Another day, another big investment in online video in China. The recipient this time is Qiyi, an online video venture from Chinese search giant Baidu (s BIDU); it’s raised $50 million from Hulu backer Providence Equity Partners.
The news of Baidu’s interest in launching an online video site for premium licensed content broke in January, when Providence Equity Partners was rumored to have invested $60 million in the new entity. According to the site’s About page, Qiyi will provide “diversified licensed video content and launches various channels for hit TV shows, movies, documentaries, cartoons, music, variety shows, etc.” At the same time, Baidu says it is committed to abiding by Chinese copyright laws and government regulations to ensure quality of content and user experience.
Baidu isn’t the only firm to have raised significant cash to tackle the online video market in China. In December, online video competitor Youku raised $40 million in a funding round led by Chengwei Ventures, with existing investors Brookside (Bain) Capital, Maverick Capital and Sutter Hill Ventures also participating. So far, Youku has raised $110 million, and now employs more than 300 people.
But while Baidu’s Qiyi will focus exclusively on licensed content, Youku has a mix of licensed and user-generated content. In a video interview with NewTeeVee posted yesterday, Youku CEO Victor Koo said that his site’s content mix is about 70 percent licensed content vs. 30 percent that’s user-generated.
Providence Equity Partners joined the Fox Broadcasting (s NWS) and NBC Universal (s GE) joint venture Hulu with a $100 million investment in 2007. Unlike Hulu, which now counts Fox, NBC, and Disney (s DIS) as stakeholders, Baidu will remain the only other partner in the firm, and will retain a majority stake in Qiyi.
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