MUMBAI: Star and Zee are in talks to share a common distribution company, a merger of operations that is set to shake up the broadcasting industry as it gathers muscle power to mop up subscription revenues and curtail carriage payouts to cable TV operators.
 
The Star channels are distributed by Star Den, an equal joint venture between Star and Den. Zee has a distribution joint venture with Turner International where it holds 74 per cent equity.

“Rupert Murdoch’s Star India and Subhash Chandra’s Zee are traditional rivals, but the new guard is having a more collaborative approach. Star India CEO Uday Shankar and Zeel MD and CEO Punit Goenka are close and are more co-operative. So a deal between the two is possible,” an industry source said.

There are several options that can be explored, if Star and Zee decide to combine their distribution business. A possible route could be merging Star Den with Zee-Turner.

“We are not clear what is being decided upon. Turner and Den could be included in the deal. Or it can take any shape. But there is a very strong buzz in the market that Star and Zee are joining hands for distribution,” said sources.

While Shankar and Goenka could not be contacted, Star Den CEO Gurjeev Singh Kapoor did not want to talk about the issue.  
 
Indiantelevision.com had earlier hinted at the consolidation of the distribution business of these two companies without naming them.

According to the report, the discomforting pace at which the carriage market is growing could force a major consolidation in the pay-channel distribution business. “Don‘t be surprised if two big entities decide to merge for distribution," the report stated.

Digicable MD and CEO Jagjit Singh Kohli said that he had heard of the deal but was waiting for more clarity to emerge.

“If the deal happens, then there may be a slowdown in the carriage market. It could also have an impact on subscription revenues of broadcasters. Besides, there will be pressure on other channel distribution companies to consolidate,” he said.