Reliance and Disney Seek Antitrust Clearance for $8.5 Billion India Media Merger

Reliance Industries and Walt Disney are pursuing antitrust approval for their $8.5 billion media merger in India, arguing that their combined presence, especially in cricket broadcasting, will not negatively impact advertisers, according to sources close to the matter. Announced in February, the merger is anticipated to undergo rigorous scrutiny as it aims to create India’s largest entertainment conglomerate, encompassing 120 TV channels and two streaming services, along with premier cricket broadcasting rights.

Key Points:

Cricket Rights and Competitive Bidding:

The companies have assured the Competition Commission of India (CCI) that the cricket broadcasting rights were secured through a competitive bidding process.

They maintain that competitors will have the opportunity to bid for these rights again when they expire in 2027 and 2028.

Impact on Advertisers:

Reliance and Disney argue that the merger will not harm advertisers since cricket viewers can be reached through multiple platforms, including YouTube and Meta.

They emphasize that content consumption in India spans various TV channels, social media, and streaming apps, ensuring advertisers retain diverse options.

Market Concerns and Estimates:

Concerns have been raised that the merger could give the combined entity significant leverage over advertisers and consumers.

Jefferies estimates the merged entity will control a 40% share of the TV and streaming advertising market.

Regulatory Review Process:

The CCI will review the merger filing, a process that typically spans several weeks but could extend if further information is required.

Former CCI mergers head K.K. Sharma noted potential regulatory concerns about the merger granting near-total control over cricket broadcasting to Disney-Reliance.

Market Impact:

The merger is poised to transform India’s $28 billion media and entertainment sector.

The new entity will rival major players like Netflix, Amazon Prime, Zee Entertainment, and Sony.

Reliance, Disney, and the CCI have not yet responded to requests for comment on the merger.

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