Orange to buy 49% of Dailymotion
January 25, 2011
France Telecom’s Orange has revealed that it is in exclusive negotiations with Dailymotion, the world’s second largest online video site, with a view to taking a 49 per cent share in the operation. Once complete, the deal, valued at €58.8 million, will provide Orange with the opportunity to develop a complete multi-screen video offer
From 2013, Orange would progressively be able to increase its stake to 100 per cent, with the deal also allowing for the integration of new business partners. Closure of the deal – which is subject to consultation with staff representative organisations is expected in the coming months – would enable both parties to optimise their video services and enrich their respective offers.
Orange suggests the proposed acquisition reflects its content strategy, which aims to benefit its customers by building on the Group’s role as an aggregator and broadcaster of content through the development of strong partnerships. It says the initiative is strategic for Orange insofar as the Dailymotion video platform will immediately provide the Group with a solution that can meet the increase in its customers’ video use across all connected screens (via Internet, WiFi or 3G). The operation will also enable Orange to accelerate its multi-screen strategy by anticipating the growth in high definition, 3D and continuity across all screens.
For Dailymotion, the deal represents an opportunity to enrich its content offer and to benefit from Orange’s innovation and marketing skills in order to extend its services across all digital screens for all users. Dailymotion would be able to accelerate its growth internationally using the presence of the Orange group in 32 countries. Orange will also reach a critical size in the field of audience and online services.
According to Stéphane Richard, the CEO of France Telecom-Orange, the deal reflects the role that Orange intends to play in the content value chain. “Although we are no longer publishers ourselves, we are strengthening our position in the fields of aggregation and distribution. We will provide our customers with an enriched and innovative video offer combining Dailymotion’s know-how and diversity of content with the quality of our networks across all connected screens. Our role is to support our customers in this digital revolution – we would like to bring them into the ‘Cloud Video’ world where Dailymotion is a major player.”
Cédric Tournay, CEO of Dailymotion, said the relationship offered many synergies and opportunities, particularly in the technology area, and would empower Dailymotion to build new services, enrich its content selection and continue its aggressive audience growth across the world.