By BestMediaInfo Bureau

The merger of Viacom18 and Star India will have a big impact on the entire media and entertainment ecosystem as  the combined entity will command a huge market share, Karan Taurani, SVP- Research Analyst (Media, Consumer Discretionary and Internet), Elara Capital, said.

However, the consolidation in the TV sector might negatively affect other linear TV broadcasters like Sun TV, Zee, Sony, and others, Taurani said while adding that this could hinder their ability to increase market share.

He also mentioned that the merged entity's emphasis on boosting market share through increased content investments, synergies and enhanced marketing capabilities presents challenges for individual broadcasters in terms of competition and growth.

Reliance Industries Limited, Viacom 18 Media Private Limited and The Walt Disney Company Wednesday announced the signing of binding definitive agreements to form a joint venture (“JV”) that will combine the businesses of Viacom18 and Star India.

As part of the transaction, the media undertaking of Viacom18 will be merged into Star India Private Limited (“SIPL”) through a court approved scheme of arrangement.

Deeper inroads into the Indian M&E ecosystem

The merger will create a large media juggernaut with 108+ channels (Star India has 70+ TV channels in 8 languages whereas Viacom has 38 TV channels in 8 languages), two large OTT apps (Jio Cinema and Hotstar) and two film studios (one each of Reliance and Disney India).

Post the merger, the combined entity will command a TV advertisement/TV subscription (excluding distributors/DTH/MSO revenue)/Total TV market share of 40%/44%/42% (as of FY23) respectively. The merged entity is expected to command a digital OTT market share of 34% in CY23, while the TV viewership share in top 10 channels (according to BARC) is 40% as of CY23 , Taurani said.

“The consolidation between RIL and Disney on the TV side could have a negative impact on other linear TV broadcasters, such as Sun TV, Zee, Sony, and others, as they may not be able to scale up on market share.

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