Chinese entertainment giant Tencent (HK:00700), owner of Tencent Video, has been in talks with search engine company Baidu (NASDAQ: BIDU) for building a stake of as-yet undecided size in rival iQiyi (NASDAQ: IQ), of which Baidu owns 56.2% share, Reuters reported on Tuesday afternoon, citing sources familiar with the matter.
According to the report, Tencent wants to replace Baidu as iQiyi’s largest shareholder in a bid to gain a dominant position in the country’s streaming industry through the deal, which is still at an early stage and subject to change.
Tencent Video, iQiyi, and Alibaba’s Youku are considered China’s answer to streaming giant Netflix, since they focus on original, self-produced content. Both iQiyi and Tencent Video claimed to have over 110 million paid subscribers by the end of March.
This article is part of KrASIA’s “China Brief” section, where KrASIA’s reporters will provide quick daily updates about the tech ecosystem in China.