UTV And Disney A Strategic Alliance A Case Solution

1. What are the global opportunities for UTV?

UTV is evaluating the strategic importance of merger with Disney. However, instead of subject merger UTV has a number of other options to expand its global footprints; it can use the earnings of its overseas film businesses to acquire the stakes in foreign channels having the target segment of kids and use its production and marketing skills for selling its idea. Other option is to start regional channels in overseas targeting the kids of 25 million non-resident Indians and can use the force behind the popularity of Indian film industry to achieve its targets. For overseas kids’, channel UTV can use its current skills and amount of investment will be less because for regional coverage low production equipment can be used.

2. How would an alliance with Disney give UTV an edge in its international operations?

Disney merger can be beneficial if UTV combines its international film distribution skills and worldwide network of Disney. In this way, it can increase its revenue by having film distribution business in almost 200 countries in which Disney has marked its footprints. Disney has expertise in creative and innovative content which will be combined with the marketing and distribution skills of UTV and this move will result in a quality product covering almost 200 countries. Brand name of Disney will help in negotiating and forming overseas partnerships. 

3. What are the advantages and disadvantages in the strategic alliance with Disney?

Advantage of this strategic alliance will be that UTV would have enough cash reserves that will help to achieve the predicted revenue growth by 2008 as dreamed by Screwvala. It will bring synergy expertise to produce and distribute good family content. Downside of this alliance is the loss of control over Hungama TV. Current size of kid’s segment in Indian television market is extremely low keeping view the worldwide stats it is expected to grow. If Disney does not let UTV to use its worldwide network then it will lose potential revenue keeping in view expected growth of kids segment. In that case, benefit gained in the form of increase in cash reservoirs will be very much small in comparison to potential revenue loss.