CASE STUDY: ACQUISITION OF NDTV BY ADANI GROUP

SYMBIOSIS LAW SCHOOL, PUNE

Internal Assessment I – Media Law

CASE STUDY

ACQUISITION OF NDTV BY ADANI GROUP

NAME: Aarya Karande

DIVISION: D

PRN: 20010125516

SEMESTER: V, 3rd Year

COURSE: BA LL.B. (H)

BATCH: 2020-2025

SUBMITTED TO: Richa Dwivedi, Raj Varma, Kirti Bikram

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 CASE STUDY: ACQUISITION OF NDTV BY ADANI GROUP

ACQUISITION OF NDTV BY ADANI GROUP

INTRODUCTION

The media division of Adani Enterprises has acquired nearly 30% of NDTV's shares
through an indirect deal, making Gautam Adani the majority shareholder of the news
network. Despite NDTV's denials, rumours of Adani's acquisition of NDTV circulated for
approximately a year prior to the deal. VCPL has acquired RRPR without the permission of
NDTV founders Radhika and Prannoy Roy. Adani Enterprises acquired VCPL from its
previous owners, transforming it into a wholly owned subsidiary of AGM Media Networks
which is a wholly owned subsidiary of Adani Enterprises.

The acquisition of NDTV by Adani could significantly alter the landscape of television news.
Although it may not be as popular as Republic TV, Times Now, or India Today, NDTV is
regarded as one of the few remaining government-critical independent media outlets.
The substantial change in ownership, which places it under the control of a close
associate of Prime Minister Narendra Modi, is likely to have a significant impact on the
variety of mainstream television news stories. Potentially, the acquisition could reduce the
diversity of perspectives and opinions in the mainstream media, leading to a more one-sided
and uniform portrayal of news events. This could have a negative impact on the quality of
public discourse and the ability of citizens to make informed decisions about crucial issues.
The acquisition has highlighted a number of legal issues that have come to light. Acquisition
of NDTV by Adani Enterprises is an example of indirect control over freedom of speech.

LEGAL ISSUES INVOLVED

In order to safeguard the democratic system and ensure a diverse and pluralistic range of
voices, it is the responsibility of the state to prevent excessive concentration of media
ownership by private entities. Regulation 5(8) and Regulation 9(2) of the Competition
Commission of India (Procedure regarding the transaction of business relating to
combinations) Regulations, 2011 have eased the requirements for hostile takeovers.
However, this does not imply that serious violations of the Constitution can be ignored or
tolerated.

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 CASE STUDY: ACQUISITION OF NDTV BY ADANI GROUP

There are several issues that arise with regards to Freedom of Speech under Article 19(1)(a)
when talking about private ownership of media outlets. The involvement of owners with
business and political interests significantly impedes the free and unfiltered flow of relevant
information. Press Freedom has been upheld as an integral part of Article 19(1)(a) for
decades. Acquisition of NDTV by Adani is bound to act as a hindrance by preventing
unfiltered flow of relevant information that is government critical thus violating the essence
of Freedom of Speech and Expression guaranteed under Article 19(1)(a) of the Constitution.

Under competition law, Adani's acquisition of NDTV may raise concerns regarding potential
anti-competitive practices or abuse of market power, especially if the acquisition substantially
reduces competition in the relevant markets. Depending on the size of the transaction and the
market shares of the parties, the acquisition may also trigger mandatory notification
requirements under the Competition Act.

ANALYSIS

Patanjali Shastri, the chief justice in the case Romesh Thapar v. State of Madras1, ruled that
without free political discourse, the public education necessary for the operation of a
democratic government cannot exist. The government prohibited the entry and distribution of
the Bombay-published English journal "Cross Road," thereby violating the freedom of
speech and expression, as a publication is of little value without the freedom of circulation.

In Union of India v. Association for Democratic Reform2, the Supreme Court stated that
one-sided information, disinformation, misinformation, and lack of information all contribute
to an uninformed citizenry, which renders democracy meaningless. Freedom of speech and
expression encompasses the right to transmit and receive information, as well as the liberty to
hold opinions. NDTV was considered the last of the mainstream media outlets that aimed to
push a strong critical agenda against the ruling party in order to hold them accountable;
however, the Adani takeover restricts this.

1
Romesh Thappar vs The State Of Madras (1950) S.C.R. 594

2
Union of India v. Association for Democratic Reforms and Another; with People’s Union for Civil Liberties
and another v. Union of India and another2002 (3) SCR 294

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The following reasons contribute to depict how media ownerships by billionaires can be
detrimental to free speech:

1. Diversity of voices and perspectives is reduced

Limiting the diversity of voices and perspectives presented in the media is one of the most
significant negative effects of media ownership by billionaires. When a small group controls
multiple media outlets, they can control the narrative and promote their own agendas. This
can lead to the suppression of dissenting viewpoints, as those who disagree with the owners
may have difficulty gaining access to media platforms.

News Corp's billionaire owner is Rupert Murdoch. His media outlets, including Fox News,
The Wall Street Journal, and The New York Post, have been criticized for advancing a
conservative agenda. Critics assert that these outlets provide a forum for the dissemination of
partisan viewpoints, frequently to the exclusion of other viewpoints. This has prompted
concerns that he is limiting the variety of perspectives presented in the media and silencing
opposing viewpoints3. Similarly, in India, channels such as Network 18, Times Now, and
Republic TV air a number of poisonous debates on communal lines with the intention of
inciting public ire and swaying the political climate in favour of one sect.

NDTV's anti-establishment stance is doomed because of Adani's close relationship with the
Prime Minister and members of the ruling BJP. This acquisition by Gautam Adani gives him
the ability to exert overbearing control over the reporting and broadcasting of news channels,
which are frequently regarded as the last bastion willing to fight against the government to
hold it accountable.

2. Homogenization of content

Additionally, billionaire ownership of the media can result in the homogenization of content.
When a small group controls multiple media outlets, they may seek to maximize profits by
creating content that appeals to the largest possible audience. This can lead to a lack of
diversity in programming and news coverage, as media owners may be less inclined to
produce niche or audience-specific content.

3
Pamela Taylor Jackson, & Stanfield, J. R. (2004). The Role of the Press in a Democracy: Heterodox
Economics and the Propaganda Model. Journal of Economic Issues, 38(2), 475–482.
http://www.jstor.org/stable/4228034

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The Sinclair Broadcast Group, which is owned by a group of billionaires, provides examples
of the homogenization of content in the real world. Sinclair has been criticized for mandating
that its local news stations broadcast content with a conservative bias, whereas in India,
channels such as Zee and Republic TV promote the values preached by the far right. This has
caused the group to restrict the variety of perspectives presented in local news coverage.

3. Interests of media owners is given more importance in comparison to public interest

Media owners may use their control of media outlets to promote their own interests and
censor potentially damaging information. As the media plays a crucial role in informing the
public and holding those in power accountable, this could be detrimental to the public
interest.

This is most prominently highlighted by Jeff Bezos and The Washington Post. Bezos has
been criticized for promoting his business interests, including Amazon, through his
ownership of the newspaper. This has prompted concerns that he prioritizes his own interests
over those of the public and may suppress negative coverage of Amazon.4

In addition to Bezos, other billionaires who own media outlets have been accused of putting
their own interests before those of the public. Sheldon Adelson, the billionaire owner of the
Las Vegas Review-Journal, was criticized for using the newspaper to promote his business
interests, namely his casinos. This led to suspicions that he suppressed negative coverage of
his businesses and used his media outlets to promote his own interests.5

SUGGESTIONS

The following measures can be implemented to protect the Press Freedom:

A. Government Regulation

Disputes have been brought before the Supreme Court as a result of infrastructure regulations
governing media ownership.6 The disputes involved scarce resources such as newsprint and

4
Kalathil, S. (2020). The Evolution of Authoritarian Digital Influence: Grappling with the New Normal.
PRISM, 9(1), 32–51. https://www.jstor.org/stable/26940158

5
BHUSHAN, S. (2015). “Regulation” and “Non-Media” Money in Media. Economic and Political Weekly,
50(7), 21–23. http://www.jstor.org/stable/24481387

6
Sakal Newspapers v Union of India (1961)

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airwaves, and major newspapers and broadcasters challenged the legislation or policy on the
grounds that it violated their constitutional rights to free speech and expression7.

In cases involving newsprint, the Supreme Court ruled unconstitutional any legislation or
policy.8 In a case involving airwaves and the telecast of cricket matches, the Supreme Court
ruled that the right of one entity to use airwaves for broadcast could not be considered a
fundamental right because airwaves are public property and must be allocated so that
everyone has an equal opportunity to broadcast and receive television information9.

The government would have persisted in its attempts to regulate media ownership through
infrastructural regulation because other methods of regulation, such as competition law, do
not necessarily link ownership to diversity of sources, which is an important consideration for
media consumers. However it does seem unlikely. Adani's acquisition of NDTV signifies the
end of the last establishment-opposing mainstream news channel. The government now has
the majority of the news ecosystem on its side.

B. The model of News outlet should be re-designed

This cherished right to free speech in India is threatened by the current business model of
news media outlets, which is based on advertising and ownership. The following model is
flawed due to the following reasons:

a) Commercial interests prevail over public interest

In the advertiser/owner business model, news media outlets place commercial interests ahead
of the public interest. The primary objective of these media outlets is to maximize profits for
their owners and increase revenue by attracting advertisers. In order to attract viewers and
increase advertising revenue, they frequently resort to sensationalism, selective reporting, and
unethical methods. This emphasis on commercial interests frequently comes at the expense of
the public interest, which can hinder journalists' ability to report objectively and freely on
significant issues. There may be a reluctance among news organizations to cover stories that
are critical of their advertisers or owners or that may affect their revenue streams. Frequently,
as in the present instance with Adani, these brands have close ties to the government, which
leads to the inherent suppression of stories.10

7
Bennett Coleman and Others v Union of India (1972)
8
Indian Express Newspapers v Union of India (1984)
9
Indian Express Newspapers v Union of India (1984)

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b) Lack of diversity

The advertiser/owner-based business model hinders the diversity and plurality of news media
voices. This model places ownership and control of media outlets in the hands of a small
number of wealthy individuals or corporations. This concentration of media ownership results
in the homogenization of news content because the owners frequently share similar interests
and agendas. Therefore, journalists and media outlets may be hesitant to report on issues that
conflict with their owners' or advertisers' interests. This fosters an atmosphere in which
dissenting voices and minority perspectives are marginalized or silenced, which is
detrimental to a healthy democracy.

Several alternative business models are emerging that can be made increasingly popular; the
subscriber-based platforms that rely primarily on subscriber payments and subscriptions for
revenue are an alternative that many new independent media channels are seeking.
Additionally, hostile takeover regulations can be made more stringent, particularly in cases
involving media companies. Regardless of how independent their journalism may have been,
platforms such as NDTV were structured so that they relied on advertisements for revenue.
This rendered them susceptible to a hostile takeover. Non-advertising revenue-based
platforms are independent and, as a result, are not susceptible to takeover by advertisers or
owners with enormous financial resources. This helps to create a more credible and
conducive environment for journalism.

C. Expansion of independent media: Establishment of new media platforms which are not
owned by any government influenced entity will enable free flow of relevant and true
information.

CONCLUSION

The acquisition could have a negative impact on the news organization's overall coverage,
which is still critical of the BJP government and its policies. In fact, Prime Minister Narendra
Modi has never appeared on an NDTV program, and numerous BJP politicians have refused
to appear on the network. During Modi's tenure as prime minister, NDTV has been charged

10
KUMAR, S. (2016). Concentration of Media Ownership and the Imagination of Free Speech. Economic and
Political Weekly, 51(17), 127–133. http://www.jstor.org/stable/44003416

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with numerous offenses, ranging from money laundering to tax evasion. newspaper by
expanding its readership and consolidating its position in the digital world.

Article 19(1)(a) of the Indian Constitution protects the freedom of speech and expression.
Adani's takeover is a severe blow to this freedom. The freedom of the press in the country is a
fundamental component of Article 19. As established in this article, Freedom of the Press is
concerned not only with the regulation of news, but also with issues such as media ownership
and indirect restrictions on news. Legally, the takeover may have followed the proper
procedures, but it certainly does not pass the test of fundamental rights. Adani's acquisition
has all the hallmarks of a self-serving acquisition by a billionaire. As an independent
mainstream media outlet, NDTV may no longer have the freedom to cover all stories,
especially those that are critical of the government or Adani himself. The relationship
between Adani and the prime minister and the BJP will exacerbate the situation. There are
solutions to prevent such takeovers, but both appear unlikely or untenable in the foreseeable
future. In the coming years, the viability of these solutions will be determined by the
expansion of independent media.

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BIBLIOGRAPHY

1. Romesh Thappar vs The State Of Madras (1950) S.C.R. 594

2. Pamela Taylor Jackson, & Stanfield, J. R. (2004). The Role of the Press in a
Democracy: Heterodox Economics and the Propaganda Model. Journal of Economic
Issues, 38(2), 475–482. http://www.jstor.org/stable/4228034
3. Union of India v. Association for Democratic Reforms and Another; with People’s
Union for Civil Liberties and another v. Union of India and another2002 (3) SCR 294
4. BHUSHAN, S. (2015). “Regulation” and “Non-Media” Money in Media. Economic
and Political Weekly, 50(7), 21–23. http://www.jstor.org/stable/24481387
5. Sakal Newspapers v Union of India (1962) 3 S.C.R. 842.
6. Bennett Coleman and Others v Union of India 1973 AIR 106
7. Indian Express Newspaper vs Union of India(1985)1SCC 641
8. Secretary, Ministry of Information and Broadcasting v Cricket Association of Bengal
1995 AIR 1236
9. Chopra, P. (1980). Economics of Press Freedom. Economic and Political Weekly,
15(40), 1655–1656.
10. T. M. Gnanapragasam. (1995). Press in India. Economic and Political Weekly, 30(3),
126–126.
11. Jain, M. P. (1973). ARTICLE 19 (1) (a): FREEDOM OF THE PRESS: Bennett
Coleman & Co. v. Union of India. Journal of the Indian Law Institute, 15(1), 154–
164.
12. Kalathil, S. (2020). The Evolution of Authoritarian Digital Influence: Grappling with
the New Normal. PRISM, 9(1), 32–51.
13. Stan, A. (2017). All Politics is Local: Sinclair News conquers America for Trump,
one living room at a time. The Baffler, 37, 72–83.

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