According to a Bloomberg report, tech giant Sony is in talks to acquire a stake in billionaire Mukesh Ambani-owned Network18. This move comes with the Japanese giant’s aim to tap the booming content market in the South Asian nations and is currently carrying out due diligence before making an offer, stated the report.
Though nothing has yet been finalised, Sony is considering several deal structures before going ahead with the transaction. This includes making a bid for the stake or a merger of its Indian business with Network18’s entertainment channels.
The media report further added that the talks are at a very preliminary stage and may not even result in any substantial transaction.
As of now, Ambani owns the controlling shares in the entertainment firm through a network of subsidiaries and offers content across media formats. Moreover, if this deal goes through, he is expected to get access to international content from the Tokyo-based entertainment giant. For Sony, this will help to boost its business in the country and give it another platform to offer its content bouquet
Currently, Sony has a reach to over 700 Mn viewers in the South Asian countries through Sony Pictures Networks India and Network18 owns 56 channels in India alone across news and entertainment. Sony is also a rising player in the OTT market with SonyLIV, which is focussing on non-conventional sports content in the Indian market.
Recent data usage trends have revealed that Indians use mobile internet mostly for streaming video content. And if this transaction goes well, it would give Reliance, which has spent $ 50 Bn in the last two years to spread the Jio telecom network, a potential content partner.
The news comes amidst OTT platforms such as Amazon Prime and Netflix offering more shows and series to the Indian viewers and Hotstar announcing the probable launch of Disney+ in India. Amidst this increasing competition, this move of Sony is seen as an attempt to capture the Indian market. According to an ASSOCHAM-PwC joint study, the Indian OTT market will be amongst the top 10 markets globally by 2020, with an overall size standing at $823 Mn.