Amazon is to purchase the historic MGM Studios in an $8.45bn deal designed to better equip Prime Video to compete with Netflix, Disney+ and Apple TV.
By taking on one of the most hallowed studios in Hollywood, Amazon is positioning its streaming service as a force to be reckoned with in the battle for content. It will draw on a legacy of over 4,000 films from the James Bond franchise to Tomb Raider, as well as 17,000 TV shows including The Handmaid’s Tale and reality cosmetic surgery series Botched.
Mike Hopkins, senior-vice president of Prime Video and Amazon Studios, commented: “The real financial value behind this deal is the treasure trove of intellectual property in the deep catalog that we plan to re-imagine and develop together with MGM’s talented team.”
The deal illustrates the rapidly-changing balance of power between big tech and the entertainment industry, with the former able to leverage near-unlimited financial firepower to turbocharge their streaming platforms in an endless pursuit of new audiences.
Founded in 1924, the venerable studio is best known for the roaring Leo the Lion mascot that opens its films, but has been in the market for a buyer since 2020 as Covid-19 devastates the cinema industry.
Kevin Ulrich, chairman of the board of directors of MGM, said: “I am very proud that MGM’s Lion, which has long evoked the golden age of Hollywood, will continue its storied history. The opportunity to align MGM’s history with Amazon is an inspiring combination.”
With MGM in its armory, Amazon will be better equipped to see off intense competition in the cut-throat streaming industry where a new show to binge-watch is never more than a click away.
Amazon’s latest addition marks an acceleration of a consolidation trend in the media industry, most recently evidenced by telecoms giant AT&T, which agreed to merge WarnerMedia with Discovery in a $43bn deal designed to establish yet another streaming giant.