Shawn Lim
Feb 29, 2024

What the Disney—Reliance merger means for marketers in India

As Disney's long-standing efforts to establish a presence in India seem to have paid off with the newly-announced Reliance merger, we take a preliminary look at what the deal signifies for marketers in the world's most populous nation.

What the Disney—Reliance merger means for marketers in India

The Walt Disney Company's historic announcement yesterday that it plans to merge its media business with Reliance Industries in an $8.5 billion joint venture marks a significant shift in the media landscape of India, the world's most populous nation.  

This partnership aims to create a media powerhouse, combining Disney's global content prowess with Reliance's market domination in India. As Disney’s senior partner in the deal, Reliance, owned by Mukesh Ambani, brings to the table its colossal market capitalisation and rights to the Indian Premier League (IPL) cricket matches—a major draw for Indian audiences.

As part of the deal, Reliance is set to inject $1.4 billion into the joint venture at closing, highlighting its commitment to the venture's growth trajectory. Following the completion of these transactions, Reliance will have a controlling stake of 16.34% in the venture, with Viacom18 owning 46.82% and Disney holding 36.84%.

So, what does this mean for marketers?

Whilst it's early days still and the details continue to unfold, for marketers in India this deal signifies a pivotal moment in the advertising and streaming space within India, opening up new opportunities for digital marketing at unparalleled scale.

With Disney and Reliance collectively holding a substantial market share of 40 to 45% in both advertising and streaming, the newly formed joint venture promises newfound reach and profitability. This collaboration is strategically positioned to optimise content costs and streamline operations, establishing both entities as premier destinations for both traditional television and digital streaming platforms. The amalgamation of Viacom18 and Star India's diverse content libraries and cutting-edge technology marks a significant paradigm shift, offering marketers novel opportunities for targeted and data-driven advertising.

Moreover, the exclusive rights unlocked upon the joint venture by Disney for the distribution of its films and productions in India, add another layer of significance to this partnership. Access to a vast repository of over 30,000 Disney content assets significantly enriches the entertainment options available to Indian consumers. For marketers, this translates into an expanded canvas for inventive and captivating promotional activities, tapping into the universally-appealing Disney content while leveraging the digital ecosystems of Reliance.

The implications for the global media landscape are equally noteworthy. Disney, despite its status as a $200 billion titan, has faced challenges in fully penetrating the Indian market. In addition to the imperative to serve culturally diverse content, intense competition from well-established local players, pricing perceptions, and the historical focus on English-language content have all contributed to the challenge for Disney to resonate with a broad spectrum of Indian consumers. Additionally, distribution obstacles, limited local partnerships, and regulatory complexities have also hindered investment opportunities and marketing penetration.

This joint venture not only underscores Disney's commitment to India as a key international growth market, but also reflects a strategic pivot in its approach to global expansion, prioritising partnerships over solo ventures. The merger comes at a time when Disney is already re-evaluating its strategies elsewhere, including its recent challenges with subscriber losses in India and more widely in Asia-Pacific, the winding down of Lucasfilm's operations in Singapore.

It also coincides with Disney's innovative endeavors in the sports broadcasting domain, where it, alongside Fox and Warner Bros. Discovery, plans to launch a new joint streaming service aimed at capturing the evolving preferences of sports fans. 

From a local standpoint, the venture also signals a renewed jolt in the mergers and acquisitions market, as competitors like Zee Entertainment and Sony, who have had their own challenges and strategic realignments, highlight the tumultuous nature of the media industry in India. Zee's failed merger with Sony and subsequent financial troubles, contrasted with Disney's bold move, underscore the dynamic and competitive environment in which these media giants operate, and the opportunities marketers have to participate.

As this partnership unfolds, it will be crucial for marketers to monitor the evolving dynamics and leverage the opportunities that this new media powerhouse is likely to offer. 

Campaign Asia

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