MUMBAI: The deal to merge Reliance Industries Ltd (RIL) subsidiary Viacom18 and The Walt Disney Company’s local unit Star India will significantly alter the media and entertainment sector by creating the biggest media entity in the country, said industry executives and experts.The Rs 70,352 crore ($8.5 billion) merged entity, in which RIL will infuse Rs 11,500 crore, will have a viewership share of more than 40%, enabling it to secure premium advertising rates and consumer average revenue per user (ARPU), they said.The failure of Zee Entertainment Enterprises and Sony Pictures Networks India to merge is expected to benefit Star-Viacom18, which would have had to contend with a duopoly if the Sony-Zee merger had also gone through.’Big Daddy of Media’The repercussions of the deal might also be felt in the telecom sector, where Reliance Jio’s rival Bharti Airtel would face pressure to step up its content offerings, said experts.According to industry estimates, telecom operators spend Rs 2,000-3,000 crore on procuring content.108117763Nuvama Institutional Equities executive director Abneesh Roy said the merger deal is negative for other broadcasters and telecom players, as Reliance Jio will gain superior access to content.”The merger is potentially also slightly negative for advertisers as the bargaining power of the merged entity will be higher. In media, the leader takes it all. The JV (joint venture) will become the big daddy of media and will be 3-6x of other key peers,” he said.Star-Viacom18 will have exclusive rights to all the key cricket properties, including the Indian Premier League, International Cricket Council and Board of Control for Cricket in India, in addition to about 200,000 hours of content comprising movies and TV shows.108117765The consolidation of TV and digital rights of key cricket properties under a single umbrella is expected to enhance monetisation over time.Roy also said that Star-Viacom18 can gradually achieve profitability in sports by increasing subscriber ARPU and ad rates. The two companies have pledged roughly Rs 82,000 crore ($10 billion) in sports rights for the 2023-27 period.The combined entity will house premium English content — from Disney, NBC Universal, Paramount Global and HBO — which will allow it to effectively compete against Netflix and Prime Video in the premium over-the-top (OTT) segment.RIL and Viacom18 will own 63% stake in the JV while Disney will hold the remaining 37%. The fund infusion by RIL will help it invest in sports and digital content. Last year, Viacom18 received a fund injection of $1.8 billion from RIL and Bodhi Tree Systems.The JV will have Nita Ambani as chairperson and Star’s former CEO Uday Shankar as vice chairperson.The two companies together own 117 TV channels and two streaming platforms, Disney+ Hotstar and JioCinema.Star and Viacom18’s consolidated revenue in 2022-23 was about Rs 25,000 crore, higher than the combined revenue of Zee Entertainment Enterprises, Sony Pictures Networks India and Sun TV Network, which was around Rs 18,000 crore.Experts said the deal will also help RIL, which will control the JV, to overcome the growing threat of Google and Meta, which together gobbled up Rs 46,000 crore in digital ad spends in 2022-23.