Ritika Janiya
In a huge move, India has given the green light to an $8.5 billion merger between giants Disney and Reliance Industries. This is set to create the biggest entertainment company in India and is going to bring a huge shakeup in the way people watch sports and other shows.
What’s happening?
It is, after all, a big deal-the merger of Disney with Reliance Industries. Reliance, owned by billionaire Mukesh Ambani, would retain the majority ownership in this new company. This indeed would make the new business venture the leading entertainment player in India, rivaling big names like Sony, Netflix, and Amazon.
The merger means that the new company will hold all these sporting broadcasting rights. Most of these broadcasting rights involve cricket, the majority popular sport with millions of fans in the country. The rest of the major sporting events involve Wimbledon, MotoGP, and the English Premier League (EPL).
Why is This Important?
The new company will have significant clout in terms of how Indians watch sports and entertainment. For years, Disney and Reliance have been winning over winner hearts by providing free live streams of cricket matches. ($9.5B has been sunk into TV and streaming rights for IPL and T20 World Cups.).
For all this, there were some red flags too. India’s competition watchdog had expressed concern that the deal helped set the terms of the cricket-advertising-price game. The watchdog had expressed fears that the new combined company would possess excessive power to raise prices regarding viewers and advertisers alike.
These has been promised to rectified, where Disney and Reliance will not raise advertising rates too high and have even promised to sell off seven to eight of the TV channels that do not show sports. This to help balance out the revenue and keep things fair.
“It’s a marriage between content and technology,” Gurmeet Chadha, a financial expert, also added: “This makes it a very big digital entertainment giant.” According to him, both Disney and Reliance were strong combinations of content and technology. They have lots of reach and know what people like to watch.
With high internet use, the country has about 1.4 billion. The new company will face a large audience to serve, hence. The new changes brought about by the merger will be important in shaping new consumption behaviors among people and might even set a new trend within the industry as a whole.
So, Now What’s Next?
It has been projected that the deal will completed after everything has been restructured, and the process and structural changes in the two firms have been realigned. “Nita Ambani, wife of Mukesh Ambani will be the Chairperson of the new company”. The deal has not yet been sealed completely as there are some voluntary changes, which the companies will have to make for them to be on the safer side of
For the Indian entertainment world, the merger deal of $8.5 billion that Disney inked with Reliance Industries was massive, creating the biggest entertainment company in this country. It would hold major sports and entertainment broadcasting in its control. There is some apprehension regarding the price of advertising, though the companies have promised to keep matters fair. Such a huge audience and potent content-this is going to be one big splash in the industry.
In other words, the merger could revolutionize the way of watching sports and entertainment in India, opening new vistas of digital media.
