Screen shot 2010-01-06 at 1.11.07 PMThere’s a gap in the online video market in China: extremely high-quality videos for users seeking a better experience.

Now Chinese search engine Baidu is stepping in to fill that role, launching an independent venture that will focus on delivering copyrighted, quality video supported by ads. There’ll be television shows, movies and sports broadcasts, through an array of different content providers.

With demand for online video going through the roof in 2009, the number of companies looking for a piece of the market is also on the rise. But Baidu, the No. 1 search engine in the country — even trumping Google’s China property — has a definite leg up on potential competitors, enjoying the name recognition and customer loyalty built up over years.

The one hurdle standing between Baidu and total dominance of the Chinese online video space is rampant piracy. The country has been afflicted by intense video theft and copyright violations, especially when it comes to movies and television shows, almost since the technology became available. Enforcement measures so far have been completely unable to stem this tide — one from which many average Chinese citizens draw an un-taxable, unmonitored income.

The piracy has grown to such an extent that it’s becoming a problem on a national level. Even U.S. consumers looking for free, fairly high-quality versions of their favorite television shows, ranging from Friends to Fringe, can find them on Chinese video platforms Youku and Tudou through English portals like TVShack and Project Free TV. But even lawsuits filed against these companies haven’t slowed them down.

As CNet notes, new technology that makes it easier to watch internet and streaming video on living room television screens will probably make this problem even worse. The opportunity is too great for people to simply watch free content like they would any other show actually broadcast on digital cable.

In order for Baidu to be as successful at video delivery as it is at search, it will need to urge the government to take a stronger position on piracy. It can’t turn back the tide on its own. Until then, it will have to rely on the premium quality of its offerings and its ability to monetize them with advertising to attract users and build as much cred as sites like Hulu and YouTube have here in the U.S.