Reliance Industries Limited (RIL) is exploring the merger of its streaming service JioCinema with Disney+ Hotstar, owned by Walt Disney's Star India, aiming to consolidate its content and create a more robust OTT platform. The proposed merger, valued at approximately $8.5 billion, is part of RIL's strategy to streamline its media operations and enhance efficiency.
Disney+ Hotstar is currently one of India’s leading streaming services, boasting over 500 million downloads on the Google Play Store. In contrast, JioCinema, which falls under Viacom18 (a subsidiary controlled by RIL), has around 100 million downloads. Despite Disney+ Hotstar’s larger user base, RIL is considering integrating its content with JioCinema to reduce operational costs and improve competitiveness against global players like YouTube, Netflix, and Amazon Prime Video.
The merger follows a deal earlier this year where RIL and Walt Disney agreed to combine Star India and Viacom18, creating a media conglomerate with extensive assets, including over 100 TV channels and two OTT platforms. However, RIL seems inclined to focus solely on JioCinema, which is poised to benefit from the merger by consolidating a vast library of content.
The merger is still pending regulatory approval from the Competition Commission of India (CCI) and the National Company Law Tribunal (NCLT). To address potential market dominance concerns, RIL has expressed willingness to consider shutting down some Hindi and regional language TV channels if necessary.
According to RIL’s 2023 annual report, JioCinema averaged 225 million monthly users, while Disney+ Hotstar had 333 million active users in the last quarter of 2023. However, Disney+ Hotstar has experienced a notable decline in its paid subscriber base, dropping from 61 million at its peak to 35.5 million as of June 2024, largely due to losing streaming rights for high-profile content like the Indian Premier League (IPL) and HBO shows.
JioCinema, on the other hand, has gained significant traction, especially following its acquisition of the IPL digital rights, which drove record-breaking viewership. RIL chairman Mukesh Ambani has highlighted this success as indicative of JioCinema’s potential to quickly attract a large audience.
The merger would potentially transform JioCinema into India's largest streaming service, integrating over 125,000 hours of entertainment, sports, and Hollywood content. The new platform would benefit from valuable sports rights, including the IPL, and content from major studios like Disney, HBO, NBCUniversal, and Paramount Global.
RIL's strategy reflects its broader approach of consolidating digital assets to strengthen its market position. This includes previous integrations like merging Voot into JioCinema. The recent transfer of JioCinema to Viacom18, combined with a significant investment of Rs 15,145 crore from RIL and Bodhi Tree Systems into Viacom18, underscores the company's commitment to enhancing its media and entertainment portfolio.
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