Internet content providers suing Baidu, QVOD

Several of China's major online video providers, including Youku Tudou, Sohu Video, Tencent Video and LeTV announced Wednesday that they have filed a lawsuit against Internet firm Baidu and tech firm QVOD Technology for copyright violation.

The joint action, which also saw the participation of industry associations like China Film Copyright Association and the Motion Picture Association of America as well as some film studios, seeks compensation of 300 million yuan ($49.23 million) from Baidu and QVOD in total.

The alliance of online video providers are alleging that Baidu and QVOD's media players and mobile handset applications have illegally played their patented content by using an automated process, and links to pirated content are also found available.

"Content we've paid for is played by Baidu and QVOD at zero cost," Sohu Chairman and CEO Charles Zhang Chaoyang said at a press conference in Beijing on Wednesday, which saw several Internet moguls present.

Zhang said at the press conference that Sohu-like online video providers invest heavily in content purchases, which could cost them around $150 million each year.

Analysts said that software like QVOD and Baidu Yingyin, the media player of Baidu, does not own content itself - instead the software directs users to the content of other video websites.

The software enables users to watch videos without actually opening the content owners' website, which of course, will eat into video websites' profits as they rely very much on traffic data to attract advertisements.

"They [the software] are more like a video navigator," Pang Yiming, an online video sector analyst at consultancy Analysys International, told the Global Times.

Pang noted that the user base of Baidu's video services and QVOD have been growing very fast recently, especially in the mobile Internet sector.

In September, Baidu announced that total users of its video application have surpassed 100 million, with daily active users topping 20 million - ranking first in the mobile video sector, earlier media said.

In an e-mailed statement sent to the Global Times Wednesday, Baidu said that it has applied a system to filter pirated content on its products and will clear out pirated content after receiving complaints.

Shenzhen-based QVOD Technology was not available for comment Wednesday.

You Yunting, an intellectual property lawyer at Shanghai-based DeBund Law Offices, told the Global Times that the key is to judge whether the case applies to the "safe harbor" principle.

Under the principle, Baidu and QVOD, if judged by the court as Internet service providers (ISP). have no obligation to review the patents of the content played on their platforms, and as long as an ISP deletes the content after complaints, they are not responsible.

This is not the first time that Baidu, China's largest search engine by market share, has faced such lawsuits. In 2011, a group of writers sued Baidu Wenku, a free literary sharing platform, over providing unauthorized content. In that case, the writers got compensated from Baidu eventually, but their plea to close Baidu Wenku was denied.

In 2008, the three major international label companies - Universal Music, Sony BMG Music Entertainment, and Warner Music Hong Kong - filed a lawsuit against Baidu for providing users with links to pirated music, but Baidu ended up wining the case in 2010.

You noted that the lawsuit brought on by online video providers against Baidu could help the public to further cultivate copyright consciousness, but it is not very likely that the case would cause a significant change to the status quo of copyright protection in the online sector.

Analysys International's Pang also noted that it is hard to "uproot" piracy issues in the online sector in the short term.