Amazon Acquires MX Player to Expand Reach in India’s Smaller Cities

Amazon Acquires MX Player to Expand Reach in India’s Smaller Cities

Mihir Gadhvi 06/06/2024
Amazon Acquires MX Player to Expand Reach in India’s Smaller Cities

Amazon is set to acquire key assets of MX Player, a popular Indian video streaming service, from Times Internet, part of the local media giant Times Group.

This acquisition marks Amazon's strategic move to strengthen its presence and brand in India's smaller cities and towns, a crucial overseas market for the e-commerce giant.

The two companies finalized the agreement on Wednesday evening, according to a source familiar with the matter who spoke to TechCrunch on condition of anonymity. The deal values MX Player at under $100 million, significantly less than the $500 million valuation from its last funding round. Notably, Amazon is acquiring specific assets of MX Player rather than the entire company, which also counts Tencent among its investors.

This deal concludes nearly two years of negotiations between Amazon and Times Internet, during which both parties explored potential synergies. Over the past two years, Times Internet and its affiliate Times Group have been looking to divest several digital properties. TechCrunch had reported in February of the previous year that Amazon and MX Player were in talks for a potential deal. Sony also showed interest in acquiring MX Player but faced complications due to its simultaneous efforts to merge its India unit with Zee Entertainment.

For Amazon, MX Player offers a valuable distribution and marketing channel that can help the e-commerce platform gain popularity and trust among audiences in smaller Indian cities and towns. While Amazon has traditionally been popular among urban consumers, MX Player's significant user base in less urban areas presents an opportunity for Amazon to broaden its reach. According to a source familiar with Amazon's strategy, the company plans to retain the MX Player branding.

Amazon has been expanding its video streaming services in India to appeal beyond metropolitan areas. The company offers a variant of its Prime subscription for about $9.50 annually, which includes a version of Prime Video. Additionally, Amazon partners with local telecom operators to bundle Prime Video with their tariff plans. In 2021, Amazon introduced an ad-supported free video streaming service in India.

In India’s competitive video streaming market, Reliance, in partnership with Disney, leads with a combined 55% market share of monthly active users, following their agreement to merge their media properties. MX Player holds a 15% market share, while Netflix and Prime Video each hold between 3-5%, according to UBS.

Times Internet acquired MX Player in 2018 for $140 million. Originally developed in South Korea, the app gained massive popularity in India due to its ability to support various video file formats, making it compatible with the affordable Android smartphones prevalent in developing markets. Post-acquisition, Times Internet transformed MX Player from a local video playback app into a comprehensive video streaming platform, investing in a diverse array of licensed and original content, including TV shows, movies, and games, to meet the growing demand for online entertainment in India and internationally.

In response to the Indian government's mid-2020 ban on TikTok, MX Player launched its own short-video app, MX TakaTak, to fill the void. This strategic move paid off when Times Internet sold MX TakaTak to ShareChat, a leading Indian social media platform, in a deal valued at over $650 million.

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Mihir Gadhvi

Tech Expert

Mihir Gadhvi is the co-founder of illustrake and HAYD. Illustrake is a D2C Enabler and offers Performance Marketing, Retention Marketing, and Content Creation Services. HAYD is a brand New, homegrown fashion line that aims to make clothing easy for us without taxing our planet. Although the concept is quite known now, HAYD wants to accomplish sustainability by reducing its impact on the environment with safe and fair manufacturing.

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