Amazon has agreed to acquire Indian video streaming service MX Player from the local media powerhouse Times Internet, the latest step by the e-commerce giant to make its services and brand popular in smaller cities and towns in the key overseas market.
The two firms reached a definitive agreement for the deal on Wednesday evening, a source familiar with the matter told TechCrunch. The deal values MX Player at less than $100 million, far short of the $500 million valuation at which the streamer raised its last capital, the source, who spoke on condition of anonymity because the companies are yet to publicly comment on the deal, told TechCrunch.
Amazon is acquiring some assets of MX Player, but not the entire firm, which also counts Tencent among its backers.
The deal caps a nearly two-year deliberation between the two firms as they sought to find synergies between their properties. Times Internet and its affiliate Times Group have been looking to sell off many of their digital properties in the past two years.
TechCrunch reported in February last year that Amazon and MX Player were engaging for a deal. Sony, which was in parallel looking to merge its India unit with media house Zee, also expressed interest in acquiring MX Player, but complications with the Zee deal derailed its efforts, according to several sources familiar with the matter.
In MX Player, Amazon gets a distribution and marketing partner that can help make the e-commerce platform more popular and trustworthy to audiences in the smaller Indian cities and towns, a source familiar with Amazon’s strategy told TechCrunch. MX Player is especially popular among such demographic groups, and Amazon’s e-commerce service has long only been popular among the urban city consumers. Amazon will retain the MX Player branding, the source said.
Amazon has been broadening its video streaming offerings in India to make noise outside of the metro cities. The company charges as little as $9.50 yearly for a variant of Prime subscription that bundles a version of Prime Video. It also maintains many partnerships with local telecom operators to bundle Prime Video with their tariff plans. In 2021, Amazon launched an additional free, but ad-supported, video streaming service in India.
An Amazon spokesperson confirmed it has agreed to purchase some assets of MX Player after publication of this story.
“We are always looking for ways to introduce new products and services that help improve customers’ lives,” an Amazon spokesperson told TechCrunch in a statement. “We’re excited to continue to entertain India with the great local originals and exclusive content available across our Prime Video and miniTV services in India.”
Reliance, which operates the nation’s largest retail chain, leads the video streaming service market in India with Disney. The two firms agreed to merge their India media properties in late February. Together, their apps commanded 55% of all video streaming services’ monthly active users in India. MX Player had a 15% market share, according to UBS. Netflix and Prime Video had between 3-5% market share each, the investment bank said.
Times Internet acquired MX Player in 2018 for $140 million. The app, which originated in South Korea, gained immense popularity in India due to its unique local video playback feature. This functionality allows the app to support a wide range of video file formats, making it highly compatible with affordable Android smartphones that are prevalent in developing markets.
Following the acquisition, Times Internet made strategic moves to transform MX Player from a local video playback app into a comprehensive video streaming platform. The company invested in populating the app with a diverse range of 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 U.S.
In response to the Indian government’s ban on the popular short-video app TikTok in mid-2020, MX Player also sought to seize the opportunity and launched its own short-video app (called 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 valued at over $650 million.
Times Internet didn’t immediately respond to a request for comment Thursday noon.