It was 5 days ago that Google Inc. had confirmed its investment into Xunlei Network Technology Company and now the MPAA is persuading Google to crack down piracy in China.

Xunlei develops software that allows users to download pirated movies.  In the MPAA’s battle to crackdown copyright infringement, the agency has won cases against several companies, including Sohu.com Inc.  Xunlei has 120 million users.

“We’re going to see more lawsuits involving online copyright infringements because Internet companies are making more money and more people are using the Internet,” stated Jasper Zhang, who is a partner at the Zhong Lun Law Firm in Shanghai, China. “Laws and regulations aren’t going to stop piracy overnight.”

In defense of the Chinese company, Xunlei spokesperson Jackson Zhang mentioned that Xunlei does not upload the videos, only provides the P2P software.  Beijing, China Google representative, Marsha Wang reassured that “We’re very serious about respecting copyright.”

Google bought a stake in Xunlei to take on Baidu.com, the largest China-based search engine.

[Source: Bloomberg]

Google Inc. has confirmed that the investment into Xunlei Network Technology Company which allows users to download videos and games is official.  The China Daily reported that Google would be joining Ceyuan Ventures to buy stake into Xunlei.  Xunlei has 54 million subscribers and is one of the largest video-downloading websites in China.

Another venture that Google had confirmed in China is that the company has teamed up with China Mobile, the largest mobile telecommunications carrier to power cellphone search.  According to iResearch Consulting, Google is the second largest Internet search company behind China-based Baidu.com.  About 63.7% of searches conducted online in China use Baidu and 19.2% use Google.

The New York Times confirmed that Google had invested $5 million into the company.  Xunlei previously had raised $20 million from Morningside Ventures and IDG VC Partners.

This month, a rumor started spreading that Google China and Ceyuan Venture is preparing to invest into P2P software and file sharing network, Xunlei. The investment announcement is expected to take place on January 5. Google China would invest $5 million and Ceyuan Venture would invest $15 million.

Xunlei was created in 2003 and is known for being a download accelerator for videos and software. Fortune China ranked Xunlei as one of the coolest companies of 2005. IDGVC invested $1 million into Xunlei and then a second round $10 million funding was invested into the company by Morningside and IDGVC. Xunlei’s software was downloaded over 110 million times and averages about 1.5 million downloads per day.

Google China is interested in Xunlei because it is the second most popular desktop website in China. If Google China invested into Xunlei and placed Google Toolbar as part of the installation, it would help Google penetrate a larger market share of Internet users in China. And also Xunlei is a video-centric web company and since Google acquired YouTube, it proves Google is ready to believe that Internet video is the way of the future. It would work out perfectly.
[Source: China Web 2.0 Review]