The competition in China's video sharing market has intensified recently with a Chinese YouTube copycat being sued for piracy by a group of online video copyright owners.

On Sept 15, the Chinese news portal website Sohu.com filed a lawsuit against one of the country's larger video-sharing websites, Youku.com, for broadcasting unauthorized videos of 503 Chinese movies and TV dramas.

The company, together with video websites Joy.cn and Voole.com, formed an anti-piracy group that pledged to file a series of lawsuits in coming months against companies including Tudou.com and Xunlei, which were also accused of streaming unauthorized videos on their websites.

Charles Zhang, CEO of Sohu.com, said at the launching ceremony of the China Online Video Anti-Piracy Alliance on Sept 15 that the group has started collecting evidence of illegal streaming of about 1,000 films and episodes of television programs.

The alliance also filed a lawsuit over beverage giants PepsiCo and Coco-Cola for posting advertisement on a page of the Youku.com website where pirated video allegedly was available.

Unlike their foreign counterparts, Chinese video-sharing websites rely heavily on videos such as films and soap operas, partly because comparatively fewer Chinese users record and post their own video clips on the Internet.

That has made Chinese websites more prone to copyright disputes and in direct competing with legal video streaming websites.

Youku.com, whose founder Victor Koo was the president of Sohu.com in 2004, said the company respects legal contents and hopes to cooperate with copyright owners.

The company has formed partnerships with many local television stations in China and spends about $10 million every year on purchasing copyrights of popular movies and television dramas, the company said.

According to figures from domestic research firm Analyses International, market revenues of China's online video industry reached 122 million yuan in the second quarter of this year - up 57.2 percent from a year earlier.

Due to China's rampant piracy, copyright owners in the country gain most of their income from movie theaters and domestic television stations and very little from DVD sales.

That has led them to work actively with Internet companies to promote their business online.

Google China, for example, has launched a legal music service in China by partnering with major label companies such as Universal and EMI. The service, which is the first around the world, is free, funded by online advertisements.

Encouraged by the success of companies such as Youku.com and Tudou.com, Sohu.com has significantly increased its investment in recent years in the online video business.

Last year, the company signed a contract with CCTV to obtain official rights to broadcast the Olympic Games.

This month, Sohu.com launched a online video channel that streams authorized documentaries via the Internet.

Experts said as Chinese news portal websites expand in the video-sharing market, the competition over video content is going to be even fiercer.

Advertisers sued

Unlike previous lawsuits, the lawsuit filed by the China Online Video Anti-Piracy Alliance also is targeting advertisers.

The group accused Coca-Cola's Chinese subsidiary of airing advertisements for its Minute Maid brand during broadcasts of the domestic TV series Wang Gui Yu An Na on Youku.com.

The lawsuit is seeking 686,386 yuan in compensation from Coca Cola and Youku.com.

Yu Guofu, a lawyer with Beijing's Sam & Partners law firm, said it is unusual for copyright owners to launch lawsuits against advertisers who post advertisements on websites with unauthorized video content.

The action, even if lacking solid legal support, might scare some advertisers away from websites such as Youku.com and Tudou.com, he said.

As part of its effort to reduce its reliance on online revenues, Youku.com will launch a new service that offers live-streaming shows.

The first show will be Stream with Deyunshe, hosted by a popular Chinese talk show group in China. Online viewers will be charged 10 yuan to view each show.

Analyses International said the new service is expected to enjoy a huge market in China, since "most of the online users in China are willing to pay for exclusive video contents."
                                                                                                       Source: China Daily