Times Internet Ltd (TIL), the digital business arm of media conglomerate Times Group, is planning a foray into video streaming with the acquisition of South Korea-based video platform MX Player for Rs 1,000 crore (around $147 million).
The deal marks the biggest acquisition till date by Bennett, Coleman and Company Ltd (BCCL), Times Internet’s parent firm, as a group and reflects its bullish outlook on the digital space. BCCL's earlier big-ticket overseas acquisition - radio network Virgin Radio in 2008 - struggled to generate financial value.
In a statement, Times Internet said that it was planning to build a video streaming platform “atop MX Player’s 350 million install base in India.”
The company said that the platform will house premium and exclusive content from leading content producers and publishers around the world, which means it will compete with the likes of Amazon Prime Video, Hotstar and Netflix.
MX Player claims that its app, which houses a basic video player, has been installed on 500 million devices worldwide. The video player will continue to support the offline video playback features that are currently available, it said.
MX Player, according to the press note, is investing in premium, original, digital-first content, with an emphasis on Hindi and regional production.
In its first year, the platform will launch with more than 20 original shows, and over 50,000 hours of premium content across all languages.
“With over 400 million internet users in India, India presents one of the biggest digital entertainment opportunities in the world,” said Gautam Sinha, chief executive of Times Internet.
Video streaming in India
Cheap data has triggered the rise of video streaming in India. Apart from Netflix and Prime Video, prominent players include Twenty-First Century Fox-backed Hotstar; Voot, a joint venture between Network18 Media & Investments Ltd and US peer Viacom Inc; SonyLIV from Japan’s Sony Corp; Zee Entertainment’s OZee and production house Balaji’s ALTBalaji.
Amazon launched Prime Video in India last year and recently said it was looking to add more regional content in India.
Beyond Hindi shows and Bollywood movies, Prime Video has also been broadening its film catalogue in southern Indian languages such as Tamil and Telugu. Rivals have also been looking to increase their local content to get a leg-up.
While traditional players in the country had been following a 'free-mium model', which essentially means most of the content is free and they charge only for some premium content, Netflix introduced a subscription-only model. Other players are gradually moving to a subscription model as well.
Amazon bundles its video streaming service as part of its Prime subscription programme, which includes faster delivery and a music streaming service.
Times Internet’s parent BCCL runs several market-leading newspapers such as The Times of India and The Economic Times as well as TV news channels.
Times Internet had set an ambitious target of achieving $1 billion in revenue by March 2022 and had previously said it would seek out the inorganic route for growth and explore big-ticket acquisitions.
The firm has close to 20 subsidiaries that include realty portal MagicBricks, coupon site CouponDunia, cricket news site Cricbuzz and eat-out table booking platform DineOut.
With more than 30 digital properties under its belt, mostly in digital content and some in digital product businesses, TIL claims to have a user base that covers a significant chunk of India’s internet population.
Earlier this year, Times Internet’s music streaming service Gaana had raised $115 million from Chinese Internet conglomerate Tencent Holdings Ltd.
TIL typically makes investments from its own resources or from deep-pocketed BCCL, so the Gaana fundraise was the first external venture capital funding for the group.
Last year, Times Internet Ltd relaunched its e-commerce business Indiatimes Shopping as GadgetsNow, a digital content site and e-tailer focussing on gadgets and electronic devices.