The Sony-Zee Affair: A Market Opportunity or a Competitive Disadvantage?

[By Samay Jain]

The author is a student at Institute of Law, Nirma University.


The merger of Zee and Sony was approved by the Competition Commission of India (CCI), subject to certain terms and conditions. These terms and conditions were levied to stop the merger, which would be operating more than 90 channels across the country, from misusing its dominating position in the market.

In India, the Hindi language category draws the most viewership, and according to its pilot study, the merged company would have 45% of that market, with rival Walt Disney – Star coming in as a close second. The CCI stated in its initial study that due to its powerful negotiation strategy and access to unmatched resources, it could have the ability to raise the cost of advertising and channel subscriptions.

After considering the company’s legal and financial arguments, Zee reported that the CCI approved the amalgamation of Zee and Sony. Some suitable remedies were also proposed to be provided by Zee in conformity with the regulators’ requirements.[i]

In view of this, this article analyses the reasons behind the grant of approval for the proposed merger between Zee and Sony. The article further tries to allay possible concerns of the merger abusing its dominant market position.


For two businesses that rely on creating such leisure plots for their livelihood, the chain of events that culminated in the merger seems largely acceptable. Sony first tried to get in touch with Mr. Goenka in November 2020, but he declined. A few months later, KPMG (Klynveld Peat Marwick Goerdeler) approached him on behalf of Sony and provided an updated figure, which is when things got going. By August 2021, he had already joined the conflict. [ii]

However, Invesco, which owns an 18% stake in Zee, lambasted the company for poor corporate governance and submitted a request for the nomination of 6 independent non-executive directors to the Board of Directors of Zee as well as the dismissal of Mr. Goenka as the CEO. Zee resisted the EGM’s attempt to be called, claiming that the intended Requisition was against Indian law.[iii]

The proposed merger saw another twist when the Bombay High Court decided in Invesco’s favor, upholding Invesco’s request for an EGM (Extraordinary General Meeting)as being legally valid but reversing a previous single-judge Judgment. Following this ruling, Invesco decided to revoke the requisition notice that it had issued calling for Punit Goenka, MD, and CEO of Zee, to be removed from the Board.[iv]


  1. The prospective buyer should be unrelated to or independent of the resultant firm and its subsidiaries.
  2. The suggested buyers cannot be Star India Private Limited or Viacom18 Media Private Limited.
  3. The buyer must not have been an employee or director in the past or present.
  4. To sustain and expand the different channels as a successful enterprise and a vigorous rival to the resulting entity in the pertinent market, the buyer must possess the required funds, the necessary knowledge, and the motivation to do so.
  5. The divestiture should not put the CCI’s order at risk of being implemented late or with immediate concerns about competition.
  6. To buy and run the networks, the buyer should obtain the necessary regulating body permissions.


Disney + Hotstar, which also has Star Sports in its possession, is well ahead of other OTT platforms in terms of market share and subscriptions. Disney + Hotstar is placed at the 1st position with 41% share, followed by Eros Now with 24% share, Amazon Prime Video (9%), Netflix (7%), ZEE5, and ALT Balaji (4% share each), and SonyLIV (3%).[v]

In terms of subscribers as well, Disney + Hotstar is in the lead with 14 crore subscribers, followed by Amazon Prime Video with 6 crore subscribers, Netflix (4 crore subscribers), ZEE5 (3.7 crore subscribers), and SonyLIV (2.5 crore subscribers).[vi]

Others have the highest market share of TV broadcasters with 35.7 % share, followed by Star + Disney with 18.6 % share, Zee (18.4 % share), Sun (10.4 % share), Viacom (8.6 % share), and Sony (8.3 % share).[vii]

As per TRAI press release dated 17th Feb 2017, the Telecom market was led by Airtel holding a market share of 23.5% followed by Vodafone (18.1%), Idea (16.9%), BSNL (8.6%), Aircel (8%), RCOM (7.6%) and Jio (6.4%).

Thus, having regard to a subscriber base, resources & economic power, it cannot be said that Jio enjoys a dominant position in the market and hence, its offers are only in nature of promotion rather than being predatory.[viii]

Similarly, the merger of Zee and Sony despite being the 2nd largest conglomerate will not have the highest market share as it is held by Disney + Hotstar who have Star Sports as well.

As of this year’s first quarter, the Broadcast Audience Research Council (BARC) India’s weekly networks’ combined viewing share has been progressively declining. According to BARC viewership data obtained from subscribers, in the Hindi General Entertainment Channel (GEC) genre, the two businesses’ combined share has declined from 49% in FY19 to 43% in FY21 and 41% in FY22. The percentage has decreased to 36% so far, this fiscal year (year to date FY23).[ix]

Corresponding to this, the shares for FY22 and the first half of FY23 in the Hindi cinema genre are 38% and 33%, respectively. During the first half of FY23, the proportions in the Bengali GEC, as well as Marathi GEC categories, plummeted to 38% and 27%, respectively.[x]

From the data presented above, it can be deduced that the merger of Zee5 and Sony will never be in a dominating market position since it lags behind Disney + Hotstar in the OTT market and Star + Disney and Other Broadcasters in the TV Broadcaster market.

To further allay this fear of anti-competitive measures like being in a dominant position and abusing it, Sony and Zee voluntarily agreed to sell three Hindi channels – Big Magic, Zee Action, and Zee Classic. This would further contradict CCI’s assertion that the deal was likely to cause an appreciable adverse effect on competition.[xi]


  1. Vodafone – Idea merger

Numerous cellular firms had been pushed to lower their pricing and introduce new offerings as a result of Reliance Jio’s entry into the telecom market. The amalgamation of Vodafone and Idea, two of the biggest names in telecom, followed this. Both of these businesses held a commanding position in the market on their own. The reason the Competition Commission of India approved this merger was therefore a matter of concern. Analyzing the market revealed the solution to this. It became clear from examining the state of the market following Jio that Jio was also in a position to exploit its dominant position. To guarantee continued competitiveness, the merger was approved.[xii]

  1. Tata Steel – Bhushan Steel Takeover

In the steel market, Tata already dominated nearly all of the segments with a dominant market share. The industry leader in auto-grade steel was Bhushan Steel. Even though it had steady activities, the asset was non-performing. It was open for annexation. The Tata Steel BSL was created when Tata Steel secured the bid. However, the CCI approved this acquisition since it raised market revenue in addition to allowing the trade to flourish.[xiii]

Future Implications

The merged company would have more negotiating leverage with distributors like MSOs (multi-system operators) and DTH (direct-to-home) operators due to them negotiating as a single company. The tv broadcasting business, meanwhile, is a different story. There could be huge repercussions for Disney Star and Viacom18. The general entertainment channel (GEC) market has been dominated by Star up to this point due to its appealing programming, but the combination of Zee and Sony may bring about a hidden bias among the production community. The merged company may have more leverage in negotiations over distributors and advertising companies because it will have a wider range of outlets and facilities to provide.[xiv]

Due to the range of services offered, the combined company would flourish tremendously. They would be able to expand their influence as a result. With a foothold in all the major areas, including entertainment and sports, the merger will make Sony-Zee a very formidable force to reckon with. Zee did not offer sports, while Sony never had a significant regional presence. Gaps will be filled as a result of the two coming together.


Despite having a staffing shortage, the CCI has performed well as an effective competition regulator in India since the country’s competitiveness has increased dramatically in recent years. CCI has always maintained an open-door approach to address any questions or concerns by concerned parties in combination to interact with stakeholders and clear up any uncertainty.

Some implications may arise due to its growth and advancement, however going by the statistics and data presented, Zee and Sony’s agreeing to the conditions imposed upon it by the CCI, it can be said that the merger would not be anti-competitive and would instead prove to be a blessing in disguise for the future generations. This deal can be used as an example of how every merger that takes place between top companies cannot be viewed as anti-competitive.

[i] TNN, Sony-Zee merger gets conditional CCI nod, The Times of India, Oct. 5, 2022,

[ii] Krishna Gopalan, What the Zee-Sony Merger Will Look Like, Business Today (Jan. 23, 2022),

[iii] Gaurav Laghate, Invesco withdraws EGM requisition for ZEE’s board reconstitution, reiterates support for ZEE-Sony merger, The Economic Times, Mar. 24, 2022,

[iv] Gaurav Laghate, Invesco withdraws EGM requisition for ZEE’s board reconstitution, reiterates support for ZEE-Sony merger, The Economic Times, Mar. 24, 2022,

[v] Constantinos Papavassilopoulos et al., Report on India: Online Video Trends (Omdia, Mar. 21, 2022),–Omdia-Consumer-Research-Highlights-2022.

[vi] Anonymous, OTT Platforms Market Share in India, The Global Statistics, (last visited Nov. 14, 2022).

[vii] Tanushree Basuroy, Television Broadcasters Market Share India FY 2020, by network, Statista (May 11, 2022),,Network%20ranking%20third%20that%20year (last visited Nov. 14, 2022).

[viii] Pavankalyan, How Reliance Jio proved that free services by it were not anti-competitive (TaxGuru, July. 17, 2022),

[ix] Gaurav Laghate, ZEE-Sony Merger – drop in market share to help get CCI approval, The Economic Times, Aug. 31, 2022,

[x] Gaurav Laghate, ZEE-Sony Merger – drop in market share to help get CCI approval, The Economic Times, Aug. 31, 2022,

[xi] Press Trust of India, Zee – Sony merger: Media groups agree to sell three Hindi channels, Business Standard, Oct. 26, 2022,

[xii] Sayanti Chakrabarti, Criteria Considered by CCI Before Approval of Mergers, Amalgamation and Acquisition, Legal Service India, (last visited Nov. 14, 2022).

[xiii] Sayanti Chakrabarti, Criteria Considered by CCI Before Approval of Mergers, Amalgamation and Acquisition, Legal Service India, (last visited Nov. 14, 2022).

[xiv] Lata Jha, Zee-Sony to escalate war for ads, content, Mint, (last visited Nov. 29, 2022).


Leave a Reply

Your email address will not be published. Required fields are marked *

Contact Us

Kerwa Dam Road., 
National Law Institute University, Bhopal
Madhya Pradesh, India. 462044​.

write to us at –