Under the terms of the investment, Xunlei users will be able to search the site’s multi-media content using Google’s engine, while Google will gain access to a slice of the lucrative Chinese search market, where it attracts only 16 per cent of search queries, according to reports.

Xunlei would not specify how much Google had spent, but its chief executive, Sean Zuo, said at a briefing in Beijing that the company would be a "strategic investor".

The deal will give Google access to the 120 million customers which use the Xunlei site, and place it in a better position to challenge Baidu, a Beijing-based competitor, which has a three times greater share of the search market.

"Xunlei is Google’s YouTube in China," Liu Bin, an analyst with the Beijing-based research company BDA China Ltd, said. "Xunlei could help Google catch Baidu as more and more people search for videos on the internet."

Xunlei, which translates as ‘fast thunder’ in English, offers customers a range of content, including film, video, music, games and ringtones, and is used to make more than 50 million downloads each day.

Its peer-to-peer software, which must be downloaded, enables the sharing of material stored on individuals’ own computers rather than relying on a central network, making for quicker download times.

In a joint statement released with Xunlei yesterday, Google said the investment highlighed its commitment to local partners, China’s internet industry, "and the China market as a whole."

"Xunlei provides an excellent platform for Google’s search products. We believe this co-operation will bring the best user experience to more Chinese users," Dr Kai-Fu Lee, Corporate Vince President and President of Google Greater China, said.

Mr Lee declined to confirm that Google had invested $5 million in Xunlei, a figure which appeared in some local reports.

Ceyuan Ventures, a Beijing-based venture capital firm, and Fidelity Asian Ventures will also put money into Xunlei, and IDG Venture Capital and Morningside Asia Advisory Ltd., which already have investments, will increase their stakes.

In a separate announcement, Google announced it was partnering with China Mobile, the world’s largest mobile telecommunications carrier, to provide search for Chinese mobile users.

Under the terms of the deal, China Mobile customers will be able to search Monternet - the company’s WAP portal - for news, ringtones, games and images using Google from early this year.

Eric Schmidt, Google’s chief executive, said:"Our goal is to develop compelling services that provide users worldwide with access to information directly from their mobile device."

The search giant has had an at times controversial relationship with China, where it has come under criticism for agreeing to censor its content after pressure from Chinese authorities, as well as with video-sharing websites, which can be an outlet for pirated content.

YouTube, which Google bought for $1.65 billion last year, recently missed a deadline it had agreed with the major record labels to introduce a system for tracking illegally uploaded content on its website, highlighting difficulty of monitoring bootlegged content on sites visited by tens of millions of users a day.

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