The two companies are willing to sell “fewer” than 10 channels to address the concerns of the CCI over the market power of the combined entity
The companies are arguing before the CCI that nothing can be done on cricket rights
Pegged at $8.5 Bn, the merger of Reliance and Walt Disney’s Indian media assets will create a new entity that will host over 100 TV channels and two streaming platforms – Disney+ Hotstar and JioCinema
Reliance-owned Viacom18 and Star India have reportedly offered to offload some of their television channels in a bid to fast track antitrust approval for their $8.5 Bn merger.
Reuters reported citing sources that the two companies are willing to sell “fewer” than 10 channels to address concerns of the Competition Commission of India (CCI) over the market power of the combined entity.
However, the two parties are said to be “resisting” any changes to cricket broadcast rights they own.
As per the report, the channels, in question, likely belong to the regional Indian language portfolio, where the two giants may have a dominant market share.
The responses of the companies came after the competition watchdog privately asked both Reliance and Disney around 100 questions related to the merger.
It is pertinent to note that the CCI, in a note approving the now collapsed merger of Zee and Sony in 2022, had said that Disney and Reliance held a market share of 65-75% in the Marathi language and more than 50% in the Bengali language market.
Meanwhile, the competition watchdog has reportedly so far not raised any concerns about the cricket broadcast rights owned by the combined entity as it is still studying the matter.
So far, the two companies have reportedly argued before the CCI that the cricket broadcast rights of Disney and Viacom18 will expire in 2027 and 2028, respectively, and can’t be sold right now.
Sources also told the news agency that the two parties have flagged concerns that any sub-licensing of cricket rights to another party would also require prior approvals from the Board of Control for Cricket in India (BCCI), which would delay the merger process.
“The companies are arguing that nothing can be done on cricket rights,” a source reportedly said.
It is pertinent to note that the combined Reliance-Star entity would wield both digital and TV broadcast rights of almost all major cricket tournaments, including the Indian Premier League (IPL). As per brokerage firm Jefferies, the combined might of Disney-Reliance entity will have a 40% share of the advertising market in TV and streaming segments.
Earlier this year, Reliance and The Walt Disney Company announced that they have signed a binding agreement to set up a joint venture (JV) that would combine the businesses of Viacom18 and Star India Private Limited.
The merged entity will host over 100 TV channels and two major streaming platforms – Disney+ Hotstar and JioCinema. It will exclusively hold the rights to distribute Disney’s content in India as well Viacom18-owned sports content.
In its financial report for the second quarter of 2024, Star India parent and entertainment juggernaut Walt Disney said it incurred over $2 Bn charges due to goodwill impairments related to Star India on account of merger with RIL.
