Arvind's Newsletter

1.Sunset for Disney+ Hotstar? RIL may have just JioCinema as OTT platform post merger with Star India

Reliance Industries is planning on combining the two streaming platforms Disney+ Hotstar and Jio Cinema under the banner of the latter, after its merger with the Walt Disney Company goes through.

However, currently Disney+ Hotstar has over 500 million downloads while JioCinema has over 100 million downloads. The merger is awaiting regulatory clearances from the Competition Commission of India and the National Company Law Tribunal. Once cleared, the combined media giant will be a $8.5 billion entity.

However, according to Reuters’ sources, Competition Commission of India has reached an initial assessment that the $8.5 billion India merger of Reliance and Walt Disney media assets harms competition due to their power over cricket broadcast rights, which if true could be setback for the deal.

2.Class war: IndiGo shows Air India it means business; Mihir Mishra and Anu Sharma, Mint

On its 18th birthday, Indigo announced the launch of a business class, IndiGo Stretch, on some of its Airbus 321 aircraft operating between 10 metro destinations in the country. Currently, these planes have 232 seats in an all-economy configuration. The business class cabin will feature 12 seats in a 2-2 configuration, while the economy class will have 208 seats—12 seats will be sacrificed to make room for IndiGo Stretch.

IndiGo executives Mint spoke with say that the business class should be looked at in the context of the airline’s larger plan to focus on improving yields or average revenue per seat. It is also looking to expand globally through the Airbus 321XLR, which is likely to be inducted next year, and the Airbus 350, which is likely to join in 2027. Emails sent to IndiGo and Airbus seeking an official response on the recent development had not elicited any replies at the time of publishing.

Industry watchers said that premium-class fliers make up about 5-6% of the Indian market, and IndiGo will target that segment. “The IndiGo of tomorrow is going to be very different from the IndiGo of 2006 or today. The business class entry is clearly to tap the segment, which has lower capacity now than until early 2019, when Jet Airways was still in operation," said noted analyst Ameya Joshi, founder of aviation consultancy Network Thoughts.

Around the time airlines in India and globally were recovering from the impact of the covid pandemic, IndiGo’s top management decided to shift focus away from load factors to better yields.

“If you look at IndiGo’s strategy, the focus is clearly on yields. Even with the business class launch, the airline will be reducing the number of seats from 232 to 220—they are adding 12 business class seats in the aircraft by losing just 12 economy seats," said a former airline executive who has worked with the commercial department of more than one airline. “These business class seats will earn them three times more revenue per seat over the economy class."

The executive added that the cost of providing business class services on a legacy full-service carrier such as Air India is up to 40% more than the cost of an economy class seat. “In the case of IndiGo, it could be only 25% higher than its economy class seat, and the reasons are simple: IndiGo’s business class offer is simpler—no hot food, no warm towel, no fine cutlery, lounge access, etc.—and that keeps the cost down," he explained. “So, it’s a win-win for IndiGo, where it would fetch better revenues at a lower cost as compared to its peers."

Airline executives told Mint that the strategy is also part of the plan to prepare IndiGo for a big international expansion, which will see with the induction of the Airbus 321XLR and Airbus 350. While the Airbus 321XLR will have a flying range of 7-7.5 hours, the Airbus 350 can fly double that. To put that in context, an Airbus 321XLR can fly non-stop from New Delhi to Amsterdam, whereas an Airbus 350 can fly directly from New Delhi to New York.

3.Changing profile of India's medical tourism exports amid Bangladesh unrest

The political upheaval in Bangladesh has once again turned the attention back to India’s medical tourism exports. The neighbouring country is India’s leading contributor to healthcare tourism.

A total of 4,49,570 Bangladeshi medical tourists thronged the Indian shores for their medical treatment in 2023, a 37.46 per cent rise from 2022. Their share in India’s Foreign Tourist Arrivals (FTAs) for medical reasons was 42.48 per cent in 2016, which has jumped to 70.85 per cent in 2023.

While the recent political developments in Bangladesh are expected to impact India’s overall medical tourism services exports, the issue runs deeper, with India’s health service exports having already declined by 38.58 per cent between FY15 and FY24.

A review of India’s Balance of Payments data shows the expenditure on health-related travel by foreigners in India has plummeted from $254 million in FY15 to $156 million in FY24. Even though health services exports by India have been rising for the past two years, they are still below the pre-pandemic level.

4.Crunchyroll is trying to turn India into a nation of anime lovers

The world’s largest anime streaming service is opening its second local office, working with Bollywood stars, and adding dozens of shows per quarter.
It is also dubbing many of its shows into Hindi, Tamil, and Telugu. Overall subscriber numbers are small, but the market is growing fast and projects to top $5 billion annually in India within a decade (According to Polaris Market Research). Crunchyroll’s history — beginning as an illegal hosting service before being acquired by Sony — mirrors the behavior of Indian fans, one of whom told Rest of World he and his friends followed anime by “sailing the high seas and being absolute online pirates.”

5.What caused the fatal sinking of the superyacht Bayesian?

One of the world’s largest sailing super-yachts sank in high winds off Sicily on Monday, with UK tech entrepreneur Mike Lynch among those missing.

Camper & Nicholsons, which managed the 56-metre British-flagged Bayesian yacht, said it “encountered severe weather and subsequently sank” near Palermo.

Owned by the Lynch family, the boat had 10 crew and 12 guests on board, 15 of whom have been rescued, including Lynch’s wife, Angela Bacares. The chef’s body was found near the wreckage, while six other people — including Lynch and his 18-year old daughter — are still missing.

Lynch, the former chief executive of Autonomy, was acquitted of criminal charges by a jury in San Francisco in June, vindicating the 59-year-old entrepreneur after a 12-year legal battle over the software group’s $11bn sale to Hewlett-Packard in 2011.

6.Intel is the latest Fortune 500 giant to test the ‘4 wrong CEOs’ rule; Geoff Colvin in Fortune

With thanks to Founding Fuel Publishing blog for pointed to this article.

Refering to Intel's missed opportunity to invest in OpenAI in 2017-2018, Fortune’s Geoff Colvin highlights how critical CEO decisions can shape a company's future. Yet, companies can survive one, even two or three wrong CEOs, but not four.

He writes: “It’s worth asking why corporate doom often takes four CEOs. Surely just one really terrible boss could do the job, right? Yes, but in companies of significant size, truly awful CEOs will probably be pushed out before they can destroy the whole thing. Ruining a substantial, successful business takes some doing, as explained by Jim Collins, author of multiple business mega-sellers (Built to Last, Good to Great, Great by Choice). In How the Mighty Fall, he identifies five stages of decline: hubris borne of success; undisciplined pursuit of more; denial of risk and peril; grasping for salvation; capitulation to irrelevance or death. Intellectually and emotionally, a single CEO would have a tough time going through all five stages, and a board could scarcely let one CEO take a company through all five.

 To see how those stages play out, and why even three wrong CEOs might not be enough to wreck a company, examine Apple’s situation in 1997. The company was 20 years old. Three consecutive wrong CEOs had taken the company through the first three stages of decline. The company had been close to bankruptcy and was now in the fourth stage, grasping for salvation. A wrong fourth CEO would almost surely have taken Apple to the final stage. The board of directors, desperate, brought back co-founder Steve Jobs, who had been fired in 1985 and (believe it or not) had never been Apple’s CEO. The rest is history, but it could so easily have gone the other way.

7.Biggest US firms worry about AI

More than half of Fortune 500 companies see artificial intelligence as a potential risk to their business, according to a review of their annual reports.

A new study found that 56% of the firms cited AI as a risk factor, a massive jump from 9% in 2022. The US’ biggest boardrooms aired their grievances about AI-driven competition, reputation harm, and ethical debates, with some industries -like entertainment-more worried than others, the Financial Times reported.

But as large companies fret about AI, smaller startups are embracing it, The New York Times reported. One professor of entrepreneurship at Carnegie Mellon University told students: “Think of generative AI as your co-founder.”

8.Ranked: Countries That Have the Most Skyscrapers

In the late 19th century, tall steel-framed structures rose in Chicago, New York, and Boston, giving birth to the term “skyscraper.”

Of course, humanity had been constructing tall buildings for millennia (see also: pyramids) but skyscrapers were different. They weren’t ornamental, but meant for humans to work and live in.

More than a century later, skyscrapers are commonplace in the world’s most populous cities. The Visual Capitalist rank the top 12 countries by the number of their buildings at least 150 meters (492 feet) tall.

China has more than 3,000 skyscrapers, more than 3x the next ranked country. Its tallest city (based on aggregate building height) is the densely-populated Hong Kong. India has only 122.