Indian Video Streaming Service Acquired By Amazon
Amazon Acquires Indian Video Streaming Service MX Player
Disclaimer: This article is based on information available as of June 6, 2024, and the details are subject to change. The article does not reflect any insider or privileged information.
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Amazon has acquired key assets of MX Player, a prominent video streaming service in India. The acquisition is part of Amazon's strategy to leverage MX Player's extensive user base and rich content library to enhance its offerings and expand its reach within one of the fastest-growing markets for digital content.
The Acquisition Deal
The deal was finalized between Amazon and Times Internet, the local media powerhouse that owned MX Player, on Wednesday evening. According to sources familiar with the matter, the deal values MX Player at less than $100 million. This valuation is a marked decrease from the $500 million valuation at which MX Player raised its last capital. The agreement includes the acquisition of significant assets of MX Player, although Amazon is not acquiring the entire firm. Notably, Tencent is among the other backers of MX Player. After the transaction is finalized, many top executives from MX Player are expected to transition to Amazon.
This acquisition marks the culmination of nearly two years of negotiations between Amazon and Times Internet, as both firms sought to find synergies between their properties. Over the past two years, Times Internet and its affiliate Times Group have been actively looking to divest several of their digital properties. For Amazon, the acquisition of MX Player signifies a strategic move to strengthen its foothold in smaller cities and towns across India. MX Player boasts a substantial user base in these areas, where Amazon’s e-commerce services have historically been less popular compared to urban city consumers. By integrating MX Player’s distribution and marketing capabilities, Amazon aims to increase its brand's popularity and trustworthiness among audiences in these regions.
Amazon's spokesperson confirmed the acquisition and expressed excitement about introducing new products and services that can enhance customers’ lives. The spokesperson highlighted the continued commitment to entertain Indian audiences with local originals and exclusive content available through Prime Video and miniTV services.
MX Player’s Market Position
MX Player, acquired by Times Internet in 2018 for $140 million, has grown to become a formidable player in India’s video streaming market. With a market share of 15%, it trails behind industry leaders Reliance and Disney, whose combined apps command 55% of all video streaming services' monthly active users in India. Other competitors, such as Netflix and Prime Video, hold a market share of 3-5% each, according to UBS.
Amazon is not the first company to express interest in acquiring MX Player. In 2021, Amazon engaged in discussions with MX Player for a potential deal. During the same period, Sony—while attempting to merge its India unit with media house Zee—also showed interest in acquiring MX Player. However, complications with the Zee deal eventually derailed Sony’s efforts to acquire the streaming service.
The acquisition of MX Player is poised to significantly enhance Amazon’s video streaming portfolio in India. Amazon has been proactive in expanding its video streaming offerings to appeal to audiences outside of metropolitan areas. A notable example is Amazon’s introduction of a Prime subscription variant costing approximately $9.50 annually, which includes a version of Prime Video. Additionally, Amazon has forged numerous partnerships with local telecom operators to bundle Prime Video with their tariff plans. In 2021, Amazon launched an ad-supported video streaming service in India, offering free content to viewers. This addition complemented Amazon’s existing Prime Video service, further diversifying its content distribution channels and broadening its audience reach.
The Indian Digital Entertainment Landscape
India’s digital entertainment sector has experienced rapid growth, driven by increasing internet penetration and smartphone usage. The country represents a key overseas market for global digital platforms, with its vast and diverse population offering immense growth potential. Reliance and Disney currently dominate the Indian video streaming market, leveraging their extensive resources and established user bases. The merger of their India media properties underscores the competitive dynamics within this space.
MX Player’s popularity among users in smaller cities and towns aligns with Amazon’s broader strategic objectives. By integrating MX Player’s capabilities, Amazon is well-positioned to tap into these underserved segments and foster deeper engagement with Indian consumers. The acquisition of MX Player by Amazon represents a pivotal moment in the evolution of India’s digital entertainment landscape. As the integration process unfolds, stakeholders will be closely watching how Amazon leverages MX Player’s assets to enhance its offerings and capture a larger share of the market.
Amazon’s commitment to providing diverse and high-quality content, coupled with MX Player’s strong presence in non-metro areas, has the potential to reshape the competitive dynamics of the Indian video streaming market. The deal underscores Amazon’s strategic intent to solidify its position as a leading player in one of the world’s most dynamic digital entertainment markets. As the transaction progresses, further details are expected to emerge, shedding light on the specific synergies and operational strategies that Amazon plans to implement. For now, the acquisition stands as a testament to Amazon’s continued investment and ambition in the Indian market.
Amazon’s acquisition of MX Player is a strategic move aimed at bolstering its presence in India’s digital entertainment market. The integration of MX Player’s user base and content library is set to enhance Amazon’s offerings and expand its reach, particularly in smaller cities and towns. As the digital entertainment landscape continues to evolve, this acquisition positions Amazon to play a more prominent role in shaping the future of video streaming in India.
Disclaimer: The information provided in this article is based on publicly available sources as of June 6, 2024. Details of the acquisition may be subject to further updates and changes.
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