Disney Star India Sale: Reliance in Talks to Buy Streaming and TV Business

Walt Disney Co., the US entertainment giant, is exploring various options for its India business, which includes its streaming service Disney+ Hotstar and its television channels under the Star India brand. According to sources familiar with the matter, Disney has held preliminary talks with potential buyers, including billionaire Mukesh Ambani’s Reliance Industries Ltd., which owns a majority stake in Viacom18 Media Pvt., a joint venture with Paramount Global1.

Disney is reportedly considering a range of options, from a deal for the entire Disney Star business to a piecemeal transaction that may involve some combination of its assets, such as sports rights and regional streaming service Disney+ Hotstar2. The talks are at an early stage and no final decision has been made, the sources said.

Disney Lineup

One of the reasons for Disney’s strategic review of its India business is the loss of its streaming rights to the Indian Premier League (IPL) cricket tournament, which is one of the most popular and lucrative sports events in the country. In July, Viacom18 won the digital and India bilateral media rights for the IPL for the next five years, starting from 2023, beating Disney Star and other bidders3. The IPL rights were seen as a key driver for Disney+ Hotstar’s subscriber growth and revenue generation in India.

Disney Star also faces challenges from other competitors in the crowded Indian streaming market, such as Netflix, Amazon Prime Video, SonyLIV, Zee5, and others. According to a report by Media Partners Asia, Disney+ Hotstar had 46 million subscribers in India as of June 2021, down from 50 million in December 2020. The report also estimated that Disney+ Hotstar’s revenue would decline by 10% in 2021 due to the loss of IPL rights3.

Jio Studios Lineup

However, Disney Star is not without its strengths. The company still has a dominant position in the Indian television market, with over 60 channels across genres and languages. It also has a strong portfolio of sports rights, including the television rights for the IPL through 2027, as well as rights for international cricket matches involving India, England, Australia, and others2. Moreover, Disney+ Hotstar offers a variety of content, such as original shows, movies, live sports, news, and regional content.

The outcome of Disney’s talks with Reliance or other potential buyers will have significant implications for the Indian media and entertainment industry, which is undergoing rapid consolidation and transformation. Earlier this month, Sony Pictures Networks India and Zee Entertainment Enterprises Ltd announced their merger plan to create a $10 billion media behemoth that would challenge Disney Star’s leadership position in the market1. The deal is expected to close by mid-2022.

2023 K-Drama Lineup

If Disney decides to sell or partner with Reliance for its India business, it would mark a major shift in its global strategy. India is one of the largest and fastest-growing markets for streaming services, with over 500 million online video users and an expected revenue of $4.5 billion by 20253. Disney has invested heavily in its India operations over the years, acquiring Star India for $2.6 billion in 2019 as part of its $71 billion deal for 21st Century Fox’s entertainment assets2. Disney also launched its flagship streaming service Disney+ in India in April 2020, rebranding it as Disney+ Hotstar.

Last month, Reliance’s Viacom18 struck a deal with Warner Bros Discovery for its streaming platform JioCinema. The deal is seen as a big push by the company to compete against Netflix and Amazon by bringing Hollywood content onto the platform. The deal will see Warner Bros as well as its HBO content becoming available on JioCinema app4. This includes popular shows such as Succession, Game of Thrones and The Sopranos, and movies such as Lord of the Rings and Harry Potter5. HBO content returns to India through JioCinema’s new subscription plan. Before this deal, HBO content was available on Disney+ Hotstar until March 31 this year.

It remains to be seen whether Disney will find a suitable partner or buyer for its India business that can help it overcome its challenges and leverage its opportunities. As one of the sources said, “It’s not an easy deal to do”2.

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