Introduction

Amazon has recently agreed to acquire key assets of the popular Indian video streaming service MX Player from Times Internet. This move is part of Amazon's strategy to expand its services and brand in smaller cities and towns in India, a crucial market for the e-commerce giant.

Details of the Acquisition

• Amazon is acquiring some assets of MX Player, not the entire firm.
• The deal values MX Player at less than $100 million.
• Many of the top executives at MX Player will move to Amazon after the transaction closes.
• The deal was reached after nearly two years of deliberation between the two firms.

Significance of the Deal

• Amazon aims to leverage MX Player's distribution and marketing capabilities to reach audiences in smaller Indian cities and towns.
• MX Player is particularly popular among demographic groups in these areas, which can help Amazon expand its reach beyond urban consumers.
• Amazon will retain the MX Player branding after the acquisition.

Amazon's Video Streaming Strategy in India

• Amazon has been diversifying its video streaming offerings in India to cater to a wider audience.
• The company offers a variant of its Prime subscription that includes Prime Video for as low as $9.50 annually.
• Amazon also partners with local telecom operators to bundle Prime Video with their tariff plans.
• In 2021, Amazon introduced a free, ad-supported video streaming service called miniTV in India.

Market Competition

• Reliance and Disney currently lead the video streaming service market in India.
• Together, these companies command 55% of all video streaming services' monthly active users in India.
• MX Player holds a 15% market share, while Netflix and Prime Video each have between 3% to 5% market share.

Conclusion

The acquisition of key assets of MX Player by Amazon underscores the e-commerce giant's commitment to expanding its presence in the Indian video streaming market. By leveraging MX Player's distribution network and brand recognition, Amazon aims to capture a larger share of the market, particularly in smaller cities and towns. This strategic move will also help Amazon compete more effectively against other major players in the Indian video streaming industry.