They don't, but they've been getting hit hard from both domestic and international rightsholders. There's also been a push against IPTV services offering foreign content/live channels on 'national security' grounds in recent months, and quite a few companies have disappeared or gone deep underground.

The big players—LeTv, Tencent—have been fairly diligent about getting proper licenses for content over the last year or so. LeTv just scored rights to the Premier League, for example.

I don't think that's the case given a number of them are being sued by both Chinese and Foreign Broadcasters and media companies.

Others are pivoting into netflix-esque licensing businesses. They are like to media companies what Uber is to taxis, they are ignoring the rules to bring a better service, and it's working.