Good evening, ladies and gentlemen. Welcome to China Literature's 2022 annual results conference call. A copy of the annual results announcement can be found and downloaded from its investor relations website at ir.yuewen.com. At this time, all lines have been placed on listen-only mode, and the floor will be open for questions following today's presentation. I would now like to hand the conference over to your host today, Ms. Maggie Zhao, Head of Capital Markets and Investor Relations at China Literature. Maggie, please go ahead.
Thank you, operator. Ladies and gentlemen, welcome to our 2022 annual results conference call. Joining us today on the call are Mr. Edward Cheng, our CEO, Mr. Monkey Hou , our President, and Mr. William Sun, our VP of Finance. For today's call, Edward will discuss the company's strategies and business highlights. Monkey will provide more operational details, and William will go through the financials. We will open the call for questions. Before we begin, I would also like to remind you that management's comments during the call will include forward-looking statements that are based on our current expectations. All statements other than statements of historical facts during the conference call are forward-looking statements which are subject to a number of risks and uncertainties and may not be realized in the future for various reasons.
Information about general market conditions coming from a variety of sources outside of the company. This presentation also contains some unaudited non-IFRS financial measures that should be considered in addition to, but not as a substitute for, measures of the company's financial performance prepared in accordance with IFRS. Please do take a minute to read the risk factors and non-IFRS measures discussion in China Literature's 2022 annual results earnings release. I'll now turn the call over to our Chief Executive Officer, Edward.
Thank you, Maggie. Hello, everyone. Thank you for joining our earnings call today. I'm pleased to share with you our business focus and achievements in 2022, as well as our common strategic and operational plans. During 2022, we experienced major macro changes and witnessed efforts across the digital entertainment industry to improve content quality and ROI. The user community, media, and capital markets have formed a consensus view that growth at the cost of quality and efficiency is not sustainable, and that product quality will remain the true engine for attracting a massive audience and creating value over time. This is consistent with China Literature's strategy and mission. Our unique insights as an industry leader have positioned us for future changes. In 2022, we further improved our online reading ecosystem and focused on delivering premium offerings.
We also continued building our capabilities along the IP development value chain, especially on mission-critical tasks to widen our competitive moat. Our operational efficiency improved significantly. Net IFRS profit attributable to equity holders of the company increased 9.6% year-over-year to RMB 1.35 billion, while its margin increased from 14.2% a year ago to 17.7% in 2022. Specifically in 2022, we have strengthened our strategy in the following two areas. Our online literature business. We strengthened our premium paid content offerings to enhance core competitiveness. A leading online reading platform in China, we have always seen strong demand and willingness to pay for high-quality content from users.
Therefore, we continue to expand our investment in premium content in 2022, while proactively giving back certain business lines such as free reading, which are more vulnerable to macroeconomic fluctuations. These adjustments enabled us to focus on our core business and enhance our competitiveness in the content ecosystem. Second, for our IP operation business, we continued to create blockbusters through our IP visualization strategy. The changing macro and industry dynamics demand a focus on premium content investment, which delivers better ROI and higher RP value. The consensus belief that content is king has reshaped the competitive landscape with players such as China Literature that have premium content enjoying a competitive edge. In the TV drama industry, for example, despite the decrease in the total number of drama series aired last year, the number of hit titles reached a three-year high.
China Literature has championed the production of blockbusters, rolling out highly popular titles, including drama series A Lifelong Journey, Life is a Long Quiet River, The Heart of a Genius, and New Life Begins, as well as the film Too Cool to Kill. These changes are no surprise to investors who have been following us for a very long time, and they are consistent with our IP Metaverse strategy for the past three years. Again, the last year's changes in the macro and the industry dynamics have validated our preexisting strategy, which is based on our insights into the digital media consumption megatrends. Our strategic initiatives over the past three years have solidified our market leadership. We will continue to adhere to our long-term strategy and focus on the incubation, development, and operation of good stories that will live forever.
Now let's move to some important progress and highlights in the literature business. First of all, as previously mentioned, we stayed laser-focused on content quality and increased the investment in premium content production. Over the past few years, we have designed several tiers of reading products, including premium paid content for the core user community, as well as mid-tier content and the long-tail content for casual readers and low-tier product users. These tiers of products reach different users through different channels. Unlike a premium paid content, the mid and the low-tier products have low likelihood to generate strategic value through IP operations and merchandise, and their ROI is more sensitive to macro headwinds. Meanwhile, the premium content is much more resilient to withstand the business circles.
In 2022, we took the initiatives to cut our investments in free-to-read content and some channels which produce low or even negative returns, continued to increase our investment in premium content and products. These adjustments have significantly improved our operational efficiency and ROI. More importantly, it has further enhanced our core competitiveness, it should generate more positive feedback to high-quality content creators. Second, we have achieved unprecedented breakthroughs in anti-piracy initiatives. Copyright infringement for reading products have grown with the advent of the Internet and is a deep-rooted chronic problem that remains a significant threat to the health of the entire ecosystem, especially when it comes to protecting creative talents and encouraging innovation in the public interest.
With the support of the relevant authorities, China Literature joined forces with the industry players and writers in the second half of 2021 to develop a more proactive and efficient an anti-piracy system. We have achieved remarkable results in 2022. For example, after the official launch of the anti-piracy system on Qidian reading app, around 40% of Qidian readings newly added users within 30 days, were attracted from pirate sites. The effective anti-piracy measures have drive significant growth in revenues for paid reading works and reinforce writers' trust in us, which has been integral part of our ongoing efforts to enhance the health and the content ecosystem. The focus on premium content, together with effective anti-piracy measures, boosted the performance of Qidian reading app.
One of our core products for paid reading, which is monthly active users, in December 2022, increasing 80% over year-over-year. Its revenue also in 2022, increasing over more than 30% year-over-year, setting a new record. The success of the Qidian reading app tells us that the premium content has a distinctive appeal, and effective copyright protection helps platforms and writers creating abiding relationships with valuable users and enable premium content to achieve its full potential, which is a win-win. We will continue to champion the efforts to produce more premium products and build a more vital content ecosystem. Now let's talk about IP visualization.
We're increasingly focused on developing high-quality visualized content and adapting literary stories into various visual formats, such as TV and web series, movies, film, animation, and comics, in order to expand our IP influence and unlock IP value. In the TV and film segment, China Literature's leadership as the blockbuster producer has been repeatedly validated with the continuous release of first-rate works. Following the release of multi-hit drama series in 2021, including My Heroic Husband, Sword Snow Stride, The Rebel, and Soul Land. 2022 was another fruitful year, highlighted by the launch of a popular drama series, including A Lifelong Journey, New Life Begins, Life is a Long Quiet River, and Heart of a Genius. In the first half of 2022, A Lifelong Journey was the number one show nationwide.
In the second half of the year, New Life Begins was released and achieved on iQIYI popularity index of 10,000 within 144 hours, breaking the records set by My Heroic Husband in 2021. According to various professional data sources, New Life Begins ranked first in terms of popularity index and video views throughout the year. These blockbusters are all enabled by the unique strengths of China Literature's popularity of proprietary IPs. Its capabilities to mobilize resources across the entire value chain, as well as the production capabilities of New Classics Media and China Literature Pictures. Going forward, our TV and film business will make breakthroughs in two directions. One direction is a serial development of IP drama series, such as Joy of Life, My Heroic Husband, and The Dafeng Guardian.
Another direction is seeking out opportunities in other visual formats based on the same IP. We endeavor to achieve success by leveraging our strong IP reserves and our full coverage along the value chain to create synergies. We expect to launch more hit dramas with support from our successful comics, animation, and other business. In animation segment, we continued our track record of strong releases. Two of our most well-known IP titles, Battle Through the Heavens and Stellar Transformations, each released the two new seasons in 2022. We also launched the new seasons for Martial Universe, Cinderella Chef, and Forty Millenniums of Cultivation, making these titles soar in popularity as well. Our animation works have achieved great success on video platforms, leading in terms of quantity, quality, and hit rate.
According to Guduo, a third-party data source, among the top 10 most popular domestic animation works that were newly released on Tencent Video in 2022, seven were based on China Literature's IP. In the comic segment, we improved our production capacity and accelerated the IP visualization process. Our joint project with Tencent Comics to adapt 300 online literature works into comics in the three years is progressing ahead of schedule. By the end of 2022, we have already launched over 230 comics, including a number of hit titles. Adapted comics based on our successful online literature are generally of higher average quality than original comics, featuring more vivid characters, more compelling storylines, and more complete worldviews.
Our successful text-to-comic adaptation efforts lay the foundation for the subsequent development of animations, film, and the dramas, which open up further possibilities to unleash the monetization potential of IP derivatives and games. Now let me turn to our progress in IP commercialization and monetization. In 2022, we made key progress in establishing a framework for our IP derivatives system and building a dedicated team. We achieved the breakthroughs in consumer goods and fashion toys. For example, several edition of the toy sculptures from Battle Through the Heavens achieved a total GMV of more than RMB 20 million in 2022. Our self-developed blind boxes for Lord of the Mysteries will also be launched soon.
In the future, we will develop derivatives adapted from other IP content and provide joint promotions for the launch of drama series, film, animation, comics, games, and other format of content. We have high expectation for the IP derivatives business, as we believe we can grow by successfully leveraging our rich IP reserves, our outstanding IP production capabilities, and our unparalleled ability to visualize our quality IP. In the game segment, we continue to walk on two legs. On one hand, we cooperated with high-quality studios, game studios to adapt our IP content into games. For example, we have previously licensed the game adaptation rights of our novels, Swallowed Star and A Record of a Mortal's Journey to Immortality, to CMGE and 37 Interactive Entertainment, respectively. Both adapted games recently obtained publication approval and are expected to launch this year.
We are enhancing our in-house game development and operation capabilities, and looking forward to seek more meaningful progress in the next few years. Finally, I would like to share with you our outlook for the future. The changing macro and industry dynamics in 2022 presented both challenges and opportunities. In response, we redoubled our IP monetization strategy to increase our investment in premium content, which has solidified our leadership and improved the efficiency of our business. We continue to launch hit titles in drama, animation, and comics, becoming a full-scale blockbuster producer in a clear demonstration of our unique advantages in IP reserves, IP production, and mobilizing resources along the entire value chain. We endeavor to maximize the business' success and the influence of each IP.
Growth takes time, especially the growth of a high quality content and IP, which requires long-term close collaboration among creators, users, and upstream and downstream partners. We will continue to take a long-term view and support our creators, users, and the industry partners to create IP that span the whole value chain in the service of good stories that will live forever. That concludes my session. Please welcome Mr. Monkey Ho to provide further information on our business. Thank you.
Thank you, Edward. Edward has just spoken about our strategies and some of our operating results. I would like to add more details on our business performance. Our online reading business, we took steps to reduce costs and increase operational efficiency, including reducing marketing spending on low ROI users, optimizing distribution channels, and focusing more on quality content. As a result, our MAU decreased from 249 million - 244 million year-over-year, and MPU decreased from 8.7 million - 7.9 million year-over-year. Thanks to our high quality content offering, creative anti-piracy measures, and better operations for our core products, MPU on our own platform products increased 16% year-over-year and 14% sequentially in second half of 2022.
The monthly ARPU for paid reading content was RMB 37.8 in 2022, compared to RMB 39.7 in 2021, mainly due to change in the revenue base. In 2022, our online reading platform added around 540,000 writers, 950,000 books, and over 39 billion Chinese characters. Benefiting from our investment of high in quality content and anti-piracy measures, the number of high quality books and their revenue increased largely. For example, the number of online literary works that newly reached 3,000 average subscribers per chapter in 2022, increased by more than 50% year-over-year. We also continued to explore the international markets, helping to grow the global profile of Chinese online literature.
In 2022, 16 of our novels, such as Great Power, Heavy Industry, My Heroic Husband, were added to the Chinese collection of British Library. This marked the first time that Chinese online books has been collected by British Library, reflecting the growing magnitude of our content among global readers. By the end of 2022, WebNovel, our overseas reading platform, offered around 2,900 books translated from Chinese and around 500,000 original works created locally. We will continue to explore global markets and promote culture exchange. This ends my remarks. William will provide more information on our financials. Thank you.
Thank you, Monkey. Hello, everyone. In 2022, in response to changes in the macro and the industry environment, we proactively implemented cost control and operational efficiency measures, such as reducing marketing spending and optimizing our online channels, which led to an annual decrease in revenues, but a significant improvement in our financial structure and margins. We believe these measures will help us focus more on key businesses and long-term targets, and therefore, lay a solid foundation for healthy development in the long run. In 2022, our total revenues were RMB 7.6 billion, compared with RMB 8.7 billion in 2021. Our online business revenues were RMB 4.4 billion, a decrease from RMB 5.3 billion in 2021, mainly due to our reduced marketing spending on user acquisition. A further breakdown of this category is as follows.
Revenues from our own platform products were RMB 3.5 billion compared with RMB 3.8 billion in 2021. Revenues from our channels on Tencent products were RMB 591 million compared with RMB 809 million in 2021. Owing in part to a reduction in advertising revenues and in part to our channel optimizing efforts. Revenues from third-party platforms decreased to RMB 290 million compared with RMB 651 million in 2021 due to the suspension of collaboration with certain third party distribution partners. Despite the overall cost control and efficiency improvement initiatives for our online business, we enhanced our focus on supporting the growth of our premium products by investing in high quality content offering, effective anti-piracy measures, and improved product operations.
As a result, revenues from Qidian Reading, one of our core online reading products, increased over 30% year-over-year. In December 2022, Qidian's MAU achieved an increase of 80% year-over-year. We will continue to invest in our premium content and products. Turning to the IP operations and other category. In 2022, revenues from our IP operations and others were RMB 3.3 billion compared with RMB 3.4 billion in 2021. Among which, revenues from IP operations decreased 2.2% year-over-year to RMB 3.2 billion, mainly due to a decrease in revenues from our self-operated online games business, but largely offset by the solid growth in revenues from our TV and web series, films, animation series, and copyright licensing in 2022.
Revenues from the others category, consisting of mainly of sales of physical books, decreased from RMB 128 million to RMB 101 million as we continue to adjust our physical book publishing business in tandem with our business development strategy. Now let's look at costs and expenses. In 2022, our cost of revenues amounted to RMB 3.6 billion, down 11.6% year-over-year as a result of reduced platform distribution costs for our online business, lower content costs, and lower amortization of intangible assets of content copyrights. Our gross profit decreased 12.4% to RMB 4 billion. Gross margin was 52.8% in 2022, compared with 53.1% in 2021.
We recorded net other losses of RMB 207 million in 2022, compared with net other gains of RMB 1.4 billion in 2021. The net other gains in 2021 mainly consisted of a gain of RMB 1.1 billion from the sale of our stake in the JV Company. The net other losses in 2022 mainly consisted of net fair value loss related to certain invested companies and acquisitions due to weaker capital markets. Our selling and marketing expenses decreased 25.9% year-over-year to RMB 2.0 billion in 2022, primarily due to reduced promotion and advertising expenses for our online business as a part of total cost control and efficiency improvement initiatives.
As a percentage of revenues, our selling and marketing expenses decreased to 26.3% from 31.2% a year ago. Our G&A expenses decreased 6.5% year-over-year to RMB 1.2 billion in 2022, mainly due to a decrease in research and development expenses. As a percentage of revenues, our G&A expenses were 16.2% in 2022, compared with 15.3% in 2021. As a result of the above factors, our operating profit was RMB 629 million in 2022 compared with RMB 2.17 billion in 2021.
The difference was mainly due to non-IFRS adjustment items, including a gain of RMB 1.1 billion related to the sale of our stake in the JV Company in 2021, and the fair value losses of certain invested companies in 2022. Non-IFRS operating profit increased 4.9% year-over-year to RMB 1.36 billion, and non-IFRS operating margin increased to 17.9% from 15% in 2021, reflecting our successful efforts to control operating costs. Our profit attributable to equity holders of the company was RMB 608 million compared with RMB 1.85 billion in 2021.
IFRS profit attributable to equity holders of the company increased 9.6% to RMB 1.35 billion. While its margin increased from 14.2% - 17.7%. That concludes our financial review part. Let's move on to the Q&A session.
Thank you for the presentation. Now we will start the Q&A session. If you wish to ask a question, please press star then one on your phone and wait for your name to be announced. If you wish to cancel your request, please press star then two. If you wish to ask your question in Chinese, please repeat your question in English. Please feel free to raise any questions. Our first question will come from Xueqing Zhang with CICC. You may now go ahead.
谢 谢 管 理 层 。 晚 上 好 ， 想 请 教 two questions. 第 一 个 还 是 想 请 管 理 层 分 享 一 下 2023 年 我 们 重 点 的 影 视 内 容 会 有 哪 些 ？ 然 后 尤 其 是 像 Joy of Life 2 、 My Heroic Husband 2 、 Dafeng Guardian 这 些 系 列 化 开 发 的 精 品 IP 的 进 展 是 怎 么 样 的 ？ 能 不 能 跟 我 们 分 享 一 下 ？ 第 二 个 问 题 是 关 于 衍 生 品 业 务 的 。 我 们 刚 刚 有 提 到 ，
就 是 公 司 在 搭 建 衍 生 品 体 系 和 内 部 团 队 的 一 个 建 设 上 都 有 关 键 的 进 展 ， 能 不 能 跟 我 们 展 开 介 绍 一 下 ， 那 目 前 衍 生 品 业 务 的 一 个 战 略 规 划 是 怎 么 样 的 ？ 有 哪 些 可 能 是 我 们 进 度 比 较 快 的 ， 重 点 IP 有 在 做 衍 生 品 的 开 发 ， 也 想 进 一 步 了 解 一 下 。I will translate myself. Thanks management for taking my questions. I have two. The first one, could management share with us the TV dramas and the film pipeline in 2023?
In particular, what's the progress of the serial development of IP drama series such as Joy of Life, My Heroic Husband and 大 奉 打 更 人. My second question is about IP derivatives. As you mentioned, you have established a framework for IP derivative system and build a team. Could you give us more color on it? What's the current strategy for the derivative business? Which are the key IPs that are progressing relatively quickly? Thank you.
呃 。 好 ， 谢 谢 你 的 问 题 啊 。 呃 ， 第 一 个 问 题 ， 呃 ， 请 那 个 曹 总 来 给 大 家 。
好 。 我 介 绍 一 下 ， 那 个 月 为 新 历 ， 啊 。 二 零 二 三 年 我 们 的 项 目 储 备 呃 ， 看 看 还 是 非 常 丰 富 的 。 呃 ， 除 了 年 初 已 经 播 出 的 电 视 剧 斗 破 激 风 起 以 外 ， 呃 ， 电 视 剧 ， 呃 ， 斗 破 苍 穹 二 、 与 凤 行 、 潜 伏 者 、 平 凡 之 路 、 骄 阳 伴 我 、 玫 瑰 的 故
事 ， 呃 ， 等 电 影 海 关 单 线 、 一 人 之 下 都 会 在 今 年 呃 ， 上 线 。 呃 ， 就 是 第 二 个 问 题 就 是 我 们 也 在 持 续 地 呃 ， 筛 选 IP 进 行 长 线 的 多 季 的 精 品 化 的 影 视 改 编 ，
包 括 庆 余 年 、 赘 婿 、 斗 破 苍 穹 、 斗 罗 大 陆 、 大 奉 打 更 人 等 都 将 进 行 系 列 开 发 。 其 中 的 庆 余 年 二 ， 呃 ， 很 快 呃 ， 就 会 开 机 。 呃 ， 斗 破 苍 穹 二 今 年 呃 ， 暑 期 应 该 会 上 线 。 大 奉 打 更 人 的 ， 呃 ， 第 一 部 ， 呃 ， 预 计 年 中 也 会 开 机 。 呃 ，
另 外 呢 ， 就 是 IP 改 编 的 呃 ， 电 视 剧 ， 假 设 今 年 下 半 年 也 会 呃 ， 开 机 ， 呃 ， 我 们 会 持 续 地 打 造 更 多 的 系 列 化 的 呃 ， 作 品 ， 呃 ， 把 IP 的 价 值 最 大 化 。 谢 谢 。
Okay, the first question will be addressed by Mr. C ao from New Classics Media. We have a pretty rich pipeline for 2023. In addition to the drama series, In Spite of the Strong Winds from 季 风 起 that was broadcasted at the beginning of the year, we are going to have another more TV project to be released in 2023, including Battle Through the Heavens Season Two 斗 破 苍 穹 二 , The Legend of Shen Li 与 凤 行 , The Infiltrator 潜 伏 者 , The Road to Ordinary 平 凡 之 路 , Sunshine With Me 骄 阳 伴 我 , and The Tale of Rose 玫瑰的故事, as well as films such as War Customised 海 关 战 线 and The Outcast 一 人 之 下 .
We continue to select IPs from our content library for adaptation into top quality multi-season serialized TV dramas, including Joy of Life 庆 余 年 , My Heroic Husband 赘 婿 , Battle Through the Heavens 斗 破 苍 穹 , Soul Land 斗 罗 大 陆 , 大 奉 打 更 人 and so on. Among which Joy of Life Season Two will start shooting soon. Battle Through the Heavens Season Two is expected to be released this summer this year. 大 奉 打 更 人 will start shooting this year, maybe in the middle of this year. Another IP adapted drama series, sure, will also start shooting this year. We will continue to create more serialized blockbusters to maximize the IP value. Thank you.
好 ， 第 二 个 问 题 我 来 回 答 一 下 衍 生 品 的 问 题 。 那 在 衍 生 品 方 面 呢 ， 我 们 现 在 是 持 续 建 设 内 部 团 队 的 核 心 能 力那 这 个 多 个 头 部 的 IP 的 衍 生 品 取 得 了 ， 呃 ， 巨 大 的 进 展 。 呃 ， 比 如 说 我 们 2022 年 我 们 授 权 的 斗 破 苍 穹 的 几 款 的 雕 像 的 GMV 合 计 超 过 了 两 千 万 ， 呃 ， 这 个 包 括 斗 破 苍 穹 的 收 藏 卡 的 GMV 超 过 了 一 个 亿 ，
都 是 爆 款 的 产 品 。 呃 ， 我 们 自 主 研 发 的 鬼 灭 之 主 的 系 列 盲 盒 也 即 将 面 世 。 在 那 个 核 心 能 力 的 基 础 上 ， 接 下 来 我 们 更 多 的 还 是 把 产 品 推 向 市 场 ， 围 绕 其 他 更 多 的 IP， 呃 ， 包 括 鬼 灭 之 主 、 全 职 高 手 、 庆 余 年 、 大 富 豪 等 人 等 ， 开 发 多 种 形 态 的 衍 生 品 ， 包 括 手 办 、 呃 ， 黏 土 人 、 呃 ， 这 个 盲 盒 、 雕 像 ， 包 括 各 类 ，
呃 ， 软 周 边 、 卡 牌 ， 并 配 合 这 些 内 容 的 这 个 上 线 播 出 进 行 联 动 推 广 。 呃 ， 比 如 说 我 们 某 个 IP， 这 个 预 计 改 编 动 画 和 影 视 作 品 的 时 候 ， 我 们 就 会 围 绕 它 来 开 发 这 个 衍 生 品 ， 并 做 到 和 动 画 和 影 视 的 同 步 推 出 ， 那 最 大 化 这 个 IP 的 热 度 和 影 响 力 。 那 优 质 内 容 方 面 呢 ， 我 们 也 会 增 加 这 个 ...
呃 ， 优 质 内 容 会 增 加 这 个 IP 的 衍 生 品 的 热 度 和 需 求 ， 进 而 也 会 ， 呃 ， 提 升 IP 的 影 响 力 和 认 知 度 。 呃 ， 我 们 ， 我 们 现 在 有 两 种 模 式 ， 一 种 是 这 个 授 权 ， 一 种 是 自 研 。 授 权 呢 是 一 种 轻 资 产 的 模 式 ， 它 对 现 金 流 前 期 投 入 要 求 不 高 ， 可 以 更 快 地 向 市 场 推 出 更 多 的 产 品 。 呃 ， 自 研 呢 ， 相 对 呢 ， 会 这 个 重 资 产 一 些
， 那 我 们 需 要 备 货 呀 ， 从 IP 的 筛 选 、 设 计 、 原 画 ， 包 括 生 产 、 渠 道 、 销 售 ， 啊 包 括 售 后 ， 那 都 需 要 我 们 来 掌 控 ， 那 对 现 金 流 、 资 源 和 这 个 精 力 要 求 比 较 高 。 那 对 于 硬 周 边 ， 还 有 手 办 、 盲 盒 呢 ， 我 们 更 倾 向 于 自 研 ， 那 这 样 的 话 ， 对 这 个 产 品 的 品 控 有 一 个 比 较 好 的 一 个 掌 控 。 那 这 - 这 些 品 类 如 果 做 得 精 美 成 功 呢 ，
也 会 获 得 更 强 的 市 场 影 响 力 ， 那 提 升 阅 文 衍 生 品 的 号 召 力 。 那 对 于 软 周 边 ， 包 括 卡 牌 ， 那 我 们 是 会 更 多 地 考 虑 通 过 授 权 的 方 式 来 推 出 产 品 。 好 ， 谢 谢 。
Okay, this is Monkey, and I would like to take your second question regarding our IP merchandise business. In the merchandise segment in 2022, we continue to build our internal core capabilities and achieve significant progress with several top IPs. For example, in 2022, the combined GMV of several toy sculptures adapted from Battle Through the Heavens, Dou Po Cang Quing , we previously licensed out exceeded RMB 20 million , and the GMV of cars based on Battle Through the Heavens exceeded RMB 100 million , both of which have become blockbusters. Our in-house developed blind boxes, blind boxes for Lord of the Mysteries, Guimi Zhi hu, will also be launched very soon.
Based on our core capabilities, our next step is to present more products to the market, developing various types of merchandises, including toy figures, play figures, toy sculptures, blind boxes, accessories, and cards based on more IPs such as Lord of the Mysteries, The King's Avatar, Joy of Life, Dafeng Guardian, and so on, and promoting them in coordination with the release of relevant content. For example, if a certain IP will be converted into animation for drama series, then we will also develop merchandises based on it and release them in sync together with the animations and drama series to maximize the popularity and influence of the IP. Quality content will increase the popularity and the demand for IP merchandise, and as a result, continuously enhancing the influence and awareness of the IP. We have both the licensing and self-development models.
Licensing is a light asset model that doesn't require much for cash investment at the beginning of a project, and enables a faster delivery of more products to the market. While self-development is a relatively heavy asset model that requires us to take inventory and control the entire process from IP selection, design, original graphics, production, channels, marketing, and office sales with higher demands for investment in cash flow, resources, and energy. For categories like toy figures and blind boxes, we prefer to adopt the self-development model that allows us to have better control of the product quality and thus achieve strong market influence and enhance our IP merchandise brand appeal if the product quality is excellent. While for accessories or cards, we prefer to license to our partners for their adaptation. That's my answer to your question. Thank you.
Our next question will come from Wang Guanran with CITIC Securities. You may now go ahead.
呃 ， 好 的 ， 嗯 ， 感 谢 ， 呃 ， 管 理 层 ， 呃 ， 这 个 提 供 的 机 会 ， 也 ， 呃 ， 非 常 恭 喜 ， 呃 ， 管 理 层 在 过 去 一 年 取 得 非 常 出 色 的 这 个 成 绩 。 那 我 的 问 题 主 要 有 ， 呃 ， 三 点 ， 第 一 个 呢 ， 是 关 于 AIGC，AIGC 的 应 用 。 那 我 们 看 到 其 实 AIGC 在 一 些 创 作 以 及 这 个 图 像 化 的 创 作 上 来 讲 ， 是 已 经 ， 呃 ， 做 到 非 常 不 错 的 这 样 的
一 个 成 果 。 那 第 一 个 问 题 也 是 关 于 AIGC 对 阅 文 现 在 IP 可 视 化 战 略 ， 呃 ， 已 经 有 哪 些 提 升 ， 阅 文 在 这 个 AIGC 的 应 用 呢 ， 目 前 是 什 么 样 的 一 个 情 况 ？ 然 后 第 二 个 问 题 呢 ， 是 关 于 费 用 端 ， 呃 ， 费 用 端 经 营 效 率 是 否 会 有 进 一 步 的 一 个 优
化 的 空 间 。 那 第 三 个 问 题 呢 ， 就 是 我 们 看 到 其 实 ， 呃 ， 自 去 年 的 下 半 年 以 来 ， 一 直 对 这 个 盗 版 的 打 击 是 比 较 大 的 ， 呃 ， 打 击 之 后 呢 ， 我 们 也 看 到 其 实 主 站 上 用 户 已 经 提 升 ， 那 我 们 下 -- 从 这 个 展 望 上 来 看 ， 对 于 我 们 的 一 个 付 费 率
的 提 升 ， 还 有 付 费 金 额 的 提 升 ， 我 们 今 年 会 不 会 ， 呃 ， 有 一 个 更 ， 更 好 的 一 个 预 期 的 展 望 。 那 我 翻 译 一 下 ， 呃 ， 第 一 个 问 题 是 ，uh, first one, what, what improvements does AIGC bring to the strategy of creating tasks, uh, in IP visualization?
The second one, is there any room for further optimization of the expense side this year? The third one is after cracking down on piracy, what improvements have been made in the rate and amount of payments for reading articles? Thank you. 谢 谢.
这 问 题 啊 。 呃 ， 谢 谢 你 问 题 啊 。 我 先 这 个 回 答 一 下 AIGC 最 近 确 实 比 较 火 啊 ， 大 家 这 个 很 多 都 在 讨 论 这 个 ChatGPT 的 这 个 技 术 ， 那 我 们 ， 我 们 也 认 为 呢 ， 这 个 以 这 个 ， 就 是 ChatGPT 为 代 表 的 这 个 AIGC 呢 ， 实 际 上 是 一 个 非 常 重 要 的 一 个 技 术 变 革 吧 ， 我 觉 得 对 各 个 行 业 都 会 有 一 些 深 远 的 影 响 ， 那 包 括 对 我 们 内 容
生 产 也 有 未 来 可 能 会 有 很 大 的 影 响 。 那 在 这 个 可 视 化 的 过 程 中 呢 ， 觉 得 这 个 AIGC 可 以 大 量 减 少 在 创 作 中 很 多 这 个 重 复 性 的 一 些 劳 动 ， 比 如 说 像 这 个 在 动 漫 化 的 这 个 生 产 中 啊 ，AIGC 可 以 在 这 个 渲 染 啊 ， 包 括 精 修 啊 ，
这 样 的 一 些 工 业 化 的 环 节 ， 减 少 很 多 基 础 性 的 工 作 ， 这 也 使 得 我 们 可 以 帮 ， 把 更 多 的 资 源 和 精 力 放 在 这 个 创 意 啊 、 想 象 力 ， 包 括 艺 术 性 这 些 高 附 加 值 的 环 节 。 那 文 字 IP 的 可 视 化 进 程 中 呢 ， 可 能 之 前 是 受 制 于 带 宽 和 产 能 ，
那 AIGC 如 果 作 为 辅 助 工 具 呢 ， 可 以 帮 助 我 们 更 快 地 将 文 字 转 变 成 音 频 、 图 片 、 视 频 ， 来 提 升 这 个 内 容 生 产 的 效 率 ， 降 低 成 本 ， 打 开 更 多 的 空 间 。 那 这 个 文 字 创 作 方 面 呢 ， 呃 ， 我 们 想 作 家 呢 ， 是 IP 内 容 的 生 产 源 头 ， 所 以 呢 ， 我 们 更 多 的 还 是 ， 这 个 会 ， 这 个 通 过 关 注 这 个 AIGC 的 技 术 去 探 索 如 何 能 更 好 地 去 服 务 和 助 力 作 家 ，
包 括 更 好 地 保 护 这 个 作 家 的 这 个 ， 这 个 ， 这 个 权 益 。 同 时 呢 ， 我 们 也 ， 呃 ， 考 虑 利 用 AIGC 这 样 相 关 的 技 术 来 丰 富 我 们 的 社 区 ， 呃 ， 比 如 说 用 AI 可 以 虚 拟 一 些 角 色 来 增 进 用 户 的 互 动 ， 提 升 用 户 的 这 个 参 与 度 。 呃 ， 虽 然 现 在 AIGC 目 前 的 技 术 水 平 ，
呃 ， 还 不 到 最 完 善 的 时 候 ， 那 在 各 行 各 业 的 这 个 呈 现 的 效 果 也 需 要 验 证 。 那 但 我 们 相 信 这 个 技 术 呢 ， 会 持 续 地 突 破 ， 那 我 们 内 部 的 团 队 也 会 密 切 地 跟 进 这 个 AIGC 的 发 展 ， 研 究 和 探 索 ， 呃 ， 这 个 技 术 对 我 们 的 这 个 文 字 、 图 像 、 语 音 等 方 面 的 应 用 ， 呃 ， 主 要 还 是 来 赋 能 和 帮 助 我 们 的 这 个 IP 生 态 。 好 ， 谢 谢 。
This is Monkey. I would like to address your question regarding AIGC. We have noticed that AIGC technology is getting pretty popular these days. A lot of people are talking about the ChatGPT and AIGC technology. We believe that AIGC represented by ChatGPT is a very important technological reform that will have a profound impact on a variety of different industries, also including our content production industry. In the visualization process, we believe that AIGC can greatly reduce repetitive labor in the creative process. For example, in the production process of animation, AIGC can reduce basic work in industrialized process such as rendering and refining. This allows us to focus our resources and energies on high value added areas such as creativity, imagination and artistry.
The visualization process of text IP has always been constrained by production capacity, while AIGC can be utilized as a tool to help us faster convert text into audio, images, videos and so on, thereby improving content production efficiency, reducing production costs, and opening up more space for content production. In terms of online literature creation, writers are the source of IP content production. We are closely monitoring the AIGC technology and exploring how to better serve and support writers while also protecting their interests.
We are also considering using the AIGC related technologies to enrich our community, such as using AI virtual characters to enhance user interaction and increase user engagement. About the current level of AIGC technology is still imperfect, and the effects in various fields are yet to be verified. We believe this technology will continue to break through. Our internal team is closely following the development of AIGC, researching and exploring its applications in our text, images, audio and so on to empower our IP ecosystem. Thank you.
好，我 的 第 二 个 问 题，请 William 回 答 一 下。
好 的 ， 我 回 答 一 下 关 于 您 提 的 费 用 相 关 的 一 些 问 题 。2022 年 呢 ， 公 司 主 动 实 施 了 降 本 增 效 的 举 措 ， 在 保 持 业 务 的 一 个 健 康 发 展 的 同 时 呢 ， 财 务 上 取 得 了 良 好 的 成 效 。 那 么 作 为 结 果 呢 ， 我 们 2022 年 IFRS 经 营 利 润 的 金 额 和 经 营 利 润 率 的 增 长 ， 都 是 非 常 明 显 的 。 那 么 2023 年 呢 ， 我 们 会 继 续 降 本 增 效 的 这 个 措 施 ， 然 后 主 要 呢 是 注 重 营 销 投 放 的 ROI 和 效 率 。
我 们 主 要 依 靠 精 品 的 内 容 ， 创 新 的 产 品 ， 聚 焦 我 们 的 核 心 优 势 业 务 ， 然 后 高 效 率 地 运 营 ， 积 极 有 效 的 反 盗 版 措 施 去 驱 动 增 长 ， 而 不 是 通 过 一 个 简 单 粗 暴 的 这 个 投 放 买 量 来 驱 动 。 我 们 会 继 续 在 管 理 费 用 支 出 上 严 格 控 制 ， 但 是 也 不 会 去 一 味 地 压 缩 成 本 费 用 。 在 ROI 比 较 高 ， 能 够 带 来 良 好 回 报 的 情 况 下 ， 我 们 也 会 坚 定 地 进 行 投 入 。
那 么 考 虑 到 2022 年 的 成 本 费 用 已 经 呃 ， 降 低 了 很 多 ， 那 么 2023 年 如 果 宏 观 上 或 者 行 业 能 够 有 比 较 强 劲 的 复 苏 ， 能 够 带 动 我 们 的 收 入 增 长 的 话 ， 我 们 的 成 ， 成 本 费 用 也 可 能 随 着 我 们 收 入 的 增 长 而 线 性 地 增 长 。 我 们 的 核 心 还 是 ROI 和 运 营 效 率 的 提 升 ， 以 及 利 润 的 持 续 增 长 。
This is William. I will take your question regarding our expenses. In 2022, we implemented very successful cost control and efficiency improvement measures and achieved good results in 2022. Our selling and marketing expenses as well as the general and administrative expenses decreased by a great extent. We strengthened the healthiness of our online business. In 2023, we will continue to implement our cost control and efficiency improvement measures and focus on the ROI and efficiency of marketing spending.
We determined to drive the business growth through premium content, innovative products, delicate operations and effective anti-piracy measures, rather than the low efficiency user acquisition or marketing behavior. We will continue to strictly control all types of general and administrative expenses. However, we would not just simply cut costs in a one-sided way, which means that if the expenditures have high ROI and can bring us good return, we would also spend the money properly. Considering that the costs and expenses in 2022 were reduced to a great extent, and if the macroeconomic situation could have solid recovery in 2023 and in turn drive our revenue growth, our costs and expenses would probably increase alongside with revenue growth. Our core idea is the improvement in ROI and operating efficiency as well as the continuous release of profitability. Thank you.
第 3 个 反 盗 版 的 问 题 我 来 回 答 一 下 。 反 盗 版 呢 ， 在 2022 我 们 应 该 说 取 得 了 重 大 的 突 破 。 Qidian 的 全 年 收 入 上 涨 30% ， 包 括 2022 的 12 月 ， MAU 同 比 上 涨 30% 。 这 里 边 应 该 说 有 上 涨 80% ， 这 个 ， 这 里 边 应 该 说 有 一 半 啊 ， 这 个 都 是 取 决 于 这 个 归 功 于 这 个 反 盗 版 的 这 个 措 施 。
我 们 这 个 效 果 比 较 显 著 。 举 个 例 子 ， 在 我 们 这 个 反 盗 版 的 系 统 上 线 以 后 ， Qidian 30-day 的 这 个 新 增 用 户 中 ， 由 这 个 盗 版 转 化 过 来 的 这 个 用 户 占 到 40% 。 刚 才 讲 到 了 这 个 我 们 2022 的 12 月 份 的 这 个 MAU 同 比 增 长 80% ， 创 造 新 高 。 包 括 我 们 的 这 个 全 年 的 Qidian 的 收 入 同 比 也 增 长 了 30% 。 此 外 呢 ， 我 们 反 盗 版 的 措 施 也 推 动 了 整 个 这 个 作 家 生 态 的 正 循 环 。
加 入 反 盗 版 系 统 的 这 些 作 品 呢 ， 获 得 了 明 显 在 订 阅 方 面 和 收 入 方 面 的 增 长 ， 其 中 多 部 作 品 的 收 入 呢 ， 获 得 了 数 倍 的 增 长 。 面 向 2023 呢 ， 我 们 会 继 续 去 投 入 这 个 反 盗 版 的 事 业 当 中 去 。 目 前 付 费 阅 读 呢 ， 仍 然 有 很 多 盗 版 的 问 题 还 需 要 解 决 。 反 盗 版 应 该 说 路 还 有 很 长 。
在 视 频 领 域 和 音 乐 领 域 ， 其 实 反 盗 版 已 经 取 得 了 很 好 的 成 绩 。 这 些 领 域 的 产 品 的 这 个 付 费 率 一 般 都 高 达 15%-20% 。 我 们 阅 读 的 这 个 付 费 率 呢 ， 目 前 只 有 3% ， 所 以 正 版 阅 读 的 这 个 上 升 空 间 还 是 很 大 的 。 谢 谢 。
Regarding your question about our anti-piracy measures, actually, we achieved a significant breakthrough in fighting against these piracy issues in 2022. In December 2022, Qidian's MAU increased by 80% and reached a historical record high, and among which, half of the growth should be attributable to effective anti-piracy measures, and the other half should be attributable to the improvement in our operations. Qidian's full year 2022 revenue increased by over 30% year-over-year. Actually our results are very evident.
For example, after the official launch of the anti-piracy system, among the newly added users for Qidian app, within 30 days, actually 40% of them were attracted from the piracy sites. I think I just mentioned that Qidian achieved very significant growth in 2022. Its revenue increased by 80% year-over-year, its revenue increased by 30% year-over-year, and its MAU in December 2022 increased by 80% year-over-year and re-reaching a historical record high. In addition, the anti-piracy measures have also driven the positive circulation of the writers ecosystem. Titles that have been included into the anti-piracy system have enjoyed significant growth in their subscriptions and revenues performance, among which, revenue from multiple works has increased for several times. In 2023, going forward, we will continue to invest in our anti-piracy strategy.
At this moment, piracy issues still exist in the pay-to-read sector, and there is still a long way to go in the fight against the piracy issues. The video and the music industries have already achieved good results in combating piracy, with their paying ratios reaching as high as 15%-20%. However, currently the paying ratio for our reading business is only a little bit over 3%, indicating plenty of room for growth for our copyrighted reading business. Thank you.
Our next question will come from Rebecca Xu with Morgan Stanley. You may now go ahead.
I will transmit myself. My question is about production business. How do we think of the potential of our production business? China Literature have top producer like New Classics Media and Yuewen Film and Tencent Film teams also joined Yuewen Film last year. Can you please share more color on the skill of China Lit production team? What is your near-term and longer term target for the drama film production business? Apart from the financial target, any other KPIs related to our IP development plan? That's it. Thank you.
Okay. Regarding your first question, the New Classics Media plans to produce about six to eight drama series each year. Our priority is to produce high quality drama series, and then we will try our best to increase our capacity as well. Okay. Regarding your first question, the inspirational drama series, The Heart of a Genius, led by Tencent Pictures and co-produced by China Literature Pictures, was broadcasted as the most popular drama series during its broadcasting period. We believe that with the joint force of Tencent Pictures team, we will be able to further improve China Literature's media production capability and efficiency, accelerate the production process, and widen the landscape of our media production business, which will be very helpful to China Literature to continuously present more high quality drama series and films to the audience.
After the integration of some commercial projects from Tencent Pictures, China Literature's media pipeline has been enriched with multiple projects in good progress now. Considering the production cycle of drama series and films, we expect to have one to two projects to be released, in the second half of 2023. Thank you.
This concludes our question answer session. I would like to turn the comms back over to Maggie Zhou for any closing remarks.
Thank you. As the due to the time constraints, we'll now have to conclude today's call. On behalf of the entire China Literature management team, I'd like to thank you for all your participation on today's earnings call. If you have further questions about the company, please feel free to contact us. Thank you and goodbye.
The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.