Look for romance in the Reliance-Disney union
This media joint venture will shake up India’s online app and TV broadcast markets but the story to watch may be how they blend skills and converge on values held dear by showbiz
Unlike motorized carriages, motion pictures caught on like wildfire after they first showed up in India. This was more than a century ago, even before the ‘talkies’ era of movies. The difference lay not just in a mass-market desire to be moved by stories more than wheels. For a film, the cost of serving every extra customer is tiny compared to its production budget, so reaching far and wide is cheap and profitable; in contrast, carmaking bears heavy variable costs in addition to fixed, as each car is costly to make, which limits how many are cranked out. Offering digital fare across the internet is cheaper still, so much so that it amplifies the classic cinema advantage of a widely cast net for eyeballs. Especially keen to capitalize on this returns-to-scale reset has been Reliance, with its digital pivot of the past decade. In US-based Disney, it has found a partner for a joint venture (JV) that could lead and possibly dominate India’s web viewing and TV broadcast market. Look again, and we may even be able to spot a common backstory—like the twin-separation trope of Hindi cinema—that could give their alliance an air of romance.
This week, Reliance Industries Ltd and Walt Disney Company joined hands to create a JV worth over ₹70,000 crore. This will be a media business in which Reliance will hold over 16% directly and almost 47% via Viacom18 (in which it owns 74%). The rest, a minority stake, will be held by Disney, which got Star’s Indian assets bundled along with its 2019 purchase of 20th Century Fox and has seemed keen on a local guardian ever since. As a parallel Sony-Zee merger proposal recently came apart, the Reliance-Disney JV will wield significant market influence. This would be thanks not just to its offer basket of popular TV channels (which includes Viacom’s and Star TV’s), but also on account of its online platforms; backed by Reliance’s deep pockets, Hotstar plus JioCinema could keep Netflix and Amazon Prime at bay in a high-octane battle for India’s click-and-watch audience. Overall, the JV’s ad-slot sellers could boast of inventory covering about a third of all Indian eyeballs engaged by general entertainment. Given how finely splintered the viewership is, this share may prove enough to turn this part of the market from a buyer’s into a seller’s one. Meanwhile, Reliance’s retail and telecom presence hints of outreach synergies as well. Yet, while advertisers may be wary of the JV’s impact on their ad budgets, we can only guess how ad-rate dynamics will actually play out.
One reason why silent cinema had such high appeal in India was our long tradition of nautanki style entertainers, with their simplified scenarios and exaggerated movements. It was the contours of this basic concept, adapted to animation, that gave Disney its early success too. Of course, today’s world of media content spans diverse genres, but this similarity evokes a separated-at-birth story of holding people in thrall that dates back to an era of showbiz innocence, imagined or otherwise. Why bother? For one, we all love tales told well, so long as fiction doesn’t pretend to be true. For another, there’s a whiff of nostalgia around in the country for old entertainers that seemed to have a twin motive: to not just keep us glued to our screens, but also make the world a better place for everyone. It’s often what inspires the creativity we marvel at. So let’s watch this union for a blend of skills and values to emerge under the JV board’s oversight. After all, with every great attraction of eyeballs comes great responsibility.