Chinese search giant Baidu (NSDQ: BIDU) says it has received a $50 million investment from Providence Equity Partners to start an online video subsidiary. Rafat was able to confirm reports that a deal for a Hulu-like service was in the final stages early last month. At the time, Baidu was said to be investing $10 million of its own money in project. The company eventually announced its intention to create an online video company venture but it did not officially identify Providence as its partner. Baidu will hold a majority stake in the venture, but it didn’t outline the specifics of the split between it and Providence.
In its release today, the company didn’t say too much more about its plans for the video site, except that it would be ad-supported and feature licensed premium content. The Chinese-language site’s name is registered as Qiyi.com. As China’s leading search provider, Baidu is in a perfect position to jump start what’s expected to be rapid growth in online video ad spending. The choice of Providence as Baidu’s partner certainly makes sense as well, given that the PE firm helped Hulu raise its $100 million in start-up backing. Release.