(Shourya Mitra, Senior Editor at IELR)
The Competition Commission of India (CCI) recently approved the $8 billion combination between Reliance Industries Limited (RIL), Viacom 18 Media Private Limited, Digital 18 Media Limited, Star India Private Limited (SIPL), and Star Television Productions Limited, subject to certain voluntary modifications. Through this transaction, SIPL, which was previously wholly owned by The Walt Disney Company (TWDC) through various subsidiaries, will become a joint venture co-owned by RIL, Viacom 18, and TWDC.
The CCI issued a Phase II notice to the parties, questioning why an investigation should not be initiated. It had concluded that the parties held a highly concentrated market share in sports broadcasting (across both television and over-the-top (OTT) platforms). A leaked copy of the notice revealed that, as a result of the transaction, the combined entity would hold digital and television rights to all major cricketing events, including International Cricket Council (ICC) and Indian Premier League (IPL) events. Consequently, the CCI expressed concerns about the increased bargaining power of the parties and their ability to monetize sports rights through subscriptions and advertising. The CCI also noted that the parties were close competitors in bidding for sports rights, and that the combined entity would have an even greater ability to outbid most competitors in such bids.
The CCI also raised concerns about the potential impact on advertisers, specifically the reduction in their countervailing buying power. The parties involved, however, highlighted that there is a mandatory requirement to share live broadcasting signals of certain sports events with Prasar Bharati, allowing Doordarshan channel viewers to watch these events for free.
In the case of Union of India v. BCCI, the Apex Court held that the mandatory sharing of broadcasting signals under Section 3 of the Sports Broadcasting Signals (Mandatory Sharing with Prasar Bharati) Act, 2007 is limited to Prasar Bharati's terrestrial and Direct-to-Home (DTH) networks. However, the re-telecast of these signals was being made available to millions of viewers who were not connected to Prasar Bharati's terrestrial or DTH networks but were subscribers of other cable operators or DTH service providers, which were required to carry the Doordarshan channel as part of their bouquet under Section 8 of the Cable Television Networks (Regulation) Act, 1995. The Apex Court ruled that this retransmission mandate does not extend beyond Prasar Bharati's own terrestrial and DTH networks.
Traditionally, the concentration of sports rights has been a focus of competition law globally, with authorities often imposing sub-licensing requirements on incumbents or implementing a "no single buyer" (NSB) rule. For example, in Germany, the Bundeskartellamt prohibited the sale of all Bundesliga rights to a single entity. However, the application of the NSB rule has been relaxed in recent years as demand has become more elastic, alleviating concerns about overcharging consumers.
Although the approval order has not yet been released, sources report that the commitments made to the CCI include:
Divestment of TV channels (Non Hindi and Non sports channels);
A prohibition on bundling ad slots across multiple cricket tournaments; and
A cap on subscription charges for their cricket content.
It remains unclear whether these are the only remedies provided or if additional modifications have been provided to address the combined entity's financial potential in bidding for future sports rights.
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