Apple To Spend $1 Billion To Buy Entire Content Library Of Movies, Music From Eros Group!
Eros Group All Set To Sell Their Entire Library Of Movies and Music To Apple!
On-demand entertainment niche in India is all set to experience some major coups, as Apple, World’s most valuable tech company is about to shake hands with Eros Group, which is India’s largest and most powerful movie producer.
And the result would be scintillating for the users of Apple Music and TV, as more than 3000 movies and millions of song titles would be available to them, directly from Eros Group’s treasure chest.
But the most fascinating aspect of this deal is the amount of money in question. If we believe incoming reports, then Apple will spend whooping $1 billion in this partnership.
And the best part is that, both the parties would benefit.
Apple’s Mega Plan For Dominating Entertainment in India
As per reports coming in, Apple and Eros Group are in talks to make a mega-deal of content in India. Reportedly, close to $1 billion would be paid by Apple to acquire exclusive rights of over 3000 Hindi and Regional movies from Eros Group.
Eros Now, which is the digital OTT platform, often referred to as Netflix of India, will be part of the deal. Eros Now has around 2.9 million paid subscribers, and 100 million users as of June, 2017.
Eros Now itself has over 10,000 movies in their database, which includes 5000 Bollywood and regional movies besides third party content and music data base.
Both Eros and Apple have declined to comment on this matter, and there has been no response from Amazon and Netflix as well.
One official who is close to the negotiations said, “Discussions are on to monetise the library. An announcement is likely soon.”
JM Financial are advising Eros on this deal.
Why Eros Is Selling Their Content?
Eros Group is aiming for some major restructuring within their company, and the main reason is their rising debt.
Selling content library to Apple, while retaining some long term rights is a solution which Eros Group has devised to effectively monetize their content, and reduce their debt as well.
A senior unnamed film veteran said, “The company is under liquidity pressure. It had to pull the plug on its bond earlier this year when allegations resurfaced. Only in FY16, the company generated some free cash flows and the promoters have recently been selling shares in US to reduce debt.”
As of March, 2017, Eros has total debt of $271.5 million, out of which $180.7 million needs to be repaid in a year.
The Fight To Dominate On-Demand Niche Continues
Every major player in this sector – Amazon, Apple, Netflix, Voot, Jio and others are aware of the potential, and this is the reason they are aggressively expanding their hold.
Amazon has already declared an investment of Rs 2000 crore to acquire exclusive right of movies, TV shows, music and web series, in order to expand their Amazon Prime in India. Recently they roped in Salman Khan, to amplify their brand presence.
On the other hand, Netflix has roped in celebrities like Saif Ali Khan, Nawazuddin Siddiqui and Radhika Apte for exclusive shows on their platform.
And now, it is the turn of Apple to pull their muscles, and start the process of accumulating exclusive content, for their users. Their partnership with Eros Group seems the best way forward.
As of now, top 5 players in this niche are:
- Jio TV
- Amazon Prime
Will Apple be able to break in the top 5? We will keep you updated.