Sony, Zee merger stalls
February 27, 2023
The much-delayed merger between India’s Sony and Zee Entertainment (ZEEL) has not – yet – hit the buffers. Zee’s MD Punit Goenk has said that he expects a timely completion of a merger. However, ZEEL told a tribunal on February 24th that its merger with Sony’s India division will “get stuck” due to the initiation of insolvency proceedings against cash-strapped ZEEL.
Goenka, a prominent member of the Chandra/Goenka family, criticised insolvency proceedings initiated against ZEEL by India’s bankruptcy court over a loan default from IndusInd Bank.
The news, and the challenges involved, come as many Indian channels from Zee and Sony have been blacked out for viewers in India. The blackouts started on February 18th.
India’s Broadcasting and Digital Foundation (IBDF), the industry body for TV channels, issued a notice on February 23rd to its cable operator members who had not signed freshly negotiated agreements to sign up to so that signals could be restored to viewers.
On February 18th, three of the biggest general entertainment broadcasters in India including Disney Star, Sony and Zee had shut down their channels to India’s giant cable operators or multi-system operators (MSOs) like DEN Networks, Hathway Cable, GTPL and others.
The cable operators had refused to sign new agreements with the broadcasters and new tariff order (NTO 3.0) that came into effect on February 1st and which allowed channels to raise prices. Broadcasters were demanding a price hike of 10-14 per cent on their bundles with some individual channels seeking even higher price rises.
The broadcasters and the cable operators’ organisation resolved their differences late on February 23rd. Local reports say that the Indian Broadcasting and Digital Foundation (IBDF) and the All India Digital Cable Federation (AIDCF) had reached an agreement over higher channel prices allowed under the new tariff order issued by the Telecom Regulatory Authority of India (TRAI).
The settlements are reported to be about 8-10 per cent, while the broadcasters were pushing for nearer 10-14 per cent.