MX Player, the over-the-top (OTT) video platform that was acquired by Times Internet Ltd (TIL) last year, has raised $110.8 million (approximately Rs 786.59 crore at current exchange rates) in a funding round led by Chinese technology giant Tencent, according to TIL vice-chairman Satyan Ganjwani.
This is the first investment in the video platform since it was acquired last year. Times Internet also participated in the latest funding round.
MX Player will use the funds to enhance its content portfolio by acquiring and providing original programming. It will also expand to other genres and increase its talent pool.
The company’s valuation, after Tencent’s funding, stands at $500 million (around Rs 3,550.67 crore), The Economic Times reported.
VCCircle has reached out to MX Player on the details of the investment and will update the story accordingly.
BCCL, Times Internet and the digital segment
The acquisition of MX Player for $147 million (around Rs 1,000 crore) by Times Internet last year marked the biggest transaction by Bennett, Coleman and Company Ltd (BCCL) at that time.
The privately-held BCCL – which also owns properties such as The Economic Times and The Times of India – has until recently avoided using external investors for capital raising. The strategy, however, changed with music-streaming service Gaana, which in February last year raised $115 million (around Rs 748 crore). That round was also led by Tencent.
Gajwani said MX Player was playing an important role in Times Internet’s strategy of becoming the largest consumer platform in India, and the OTT service has the potential to change the consumption of mobile entertainment in the country.
BCCL is no stranger to making aggressive moves in the digital segment to capture market share. It acquired radio network Virgin Radio in 2008. However, the investment was not successful for the Mumbai-based media group, and Virgin was sold to a Bauer Media Group division in 2013.
Media reports at that time pegged the deal value at around £22 million ($33.5 million or Rs 204 crore). This would mean that BCCL exited Virgin Radio (which was later renamed Absolute Radio) at about half of the £53.2 million (Rs 445 crore or $100 million) it paid to acquire it.
Other properties in TIL’s portfolio include cricket news portal Cricbuzz, restaurant reservation platform Dineout, personal finance platform ET Money.
The state of India’s OTT segment
Perhaps the biggest contributor to the rise of OTT services and content production in India has been the advent of cheap mobile data packages, which was hastened by Reliance Industries’ aggressive launch and marketing of telecommunications service Jio.
Services such as Amazon's Prime Video, Netflix and Star India’s Hotstar have raced to capture consumer attention through a mix of original programming and signing deals with production houses for existing properties. The three have also concentrated on expanding their base to regional content in an effort to appeal to the broader section of India’s population.
Beyond these three, there are other platforms which are trying to carve a niche for themselves in the segment. For instance, The Viral Fever in May this year raised an additional $5 million (around Rs 34 crore) from existing investor Tiger Global Management.
Similarly, in July this year, digital entertainment startup Pocket Aces Pictures Pvt. Ltd raised Rs 100 crore (about $14.5 million) from Sequoia Capital India, DSP Group and 3one4 Capital, among others.