A group of major media companies has accused Internet giant Google of benefitting from the sale of pirated movies and providing business support to two websites suspected of offering access to illegal film downloads.
The companies have accused Google of being too cozy with two websites accused of providing access to illegal download, the Wall Street Journal reported.
Google assured the companies that it would take measures to prevent a recurrence of the episode.
The media companies are considering launching their own service to compete with Google's popular YouTube video website, it said.
The flare-up comes amid negotiations between Google and the big film and TV studios over the unauthorised use of copyrighted programming by YouTube, a free video website Google bought last year after the site quickly became a cultural phenomenon.
Media companies regard Internet piracy - the unauthorised online transfer of movies, music and other copyrighted content - as a major threat to their businesses and claim that it has already cost them billions of dollars.
Yet, journal says, they acknowledge that consumers want the convenience of downloads, and the companies don't want to miss out on a potential business opportunity or try to block downloads completely, as the music industry for a time unsuccessfully sought to do.
At the core of the media companies' dispute with Google, which isn't a defendant in the piracy case, is their claim that Google deliberately directed traffic to websites that were engaged in fostering piracy.
Google told the studios on Friday it would implement new procedures to prevent recurrences.