By acquiring 4,000 movies and 17,000 TV shows as part of an $8.5bn deal, Amazon has made it clear that there’s no ceasefire in the streaming wars.
Content is still king with Amazon paying $8.5bn for MGM in the latest salvo in the streaming wars.
One of the world’s oldest film studios – which filed for and emerged from bankruptcy in 2010 – had been in discussions for weeks about a sale. Now, James Bond, RoboCop and The Pink Panther have a new home in Jeff Bezos’ house.
In one fell swoop, Amazon gained access to more than 4,000 movies from the MGM catalogue for its Prime streaming service as well as 17,000 TV shows including The Handmaid’s Tale and Fargo.
The deal is Amazon’s second biggest acquisition to date – after $13.7bn for Whole Foods in 2017 – and marks a serious statement of intent by Amazon and specifically its Amazon Studios division, which was set up in 2010.
“The real financial value behind this deal is the treasure trove of IP in the deep catalogue that we plan to reimagine and develop together with MGM’s talented team. It’s very exciting and provides so many opportunities for high-quality storytelling,” Mike Hopkins, senior vice-president of Prime Video and Amazon Studios, said of the deal.
Amazon has shown it is not afraid to cut big cheques in the crowded and cut-throat world of streaming.
It has recently paid large sums for streaming rights to new film releases like Coming 2 America, but clearly the tech giant sees value in older and legacy content and unsurprisingly in current TV series like The Handmaid’s Tale.
But the acquisition of MGM’s content isn’t straightforward either.
MGM produces TV shows for other networks such as NBC, which directly competes with Amazon, so how exactly those relationships will shake out remains to be seen.
Secondly, the James Bond franchise is still part-owned by producers Barbara Broccoli and Michael G Wilson, who have a significant say over the franchise and the character. Amazon won’t have free rein to do with 007 as it pleases.
Amazon is still looking for its mega hit in the vein of HBO’s Game of Thrones. Now with additional firepower, Amazon will likely be looking to finance and develop more new shows – it’s investing eye-watering sums in a Lord of the Rings TV show – and movies that give it an edge over Netflix and Disney+.
That will be easier said than done. Netflix is churning out content like there’s no tomorrow, from regional TV shows to big movies like Army of the Dead, while Disney+ has its own vast treasure trove to woo subscribers.
Competition is only getting tougher too. AT&T’s WarnerMedia and Discovery recently merged to create yet another streaming superpower.