Amazon has agreed to acquire Indian video streaming service MX Player from local media powerhouse Times Internet. This is the latest step by the e-commerce giant to popularize its services and brand in smaller cities and towns in key overseas markets.
The two companies reached a final agreement on the deal on Wednesday evening, a source familiar with the matter told TechCrunch. The deal values MX Player at less than $100 million. This is well below the $500 million the streamer was valued at when it last raised capital. The sources spoke to TechCrunch on condition of anonymity because the companies have not yet commented publicly on the deal. .
Amazon is acquiring some of MX Player's assets, but not the entire company. Tencent is also one of the sponsors.
The deal caps nearly two years of deliberations as the two companies sought to find synergies between their assets. Times Internet and its subsidiary Times Group have been trying to sell many of their digital assets over the past two years.
TechCrunch reported in February last year that Amazon and MX Player were working on a deal. Sony, which was also pursuing a merger of its Indian operations with media house Zee, had also expressed interest in acquiring MX Player, but complications arising from the Zee deal derailed the effort, according to multiple sources familiar with the matter.
In MX Player, Amazon has gained a distribution and marketing partner that can help make its e-commerce platform more popular and trustworthy with audiences in smaller cities and towns in India, sources familiar with Amazon's strategy told TechCrunch. MX Player is particularly popular with this demographic group, and Amazon's e-commerce services have long been popular only among urban consumers. Amazon will retain the MX Player brand, the sources said.
Amazon is expanding its video streaming service in India, making noise outside of the big cities. The company charges $9.50 per year for various Prime subscriptions that bundle a version of Prime Video. It also has many partnerships with local telecom operators to bundle Prime Video with their plans. In 2021, Amazon additionally launched a free but ad-supported video streaming service in India.
An Amazon spokesperson confirmed after this article was published that it had agreed to purchase some of MX Player's assets.
“We’re always looking for ways to introduce new products and services that help improve the lives of our customers,” an Amazon spokesperson said in a statement to TechCrunch. “We are excited to continue entertaining India with great local originals and exclusive content available through our Prime Video and MiniTV services in India.”
Reliance, which operates the country's largest retail chain, leads the Indian video streaming services market along with Disney. The two companies agreed to merge their Indian media assets in late February. These apps accounted for 55% of all monthly active users of video streaming services in India. According to UBS, MX Player had a market share of 15%. The investment bank said Netflix and Prime Video each have a market share of 3 to 5 percent.
Times Internet acquired MX Player for $140 million in 2018. The app, which originated in Korea, gained immense popularity in India with its unique local video playback feature. This feature allows the app to support a variety of video file formats, making it highly compatible with affordable Android smartphones widely used in developing countries.
Following the acquisition, Times Internet took strategic steps to transform MX Player from a local video playback app into a comprehensive video streaming platform. The company has invested in filling its apps with a range of licensed and original content, including TV shows, movies and games, to meet the growing demand for online entertainment in many international markets, including India, the UK and the US.
In response to the Indian government's ban on popular short video app TikTok in mid-2020, MX Player also seized the opportunity and launched its own short video app (called MX TakaTak) to fill the gap in the market. Times Internet later sold the short video app to India's leading social media platform, ShareChat, for a valuation of over $650 million.
Times Internet did not immediately respond to a request for comment midday Thursday.
