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Updated: Eros International to acquire controlling stake in Techzone for Eros Now


Update & Corrigendum: Saregama has informed that it distributes content directly across the operators and doesn’t have an exclusive tie-up with Techzone. Times Music also informs us that it doesn’t have an exclusive contract with Techzone. Techzone has informed us that it no longer has exclusive content deals with Venus, Sony Music, MTV, VH1, Colors and India TV. The company had exclusive deals as of October last year.

Update: Probir Roy, co-founder of mobile payments company Paymate, reminds us that Coruscant Tec, a company that he co-founded, was bought by Mukta Arts in 2008. That was the first instance of a content owner buying a MVAS company. It’s been a while.

Earlier: This is probably the first instance where a content owner is acquiring a content aggregator in the country: Eros International Plc has announced that it has signed a term sheet to acquire a controlling stake in the mobile value added service provider Techzone (Universal Power Systems Private Limited) for an undisclosed amount.

While the terms of acquisition were not disclosed, Eros CEO and Managing director Jyoti Deshpande says that Techzone’s billing integration and distribution across major telecom operators will complement its existing online movie streaming service ErosNow. Techzone currently delivers content through caller ring-back tones (CRBT), mobile radio, short message service (SMS), wireless application protocol (WAP) and interactive voice response (IVR). It also owns a mobile shortcode 56060.

Conflict of Interest?

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What’s not clear right now is what will happen to other content partners of Techzone post this acquisition. Would they now be open to provide the same content to Techzone since there might a conflict of interest involved now that Eros owns it.

Techzone logo

Established in 1999 by Naveen Bhandari, Techzone is a mobile aggregator, developer and distributor of entertainment content. It focuses on Bollywood film and music markets, although it claims to have significant region-specific content in Tamil and Telugu. The company claims to have done an average of 25 million SMS, WAP or IVR transactions per month over the past three years across 12 major telecom operators in India. Techzone notes that this excludes the CRBT transactions which are marketed and distributed by Techzone but billed by the telecom operators directly.

Last October, Aircel had partnered with Techzone to launch a Re 1 store which offers mobile content like videos, full music tracks, images and games to Aircel subscribers. As part of the deal, Techzone was expected to manage the platform for Aircel and offer more than 10,000 pieces of content across multiple categories in more than 12 languages to this store.

Techzone had also inked a two-year exclusive deal with music channel MTunes HD to offer MTunes content through SMS and CRBT services in June last year. It had also partnered 9x Media’s International music channel 9XO to launch an international music store at 9XO.56060.in (now defunct) in September 2012. Other tie-ups include VH1 for its mobile content shop VH1 Hub and India TV to offer its short code services and become technology partner.

Magic Voice: Apart from this, Techzone also offers a IVR application called Magic Voice that allows users to change their voice in different ways in real time while making a phone call. The company had initially launched it on Idea Cellular (Tamil Nadu & Chennai circle) in May 2012 and had later extended it to Uninor (across India) and Airtel (Chennai) in April last year. The service was developed by Techzone’s international division BlackNGreen.

Techzone had claimed that the service had 40 million users globally, which includes 40,000 active users in India, as of April 2013.  At the time, the service had apparently been deployed in 22 countries including Indonesia, Tanzania, Sri Lanka and Nigeria, among others with plans to deploy the service in Ivory Coast, Cyprus, Zambia, Sudan and Cameron in the future.

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