First Acquisition of a Hollywood Media company by a Bollywood Company

Our past stories on angle featured large capital infusions in to big Hollywood names like Spielberg, Clooney, Pitt etc. Today’s story is small but strategic.

The Times of India reports that, Valuable Group, a privately held media house, has acquired Hollywood-based media company MovieBeam. MovieBeam specializes in video-on-demand services, telecasting movies using wireless technology into customers’ homes through a set-top box. This is the first acquisition of a Hollywood media company by an Indian firm, the company said. Post-acquisition, Valuable Group plans to infuse about $100 million into the company over the next two years.

MovieBeam was incubated in 2005 by an alliance of Disney, Intel and Cisco that had infused over $200 million into it. In 2006, Disney had spun off MovieBeam and 2007 Movie Gallery had acquired MovieBeam.

After the acquisition, Valuable Group says it could directly beam new movies to televisions sets on the day of the release (first-day, first-show in the cinema parlance).  Direct release of movies to viewers is expected to revolutionize distribution of movies. It is probably the most effective way to minimize piracy and to increase studio margins. It can magnify the reach of the studios to areas where the theater distribution model might not work efficiently.

Valuable Group is a technology-driven media company that operates several media and entertainment initiatives. It also runs UFO Moviez, the largest satellite-based digital cinema network in the world. According to the Times of India, there were rumors recently that a large corporate house, having interests in businesses like finance, power, telecommunications and also expanding its media business rapidly, had approached Valuable Group for acquisition. The proposal, however, was declined by Sanjay Gaikwad, the technocrat-turned-entrepreneur who heads Valuable Group.


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