India: Flipkart eyes stake in Hotstar to enter video streaming arena

Artwork - DEALSTREETASIA/HotStar

Flipkart has held talks to buy a stake in Hotstar, Star India’s video streaming service, as part of India’s largest online retailer’s strategy to bet big on video content and attract more Internet consumers and shoppers, three people aware of the discussions said. The talks have not reached an advanced stage and may or may not result in a transaction, the people cited above said. All three requested anonymity as the talks are confidential. Mint could not immediately verify the size of the stake Flipkart wants to buy in Hotstar.

Flipkart already has some ties with Hotstar, having launched a new video advertisement platform with Hotstar in July. Hotstar is also one of the many Internet partners that Flipkart has brought on board for its relaunched customer loyalty programme, Flipkart Plus.

The talks with Hotstar come at a time when demand for video streaming services such as Netflix and Amazon Prime Video offering is at an all-time high, and streaming companies are investing hundreds of millions of dollars, betting that the content business will be the biggest future growth driver in the global consumer Internet economy.

Under the stewardship of chief executive Kalyan Krishnamurthy, Flipkart has identified content as a massive business opportunity for the future and has been attempting to bet big on that, without having to build a Prime Video-like service from scratch. An investment or strategic alliance with Hotstar would go some way in addressing that gap for Flipkart, the people said. Flipkart’s bet on content has also been driven by the success of services such as Prime Video and Netflix in India.

Over the past six months, Flipkart has also held discussions with other large streaming services. According to the three people cited above, Flipkart also held preliminary talks with Netflix for a potential alliance —however, those talks did not progress much.

Flipkart did not immediately respond to requests for comment. A Netflix spokesperson declined to comment. A Hotstar spokeswoman denied that Flipkart and Hotstar had held any such talks.

‘This query has no basis in facts. No such conversation is happening with Flipkart or any others. We are well resourced and on a velocity of growth that is ahead of almost every other consumer Internet company in India. As flattered as we are by the rumours, the service is too valuable for such conjectures to be even entertained,” the Hotstar spokeswoman said in an emailed response to a query.

“However, we remain open to partnerships that can help grow the Internet ecosystem in India and beyond,” Hotstar added.

Under Krishnamurthy, Flipkart has displayed renewed aggression towards large investments or outright buyouts of Internet and tech startups, as the e-commerce firm looks to diversify its business and reduce its reliance on a few categories such as smartphones and large appliances. For instance, last year in October, Flipkart held talks to buy a small stake in BookMyShow, Mint first reported. Those talks, however, did not progress beyond the preliminary stages.

Mint also reported on 23 October that Flipkart was planning more start-up investments and acquisitions, and had held talks with a number of Internet startups such as Swiggy and Urban Ladder.

This article was first published on livemint.com.

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Following vacancies can be applied for (only in Singapore).   

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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.