14 DAY TRIAL // Online video is big and, despite little money being made from it at the moment, everyone wants a piece. And with broadband speeds going up worldwide, online video ventures with professional content, along the lines of Hulu, are beginning to be viable on markets other than the US. Baidu, the leading search engine in China, is betting on its home market and has officially announced an online video venture and funding for it from venture capital investors.
There have been talks about a video site from Baidu for a while now and the company previously confirmed the rumors and the fact that it would have a venture capital partner. Now, we got the name of the investment firm, also rumored at the time, Providence Equity Partners. Baidu said it had received $50 million from it to create and launch an online video business in China. There's no word on how much Baidu is putting in, the figure is expected to be much lower, but it has said it will retain a majority ownership of the venture.
Baidu has registered the http://www.qiyi.com domain name for the service, but offered no timeline for when it would be available. The service will be free and ad-supported, there's really no other option in China, and will offer premium content. The project is very much in the early stages with both the technical and the business side of the product still needing to be put together. As such, there's no word on any content partners for the upcoming video site.
"The online video market has great potential for growth in China," Robin Li, CEO of Baidu, said. "Providence is our ideal partner in this space as it has rich experience in investing in and managing businesses that distribute licensed content online. With Baidu's strong ability to drive traffic and offer innovative products that suit user needs, we are very excited about the future prospects of this new company."