Chinese smartphone maker company Xiaomi, Inc. said it's planning to invest $300 million in Chinese online video company, iQiyi.

iQiyi, an online video streaming platform with more than 50 million viewers every day, is currently backed by Chinese Internet giant, Baidu, Inc.

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The move comes after iQiyi last week announced plans to add 1,000 new Hollywood movies to its platform in 2015 to serve China's users.

Xiaomi, now the third largest smartphone developer in the world, also announced earlier this month it plans to invest US$1 billion to expand its online TV content business.

"Xiaomi came to us. Baidu has been our main stakeholder for a long time and we didn't have that much need, but we had a conversation over the last four months and decided it would be good for both sides," iQiyi's CEO Gong Yu told Hollywood Reporter.

Xiaomi will lead the investment along with Shunwei China Internet Fund, a venture capital firm established by Xiaomi's Chairman Lei Jun. Reports claim Baidu will also increase its stake in iQiyi.

Aside from iQiyi's online streaming platform, the company also produces its own movies and has revealed plans to produce eight new films by 2015. It's estimated that China has over 600 million users that watch video contents online.

TagsiQiyi, Online Video Platform, Hollywood Movies, Shunwei China Internet Fund, Lei Jun