Disney Hires Lawyers to Officially Give Up Streaming Service

The Walt Disney Company and Reliance Industries have hired law firms to begin antitrust due diligence, according to a report from Yahoo! Finance. Last month, the companies agreed to merge assets in India, creating one of the most giant corporations in the country’s history. Disney streaming profits took a nosedive last year after Disney+ Hotstar lost the rights to broadcast India Premier League (IPL) cricket matches.

Disney+ Hotstar has long been the Mouse’s biggest streaming service, but losing India’s most popular spectator sport left the platform bleeding money. Millions canceled their subscriptions as the company was busy with a Disney+ overhaul, creating ad-supported tiers and cracking down on password sharing.

Reliance Industries operates its own subscription streaming service, JioTV+. If the merger is successful, the two companies will share two streaming services and more than 120 television channels.

Due to the massive scale of the business deal, Disney and Reliance Industries must perform antitrust due diligence to ensure their merger doesn’t negatively impact the consumer with predatory pricing or by overly restricting competition. According to Reuters, it’s likely that the companies will be forced to release some channels to avoid controlling too much of the Indian entertainment industry.

Reliance Industries hired Indian law firm Khaitan & Co and Shardul Amarchand Mangaldas, while The Walt Disney Company selected AZB & Partners.

Indian billionaire Mukesh Ambani owns Reliance Industries and is said to hold the majority stake in the entertainment corporation if the Disney merger is successful. This will free The Walt Disney Company of some of its responsibilities and financial liability regarding the performance of Disney+ Hotstar. Ambani currently broadcasts IPL cricket matches for free, harshly impacting Disney’s bottom line in India.

According to Reuter’s anonymous sources, the antitrust review is in its early stages. Both companies allegedly signed a non-binding agreement during a private business meeting in December.

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