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Online Chinese Portals Take Joint Action Against Baidu and QVOD For Online Video Piracy
Lawsuits Seeking RMB300 Million in Damages Filed Against Baidu and QVOD on Claims of Spreading Pirated Videos and Engaging in Hotlinking
By Eric de Fontenay (Founder & Publisher)
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Youku Tudou, Sohu Video, Tencent Video, LeTV, MPA, the Motion Picture Association of America (MPAA), CODA, Wanda Films, Enlight Media, Letv Films announce a joint declaration in Beijing to fight online video infringement and piracy both on PC and mobile Internet in China. Meanwhile, the joint action announces legal action has been taken against Baidu and QVOD for compensation as high as RMB300 million.

Representatives from more than a dozen Chinese and international film and television production companies attended the joint action announcement in Beijing. International attendees included the Motion Picture Association of America, Sony Pictures Entertainment, Warner Brothers, Disney and Paramount. Chinese attendees included the Capital Copyright Industry Alliance Capital Protection Division, the China Radio and Television Association of the Television Production Committee, and many Chinese production companies.

"Since 2009, the video industry is facing a more severe anti-piracy situation," Sohu Group Chairman and CEO Charles Zhang said. "Especially when those big Internet companies with resource advantages participate in large-scale piracy. We cannot keep competing because where thieves and robbers are having their way, law-abiding companies cannot survive. We may even have to exit online video industry if such practices continue. Nobody will invest in content, and China's online video industry will face the sad situation as the music industry, which has already been destroyed by piracy, had faced before. The video industry now has walked to crossroad. If to let such industry malpractices continue, it would be a devastating blow to the core of the copyright and creative industries."

"At present, mainstream video sites through healthy competition and collaboration have established a stable ecosystem, including government regulators, investors, production teams, other interested parties, advertisers, users, etc," Youku Tudou Chairman and CEO Victor Koo said. "Among them, the respect of intellectual property and copyright has been a virtuous cycle to maintain the core of this ecosystem, especially in the mobile Internet era. We hope more people can join in, and together, with government, authorities and copyright holders to strengthen cooperation, enhance technical measures, fight against hotlink, combat piracy, and jointly promote the process of genuine network."

"To be able to provide high quality content to the end user, major legitimate video sites have made a huge investment, and respecting copyright is one of the most important investments," said SY Lau, Senior Executive Vice President of Tencent and President of its Online Media Group. "Any investment to circumvent copyright and other content shortcuts cannot be accepted as legal and ethical. For infringement, Tencent Video has completed the bulk of notary acts of hotlinking evidence, filed lawsuits against QVOD and will retain rights to take legal actions against Baidu (Video).

"Such Internet crime is low cost and secretive," Liu Hong, LeTV COO and shareholder of LeVision Pictures, said. "Infringement online is showing explosive growth. On search engines you will find the first few ranked pages are sites containing pirated material. Infringement and piracy to the copyright holder causes significant damage. Since the second half of 2010, LeTV has found evidence of 650 copyright violations by QVOC and evidence of more than 800 infringement violations from Baidu's Yingyin."

"A large number of Chinese and foreign films and television productions are distributed on rogue video sites that are easily built using light content management systems," Wei Feng, China president of the Motion Picture Association of America, said. "We must increase efforts to stop companies from infringing copyrighted material and to pay for the damages for the loss of copyright."

Baidu's infringement activities cover four main areas: the PC web, PC desktop applications, mobile device applications and TV boxes. Four specific Baidu products responsible for the distribution of and/or access to pirated content include: Baidu video search, Baidu Yingyin, Baidu Video App and Baidu TV Stick. Via these products, Baidu is distributing content without authorization while engaging in activities that are beyond the scope of a search engine.

Via hotlinks, users are able to access content hosted on third party sites. Such content can be viewed using Baidu video applications while Baidu takes advantage of licensed content, storage and bandwidth of third party video sites. Additionally, users are able to access the content without ever having to visit the website of the online video site, which ultimately hurts the operations of online video companies who have legally procured content. Normal searches should provide a link and then take users to a third party site. Yet Baidu video search pages directly host and play video content, which is a serious violation of the rights of video sites.

Baidu is also providing access to rogue video sites that host pirated content and do not have official licensing to operate in China. This behavior is generating revenue and traffic to illegal online video operations. Baidu is also profiting from advertising revenue sharing agreements with such sites. The illegal video sites, built using turn-key content management system solutions, can host hundreds of thousands of movies and television programs, which can be viewed on Baidu Yingyin. Much of the content is unauthorized.

Baidu's infringement is worse on the mobile Internet. In August 2011, Baidu launched its Baidu Video App for mobile devices. On Sept. 9, 2013, Baidu announced that active users of the app surpassed 100 million with more than 20 million daily active users. They claimed to have aggregated more than 350,000 movies, TV shows and other content for the Baidu Video App. Baidu's copyrighted material is only a tenth of what is available on the app.

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