Bharti Airtel in Advanced Talks to Acquire Tata Play: Report

Airtel aims to bolster its digital TV presence amid competition from OTT services as Tata Play faces financial struggles.

Highlights

  • Tata Play has seen its valuation drop from USD 3 billion pre-pandemic to USD 1 billion.
  • The deal would mark Tata's exit from its content and entertainment sector.
  • Airtel Digital TV holds a 27.8 percent market share, showing growth amid financial losses.

Follow Us

Bharti Airtel in Advanced Talks to Acquire Tata Play: Report
Bharti Airtel is reportedly in advanced negotiations with the Tata Group to acquire Tata Play, India's largest direct-to-home (DTH) service provider, which has been struggling financially. The move aims to strengthen Airtel's presence in the digital TV segment, which faces increasing competition from over-the-top (OTT) streaming services, ET reported citing people aware of the matter.

Also Read: Airtel Digital TV Launches New Entertainment Plan With Amazon Prime Benefits




Market Dynamics Shifting Towards OTT

If the sale goes through, it will mark Tata's exit from its sub-scale content and entertainment operations. This would be the second significant deal between the two business groups, following Bharti's acquisition of Tata's consumer mobility business in 2017.

Despite Tata Play's market leadership with 20.77 million subscribers and a 32.7 percent market share, it has reported widening losses, with its consolidated net loss reaching Rs 353.8 crore in FY24. Airtel Digital TV, while also posting losses, showed growth with a 27.8 percent market share and improved subscriber additions in recent quarters.

According to the report, Tier 1 and tier 2 users are upgrading to over-the-top (OTT) packs on home broadband instead of DTH and cutting the cord to migrate to cheaper online alternatives while rural subscribers are increasingly opting for Doordarshan's Free Dish.

"The group had bet on the growth of Tata Play and seen strategic value in it until the dynamics of the market changed," the report said quoting an executive close to the development. "The group has been clear that in any market, it has to be in a position of strength and scale. That did not seem to happen as hoped with Tata Play. On the other hand, Tata Play fits well in the strategic plans of Airtel and its portfolio of offerings to consumers."

Reportedly, Tata Play's valuation has dropped significantly, recently pegged at USD 1 billion, down from USD 3 billion pre-pandemic.

Tata Sons currently owns 70 percent of Tata Play after acquiring Singapore's Temasek Holdings' stake in April for Rs 835 crore. Walt Disney holds the remaining 30 percent but has been seeking to exit the TV distribution sector, the report said.

Also Read: Airtel Digital TV Partners With Sony to Launch Anime Booth Channel

Strategic Fit for Airtel

While analysts see the acquisition as a strategic fit for Airtel, challenges remain. The companies face pending license fee liabilities—Tata Play has received demand notices totalling Rs 3,628 crore, while Airtel is provisioned for potential liabilities of Rs 5,580 crore.

Additionally, operational issues related to the different satellite technologies used by the companies could complicate integration efforts. For instance, Airtel uses the SES satellite, while Tata Play uses GSAT.

The talks, ongoing for weeks, have gathered momentum and a formal announcement is expected soon. Airtel is expected to buy Tata Play at a valuation similar to that of the Temasek deal, the report said quoting people cited above.

Recent Comments

Vishal D :

Satisfied with jio 449. Getting free netflix as an old customer.

Who is the Postpaid Mobile King in India Amongst Jio,…

Faraz :

Airtel has started to dominate Northern and central india.. With these deals it will capture market more than before. With…

Bharti Airtel Extends Multi-Year Deal with Ericsson for 4G and…

SCKPA :

It was active on my no. But fact is fact.

Jio, Airtel, and Vodafone Idea See Subscriber Losses, While BSNL…

TheAndroidFreak :

Samsung will stick to 5000 for another three years I believe as Samsung tunes their phones well with Ultra series.

OnePlus 13 and Xiaomi 15 to Feature Qualcomm Snapdragon 8…

TheAndroidFreak :

Redmi Note 14 Pro Plus is launching in India with 6200 battery so Realme regulations claims were havoc. People will…

OnePlus 13 and Xiaomi 15 to Feature Qualcomm Snapdragon 8…

Load More
Subscribe
Notify of
7 Comments
newest
oldest most voted
Inline Feedbacks
View all comments