en masse. Previously, the 21st Century Business Herald reporter quoted an informed source as saying, "It is said that free reading is to be promoted internally, but there is no consensus."

Wu Wenhui, the former co-CEO of China Reading Group, said in response to the Beijing News that the rise of free reading originated from the previous piracy market, which shows that it does not recognize this model. "In the past, many users used piracy to enjoy free content, and pirate websites made profits through advertising. Now some websites have taken advantage of the market gap after the crackdown on piracy, and established a free business model, attracting some users who used to watch piracy to the platform through free means. This is the reason why the business model can be established." Wu Wenhui said.

He also believes that the free and paid reading models will coexist in the future, because the free business model can win users from the original piracy market and may generate in-depth users, who will then convert to paying users.

Many interviewed people mentioned that due to the relatively low price of literary copyright, low cost of bandwidth consumption, long user stay and other characteristics, it has gradually become the standard content of major super applications. This point has been confirmed on QQ browser, Youku, UC browser, and is being confirmed on WiFi master key and today's headlines.

The payment model is a proven successful business model of online literature after more than 15 years of development. Paid online text software, such as QQ reading, book flag novels, there are usually five forms of reading: the whole book free reading, the whole book paid reading, some chapters paid reading, and basic monthly membership and super monthly membership. Among them, basic monthly members can read about 70% of the library, generally costing tens of yuan per month, super members can read most of the library, except for very individual copyright books, generally spending about 100 yuan per month.

Tomato-based Little Book, Lian-Shang Free Book, and Mi Reading novels all initially adopted the free model, that is, reading books is free, but users need to endure a certain amount of advertising. Beijing News reporter experience found that tomato reading every 4 to 7 pages insert an advertisement, advertisement and text mixed row, click directly jump to games, friends and other download page; Ads appear at the end of each chapter of Lianshang Reading, click on it and jump directly to Lianshang's original website. Meter read every 3 pages appear an AD, click directly to jump to fitness, friends and other registration or download page.

They are Wu Wenhui, who served as president of Shanda Literature and CEO of Qidian Chinese Website in 2004;

Wang Jingying (now CEO of Lianshang Network and Chairman of Lianshang Books) and Wang Xiaoshu (former Vice President of Lianshang Network and CEO of Lianshang Books), who joined Shanda in 2002; Tan Siliang, who joined Shanda after 2010 (now the founder and chairman of Interestheadlines).