A Battle of Vague Justice or for a Brighter Future?

analysis on the copyright dispute between video-sharing giants Tudou vs Youku in China

Bridge IP Law Commentary will post two comments on the copyright conflict of the entertainment show “Kang Xi Lai le” between Tudou (NASDAQ: TUDO) and Youku (NYSE: YOKU), two China video sharing giant in China. The first post is from Attorney Albert Chen.

The hottest news hitting the headline of IT news in China these days may be the battle between Youku and Tudou, who are the top two online video providers in mainland China. The war was triggered by Youku’s streaming of Kang Xi Lai Le (the “Show”), a popular entertainment show from Taiwan, which is claimed by Tudou of piracy and against its exclusive right of the show in China.

Shortly after that, the dispute was heated by the quarrel between chiefs from the video-sharing giants on Weibo (a fashionable Twitter like website in China). Wang Wei, the CEO of Tudou, accused Youku of breaking the “notice-delete” rule among the video websites and stated that this is a battle for the protection of video industry root in China rather than a simply war of words. Accordingly, Youku stroke back with the irony of Mr. Wang’s personal affairs (hint at Tudou’s IPO failure due to Mr. Wang’s divorce) and the statement that the accusation is Tudou’s struggle for survive.

By the latest reports, both Youku and Tudou have filed suits against each other, demanding the compensation of millions.

I. The relationship between Tudou and Youku

Both websites are the video shareing portal under the model of Youtube, with the main opponents of Sohu (NASDAQ: SOHU) video and iQiyi affiliated to Baidu following the model of Hulu. Before the listing of Tudou and Youku, the main conflict is the competition dispute between them and Hulu model websites, who have purchased copyrighted works with huge expenses. The fierce quarrel of that time was curbed by the administrative order from the State Administration of Radio, Film and Television (the Administration) in 2009, which regulates that all the video site shall respect the copyright. Ironically, the charging administration of copyright protection is the Copyright Office, such order is suspicious of exceeding the Administration’s power. And in the same year, China Online Video Alliance against the Piracy (the “Alliance”) was established as initiated by Hulu model companies, and the Alliance filed the lawsuit against Tudou and Youku shortly after its establishment for the copyright infringement, and won the support of the court. Facing the challenge, Tudou and Youku once allied with each other for the counterattack.

While just like the diplomacy, there’s no sempiternal friend but eternal interest. Once there emerged the interest conflict, any party may turn its gun to its ally. The dispute of this time is the consequence of the fierce competition between the companies.

II. The nature of Kang Xi Lai Le in law and its protection

Back to the case, the conflicted point is the exclusive cyber copyright of the show in China. According to Tudou’s statement, it has been licensed by the copyright owner Cti TV from Taiwan. Therefore, the show shall be the imported entertainment program. By the Regulation on the Import and Broadcast of the Overseas TV Programs promulgated by the Administration in 2004, any programs imported overseas shall first be examined by the Administration before broadcasting in China. That is to say Kang Xi Lai Le should first be examined by the Administration before broadcasting (Is it ironic for the regulation is kind of rule in Owell’s works of 1984?). Has the show been presented to the Administration is unknown to us, but we would not choose to apply for the examination shall we were the operating party of Tudou. The current situation is that the unexamined show is broadcasting in China while it risks the stop showing as demanded by the administration at any time,.

Actually the un-administrative approved program could also be protected by the Copyright Law in China. The only standard by which the prohibited works are determined is the legality of its content, and the illegality normally includes the reactionary, pornography, superstitious ones. Despite this regulation, the copyright of prohibited works is only limited rather than exempted. As a popular show in China, Kang Xi Lai Le bears no obvious defect, therefore the lack of examination will not influence its copyright protection, and any violation against its cyber broadcasting shall be the infringement.  For more information of the protection on the unauthorized works, pls click here.

In a word, Bridge IP Law Commentary holds that any copyrighted works shall be protected, especially those popular ones, for it may influence the overall combat against infringement in the industry. As to the conflict between the two giants of this time, Bridge IP Law Commentary looks forward the settlement through judicial way rather than the mediation by the administration, for the court decision could play a more constructive role in the market regulation. Although the dispute is the continuation of the past chaos in the industry, we hope it could also be the beginning of the order in the future.

For the other post of the series comments on this copyright dispute, pls click here.

Other posts on our website:
1. The Actual Term of Trademark Registration in China
2. How to Apply for the Trademark Record in China Custom
3. How to improve the success rate of trademark registration in China?
4. Matters for Attention in Trademark Refusal Review in China
5. Introduction of China’s Legal System of Trademark Renewal
6. Introduction on the Regulations concerning the Capital Contribution in IPR or Domain Name in China
7. The Copyright Registration in China Could Be FREE?
8. China Copyright Protection Term Longer than EU’s?
9. Matters for Attention in the Patent Preliminary Injunction Application in China(I)
10. Matters for Attention in the Patent Preliminary Injunction Application in China(II)

Author: Mr. Albert Chen
Attorney-at-law of DeBund Law Offices
Co-author: Mr. You Yunting
Founder & Editor-in-Chief of Bridge IP Law Commentary
Partner & Attorney-at-law of Shanghai DeBund Law Offices
Email: Bridge@chinaiplawyer.com, Tel: 8621-5213-4900,
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Bridge IP Law Commentary is a website focus on the introduction of commercial laws in China, especially the intellectual property laws. All the posts here are our original works. And all news or cases referred here are from public reports, and our comments or analysis are of due diligence, neutrality and impartiality, representing our own opinions only and are our original works. You may contact us shall you have any opinions or suggestions.

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