The Red Candle Story service is discontinued; Byte continues to adjust its content business landscape.

```

On July 12, ByteDance's paid novel app "Red Candle Story" issued an "In-App Shutdown Notice," announcing that operations will be gradually ceased from July 9 to August 17. According to the announcement, all paid services such as membership recharges and book coin purchases will stop on July 9; content updates will end and automatic user asset refunds will begin on July 10; servers will officially shut down on August 17.

Public information shows that Red Candle Story is operated by Jiangxi Bihuimoying Technology Co., Ltd., which is wholly owned by Beijing Bimoliuxiang Technology Co., Ltd., a ByteDance-affiliated company. Unlike Tomato Novel, which uses a free reading model, Red Candle Story is positioned as a paid reading platform, while still retaining some free sections and adopting a business model combining membership and single book purchases.

This marks yet another contraction in ByteDance's content business in recent years.

From a business layout perspective, Red Candle Story has always been a non-core product within ByteDance's web novel sector. In recent years, Tomato Novel quickly rose to become one of the major domestic free web novel platforms, relying on free reading, advertising monetization, and rapid content ecosystem expansion. At the same time, ByteDance has invested more resources into short drama businesses, launching products like "Hongguo Short Drama" and continuously increasing efforts in live-action short dramas and AI content production. Against this backdrop, the strategic priority of paid web novel products has gradually diminished.

It is noteworthy that the shutdown of Red Candle Story has not sparked any disputes about user asset handling. The announcement clearly states that auto-renewal will be stopped, refunds will be issued via original payment channels, and more than a month-long transition period is provided. The process resembles a standard internet product exit mechanism.

This business adjustment also comes as ByteDance continues to optimize its business structure and resource allocation.

Over the past year or so, ByteDance has continuously increased its investment in the AI sector. Public information shows that the company has been ramping up investment in large model R&D, AI applications, and computing infrastructure, while attracting and retaining R&D talent through higher salaries and expanded long-term incentives. As generative AI becomes a focal point for internet industry investment, many companies are also adjusting resource allocations, concentrating capital and talent further on core strategic businesses.

Based on ByteDance’s recent business adjustments, its resource allocation has become increasingly focused on strategic synergy across businesses. While continuing to invest in AI, content ecosystems, and core products, products with relatively low relevance to current core businesses, or those with overlap with existing offerings, are being integrated or phased out. This shutdown of Red Candle Story aligns more with this product portfolio optimization approach.

Against this backdrop, it is not surprising that businesses with limited growth potential and weak links to the group’s core strategy are being further integrated or withdrawn.

However, the shutdown of Red Candle Story alone is not enough evidence to conclude that "the paid web novel model has failed."

At present, the domestic digital reading market still features multiple business models including free reading, membership subscriptions, and payment by chapter. Different platforms adopt varied strategies based on content supply, copyright reserves, and user composition. This adjustment is more an internal product portfolio optimization by ByteDance, rather than a market-wide shift in the paid reading sector.

From the evolution of ByteDance’s business in recent years, the logic of resource allocation has become increasingly focused: continuous investment in products with established scale advantages, sustained high-intensity resource allocation for new ventures related to AI and short dramas, and gradual contraction of products with limited strategic synergy and slower growth.

The withdrawal of Red Candle Story is, to some extent, a continuation of this logic. Rather than discussing the shutdown of a single product, it is more pertinent to pay attention to how ByteDance reallocates talent, capital, and organizational resources in the AI era, and how such adjustments will impact the overall layout of its content business.

Risk Disclaimer and Liability StatementThe market involves risks, and investment should be undertaken with caution. This article does not constitute personal investment advice, nor does it consider the unique investment objectives, financial situations, or needs of any individual user. Users should consider whether any opinions, views, or conclusions in this article are suitable for their particular circumstances. Any investment made based on this information is at the user's own risk. ```