The Indian branch of Japanese multinational Sony has agreed to merge with local rival Zee Entertainment to create the country’s second largest entertainment network.
More than 75 television networks, film assets, and two streaming platforms will be part of the united entity. It is on track to become a key participant in the fast-growing entertainment business in the country, competing with rivals such as Walt Disney’s Hotstar.
There are about 800 networks and over 900 million TV viewers in India.
These networks broadcast a wide range of entertainment, including sports, melodramas, and reality television.
Sony Pictures Networks India would hold approximately 51 percent of the merged firm, according to the deal, which was announced on Tuesday (SPNI). After a 90-day due diligence phase, it will be led by Zee’s Chief Executive Officer Punit Goenka.
The deal was described as a “significant milestone” by Goenka.
“The combined company will create a comprehensive entertainment business, enabling us to serve our consumers with wider content choices across platforms,” he said, according to an official release.
Both companies have a long history in India and hold the streaming services ZEE5 and SonyLIV. They also have a large television audience, thanks to famous channels like Sony MAX and Zee TV.
“It’s a hugely complementary deal,” media and entertainment industry specialist Vanita Kohli Khandekar told the media. “For example Sony does not have the pan-India, small town and regional reach that Zee has. And Zee does not have a kids or sports business like Sony.”
Zee will also be propelled to the international stage because of the deal, Khandekar said.
“The company has now been absorbed by Sony, a $82bn (£61bn) corporation. So, Zee now becomes a foreign company, which gives it a bigger platform.”
Although the majority of Indians still rely on direct-to-home television for entertainment, the country is also a valuable location for streaming services looking to reach a young digital audience.
Streaming companies such as Netflix, Amazon Prime Video, and Hotstar, as well as various desert television stations, have increased competition for digital shows in recent years.
According to experts, the Sony-Zee merger will ratchet up the competition even more.
(Adapted from Variety.com)