New technology has always disrupted existing edifices, pushing the weak and inefficient under, while others scramble to acquire heft in a rapidly changing ecosystem. It is no surprise then that consolidation was the name of the game for the media sector in 2018. From Reliance’s multiple acquisitions to mammoth mergers like the Videocon-Dish TV deal, the industry saw large-scale consolidation in the race for dominance in the converging technology, media and telecom (TMT) space.
With technology firms like Amazon and Google effectively blurring the lines between previously clearly segmented ecosystems, the year saw a slew of partnerships, mergers and acquisitions between telecom firms, content creators and technology platforms.
Reliance flying high
Reliance Industries, with its sprawling interests, has been one of the prime movers this year. Having almost single handedly driven India’s mobile internet consumption story with Reliance Jio (RJio), RIL and its subsidiaries have made major acquisitions. For one, RIL took control of the Viacom18 joint venture by buying one per cent for USD 20 million, making RIL’s TV18 the majority shareholder. Viacom18 currently operates more than 40 TV channels across 80 countries. To beef up muscle in content, it picked up a 5 per cent stake in motion picture giant Eros International.
It also used RJio to pick up two companies in the wired broadband and cable TV segments. It paid `2,290 crores for a 66 per cent stake in Den Networks, India’s largest cable TV distributor, and Rs 2,940 crore for a 51.3 per cent stake in Hathway, another cable TV giant. Both have a significant presence in wired broadband too.
A DTH giant is born
While RIL was pocketing wire service assets, the airwaves saw a direct-to-home giant created through the merger of Dish TV India and Videocon d2h. Dish TV has benefitted from a sharp rise in its average revenue per user (ARPU), with the merged entity’s ARPU rising to Rs 207 from Dish’s Rs 144 pre-merger. Dish TV-Videocon d2h is now the largest DTH operator in India with nearly 45 per cent market share and over 29 million subscribers.
Times goes a-streaming
Another of India’s media giants — the Times Group — paid Rs 1,000 crore to buy a majority stake in video playback app MX player. The deal is expected to help Times in the OTT race. MX Player currently has upwards of 350 million users in India, of whom 175 million use it every month, with 80 per cent users under the age of 34. MX has already announced investments in original content with a focus on high-quality Hindi and regional languages.
AT&T almighty
Global telecom giant AT&T acquired content major Time Warner in a USd 85 billion deal this year. AT&T has now gained access to content of Time Warner properties like CNN, HBO and Warner Brothers. While the deal had to wait nearly two years for approval, a six-week trial saw the US courts rule in favour of the deal
A foxy move
Another humdinger of a deal in the sector was the USD 71 billion acquisition of movie powerhouse 21st Century Fox by Disney. With shareholders approving the deal almost immediately, only regulatory approvals in both US and foreign markets remain. Disney is now set to take the fight to OTT giants Amazon and Netflix