Amazon’s MX Player acquisition marks its strategic play for India’s heartland

Amazon’s acquisition of MX Player, India’s top free streaming service, signals the company’s strategic move to stand out in the crowded OTT space. The deal combines the forces of Amazon miniTV and MX Player, merging two prominent ad-supported platforms into a single entertainment giant: Amazon MX Player.

This new service, with over 250 million unique users as of September 2024, offers a rich library of original content, international shows, and local programming dubbed in multiple Indian languages.

The acquisition comes amidst MX Player's financial struggles, highlighted by a petition from Sony India (Culver Max Entertainment) to the Delhi High Court seeking protection of INR 31 crore in dues. Sony’s concerns stemmed from liquidation proceedings against MX Player’s parent company in Singapore, which owed money to several lenders. Fearing the sale of MX Player’s assets would bypass its claims, Sony took legal action just as Amazon emerged as the likely buyer.

MX Player’s journey, from being acquired by Times Internet in 2018 for $140 million to becoming India’s top streaming app by 2021, as per a App Annie report, has been transformative. Under Times Internet, MX Player evolved from a media player into a full-fledged streaming service, licensing content and producing original shows like ‘Aashram’ and ‘Dharavi Bank’. It also tapped into other verticals like gaming and short videos, but its focus on tier-2 and tier-3 cities meant it struggled to convert its massive user base into paying subscribers.

By 2023, MX Player’s revenue had dropped by 63% to INR 215 crore, while its ad revenue fell by 17% due to shrinking marketing budgets in the post-pandemic economy. Despite growing its subscription revenue from INR 2.4 crore to INR 12.5 crore, the platform couldn't maintain profitability. The increasing competition from JioCinema and a lack of unique content only exacerbated the situation, prompting Times Internet to put MX Player up for sale a year ago.

Amazon’s acquisition is more than just a rescue mission. The e-commerce giant sees a strategic opportunity in MX Player’s wide reach, particularly in India’s underserved markets. Girish Prabhu, head of Amazon Advertising India, emphasised the synergy between Amazon’s advertising tech and MX Player’s user base, saying, “Today we are bringing together the vast reach of MX Player, with the advertising tech that leverages Amazon’s billions of customer signals. It’s about enabling all brands, not just the ones selling on Amazon, to reach and deliver relevant advertising to a very large and engaged base across India. It’s about directly measuring outcomes from the very top of the funnel to the very bottom.

Karan Bedi, now head of Amazon MX Player, echoed this sentiment, highlighting the merger’s potential to bring high-quality, free entertainment to even more users while deepening relationships with advertisers. “Amazon and MX Player obsess over customer experience and are both believers in the future of free entertainment,” he said. “We will offer high-quality entertainment and streaming experiences faster than we could have done independently, while continuing to keep the service free. This merger will mean great things for our viewers, advertisers and content partners, and will let us bring MX Player to even more people in India.”

With this acquisition, Amazon aims to dominate both the premium (Prime Video) and free (Amazon MX Player) OTT segments in India. By continuing to invest in original content and leveraging its advanced advertising tech, Amazon MX Player is poised to reshape the Indian streaming landscape, offering brands and viewers alike a unique and powerful platform.

In an industry where content is king, Amazon’s latest move positions it as a dominant player in India’s rapidly growing digital entertainment sector.