Disney+ Hotstar, an entertainment platform with more than 100-odd TV channels in at least eight languages, a big OTT app with the largest subscriber base and the strongest distribution might, as well as the coming together of other entertainment businesses is what is in the making if Reliance Industries does acquire Disney’s India business.
Mukesh Ambani’s RIL is reportedly nearing a deal to acquire Disney India’s television and digital businesses, in what could be the largest such deal in the Indian entertainment, much bigger than the propose merger between Sony Pictures Networks India (SPNI) and Zee Entertainment Enterprises Limited (ZEEL) that was first announce in September 2021.
Disney’s India business includes streaming platform Disney+ Hotstar, a significant linear TV business in the form of 70-plus TV channels in eight languages, as well as a film studio.
Reliance’s broadcast division Viacom18 owns 38 TV channels in eight languages, video OTT app JioCinema and Viacom18 Studios.
Disney reportedly values the India business at around $10 billion and Reliance’s valuation of the assets is reportedly $7–8 billion.
As per estimates the digital streaming business to be value at $3–3.5 billion and its international part will account for $0.5–1 billion and the TV business at $5.5 billion.
From a content valuation standpoint, Disney Star’s TV business is higher than OTT because they have massive clout on television, while IPL has gone away from Disney+ Hotstar.
TV is also crucial because it provides catchup content on OTT.
On the TV part, the players together have a 40% advertising share and 35%-40% share in the Indian television network market.
While the OTT part, the combine might of JioCinema and Disney+ Hotstar will result in a mega entity with the largest subscriber base and the strongest distribution.
Disney+ Hotstar’s around 40 million subscriber base is still the largest in the country, despite its loss of 20 million subscribers between September 2022 and June 2023 due to the Indian Premier League.
As per estimates the two OTT apps could together have 300-350 million Monthly Active Users (MAUs), which will challenge YouTube’s 470 million MAUs in India.
JioCinema brings the distribution backing of group telecom firm Reliance Jio’s around 450 million subscribers.
Most OTTs have not able to scale up because of distribution challenges.
They have always back on third party OEMs and telecom partners.
But this will mean a gigantic entity with a large distribution chain.
Eventually, it might even force other OTT platforms to go in for a tie-up with Reliance Jio or JioMobile.
The potential deal has necessitate as Disney is reportedly trying to give off its Indian business after a global cost restructuring operation.
It seem like the India business could either be sold or turn into a joint venture.
But, no deal has confirm yet.
Rahul Ram Dwivedi (RRD) is a senior journalist in 2YoDoINDIA.
NOTE : Views expressed are personal.
