Shenzhen QVOD Technology Co Ltd, which owns one of China's most popular video player softwares, announced that users can no longer watch and download pirated videos on its player, media reports said Thursday.
The company said in a statement released late Wednesday that it will block users from downloading pirated videos and videos that have vulgar content. The firm will also adopt a new business model of purchasing copyrighted content as well as making original videos, the statement said.
QVOD, which is widely used by Chinese Web users to download pirated videos and pornography, was likely forced to make the change due to pressure from the government and the market, Pang Yiming, a senior analyst at Analysys International, told the Global Times Thursday.
Many Chinese video players use pirated content since they are cheap to obtain, Zhao Zhanling, a legal counsel with the Internet Society of China, told the Global Times Thursday, noting the fine for each pirated film or TV series ranges only from 20,000 yuan ($3,216) to 30,000 yuan.
There is a dilemma about the piracy fine, Zhao said, noting low fines cannot stop piracy but high fines may lead to people uploading illegal videos onto websites in order to claim compensation.
In addition to the Chinese government's stronger protection of copyright, QVOD cannot attract advertisers due to its reputation having been damaged by piracy, which prevents the company from making a profit, Pang said.
Therefore, QVOD has no other choice but to get rid of piracy for further development, according to Pang.
Baidu Inc, which operates China's most popular search engine, also had been criticized for pirated content including e-books, music and videos, and subsequently deleted much of the pirated content, said Pang.
Baidu and QVOD were identified as the top two violators of copyrighted video content for 2013 and have both been ordered to stop copyright infringement and slapped with a penalty of 250,000 yuan each, an official with the National Copyright Administration said December 30.
QVOD also said in a statement that it will invest 100 million yuan to purchase the copyright of videos and 30 million yuan to produce mini-films, but experts predict it will not be easy.
The copyright of a film or TV series can cost 1 million yuan and the price of exclusive copyright may be even higher than 10 million yuan, Zhao said.
Pang also pointed out that building an authorized video library is very expensive. And websites such as tv.sohu.com and iqiyi.com have already provided rich video selections that users can choose from.
The only advantage QVOD has is a large number of users, according to Pang.
With the development of mobile Internet, an increasing number of people are switching to smartphones and tablets to watch videos.
QVOD seems to maintain an advantage in the mobile front. According to Analysys International, QVOD owns 101 million active users of its app in February, making it the most popular aggregate player app in China.
However, these users may be mainly attracted by QVOD's pirated videos including pornography, so they may not be very interested in authorized content or self-produced mini films, Pang said, concluding that the transformation of QVOD will be a hard task.