Silver Screening online films(3)

Western movies have become a major selling point for several Chinese video sites.[Photo provided to China Daily]

As the main sponsor of last year's Venice International Film Festival, iQiyi was licensed to stream 23 nominations from previous festivals, including six award-winning Italian productions that ran exclusively on the video website.

Gong says the website has established close, long-term relationships in the Asia-Pacific and US, and is now looking for new collaborations in Europe.

The producers of 30 films shown at June's Shanghai International Film Festival authorized the site to stream the movies, including the festival's winner, Greek director Pantelis Voulgaris' Little England. It also streamed 20 films from the Hong Kong Summer International Film Festival.

Movies account for about 60 percent of the content China's online video viewers watch. And 60 percent of users watch films online at least once a week, a 2013 survey found.

Yang from iQiyi says online cinema holds great potential. Only 30 percent of a film's profits in the US come from the box office. The rest flow from other modes of distribution, such as pay-per-view TV, DVDs and video websites.

China doesn't really have a DVD market or subscription TV channels. Streaming sites fill the void.

In 2014, iQiyi's registered members and revenues increased eightfold.

"Profits are still just enough to cover licensing fees, not to mention labor," Yang says. "But we're still in the process of fostering the market. We're not in a hurry to make more profit. We'll spend what we bring in on buying rights to more films."

The only obstacle may be that, starting this year, the State Administration of Press, Publication, Radio, Film and Television requires online content to be registered and wholly reviewed before it's certificated to be shown.

"Our quota will surely still be much larger than cinemas'," Yang says. "As far as I know, we'll also be allowed to carry content intended to be exclusively for the Internet. I don't think there will be much difference in content choices."