Reliance Industries and Walt Disney Divest Seven Channels in Major Media Merger

Reliance Industries and Walt Disney are set to divest seven TV channels. They will also ensure that advertisement slots for cricket events are not bundled. These steps are part of the Competition Commission of India's (CCI) approved measures for merging their media assets, forming a Rs 70,000 crore media giant. The CCI released a detailed 48-page order outlining these measures to prevent anti-competitive practices post-merger.

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The merged entity will possess significant sports properties, including the Indian Premier League (IPL) and ICC cricket tournaments, both on TV and digital platforms. It will also have rights to Wimbledon, Pro Kabaddi League, and BCCI domestic cricket matches. Concerns were raised by the advertising industry about potential higher charges for ads during major cricket events due to the merger of Reliance Media assets and Star India, a part of Walt Disney.

Advertising Rates and Bundling

In response to these concerns, both parties have agreed not to raise advertisement rates unreasonably for ICC and IPL events on their TV and streaming platforms. The CCI order specifies that the merged entity will not bundle TV advertisement slot sales for major cricket events like IPL, ICC, and BCCI matches with Prasar Bharti, the public broadcaster.

Reliance and Walt Disney have voluntarily committed not to bundle OTT ad slot sales for all three cricketing rights they hold. Both OTT platforms, Disney+Hotstar by Star and JioCinema by Viacom18, will continue operating separately. Additionally, ad slot sales for IPL on TV and OTT will not be bundled together.

Divestment of Channels

Among other measures, the entities will divest seven channels: Star Jalsha Movies, Star Jalsha Movies HD, Colors Marathi, Colors Marathi HD, Colors Super (Kannada General Entertainment Channel), Hungama, and Super Hungama (Kids Channel Segment). These channels are operated by Viacom18 under Reliance Industries or Star India.

The divestment includes licenses for trademarks, channel names, and logos for a reasonable period agreed with approved purchasers. For five years post-divestment, neither party nor their joint venture can acquire any stake or influence over these channels.

Monitoring and Restrictions

The CCI has stipulated that the purchase of these channels should not involve Zee Entertainment, Culver Max Entertainment (Sony Pictures), or South-based Sun TV Network. An independent agency will be appointed by the regulator to monitor the sale of these divested TV channels.

On August 28, CCI approved the merger of media assets from Reliance Industries and The Walt Disney Co., creating India's largest media empire worth over Rs 70,000 crore. This deal faced scrutiny from the anti-trust regulator earlier this year but received approval after modifications were proposed to the original transaction structure.