Amazon has agreed to buy the assets of Indian video streaming service MX Player from local media giant Times Internet Ltd, the e-commerce giant's latest move 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 night, sources familiar with the matter told TechCrunch. The deal values MX Player at less than $100 million, well below the $500 million valuation the streamer was at when it last raised funds, the sources, who spoke on condition of anonymity because the companies have not yet publicly commented on the deal, told TechCrunch.
Amazon is acquiring some assets of MX Player, but not the entire company, whose backers also include Tencent.
The deal marks the culmination of nearly two years of discussions in which the two companies have explored synergies between their respective assets. Times Internet and its affiliate Times Group have been considering selling many of their digital assets over the past two years.
TechCrunch reported in February last year that Amazon and MX Player were in the process of a deal. Sony, which was also merging its Indian unit with media house Zee, had also expressed interest in acquiring MX Player, but sources familiar with the matter said that the effort was thwarted by complications with the Zee deal.
With MX Player, Amazon has gained a distribution and marketing partner that will help make its e-commerce platform more popular and trustworthy with users in smaller cities and towns in India, sources familiar with Amazon's strategy told TechCrunch. MX Player is especially popular with that demographic group, while Amazon's e-commerce services have long been popular only with urban consumers. Amazon will retain the MX Player brand, the sources said.
Amazon is expanding its video streaming services in India to gain traction outside major metros. The company offers a variant of its Prime subscription that bundles a version of Prime Video for just $9.50 per year. It also maintains a number of partnerships with local carriers to bundle Prime Video into their rate plans. In 2021, Amazon launched an additional free but ad-supported video streaming service in India.
After this article was published, an Amazon spokesperson confirmed that the company had agreed to purchase some of MX Player's assets.
“We are always looking for ways to introduce new products and services that help improve our customers' lives,” an Amazon spokesperson told TechCrunch in a statement. “We're excited to continue entertaining India with great local originals and exclusive content available on our Prime Video and miniTV services in India.”
Reliance, which operates India's largest retail chain, is a leading player in India's video streaming market along with Disney. The two companies agreed to combine their media assets in India in late February. The two companies' apps account for 55% of monthly active users of video streaming services in India. MX Player has a 15% market share, according to UBS. Netflix and Prime Video each have between 3% and 5% market share.
Monthly active users of popular streaming services in India. Image: UBS, Data: UBS and Sensor Tower
Times Internet acquired MX Player for $140 million in 2018. The South Korean-origin app gained immense popularity in India due to its unique local video playback feature, which allows the app to support a wide range of video file formats and makes it more compatible with affordable Android smartphones that are prevalent in developing markets.
Post-acquisition, Times Internet made a strategic move to transform MX Player from a local video playback app into a comprehensive video streaming platform. The company invested in diversifying its apps with licensed and original content, including TV shows, movies and games, to cater to the growing demand for online entertainment in India and many international markets, including the UK and the US.
Following the Indian government's ban of the popular short video app TikTok in mid-2020, MX Player also tried to seize the opportunity and launched its own short video app (named MX TakaTak) to fill the void in the market. Times Internet later sold the short video app to ShareChat, a leading Indian social media platform, in a deal worth over $650 million.
Times Internet did not immediately respond to a request for comment midday Thursday.