Siemens Communications has acquired Myrio Corporation, which makes middleware for internet protocol television.

Myrio is headquartered in Seattle, in the shadow of Microsoft, with which it competes in the emerging middleware market for IPTV.

Under the agreement, Myrio will operate as a wholly-owned subsidiary of Siemens. Other terms of the deal were not disclosed.

The acquisition will strengthen the position of Siemens in offering “triple-play” technologies aimed at network operators, broadband service providers and cable companies, as they rush to offer interactive television and video-on-demand services in addition to voice and data services.

The announcement was hardly unexpected. Siemens has been a long standing partner of Myrio, a venture capital backed private company, following an initial investment in late 2003. The two companies have been working together on a deployment with Belgacom in Europe.

Myrio has around 75 staff and 65 customers, although to date these have mostly been small regional service providers. Their system consists of Myrio Interactive, an end-user application enabled through a set-top box, and Myrio TotalManage, a back-office subscriber and content management solution. Siemens describe it as the “brain” of future home entertainment systems.

“Myrio’s middleware is the foundation for developing additional new services in home entertainment,” said Andy Mattes, president and CEO, Siemens Communications, Inc. “The acquisition means we can focus even more closely on our customers needs and realize our vision of offering a universal platform for managing customer services.”

This transaction is the next logical step for the two companies, said Chris Coles, the president and chief executive of Myrio. “Siemens’ reputation as one of the leading players in the global telecommunications industry, combined with its exceptional client service is the ideal complement to Myrio’s business,” He added that he expected the move would allow the company to accelerate and expand its product plans.

The Myrio IP Video Platform will continue to be sold directly to customers and through channel partnerships. In addition, Siemens will continue to bundle the system with its SURPASS Home Entertainment solution.

Within the newly formed subsidiary, the Myrio offering will remain hardware and operating system agnostic, allowing customers to choose their own set-top box, video-on-demand server and other system components according to their requirements.

Siemens and Myrio will now compete directly with Microsoft, which has a partnership with Alcatel.