Disney has announced that it has merged its Star India business with Reliance Industries and Viacom18, which will bring together Star India and JioCinema together to create a huge entertainment business in India.

The new joint venture has been valued at ₹ 70,352 crore (~US$ 8.5 billion) on a post-money basis, excluding synergies. At the closing of the transactions noted above, the joint venture is controlled by Reliance (16.34%), Viacom18 (46.82%  and Disney (36.84%).     Recently, Reliance also brought out Paramount’s 13.01% stake in Viacom18, which means it now has a 70.49% stake in.

Mrs. Nita M. Ambani will be the Chairperson of the Joint Venture, with Mr. Uday Shankar as Vice Chairperson providing strategic guidance to the JV.  

The joint venture is home to the most iconic and engaging media brands in India across TV and digital platforms. The combination of ‘Star’ and ‘Colors’ on the television side and ‘JioCinema’ and ‘Hotstar’ on the digital front will provide extensive choice of content across entertainment and sports to viewers in India and globally.

The formation of the JV will herald a new era in India’s entertainment industry for consumers. This unique joint venture of Reliance and Disney brings together the companies’ content creation and curation prowess, world-class digital streaming capabilities along with a digital first approach that will help the JV deliver unparalleled content choices at affordable prices to Indian viewers and the Indian diaspora globally.

The JV will be one of the largest Media & Entertainment companies in India with pro forma combined revenue of approximately ₹ 26,000 crore (~US$ 3.1 billion) for the fiscal year ended in March 2024. The JV operates over 100 TV channels and produces 30,000+ hours of TV entertainment content annually. The JioCinema and Hotstar digital platforms have an aggregate subscription base of over 50 million. The JV holds a portfolio of sports rights across cricket, football and other sports.

The Competition Commission of India (“CCI”) approved the transaction on 27 August 2024, subject to the compliance with certain voluntary modifications offered by the parties. Apart from the CCI, the transaction has been approved by anti-trust authorities in the EU, China, Turkey, South Korea and Ukraine.

Speaking about the JV, Mr. Mukesh D Ambani, Chairman & Managing Director of Reliance Industries Limited, said in a statement:

“With the formation of this JV, the Indian media and entertainment industry is entering a transformational era. Our deep creative expertise and relationship with Disney, along with our unmatched understanding of the Indian consumer will ensure unparalleled content choices at affordable prices for Indian viewers. I am very excited about the JV’s future and wish it all the success.”

Mr. Robert A. Iger, Chief Executive Officer, The Walt Disney Company added:

“This is an exciting moment for our two companies, as well as for India’s consumers, as we create one of the top entertainment entities in the country through this joint venture.  By joining forces with Reliance, we are able to expand our presence in this important media market and deliver viewers an even more robust portfolio of entertainment, sports content, and digital services.”

Mr. Uday Shankar, Co-Founder of Bodhi Tree Systems, said,

“James and I are excited to be partners in this journey to disrupt the media and entertainment industry in India. The new organisation is committed to deliver an unprecedented level of creativity, disruption and new age consumer experience. As media consumption continues to move to an integrated TV-digital ecosystem, the merger of Viacom18 and Star India offers a unique opportunity to reorient the industry to better serve diverse cohorts of consumers across the country. Together, we aim to build India’s largest integrated media platform which will deliver unparalleled experiences in innovative and exciting ways.”

The JV will be spearheaded by three CEOs who will lead the company into a new era of ambition and disruption. Kevin Vaz will head the entertainment organisation across platforms. Kiran Mani will take charge of the combined digital organization. Sanjog Gupta will lead the combined sports organisation. Together, they will leverage their unique strengths to cultivate a bold, transformative vision that challenges the status quo and sets new standards in the industry.

With this new joint venture, it’s not yet clear what the future holds for Disney+ Hotstar, as its going to be merged with JioCinema, with speculation that the new service could be called JioStar or something similar. It’s unknown if Disney+ will remain in the name, or simply become a tile within the combined streaming service.

It’s also unclear what the future holds for Hotstar globally, as Disney has been running the streaming service in many countries, including the UK.  There is also a lot of Hotstar content available on Hulu in the United States.

Over the past year, Disney has been slowly trying to separate the Disney+ Hotstar subscriber numbers away from its “core” subscribers since, moving forward, we will likely just see an income from Star India being registered within the quarterly results rather than how it’s been operating for years.

Disney acquired Star India when it purchased 20th Century Fox in 2019 and made some major changes to how the business worked in India, including rebranding Hotstar to Disney+ Hotstar.  However, after failing to acquire the rights to the cricket league, (which Reliance outbid Disney for), Disney+ Hotstar lost tens of millions of subscribers and set off a chain of events, which has resulted in Disney going into this joint venture, so it can still remain in business in India, but with a partner who knows the region better.

Roger’s Take:  While the Star India merger with Reliance might initially look to impact only Disney+ Hotstar subscribers in India, it does have many far-reaching issues for Disney+ subscribers globally.  There are many questions about what’s going to happen now with Disney+ Hotstar, not just in India, but also in other countries across Asia.   Will Hotstar content be removed from Hulu in the US?  Will Hotstar content be licensed to Disney+ globally?   There’s also the issue with the general entertainment hub, Star, within Disney+, which was named after Star India and rolled out internationally.  Could the Star hub be rebranded to Hulu in the future?     As with any major merger, we might not see the changes happen overnight.

What do you think is going to happen to Disney+ Hotstar?  Let me know on social media!

Roger Palmer

Roger has been a Disney fan since he was a kid and this interest has grown over the years. He has visited Disney Parks around the globe and has a vast collection of Disney movies and collectibles. He is the owner of What's On Disney Plus & DisKingdom. Email: Roger@WhatsOnDisneyPlus.com Twitter: Twitter.com/RogPalmerUK Facebook: Facebook.com/rogpalmeruk

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