The statements that the two parties made papered over the bitter
wrangling that had led up to the final parting of ways. "India continues
to be a major priority for Disney and we remain fully committed
to our customers and clients here. We have had a productive business
partnership with Modi Enterprises in India, and we would like to
thank them for their support and assistance", Doug Miller, senior
vice-president and managing director of Walt Disney Television International
(Asia Pacific), was quoted as saying.
"The partnership that we enjoyed with Disney for a decade was immensely
rewarding and fruitful," said Lalit Modi, chairman, Modi Enterprises
Limited. "While it was a novel and enriching experience for us,
we take as much pride in saying that we, as local partners, were
able to make significant and lasting contributions towards raising
the salience of the Disney brand, and in popularizing Disney characters
and television programming, in India."
Disney and the Modis are currently working together to formalise
transition plans to ensure a smooth continuity of Disney's business
operations in India, the statement says.
It was in October 2001 that Disney moved the Foreign Investment
Promotion Board (FIPB) seeking permission to set up a wholly owned
subsidiary company for the purposes of launching The Disney Channel
in India. Though an initial go-ahead was received from the Department
of Industrial Policy and Promotion (DIPP) in January 2002, the Modis
protested saying that clearance for the proposal could be given
only after MEL gave a no objection certificate (NOC), which it was
not inclined to do.
The FIPB, under the DIPP, was finally informed in September 2002
by the ministry of information and broadcasting (I&B), the administrative
ministry in this case, that it could not support Disney's proposal
to launch The Disney Channel.
MEL had opposed Disney's proposal on the grounds that the businesses
of the existing joint venture company and the proposed wholly-owned
subsidiary were similar. Disney, however, refuted this. One of the
arguments that Disney put forth was that apart from the existing
joint venture, its earlier agreement with Modi Entertainment Network,
another Modi group company, was for a free to air Disney channel.
Now that Disney proposed to bring the kids' channel as a pay-per-view
channel, the whole business plan had undergone a change and, hence,
the Modis should have no objection to issuing an NOC.
The argument however, failed to find favour with the I&B ministry
and there the matter remained till now. The Modis took the position
that if Disney wanted to bring its channel bypassing the existing
agreement, then it would have to either buy out the stake of the
Indian partners or else air non-Disney software on any channel it
might bring into the country.
The WD India Pvt. Ltd JV was established in 1993. Managing the
sale of Disney software in India was Buena Vista Television India
(BVTI), a division of WD India. BVTI was responsible for selling
serials, animation series, educational software and films from Disney
and Disney-associated studios like Hollywood Pictures, Touchstone