A proposed merger between Walt Disney and Reliance’s media assets in India is poised to face intense antitrust scrutiny due to concerns over market power, particularly in the realm of cricket broadcast rights. Legal experts have raised flags, highlighting the potential impact on advertisers by the combined entity’s robust portfolio.
The $8.5 billion merger, if approved, would catapult the conglomerate into the position of India’s leading television player, boasting a formidable arsenal of 120 channels. This would significantly outstrip local competitor Zee, which currently commands a distant 50 channels.
According to analysts at India’s Ambit Capital, the merged entity, primarily owned by billionaire tycoon Mukesh Ambani’s Reliance, is anticipated to corner a substantial 35% share of India’s TV viewership market. While the overall television landscape will come under close scrutiny by the Competition Commission of India (CCI), attention is expected to be particularly focused on the cricket segment.
Related: Anticipated Antitrust Concerns Arise in Reliance-Disney Merger
Cricket enjoys an almost religious fervor in India, with fans venerating players as deities. Companies spare no expense in acquiring broadcast rights or investing in advertisements to entice consumers to their offerings. Disney currently holds the television broadcast rights for the Indian Premier League (IPL), the world’s most lucrative cricket tournament, along with both television and streaming rights for matches organized by the International Cricket Council (ICC). Meanwhile, Reliance possesses streaming rights for the IPL and holds the Indian cricket board’s rights for all matches.
K.K Sharma, a former head of mergers at CCI, emphasized that the proposed Disney-Reliance merger is bound to attract significant regulatory attention due to the immense market power it would wield, particularly within the cricket domain. He suggested that such a consolidation would necessitate a thorough and rigorous examination by antitrust authorities.
Source: Reuters
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