Reliance Industries Limited has announced the merger of its music streaming service JioMusic with the Tiger Global backed Saavn. The merged entity is valued at over USD 1 billion with JioMusic being valued at USD 670 million, as stated by the media release.
The announcement comes a week after Amazon launched its music streaming service Amazon Music in India, and almost ten days before Spotify, which is valued at nearly USD 20 billion, initiates its IPO.
Apart from the merger, Reliance will also invest USD 100 million for the growth and expansion of the platform. Besides, Reliance is acquiring a stake from the existing shareholders for USD 104 million. The three co-founders of Saavn, Rishi Malhotra and Paramdeep Singh will continue in their leadership roles.
With this development, it will be interesting to see which streaming turns out on top. Amazon Music technically has a user base of around 11 million subscribers in the country as the Seattle-based internet company offers the streaming along with an Amazon Prime subscription in India. Another contender for the top spot is Spotify, which boasts 70 million paying subscribers globally and has announced that it will launch its services in India soon. Apple Music claimed to have 30 million subscribers worldwide last year. Meanwhile, Saavn claims to have around 18 million users in India where it offers a freemium ad-supported service.
“The investment and combination of our music assets with Saavn underlines our commitment to boost the digital ecosystem further and provide unlimited digital entertainment services to consumers over a strong, uninterrupted network,” said Akash Ambani, Director, Reliance Jio, who is said to have driven the deal.
Reliance Jio says that it will continue to build on Saavn’s original programming and originals created with leading artists. The deal aims to combine the streaming media expertise of Saavn with the connectivity and digital ecosystem of Reliance Jio.