Online video industry uniting for growth

China is encouraging more mergers and acquisitions in the online video industry, as authorities look to back the consumption of information products and services, and make the sector a new engine to drive domestic demand and economic growth.

The industry is likely to experience a reshuffle before a fair and orderly market is established to protect the rights of program creators, said Luo Jianhui, director of the online audio-visual programs management department of the State Administration of Radio Film and Television.

The country also has licensed 15 radio and television broadcasters to operate network radio and TV stations, he told the 2013 China Network Audio-Visual Industry Forum in Shanghai.

Meanwhile, more Chinese video companies are gaining an overseas presence by partnering with foreign online TV gurus.

Sohu Video, a unit of popular Chinese Web portal Sohu.com, announced on Thursday an online video-on-demand and video syndication collaboration with Viacom International Media Networks, a unit of Viacom Inc.

According to the statement from Sohu, the deal will enable an estimated 389 million Chinese online video users to watch Mandarin-dubbed and subtitled Nickelodeon programming on Sohu's site. The companies declined to say how much Sohu was paying for the content.

Sohu obtained the exclusive online broadcast rights for the second season of hit reality talent show “The Voice of China,” shown earlier this year, which helped generate nearly 2 billion video views.

Charles Zhang, CEO of Sohu, said at the forum that China’s online video industry will experience explosive growth if its battle against content poachers is successful.

By forming a China Online Video Anti-Piracy Alliance, the country’s leading online video providers and advertising firms are focusing their efforts on Chinese search giant Baidu, which has been accused of facilitating online piracy.

By the end of 2015, the consumption of information products and services is expected to grow at an annual pace of at least 20 percent to reach 3.2 trillion yuan, Luo said.

Internet-based consumption should grow by at least 30 percent annually to 2.4 trillion yuan, according to guidelines issued by the State Council in August.