Get the scoop on the Reliance Disney Merger deal and potential clash between cricket giants and the looming antitrust storm! Dive into the latest buzz, poised to reshape India’s TV landscape and cricket viewing experience. Discover why advertisers and regulators are on high alert as two industry titans vie for control.
Antitrust Scrutiny Looms Over Reliance Disney Merger
Experts anticipate a scenario reminiscent of the Zee-Sony merger, where antitrust scrutiny becomes a focal point amidst the Reliance Disney Merger deal and the landscape of cricket viewing. The proposed merger between Mukesh Ambani-led Reliance Industries and Walt Disney India could potentially draw the attention of antitrust regulators, as predicted by industry analysts. This merger aims to establish India’s largest TV player, boasting an extensive portfolio of over 120 channels and carrying a valuation of $8.5 billion.
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Concerns Raised by Legal Experts
Legal experts have raised concerns, particularly regarding the combined entity’s formidable collection of cricket broadcast rights and its potential impact on advertisers. The merger is expected to command a substantial 35 percent viewership share in the Indian television market. Notably, both Reliance and Disney have previously made substantial investments, amounting to billions of dollars, to secure telecast rights for prominent cricket tournaments.
Antitrust lawyers emphasize that cricket rights will be under scrutiny, alongside an overall examination of the TV space by the Competition Commission of India (CCI). Six antitrust lawyers have indicated that regulators will closely analyze market share dynamics and the influence wielded by the merged entity, especially within the cricket segment. K.K Sharma, former head of mergers at CCI and currently a senior partner at Singhania and Co., remarked that the Reliance Disney Merger is bound to attract attention due to the significant market power they will possess, particularly in cricket. Sharma emphasized the need for a thorough investigation, stating, “With Disney and Reliance together, hardly anything of cricket will be left. The regulator gets concerned even when there is a possibility of dominance. Here, it is not merely dominance but almost absolute control over cricket.”
Impact on Advertisers and Bargaining Power
Analysts and legal experts contend that Reliance Disney Merger will be a dominant player in the cricket viewing ecosystem could lead to advertisers facing diminished bargaining power, thereby inviting scrutiny from the CCI. Given the substantial presence of both companies across television and streaming platforms, there are concerns about potential market distortions.
Drawing parallels with the CCI’s intervention in the Zee-Sony merger, experts speculate that regulators may require Viacom18 and Disney Star to divest channels in specific categories where their market shares exceed acceptable thresholds. This regulatory action underscores the importance of maintaining a competitive balance within the industry. Notably, both Reliance and Disney have fiercely competed for cricket broadcast rights, with Reliance offering free live streaming of Indian Premier League matches following its $2.9 billion rights acquisition. Subsequently, Disney countered by providing free live streaming of the Cricket World Cup on mobile devices.
In conclusion, the proposed Reliance-Disney merger, aimed at creating a dominant force in the Indian television landscape, is likely to face rigorous scrutiny from antitrust regulators, particularly concerning its control over cricket broadcast rights and potential implications for advertisers. The outcome of this scrutiny will not only shape the future of the merged entity but also set precedents for competition regulation within the industry.
Bhaarat Bulletin’s Shikha Rai, Bimal Dev, and PTI have contributed to the above report
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