Amazon Buys MGM Studios for $12 Billion

Amazon Buys MGM Studios for $12 Billion

It’s official folks — Jeff Bezos now owns James Bond. After murmurs earlier this week, Amazon announced today that it had acquired MGM in an $US8.45 ($11) billion deal that will bolster the e-commerce giant’s Hollywood ambitions.

To be clear, this deal isn’t so much about Amazon competing with other streaming rivals like Netflix, Hulu, or Disney+. This is all about intellectual property, baby. MGM — or that studio with the iconic roaring lion — has a vast catalogue of more than 4,000 films, including James Bond, Robocop, Silence of the Lambs, Stargate, Tomb Raider, and The Pink Panther. It also has 17,000 TV shows, including popular series like Fargo and The Handmaid’s Tale. MGM also has several buzzworthy projects lined up, including Ridley Scott’s House of Gucci, the next Bond flick No Time to Die, and an unnamed Paul Thomas Anderson film.

Since 2013, Amazon’s thrown piles of cash at producing its own original content. Case in point, it’s throwing a whopping $US465 ($596) million at the first season of its forthcoming Lord of the Rings prequel series. Despite all that moolah, you’d probably be a little pressed to remember more than a handful of memorable titles like Transparent, The Marvellous Mrs. Maisel, and The Boys. By snapping up MGM’s most popular IP, Amazon’s banking that you’ll be less likely to cancel your Amazon Prime account, and therefore, your access to Amazon Prime Video.

“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,” Mike Hopkins, senior vice president of Prime Video and Amazon Studios, said in a press release. “It’s very exciting and provides so many opportunities for high-quality storytelling.”

According to NBC News and Variety, the nearly $US9 ($12) billion deal is a huge victory for MGM as well. Both Apple and Comcast had apparently sniffed around buying MGM in the past few years, at a valuation of roughly $US6 ($8) billion (including MGM’s debt). The deal is Amazon’s second-largest acquisition and its biggest since buying Whole Foods in 2017 for $US13.7 ($18) billion.

That said, it might not be completely smooth sailing from here. Amazon will have to convince regulators that the deal doesn’t violate antitrust regulations. According to Recode, Amazon will likely argue it’s a small fish in the streaming world and that the deal won’t result in fewer streaming choices for consumers. The other snag is that the Bond franchise isn’t solely owned by MGM. That’s because it shares the rights to everyone’s favourite spy with Eon Productions, which is owned by the Broccoli family. Eon Productions has maintained a vise grip on its creative control over the film series, with the Broccoli family having the final say on everything from distribution to which actor gets to replace Daniel Craig. Citing anonymous industry sources, Variety notes that it’s unlikely the Broccoli family will allow any Bond film to debut on Amazon Prime Video and they haven’t been big fans of Bond spin-offs or TV series.

At the end of the day, this is just the latest example of how smaller media companies are consolidating to keep up with the big guys. Last week, AT&T announced a $US43 ($55) billion merger between WarnerMedia and Discovery, a move that brings HBO, Warner Bros., CNN, Food Network, HGTV, DC Comics, and more, all under one roof.

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