Furthermore, Orange plans to increase its ownership in Dailymotion to 100% from 2013, with the overall value of the deal being €120 million ($163.2 million). The deal is expected to close in the coming months.
With more than 93 million monthly unique visitors, Paris-based Dailymotion is one of YouTube's biggest competitors. It may be far behind YouTube in terms of traffic and revenue, but it has been making strides in the content department, having partnered with EMI in February 2010. It's also doing well in the advertising department, reporting strong growth throughout 2010.
The acquisition is part of a new strategy for France Telecom, which has lately been trying to form content partnerships instead of buying exclusive rights to TV content, and then offering it through its Internet and mobile channels.
One of the early investors in Dailymotion, VC Fred Destin, has shared a couple of more details about the deal. Dailymotion has had revenues of €18 million ($24.5 million) in 2010, he claims, and the deal is mainly the result of Orange CEO Stephane Richard's strategy, who wanted to win the deal over an unknown U.S. investor. It had nothing to do with net neutrality, and the French government didn't have any impact on the deal, Destin says.
Furthermore, he says Dailymotion will remain an independent company and its management and shareholders will continue to control the board.