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Vivendi, Thomson Ink Digital Media Partnership Deal

19 Apr, 2002 By: Hive News

Vivendi Universal and Thomson multimedia have forged a strategic partnership for digital media the companies expect to generate $50 million in savings for Vivendi and $550 million in new revenues for Thomson.

The deal covers video replication, digital rights management (DRM) efforts and broadband access.

“This Strategic Partnership with Vivendi Universal is a good illustration of Thomson's strategy of providing products, services and technologies to global media and entertainment groups active along the video chain. Thomson is particularly pleased to be deepening its commitment to Canal+ and Universal, as a trusted partner and supplier to Vivendi Universal,” said Thierry Breton, Chairman and CEO of Thomson.

Thomson, the primary provider of set-top boxes to Canal Satellite and, through Technicolor, a supplier of video fulfillment services to Universal, is also a 3 percent shareholder in troubled Vivendi subsidiary Canal+ Technologies. Thomson recently announced plans to acquire from MEI of Japan, of PDSC, a DVD manufacturer, replicator and distributor for Studio clients, including Universal.

The planned acquisition of PDSC already expands the relationship between Technicolor and Universal in the field of DVDs. The deal will provide for a gradual increase of the role of Technicolor as supplier to Universal for home entertainment and content services.

Vivendi Universal and Thomson will cooperate in standards bodies (DVD, Digital Video Broadcast, Digital Cinema, Mobile Multimedia) and will encourage other consumer electronics and information technology companies to adopt and implement interoperable standards-based content protection and rights management systems, with emphasis on Thomson's SmartRights copy protection proposal.

In addition, the two Groups will test, together with partners, video-on-demand solutions and participate jointly in VOD projects. Similarly, they will cooperate in tests and projects for mobile multimedia. They will also intensify, on a joint basis, efforts around Media Asset Management and digital content preparation.

“It is critical that two French companies tie together to strengthen their positions on global markets, particularly for the promotion of digital technologies which respect intellectual property protection.” said Jean-Marie Messier, chairman and CEO of Vivendi Universal.

Messier and Breton, chairman and CEO of Thomson who will chair a a Strategic Partnership Committee to monitor the effort. The committee will meet on a quarterly basis, and have an initial duration of three years.

Vivendi expects the partnership to generate cost savings of significantly over $50 million per year across its businesses, while Thomson execs anticipate “ revenues significantly in excess of $500 million per year on top of today's business.”

The relationships remain nonexclusive on both sides, a spokesperson said.

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