Youku purchases rights to stream Hollywood flick

The move is regarded as an attempt to branch out from the more common advertising-supported free video model and encourage Chinese viewers to pay for content.

'Inception', directed by Christopher Nolan, was the third-highest grossing movie at Chinese theaters last year after 'Avatar' and domestically produced 'Aftershock', according to media-research firm EntGroup.

Youku and rival Tudou largely rely on revenue from ads that run alongside free videos, similar to YouTube.

The growth in licensed distribution of films and TV shows reflects how some leading Chinese Internet companies are trying to disassociate themselves from piracy due to pressure from copyright holders and advertisers.

Youku, which raised US$202 million in an initial public offering on the New York Stock Exchange last month, and Tudou are China's two most-visited video sites, with services that let users upload and view streaming videos.

Youku and Tudou have acknowledged that users have posted pirated content on their sites and said they work with copyright owners to remove such material and obtain licenses for legitimate programming.