While the market for user-generated content in China is still rapidly growing, with major investments being made in video sharing sites like Youku, the country could also get a major premium video aggregator soon. As first reported by Reuters and confirmed by paidContent, Chinese search giant Baidu is teaming up with one of Hulu’s investors to create a new web site for licensed online video.
Providence Equity Partners, which joined the Fox Broadcasting and NBC Universal joint venture Hulu with a $100 million investment in 2007, has reportedly agreed to invest $60 million in private equity into the new Chinese venture, with Baidu putting up an additional $10 million (although a paidContent source disputes the amount Providence invested). Unlike Hulu, which now counts Fox, NBC, and Disney as stakeholders, Baidu will remain the only other partner in the firm.
Like Hulu, the new site will probably seek to license video content from Chinese providers and offer it up to viewers on an ad-supported basis. According to the Reuters story, the venture already has a chief executive to run the new company in mind — Gong Yu, a senior executive from China Mobile who recently resigned.
The new unnamed venture isn’t Baidu’s first investment in online video; the search company also has a stake in PPLive, the P2P-based live streaming platform in China, which enables users to have access to free movies. PPLive is one of the largest P2P video-streaming platforms in China, with some 20-30 million active monthly users and an install base of more than 100 million users.