BEIJING - Chinese netizens enjoying free online reading might soon be paying for literary works as two pillars of China's Internet world appear to make up in a row over piracy.
Online publisher Shanda Literature Corporation is hoping that a pledge by search giant Baidu to resolve complaints that it "connives" in copyright violations could see an end to unauthorized copies.
Baidu has said it will introduce charges for online literature.
"We will make efforts to solve the copyright issue," Zhu Guang, a senior official of Baidu's market department, said Thursday at a ceremony to celebrate the first anniversary of Baidu's online library.
Zhu's remarks were welcomed by Shanda, which owns more than 80 percent of the country's online literary publications, as well as the seven leading original Chinese literature websites.
Its Qidian site, for example, charges very important person (VIP) members 0.02 yuan per thousand words of popular e-books.
"Each of Qidian's 10 most popular original Internet novels is pirated 8 million times on average, meaning that if the cost of reading a novel is 1 yuan, the economic loss is 8 million yuan ($1.2 million)," Shanda chief executive officer Hou Xiaoqiang told Xinhua News Agency.
More than 1.1 million authors had signed contracts to provide Shanda with original works, but pirated versions were commonly found among Baidu search results, he said.
"Baidu's connivance at net piracy leads to over a billion yuan of losses to our company every year," Hou said.
The losses to Shanda's contracted authors, who were paid according to reading fees, ran into millions of yuan.
However, pirate websites could operate at only a fraction of the cost that Shanda invested in its services.
A website management specialist surnamed Jiao explained to Xinhua how website operators hired netizens to register as VIP users of official sites and then asked them to copy the content of popular novels.
If the official websites used technologies to prevent their works being copied, the pirates would just type out the content, said Jiao.
Pirate websites profited by charging lower reading fees than the official sites or just from advertising links.
Shanda said Baidu's "lenient" attitude to piracy had resulted in Baidu's online library becoming a hotbed of online copyright theft.
Baidu was also accused of profiting from advertising on pirate websites and by deliberately filtering out Shanda results.
Shanda filed a lawsuit against Baidu in March. The Luwan district court in Shanghai is assessing evidence from both sides, but no hearing date has been set.
China Written Works Copyright Society, China's sole literary copyright collective management organization, has backed Shanda, urging publishers and authors to join the lawsuit against Baidu.
Launched in November 2009, Baidu's online library offers an open platform for online resource sharing. Users can read or download information for free, and all accumulated resources come from user uploads.
More than 80 percent of its materials involve education information, such as textbooks, tests, professional reference books and materials.
The library also offers reference materials uploaded by others, including sample contracts, tourist and shopping guides, and reviews.
In the past year, it has stocked more than 10 million documents.
"This is a platform for sharing information, not for encouraging piracy," Li Jinfei, director of Baidu's online library, told Xinhua.
Baidu admitted that some netizens could upload pirated content, but this only accounted for a small part of the whole library.
"Only eight percent of online library documents are related to novels," Zhu Guang, a senior official of Baidu, said Thursday, claiming the library was set up to help people wanting to learn.
Zhu said the online library had more than 100 staff handling piracy complaints.
"Baidu will verify the copyright certification and deal with pirated content in 48 hours of receiving a report," said Zhu.
Under this mechanism, tens of thousands of documents had been deleted in the past year, according to Baidu.
Zhu said Baidu had contacted many publishers and online authors to discuss cooperation to actively introduce copyrighted works.
"We will try to set up a reasonable method to share profits with all copyright holders," Zhu said.
Shanda's senior legal affairs official, Chen Mingfeng, told Xinhua Friday that Shanda welcomed Baidu's willingness to respect copyright, saying that the two companies might also cooperate in future.