Thursday, February 2, 2012

Disney strengthen its position in India

I've told you in previous articles that Disney was looking to India and one more proof of it is coming in a recent move from Disney as reported by Zachs website in an article called "Disney Eyes Bollywood Expansion":

In a bid to gain further traction in the Indian market, The Walt Disney Company (DIS) is set to acquire a controlling interest in UTV Software Communications Ltd. (UTV). One of the largest entertainment companies in the world is expected to enhance its presence in India through this deal. The strategic move on the company’s part will also enhance its position compared to its peers with respect to movie offerings. The company currently owns three leading children's television networks - Disney Channel, Disney XD and Hungama, which are performing well in the (India) market.

UTV is one of the leading producers and distributors of cinema and television programs in the rapidly growing Indian entertainment industry. UTV operates in five verticals, including Broadcasting, Motion Pictures, Interactive, Games Content and TV Content. Post acquisition, Disney would become India’s leading broadcasters catering to more than 100 million viewers weekly.

Through the acquisition, Disney will also gain access to "Bollywood" and other programs including gaming. The company will operate both UTV as well as Disney brands in India.

Although the financial terms of the deal remained undisclosed, UTV and Disney are progressing well on its integration process. Disney has started the process of delisting the shares of UTV from Indian bourses. In addition, the CEO of UTV, Mr. Screwvala will head the Indian operations as a managing director of Disney. Screwvala has a track record of successfully delivering content rich programs to the viewers.

Disney is expanding its global footprints in the developing markets such as India, Russia and China. The acquisition of UTV is a step forward in its expansion process with a strong boost in Indian operations. In Russia, Disney will begin broadcasting a free-to-air channel this year following its acquisition of 49% stake in the Russian media group UTH".

And from a N.Y Times blog: "UTV is one of India’s biggest producers of movies and television shows; it also owns six TV channels. Most importany, however, is UTV’s substantial mobile gaming division, Indiagames. With about a million new cellphones being activated a month in India, the potential for Disney to sell content that can be downloaded and played with is enormous.

Disney decided to buy market share in India rather than pursue organic growth in part because of the quick pace of consumer change in the country; by the time Disney got its footing, the market would have most surely moved on. The Indian middle class, for instance, is expected to grow to 500 million by 2025, up from roughly 50 million people today, according to UTV-provided estimates."

There is no doubt that Disney intend to strengthen its position in the huge India market and if one of your question is: "Will they build someday a Disney theme park in India? " the answer is: probably, all the question is: when?

Text: copyright zachs website, N.Y Times

Picture: copyright Disney


Andrew said...

It's great to see Disney being quick off the mark in these rapidly growing markets - and from your article it looks like South America is the last emerging market to be fully saturated with Disney content. If Disney lets their characters become well known in India as well as grow their new Bollywood movie business, a park in India sounds like a given.

Marco Antonio Garcia said...

Disney don't need new Theme Parks, it is only going to dilute its brand, create competition for their own parks, and overstretch the company.

Disney needs to keep improving their existing Theme Parks, to make them all profitable and ahead of the competition, instead of keep building new lame Resorts that loose money and are not good for the company's image.