Disney Exploring Strategic Options for Its India Business, Including Possible Sale or Joint Venture (Report)

The business includes the Disney+ Hotstar streaming service and Star India, which was acquired from 21st Century Fox’s entertainment assets in 2019

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Disney is reportedly exploring strategic options to sell or find a joint venture for its digital and TV business in India.

The business includes the company’s Disney+ Hotstar streaming service and Star India, which was taken over following the $71.3 billion acquisition of 21st Century Fox’s entertainment assets in 2019.

According to The Wall Street Journal, the entertainment giant has held discussions with at least one bank regarding how to make its India business grow while also sharing some of the cost. The outlet noted that discussions are in very early stages and that its currently unclear which option Disney may pursue.

In the second quarter of 2023, Disney reported a total of 52.9 million Hotstar subscribers, down 8% from 57.5 million in the previous quarter. Average revenue per user for the offering fell 20% from 74 cents to 59 cents due to lower per-subscriber advertising revenue.

People familiar with the matter told the Journal that Hotstar is expected to lose 8 million to 10 million subscribers in its fiscal third quarter, while Star’s overall revenue is expected to drop around 20% to slightly less than $2 billion and its earnings before interest, taxes, depreciation and amortization is expected to fall roughly 50% for that time period, from about $200 million last year.

A Disney spokesperson did not immediately return TheWrap’s request for comment.

The review comes as Disney has been undergoing a restructuring designed to remove $5.5 billion in costs, including 7,000 layoffs, removal of certain content on its streaming platforms and producing lower volumes of content. Disney expects to take an impairment charge ranging from $1.5 billion to $1.8 billion, which will appear in its third quarter results.

In addition to consolidating its India business, Disney CEO Bob Iger has revealed plans to merge Disney+ and Hulu into one app offering by the end of the year.

Disney executives expect the company’s direct-to-consumer division to turn a profit in 2024. The company is set to report its latest quarterly earnings on Aug. 9.