Disney-Reliance merger a watershed moment in India’s M&E: Harsha Razdan

The Disney-Reliance merger represents a transformative development in the Indian media and entertainment industry. The combined entity will hold significant influence over content creation, distribution, and consumption patterns in India. Pending regulatory approvals, this merger is poised to establish a dominant force, consolidating influence over content creation, distribution, and consumption patterns in the country.

According to market analysts, the transaction values the joint venture at Rs 704 billion (~USD 8.5 billion) on a post-money basis, excluding synergies. Post completion of the above steps, the JV will be controlled by RIL and owned 16.34% by RIL, 46.82% by Viacom18 and 36.84% by Disney.

The merger will create a large media juggernaut with 108+ channels (Star India has 70+ TV channels in 8 languages, whereas Viacom has 38 TV channels in 8 languages), two large OTT apps (Jio Cinema and Hotstar) and two film studios (one each of Reliance and Disney India).

Sharing his insights with Adgully on the implications of this mega merger, Harsha Razdan Harsha Razdan, CEO - South Asia, dentsu, said that the merger signifies a watershed moment that can inherently reshape and revolutionise the landscape of the Indian media and entertainment industry in the next two years.
“Once it has cleared all industry-specific regulation protocols, the combination should create a significantly dominant player in the market, wielding substantial influence over content creation, distribution, and consumption trends in the country,” he added.

According to Razdan, for the advertising and marketing sector, this presents a dual prospect of opportunities and challenges. “On the positive side, it unlocks fresh possibilities for crafting and deploying innovative and compelling campaigns across an extensive and diverse portfolio of channels and platforms, providing us with extensive reach. However, it also heightens competition and enhances the negotiating power of the newly merged entity, enabling it to exert greater control over pricing and inventory,” he noted.

Razdan hoped that in the coming years, the merger would achieve a balanced outcome. According to him, it’s crucial to maintain two or three major players in the market to foster a healthy and competitive environment, which ultimately should serve the end consumer.