India’s largest movie producer Eros Group is in talks with Apple to sell its entire content library of films and music for a price of $1 billion, reports Economic Times. The deal could also include their digital OTT platform, Eros Now, an online video streaming platform.
Eros is also talking to Amazon and Netflix. This is all a part of the mega restructuring exercise in Eros, which could result in the reverse merger of NYSE-listed Eros International into the Indian-listed subsidiary Eros International Media to create a single listed firm.
ET reports that this could also be an attempt to please investors, which have been worried over repeated allegations of corporate misgovernance, non-transparent related party transactions, financial malpractices and fraud.
The deal for its content library of films and music includes over 3000 Indian films. The company that manages to bag the deal will gain access to a huge range of film and music content, both Bollywood and regional.
Eros Now too, has rights to over 10,000 films, out of which around 5,000 films are owned in perpetuity, across Hindi and regional languages. It has close to 2.9 million paid subscribers and over 100 million registered subscribers as of June 30, 2017, reports ET.
The idea here is to monetise the library.
Analysts say that a deal like this would make sense for foreign players like Netflix, Apple or Amazon, as it will be a major boost for them in terms of movie content, which in turn will increase number of subscribers and make the Indian OTT market more competitive.
In the past, Eros has been in talks Fullerton and Amazon to sell a stake in ErosNow at a $800 million valuation and had engaged investment bank Moelis & Co to identify a strategic partner.
With Netflix and Amazon Prime entering India, the Indian OTT space has seen a lot of growth and competition in the past year or so. A number of other players also emerged like Hotstar, Voot, Ozee and Sony Liv.
ET reports that Amazon, which has earmarked Rs 2,000 crore investment for video streaming service in India alone, is also is in talks with music labels to acquire content for Amazon Music, which is expected to launch in India next year.
It has already signed deal with T-Series, which owns the majority market share in the music space. Eros Music is also one of the leading players after T-Series, Sony Music and Saregama.
According to the ET report, the industry estimates that after Hotstar, Jio TV and Voot, Amazon Prime Video has maximum active users among the video streaming services. It is far ahead of Netflix, which has minimum subscription plan of Rs 500 a month.
In India, Apple Music charges Rs 120 a month for individual membership services after a three-month free trial, and has notched up to 400,000 subscribers.
It is up against local competitors like Saavn, which started out as a library for iTunes, then branched into streaming by itself. Today it has around 20 million users, around 16 million paid users. Gaana.com has around 28 million users.