Game streaming is taking a step into the European market today. Playcast Media Systems is announcing that Bouygues Telecom will launch a cloud gaming service on Internet-TV set-top boxes in France.

“Cloud gaming is becoming an important play in France,” said Guy de Beer (pictured), chief executive of Playcast, in an interview.

The new service will debut in June as an option on a million set-tops in French homes. Playcast uses streaming from game servers to bring consumers console-quality video games on their set-top boxes.

De Beer said the deal took about six months to complete and gives Playcast its first real foothold in the French market. Playcast also has services available in Portugal and Singapore.

Like rivals OnLive and Gaikai, Playcast streams games to players. It runs the games on servers in its web-connected data centers and then streams 720p video to a set-top box. You play the game using a universal serial bus (USB) game controller hooked up to the set-top box. The box then sends the commands from the controllers back to the servers.

Bouygues Telecom “triple play” subcribers will be able to play high-quality video games on their TVs without requiring additional hardware. The company offers Bbox set-top boxes with Internet protocol TV, games, voice-over-Internet calling, and Internet connectivity.

De Beer said Playcast’s game publisher partners are Activision, Atari, Capcom, Codemasters, Disney, Sega, THQ, Warner Bros., and others. The service will offer games such as Street Fighter, Sonic Generations, MotoGP, Call of Duty (older versions), Homefront and Lego Batman. Most of the games will come from the existing library of games, but De Beer said it will include new titles as well.

Olivier Roussat, Bouygues Telecom CEO, said, “We are very proud to be the first telecom operator in the French market to bring such high profile games franchises and AAA titles directly to our customers’ TVs, through an easy-to-use interface.”

De Beer said Bouygues hopes to set itself apart in the competitive French digital TV market by offering the high-quality games, which normally would require a high-end computer or game console to play. Offering games in this way makes it more convenient for players. Bouygues uses fixed broadband technology to offer Internet protocol to IP TV partners.

Playcast was founded in 2007 and it has raised $12.5 million from MK Capital, JVP, Xenia Venture Capital and C.Mer Industries. Playcast has 40 employees. Pricing and the exact number of titles available hasn’t been disclosed. But de Beer said it will cost in the single-digit dollars per month to subscribe to the Playcast games. Rivals include OnLive and Gaikai, as well as G-cluster, owned by Japan’s Softbank. By year end, Playcast will be able to reach 10 million homes, de Beer said.