With the twin objective of paring the huge debt burden and expanding the digital network business, Reliance Industries is reportedly holding talks with Sony Entertainment for a possible stake sale, a Bloomberg report states.
Reliance holds 51% stake in Network 18, with the remaining 49% being held by the US company Viacom 18. The venture runs general entertainment as well as news channels. Sony, through its Sony Pictures Network India too, has a bouquet of channels in different genre, including GEC.
While talks are only at a preliminary stage, if the deal goes through, it is expected to help Sony increase local offerings and be able to take on rivals. For RIL, it will give the Ambani-owned company access to international content.
Sony is reportedly looking at either bidding for the company or to merge its Indian business with Network 18’s entertainment channels.
If this is seen as an OTT play, it is understandable, since the business in India is attracting increasing attention. At last count there are 32 OTT players, both local and international. At the top level are Hotstar, Netflix and Amazon Prime, followed by a host of local players. Each one of them is trying to keep adding more proprietary content, commissioning leading lights of Bollywood to produce exclusive programmes.
The viewers in India are mostly familiar with the faces featuring in these shows. Sony, with its SonyLiv OTT app may not have that many shows of its own, but there is scope for more content to be added. Reliance may be looking at these advantages as well. Its mobile service under the Jio brand, has close to 350 million subscribers and can easily scale up the subscription base if there is a tie up between Sony and Reliance. Sony is able to reach around 700 million viewers through its various television channels. An association between the two could be a formidable one.