Disney and Reliance Entertainment are merging. Its merger has received approval from the Competition Commission of India i.e. CCI. This will become India's largest entertainment company. It will also become a sports powerhouse. The company will have 7.5 crore viewers across India. Question: How many channels and OTT platforms will the new company have? Answer: 80 channels of Disney Star and 40 channels of Reliance Viacom18 will be added in this mega-merger. That means there will be a total of 120 channels. However, some of these channels may be closed. Both also have OTT apps – Disney Hotstar and Jio Cinema. After the merger, the new company will have 2 lakh hours of digital content. Viacom 18 also has the TV rights to BCCI-run cricket matches, while Disney Star has the TV rights to telecast the IPL till 2027. Reliance has the rights to show IPL on its OTT platform Jio Cinema. Reliance's news channels will not be part of the deal as they come under the Network 18 group. The joint venture will also be given exclusive rights to distribute Disney films and productions in India along with licensing of over 30,000 Disney content assets. Question: Why Reliance-Disney merger is happening, what is its benefit? Answer: Walt Disney CEO Bob Iger recently said that there is a lot of competition in the market, so a merger would create a bigger company, which would help it stay on top of the market. The new company will have the largest OTT customer base. Disney Hotstar has around 3.6 crore paying subscribers and Reliance has 1.5 crore paying subscribers. That means there are total 5.1 crore customers. The partnership with Reliance will give Disney an opportunity to grow its business and reduce risk. At the same time this will give Mukesh Ambani a firm grip on the $28 billion i.e. around Rs 2.3 lakh crore entertainment sector. The new company will be able to compete with companies like Sony and Netflix. Question: What will be the share of the advertising market after the merger? Answer: The merged entity will have 40% share of the Indian advertising market in the TV and streaming segments. The new company will have a monopoly on cricket advertising revenue. Apart from cricket, there will also be broadcast rights to the Wimbledon Tennis Championships, MotoGP and the English Premier League. Question: How will this merger affect you, will you get cheaper plans? Answer: India is a huge market for entertainment services. In such a situation, American streaming companies like Netflix, Amazon are attracted towards the Indian market. Disney and Reliance are also into OTT, facing competition from Netflix and Amazon. Both these companies may launch cheaper plans to increase user base. Which will directly benefit the audience. While Disney viewers will have access to Reliance content and Reliance viewers will have access to Disney content. Question: How much is this deal, who will be the chairperson of the new company? Answer: This deal is worth 8.5 billion dollars (about 71 thousand crore rupees). After the merger, Reliance will hold 63.16% and Disney will hold 36.84%. Nita Ambani will be its chairperson. Question: When will the Reliance Disney deal be completed, what are the hurdles? Answer: The deal is expected to close in 6 months. It will also need the approval of the Indian Companies Tribunal to complete the deal. KK Sharma, the former head of mergers at CCI, has said that, if the deal goes through, it will be a 'big fish in the broadcasting market' with a 'monopoly on cricket advertising revenue'.
Image Credit: (Divya-Bhaskar): Images/graphics belong to (Divya-Bhaskar).
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