Reliance Industries Ltd. and Disney Star India join hands to create a media behemoth, valued at $8.5 billion. RIL is set to invest 11,500 Crore Rupees for the growth strategy. This joint venture will be majorly held by Reliance Industries. With 16.34% owned directly and 46.82% by Viacom18, while Walt Disney will hold 36.84%.
Nita Ambani will be the chairperson of the merger. Uday Shankar, a former top executive of Disney, as the vice chairperson. Furthermore, Akash Ambani will be in the board.
This joint venture comes forth at an interesting time, as the budding rivalry between the two blooms into a collaboration. Considering that Disney just lost the digital streaming rights of IPL for 5 years to Viacom18 (Reliance Industries).
Exhibit A: The IPL enthusiasts, among others.
Reliance Industries’ Chief on Merger
In the words of Mr. Mukesh Ambani, this collaboration will prove to be “a landmark agreement that heralds a new era in the Indian entertainment industry.”
The Disney CEO exclaims that, “Reliance has a deep understanding of the Indian market and consumer. Together we will create one of the country’s leading media companies.”
As a result of this collaboration the OTT leaders of India, JioCinema and Disney+Hotstar have also been amalgamated. The viewership is expected to excel as they have all the goods- rights to digital streaming of exclusive sports events like IPL.
The Deal between Walt Disney and Reliance
With rights to their TV streaming, a plethora of TV channels that Disney owns. Including exclusive rights to Disney’s movies and other productions in India. Not to forget, the 30,000 additional assets, along with the contents of HBO, Showtime, Warner Bros. and NBC Universal.
Other than OTTs, their 120 TV channels will come together under the same umbrella. At $8.5 billion, this deal seems a win-win position to both the companies.
Understanding the Indian Market
Moreover it is easy to say that Disney+ Hotstar understood the game better than the rest of the OTTs in India. It has the largest market share in the Indian OTT scenario with a whooping 25.65%. Followed by Amazon Prime Video with 21.27% and Netflix with 12.59%.
Disney+ Hotstar (25.65%), Jio Cinema (5.91%) and Voot (5.15%) will make Reliance the largest OTT platform owners in India. This will amalgamate to a whooping 36.71% of the total OTT market. Jio Cinema is fairly new and has a much lesser base, the addition of Hotstar will be a plus.
The Indian OTT video market was valued at INR 249.09 billion (US$2.92 billion) in fiscal year 2021-22. Analysts expect it to reach a value of INR 581.21 billion (over US$7 billion) by FY 2027.
This merger elates both the parties and will reach audience of about 750 million. The public will find out whether it is a faux pas or not in March 2025.Being subject to regulatory, shareholder and other customary approvals. The merger will occur between Oct’24 to Mar’25. None other than India’s wealthiest tycoon Mukesh Ambani grabs that opportunity.