Reliance, Disney Said to Seek CCI Nod With Cricket Rights Assurance

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Reliance Industries and Walt Disney have sought antitrust clearance for their $8.5 billion Indian media merger arguing that their combined power, particularly in cricket broadcasting, will not affect advertisers, two people with direct knowledge told Reuters.

Experts expected the deal, announced in February, to face intense scrutiny as it will create India's biggest entertainment player with 120 TV channels and two streaming services. It will also have lucrative rights for cricket, India's main sport.

Reliance and Disney have told the Competition Commission of India (CCI) that the cricket rights were obtained separately through a bidding process that was competitive, said the two sources, who declined to be named because the process of approval is confidential.

The companies argue that other competitors will not be harmed as they can bid when those rights expire in 2027 and 2028, the sources added.

The CCI will now review the confidential file. Although any authorization usually takes several weeks, it can take longer if the watchdog is not satisfied and seeks more information.

Reliance, Walt Disney and the CCI did not immediately respond to requests for comment.

Disney and Reliance currently own digital and television cricket rights worth billions of dollars for the world's most valuable cricket tournament, the Indian Premier League, International Cricket Council matches and Indian cricket board matches .

This has raised concerns that the merged entity could have too much influence over advertisers and consumers, with KK Sharma, CCI's former head of mergers, saying in March that the regulator may be concerned that “there will be almost nothing left of cricket” like Disney-Reliance. will have “absolute control over cricket”.

Jefferies has estimated that the Disney-Reliance entity will have a share of 40% of the advertising market in the television and streaming segments.

The companies have told the CCI in their submission that there will be no impact on advertisers as consumers watching cricket can be targeted on many rival platforms where they also consume content, including YouTube and Meta, the sources said.

Similarly, the companies have said, Indians consume content through TV channels, social media and streaming apps, and advertisers will not be harmed by the deal.

“The lines are blurring (between TV and digital). Companies are targeting demographics. If they don't like the ad rates of the Disney-Reliance entity, they can always target a consumer,” the first source said.

The deal is set to reshape India's $28 billion media and entertainment market, where the Reliance-Disney combination will compete with Netflix, Amazon Prime, Zee Entertainment and Sony.

© Thomson Reuters 2024


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