NEW DELHI: Walt Disney’s landmark $52.4bn deal with 21st Century Fox made headlines around the world last week and India is one of the major markets where it is likely to have far-reaching implications.
In its analysis of the deal that effectively makes Disney the world’s largest media company, Business Standard said it would “fundamentally change India’s TV broadcast landscape”.
All of Star India, including its entertainment and sports channels as well as digital OTT channel Hotstar, will transfer to Disney, which also takes over Rupert Murdoch’s 20% stake in Tata Sky, the direct-to-home operator.
Disney has been operating in India since 1993, yet until now it has been a relatively small player in the country’s huge TV market.
In the children’s TV genre, Disney Channel and Hungama TV, another Disney channel, are the second and third largest respectively after Viacom18’s Nickelodeon, but many of Disney’s other assets lag way behind its competitors.
UTV, for example, which Disney acquired in 2011, currently has just eight channels compared to Star India’s 70 channels, Viacom’s 42 and more than 74 owned by the Zee network.
According to Business Standard, Disney’s relatively small footprint is very likely to change significantly following its acquisition of Star India, especially as there are no regulatory issues due to Disney’s previously limited market share.
“The move will catapult Disney, currently a small player known primarily for its kids’ channels and distribution of Hollywood films, as the country’s largest media and entertainment broadcaster, with over $1.3bn of additional India revenue,” noted Senior Editor Surajeet Das Gupta.
Among its many other investments, Star India has acquired the global media rights to the Indian Premier League (IPL) cricket tournament.
And even without accounting for the IPL rights acquisition, independent analysts have valued the company’s India business at between $11bn and $14bn.
In addition, the company aims to generate pre-tax income of $500m in its current financial year ending June 2018, before doubling revenues to $1bn by 2020.
Sourced from Business Standard; additional content by WARC staff