Reliance Industries and Walt Disney have reportedly offered to sell a portion of their television channels to expedite antitrust approval for their proposed $8.5 billion merger of media assets in India. The merger, announced in February, aims to create the largest entertainment entity in India, intensifying competition with industry giants such as Sony, Zee Entertainment, Netflix, and Amazon. However, concerns regarding the combined entity’s market dominance, particularly in cricket broadcasting, have led to a closer examination by India’s Competition Commission (CCI).
The CCI, which has privately posed around 100 questions regarding the merger, is concerned that the merger could lead to excessive pricing power and increased influence over advertisers due to the merger’s control over cricket broadcasting rights. In response, Reliance and Disney have offered to divest fewer than 10 television channels, particularly in regional Indian language markets where they hold a dominant share. Notably, the companies are reluctant to alter their cricket broadcasting rights, which include the highly lucrative Indian Premier League (IPL).
Cricket is a significant point of contention, given its massive popularity in India and its substantial advertising revenue. The merged entity is expected to control 40% of the advertising market across TV and streaming platforms. Despite the CCI’s scrutiny, Reliance and Disney have argued that the cricket rights cannot be sold or sublicensed without prior approval from the Indian cricket board, and that these rights will expire in 2027 and 2028, complicating the matter further.
The outcome of this antitrust review remains uncertain, with both companies resisting significant changes to their cricket broadcasting arrangements while offering limited concessions to alleviate concerns regarding market dominance.
Featured Image courtesy of The Globe and Mail
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