Summary:

Eager to prove that it is on the digital cutting edge, EMI Music is going into business with leading Chinese search engine Baidu. The two ar…

Eager to prove that it is on the digital cutting edge, EMI Music is going into business with leading Chinese search engine Baidu. The two are launching an ad-supported streaming music service and will explore offering ad-supported download services. The deal announced today in Beijing will make music from EMI’s Typhoon Music available to all users of Baidu at now charge. (EMI owns the controlling interest in Typhoon Music, a JV that includes companies in China and Hong Kong.) For its part, Baidu will create an EMI Music Zone in its music search channel where all of EMI’s Chinese mousic will be streamed legally. The two will share ad revenue, a model they call “pioneering” for digital music in China. Release.
Update: Baidu has been in a long-running legal battle with major music companies, including EMI, over alleged copyright violations through MP3 search with rulings going both ways; the most recent one in Baidu’s favor. EMI will drop its appeal as part of the deal. Early on, Baidu offered the idea of new business models for legal downloads. Other deals may be on the way; the labels also are suing/talking to Yahoo China, operated by Alibaba.com.
Bloomberg: Michael Hwang, EMI’s top exec in China, told reporters in Beijing that EMI is also talking to other Chinese internet companies about similar partnerships. Analyst Florian Pihs: “A traditional business of making people pay for music downloads is not going to work in China. Using music to attract users has more potential.”
Related:
Shake Up Coming At EMI; Levy, Munns Out: Reports WSJ
More On EMI Restructuring
Legal Roundup: Sites Not Liable For Third-Party Content; Adult Online Law Challenged; Baidu Wins
Yahoo China Sued by Music Labels/IFPI, For Mp3 Links

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