Disney Star-RIL to dominate 80% sports broadcasting: Will it change rules of the game?
Ever since talks about a potential merger between Reliance Industries and Disney Star first emerged last year, there have been concerns over the possibility of this alliance creating a monopoly in India's media and sports markets. Now, with the approval from the Competition Commission of India (CCI), these fears are closer to becoming a reality. The combined entity will dominate around 75-80% of sports broadcasting, particularly cricket, raising worries about reduced competition and higher prices. While the merger promises operational efficiencies and a unified platform for advertisers, it also amplifies fears of market dominance. However, though the CCI’s approval includes conditions to address these issues ensuring a fair and competitive landscape, significant market power domination seems inevitable.
window.googletag = window.googletag || {cmd: []};
googletag.cmd.push(function() {
googletag.defineSlot('/21740140234/e4m_story_page_para3_small_horizontal_banner_3_728x90_normal', [728, 90], 'div-gpt-ad-1595331589677-0').addService(googletag.pubads());
googletag.pubads().enableSingleRequest();
googletag.enableServices();
});
window.googletag = window.googletag || {cmd: []};
googletag.cmd.push(function() {
googletag.defineSlot('/21740140234/e4m_story_page_para3_small_horizontal_banner_3_728x90_normal_next', [728, 90], 'div-gpt-ad-1601359261569-0').addService(googletag.pubads());
googletag.pubads().enableSingleRequest();
googletag.enableServices();
});
Monopoly could drive up ad revenues According to Harsha Razdan, CEO, South Asia, dentsu, advertisers now have a one-stop shop for everything from Hindi and regional entertainment to sports, music, and international content. “However, with this scale comes the inevitable power to influence market dynamics, including pricing. The control over 80% of India’s cricket broadcasting alone speaks volumes. While some may worry about rising ad rates, this is an opportunity for smarter, more targeted ad spends and a unique chance to integrate marketing plans across TV and digital platforms for greater impact and efficiency. The sheer reach and diversity of this new entity mean that advertisers can now connect with audiences on an even larger scale, across multiple platforms,” said Razdan. He also added that the industry must adapt by focusing on creativity and consumer-centric strategies to navigate these changes. “As this giant takes form, let’s ensure that we leverage its strengths to continue delivering value-driven, impactful solutions. After all, in the world of advertising, the only constant is change, and this merger is simply the opportunity to ride the next big wave.” This merged entity is set to command around 40-45% of the TV market and 30-35% of the digital space—a scale that’s unprecedented. This dominance in sports, primarily cricket, positions the merged entity to command a substantial share of the overall ad market, showcasing strong growth in an industry where sports is a key driver of viewership on both linear TV and digital platforms. Karan Taurani, SVP, Elara Capital shared, “In CY22, sports adex (TV+Digital) in India stood at INR 71bn (according to GroupM) out of which Disney India had a contribution of 80%. The combined entity will have lucrative sports properties like Indian Premier League (both TV and digital), ICC cricket tournaments (both TV and digital), Wimbledon, Pro Kabaddi League, BCCI domestic cricket etc.” Regulators must ensure market balance After the CCI clearance, additional approvals from the NCLT, Ministry of Information and Broadcasting (MIB), exchanges, and shareholders will be needed. The merger expected to finalize by January-February 2025, as per the media analysts. Alay Razvi, Partner, Accord Juris shared, “We can’t deny that this merger has brought significant market power where the entity will hold the majority of content, from movies to sports and other digital platforms. This raises concerns for the smaller players to compete. This is where CCI will have a crucial role in balancing the market and making sure that no monopoly arises out of this merger, protecting the rights of other players.” Since the detailed order of the CCI is still pending, Rohit Jain, Partner, Singhania and Co, believes that it is possible that these modifications might include commitments from the merging parties to divest some non-sports channels and to adhere to fair practices in cricket broadcasting, such as avoiding unfair increases in advertisement rates. He further added that the merger may still face additional legal and regulatory challenges. Jain stated, “Furthermore, since the Board of Control for Cricket in India (BCCI) awarded Viacom18 the rights to stream the IPL on JioCinema and Disney Star holds the television broadcasting rights, any impact of the merger on these rights would require prior approval from the BCCI, which could further delay or affect the merger.” Over Rs 80,000 crore riding on cricket The media rights saga began in June 2022 when Viacom18 and Disney Star collectively paid Rs 48,390 crore for IPL Men’s digital and TV rights. In August 2022, Disney Star secured TV and digital rights for all ICC cricket events in India through 2027, investing $3 billion (Rs 24,800 crore). Viacom18 later acquired Women’s IPL media rights for Rs 951 crore, and in a recent auction, it paid Rs 5,963 crore for the media rights to BCCI’s bilateral India matches, covering both TV and digital. The two media networks- Disney Star and Viacom18- together have paid Rs 80,104 crore for all the major cricket matches. These major cricket properties, including the IPL, World Cups, and T20 matches, draw significant viewer and advertiser interest due to their widespread appeal. Experts anticipate that post-merger, the network will have increased leverage to demand higher rates and potentially secure even greater revenue. In addition to major cricketing properties, the merged entity will hold the media rights to the FIFA World Cup, the Olympics, and the NBA. This broad portfolio leaves little room for other players to thrive in the sports genre. It is important to note that apart from Disney Star and Viacom18, Sony Pictures Network India (SPNI) is the only broadcaster which owns some other sports properties including cricket. For instance, SPNI owns the rights to various events such as the Champions League, UEFA Nations League, Emirates FA Cup, UEFA Europa League, ROSHN Saudi Pro League, Asian Games, WWE, and more.
Tags : Disney Star Reliance Merger Cricket Broadcast Sports On Tv