Chinese video streaming Web site 56.com began full use of a filter for copyrighted content designed by U.S. startup Vobile, the companies said Tuesday, marking progress in an industry plagued by intellectual property issues.

The move places 56.com a step ahead of its biggest Chinese rivals in combating the upload of copyrighted content by users. But as Vobile’s software makes 56.com a more law-abiding Web site, the software could hurt it against rivals less stringent with copyrights.

Vobile’s product automatically checks videos uploaded to 56.com against a registry of copyrighted material and flags infringing clips for staff to remove. Its use will save countless labor hours for the video Web site, whose staff manually watched and vetted clips one at a time before starting to trial Vobile’s product last year, Lucia Li, 56.com’s marketing director, said Tuesday.

China’s video streaming sites often play host to user-uploaded clips of copyrighted Chinese and foreign works, including episodes of television shows like “Gossip Girl” and “Desperate Housewives” popular among urban youth.

Removing such content could hurt 56.com’s popularity. There are many online video sites Chinese users can jump between, said Dave Carini, founder of Maverick China Research, a market intelligence firm.

“If this is successful in eliminating a lot of the popular content that 56 does not have the rights to, then I think Chinese users would very quickly jump to other competing sites,” he said.

56.com recognizes the risk, but competitors may also move toward greater content control, said Li, the marketing director.

“As a company that respects the law, 56 cannot just satisfy users’ tastes forever by allowing the upload of videos we clearly know are copyrighted,” Li said.

Vobile’s video identification product, called VideoDNA, can also be used to collect usage data or place ads at the beginning of selected videos, a spokeswoman for the Silicon Valley-based firm said.

Smaller Chinese video sharing site Pomoho.com also began full use of VideoDNA this week, she said. Other Vobile clients include China’s state-run broadcaster CCTV, which used VideoDNA to prevent the unlicensed spread of Olympic footage last year.

Vobile, which has over 100 employees in China, is also in talks to sell its services to Tudou.com, one of China’s three biggest video streaming Web sites beside 56.com and Youku.com.

56.com claims 120 million viewers a day for its user-generated and professional video clips.

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