French media services group Thomson will acquire the broadcast and multimedia division of the French defence electronics company Thales for 130 million euro.

The Thales Broadcast & Multimedia division provides platforms for internet protocol television, video-on-demand, mobile television and other digital radio and television systems.

Thales IPTV middleware, SmartVision TV, has been deployed by France Telecom for its MaLigne TV broadband television service.

The Thales division will be combined with the Thomson Systems and Equipment group to offer end-to-end products and services in IPTV, mobile television and digital terrestrial transmission.

Thomson also announced a strategic partnership with Thales to cover video content management and distribution for in-flight entertainment, security and defence applications.

“The strategic agreement with Thales creates a powerful partnership for addressing the rapidly increasing demand across various markets for multidistribution access of video content,” said Frank Dangeard, the chairman and chief executive of Thomson.

“Furthermore, acquiring TBM will strengthen Thomson’s position in the high-growth IPTV and mobile TV markets. It will reinforce our relationships with telecom operators and broadcasters and create value through tightly integrated, optimized and pre-packaged system solutions.”

Thomson recently announced a 91 million euro acquisition of Canopus, a Japanese software company specialising in desktop video editing.

The acquisitions are in support of a strategy that identifies electronic content distribution and internet protocol based technologies as key areas of growth.

Thomson is pulling out of the low-margin consumer electronics market to transform itself into a media services company.

Thomson sees opportunities created by digital terrestrial television switchover, together with mobile television using terrestrial television technologies, and emphasises the importance of the nascent broadband television market.

IPTV represents one of the hottest sectors in the telecommunications industry and is subject to consolidation through major mergers and acquisitions as companies jostle for competitive position.