Orange to invest $80m in Dailymotion

French telecoms company Orange has entered exclusive negotiations with online video portal Dailymotion, to take a 49% share in the firm for €58.8m (US$79.9m).

Orange, part of France Telecom, already operates its own IPTV service across the country but its previous ventures into content have proved challenging.

Last week the firm reached a deal to merge several of its struggling pay-TV channels with the operations of Canal+’s TPS Star, marking a shift in strategy under new CEO Stephane Richard.

Dailymotion, often dubbed the ‘French YouTube’, has expanded its presence overseas, setting up offices in territories including the UK and the US, but is still a long way behind the Google-owned market leader.

The company has raised some US$70m since setting up in Paris in 2005. Speaking at a press conference, Richard said Orange’s planned investment in Dailymotion valued the business at €120m.

“This operation once again illustrates 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,” he said.

“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.”

Dailymotion CEO Cédric Tournay added: “We are delighted with this agreement as it will bring Dailymotion into a new era of development, six years after it was founded. This relationship offers many synergies and opportunities, particularly in the technology area. It will empower Dailymotion to build new services, enrich its content selection and continue its aggressive audience growth across the world.”