Reliance, Disney USD 8.5 billion merger receives 100 antitrust queries from India

In a significant development in India's media, the proposed USD 8.5 billion merger between Reliance Industries and Walt Disney has come under intense scrutiny from the Competition Commission of India (CCI). The antitrust watchdog has sent over 100 queries to the companies, focusing particularly on the deal's impact on cricket streaming rights.

The merger, announced in February, would create India's largest entertainment conglomerate, having 120 TV channels and two streaming services. Cricket, often described as a religion in India, plays a pivotal role in the country's media consumption habits. The Reliance-Disney merger would consolidate ownership of lucrative cricket rights, potentially giving the new entity unmatched control over this crucial content.

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The CCI's extensive questioning reflects the complexity of the deal and its potential implications for market competition. Of particular interest is the regulator's inquiry into why YouTube should be considered in the same market as subscription-based streaming services like Netflix and Disney+. This distinction is crucial as it could significantly impact the assessment of market dominance.

Reliance and Disney have argued that their merger won't harm competition, citing the expiration of current cricket rights in 2027 and 2028. They believe that this will allow for competitive bidding by rivals. Additionally, they have pointed out that advertisers can reach cricket-viewing audiences through various platforms, including YouTube.

However, data from Media Partners Asia reveals that while YouTube commands 88% of India's online video market, it primarily consists of free, user-generated content. The premium video market, dominated by curated long-form content on streaming services, accounts for just 12% of the total.

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The CCI has also requested detailed information about sports rights ownership, including past bidding processes. This level of scrutiny suggests that regulators are keenly aware of the strategic importance of sports content, particularly cricket, in India's media ecosystem.