The Indian media landscape is on the brink of a major transformation. At the upcoming FICCI-Frames conference in Mumbai, a hot topic of discussion will be the future of Indian media, focusing not on what could have been, but on what lies ahead.
The recent collapse of the Sony-ZEE merger plans, followed by the news of Mukesh Ambani’s Reliance Industries acquiring Disney’s streaming and pay-TV businesses in a massive $8.5 billion deal, has set the stage for a new market leader in Indian media.
This seismic shift will have significant implications for local and international players across various sectors, including streaming, pay-TV, channels, advertising, sports, and content.
According to experts at Singapore-based consultancy Media Partners Asia, the merged entity of Reliance Industries and Disney India (including Disney+ Hotstar and Star TV) will hold a staggering 35% of total TV viewership, 40% of the revenue market for broadcasters, and a commanding 45% share of the premium VOD streaming market, excluding YouTube and Meta.
The deal, expected to close within a year, will not only enable the Reliance-Disney group to dominate the market but also create opportunities for long-term partnerships and cost savings. There are even rumors of the group potentially acquiring Disney’s stake in the Tata Sky satellite business.
This consolidation in the Indian media industry highlights the challenges faced by foreign entities trying to navigate this complex landscape. Disney, in particular, has experienced setbacks in India, including a $1 billion write-down on Star India and a previous failed acquisition of film and TV giant UTV.
Sony, too, has faced its fair share of hurdles in India, with unsuccessful acquisitions and the need to find new avenues for growth. The traditional family-controlled business Zee, despite its financial constraints, manages to sustain itself with its extensive content library, attracting potential partners.
While the Indian media and entertainment market continues to be dynamic and growing, it has experienced a slowdown in content investments due to corporate uncertainties and reevaluations of content priorities. The challenge lies in finding and producing Indian shows that resonate internationally, beyond the diaspora audience.
Global streaming platforms like Netflix have recognized this challenge and are increasing their acquisitions of third-party-produced film rights. However, the new Viacom18 / JioCinema and Disney combination poses a strong competition to Netflix, with the ability to offer a diverse range of international and Indian content.
As the industry consolidates and channel portfolios are pruned, broadcasters’ affiliate fee revenues may be affected. Smaller networks and news channels face the greatest vulnerability, while larger players like Zee and Sun may be the last to face significant impact.
It’s also important to note the immense popularity of social video platforms in India. YouTube and Meta (Facebook, Instagram, and Whatsapp) dominate the market, constituting approximately 30% of total revenues. The exponential growth of Instagram Reels and YouTube on big-screen TVs further reinforces the dominance of these platforms.
While India’s TV channels have the opportunity to expand their broadcaster-VOD operations, they lack the technology prowess of Meta and Google. As a result, they may seek mergers or alliances to bridge this technological gap.
In the streaming space, smaller specialist streamers cater to the diverse linguistic preferences of different regions in India. However, the big players are now focused on commissioning original programming in all major Indian language groups to capture the burgeoning market of Bharat, the multilingual and aspirational segment of the population.
Mukesh Ambani, with his ambition for scale, has already achieved market leadership in the telecom and retail sectors. The Disney-Reliance deal represents his strategic move to replicate this success in the media business, as he aims to become a dominant player in this rapidly evolving industry.
So, as the Indian media landscape undergoes this transformation, all eyes are on the future. The FICCI-Frames conference will be a platform for industry leaders to shape their strategies and explore new possibilities in a market that holds enormous potential.
Source link: F5mag.com