Tata Play and Bharti Airtel's Digital TV are said to be in advanced talks to merge. Since live streaming has become the fashion, the subscriber base of direct-to-home (DTH) is dwindling, and hence the two companies are looking at the path of consolidation. As per a report by The Economic Times, the talks are on and the merger is likely to happen.
Merger Structure and Airtel's Stake
The transaction will be done on a share-for-share basis, sources added further. The merged entity will have Bharti Airtel with a majority stake of over 50%, if the transaction is completed. The transaction will also diversify Airtel's business in broadband and entertainment space, leading to growth ahead of telecom business. The transaction will also lead Airtel's service to Tata Play's current 20 million customer connections.
Impact of the Merger on the DTH Industry
The negotiations on this merger have acquired a larger meaning as the DTH segment is facing danger due to increasing digital consumption. As consumers increasingly move towards streaming, conventional satellite TV services are losing their sheen gradually. The merger will establish a stronger contender in the DTH segment that will address evolving consumer behavior.
Tata Play Evolution and Role of Disney
Tata Sky, India's market leader in the DTH segment, rebranded itself as Tata Play. It is a joint venture and Walt Disney acquired a stake in the company in 2019. If the merger goes through, it would be the second big joint venture of Tata and Airtel, following the 2016 merger of Tata D2H and Dish TV. The new entity will be managed by the top management of Airtel, while Disney retains its stake in the combined entity, according to reports.
This possible merger would redefine India's DTH sector, combining two of its largest players in one company and providing better services to millions of subscribers.
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