Courts in Bejing ruled in favor of Baidu today in a lawsuit based on illegal MP3 downloading on the site.

The No. 1 Intermediate Court of Beijing ruled in favor today of Baidu, China's most popular search engine, in a lawsuit stemming from the illegal downloading of MP3's from it's website.

Created in 2000 by Robin Li and Eric Xu, Baidu's mission is, "to provide the best way for people to find information online, including Chinese language web pages, news, images and multimedia files though links provided on our website. In addition to serving individual Internet search users, we also provide an effective platform for businesses to reach potential customers online."

Almost a year ago several music giants including, Universal, EMI, Warner, and Sony BMG, filed a lawsuit against China's most popular search engine. The lawsuit alleged that Baidu enabled users to search and download music illegally on the site's MP3 search engine and could have potentially shut down the MP3 site for indefinitely.

Baidu is the fourth most viewed search engine in the entire world and derives 15% of it's traffic from visits to the MP3 subdomain on the site, according to Alexa.com.

The creators of the site say that "If Baidu shuts down the MP3 service, the consequences will be severe. Baidu derives about 20% of revenue from the MP3 service by showing advertisement on every page that leads to a third party download link."

Baidu's Vice President of Marketing Liang Dong said that Baidu.com only provides a music search service rather than downloads. He also adds, "From the copyright point of view, we think differently than the music companies. Baidu is just a platform for music search."

Filing suit against a search engine instead of illegal downloading sites seems to be an odd legal strategy. There have been several similar cases in the United States in which the music-sharing websites, such as Napster were sued rather than at search engines providing only song results.

Had the music companies won the lawsuit, Baidu would have been forced to compensate the music giants and the MP3 site would have completely been completely disintegrated on the alleged grounds of providing downloads of illegal music.

It would seem that every cloud has a silver lining as Baidu has signed an agreement with Viacom to stream it's music videos for free ad-supported services and premium. Five other major Chinese music labels have also joined in the arrangement, perhaps creating a truce between the Baidu and other music companies.

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