Tudou is now the first of the two leading YouTube-like video sites in China to file for an initial public offering in the United States. It is seeking to raise up to $120 million on Nasdaq.

Forbes predicts that in this year of the Chinese IPO, this one will be oversubscribed. Also, Forbes predicts that the leading site in China, Youku, which has more viewers than Tudou, will file sometime soon for an IPO.

Forbes’ Gady Epstein said that China’s online video sites are not near turning a profit. Among the challenges: bandwidth costs a lot more in China than in the United States; the two leading companies compete not only with each other but with other well-funded players, including Internet portals, state broadcasters’ own websites and a Hulu-like service backed by China’s Google, Baidu; high costs for acquiring and producing content to distinguish themselves from all those competitors; and a political environment that is generally challenging for non-state-controlled media players, according to Epstein.

Interestingly, it’s even unclear whether Youtube has achieved profitability; its owners at Google haven’t said so, Epstein said.

Forbes reports that Tudou and Youku combined have raised $245 million in cash and $10 million in debt in advance of going to the public capital markets.

Tudou’s F1 filing says it has bought investors a company that is still losing more than $1 million a month ($12.5 million through nine months this year). But Epstein says there was a very promising trend evident in the company’s 2010 numbers: Revenues more than tripled in the first three quarters over the same period last year to $34 million, while the attendant costs less than doubled.

Epstein adds that Tudou is doing a good job of controlling its bandwidth costs. Bandwidth accounted for just 40 percent of the company’s costs of revenues in the first three quarters this year, continuing a multi-year downward trend. Bandwidth accounted for 49 percent of the cost of revenues in 2009 and 72 percent in 2008.

Epstein said that both Gary Wang, the Tudou CEO, and Youku’s CEO Victor Koo, said in interviews two years ago that they were constantly working on ways to optimize their usage of bandwidth. Tudou may have done a better job so far of controlling costs in proportion to revenues, according to Forbes. More will be known if and when Youku files its SEC paperwork.