"We cannot keep competing because where thieves and robbers are having their way, law-abiding companies cannot survive," Sohu chief executive Charles Zhang said yesterday.

Baidu was the top enabler of video piracy in China via its Baidu video search, Baidu TV Stick, Baidu Yingyin desktop player and Baidu Video mobile app, the plaintiffs said in a statement.

Normal searches should provide a link and then take users to a third-party website, but Baidu directly hosted and played video content and profited from advertisements, it said, accusing Baidu of profiting from advertising revenue it shared with pirated video websites.

"I'm friends with [Baidu chairman and chief executive Robin] Li Yanhong on other things, but on the issue of piracy we have very different views," Zhang said.

"Baidu has the search capability, but it doesn't have the client application … Amid intense competition, it is grabbing market share the illicit way."

He estimated that half of total online video views were done through illegal websites.

Baidu valued copyright protection and had blocked links to more than 5.8 million videos since June, Kaiser Kuo, a spokesman for Baidu, said.

The company would stop linking to pirated video sites, and conduct research into automatic filtering, he said.

Popular content is hugely important to any site that streams videos, but prices have been rising quickly on the mainland.

Market research company iResearch said the mainland's online video market brought in more than 3.25 billion yuan in revenue in the third quarter, up 37 per cent from a year ago. Popular television shows and increased access on mobile devices helped raise revenue from advertising, it said.

Nasdaq-listed Sohu posted a third-quarter loss of US$65 million as costs for video content increased. It bought exclusive rights to popular shows such as singing contest , which it says had 2 billion views.