The collapse of Bharti Airtel’s $1.3 billion merger with Tata Play underscores challenges in India’s DTH sector amid OTT growth, valuation disputes, and Reliance-Disney’s streaming dominance.
The abrupt termination of Bharti Airtel’s proposed $1.3 billion merger with Tata Play reveals deepening fractures in India’s pay-TV market, where OTT platforms now drive 65 million paid subscriptions.
Merger Talks Collapse Amid OTT Dominance
Bharti Airtel formally withdrew from merger discussions with Tata Play on 31 May 2024, citing ‘divergent strategic priorities.’ The failed deal followed six months of negotiations, with Economic Times reporting a valuation stalemate: Tata Play sought ₹7,500 crore, while Airtel capped its offer at ₹6,500 crore.
Reliance-Disney Success Highlights Market Split
In contrast, Reliance Industries’ merger with Disney+ Hotstar added 2 million subscribers post-deal, reaching 40 million users. Their bundled Jio Fiber-OTT packages, launched 01 June 2024, now account for 18% of new broadband signups according to TRAI data.
Valuation Paradox in Declining DTH Market
TRAI’s 28 May report revealed a 12% annual drop in DTH subscribers, yet Tata Play maintains 22 million users. Analysts question its ₹7,500 crore self-valuation given infrastructure costs. ‘Hybrid models require heavy CAPEX,’ noted JM Financial’s Tushar Kansal, ‘but investors favor pure-play streaming.’
Strategic Pivot to Enterprise Services
Airtel Chairman Sunil Mittal emphasized ‘non-mobile revenue streams’ during the 25 May earnings call, prioritizing cloud services over media. This shift mirrors Paytm’s 27 May partnership with Eros Now to embed streaming in its fintech app, targeting 10 million users.
Historical Precedents and Future Alliances
The 2016 Dish TV-Videocon merger ($800 million) initially consolidated 30% market share but faced integration issues. Experts suggest Tata Play’s planned 2025 IPO could follow ZEE-Sony’s failed template unless OTT synergies emerge. PhonePe’s rumored talks with ALTBalaji signal streaming’s appeal for fintech platforms.
