Amazon buys MGM company for $8.45 billion

  • Amazon has acquired MGM company in an $8.45 billion deal.
  • MGM owns the iconic Holywood studio that released the James Bond and Rocky franchises.
  • Amazon says it plans to boost Amazon Prime Video with new programming mined from MGM’s intellectual property. 

Amazon now owns MGM after buying it for $8.45 billion. 

MGM, the company that owns the Hollywood studio that became famous for releasing the James Bond and Rocky franchises, is now owned by e-commerce giant Amazon. 

The $8.45 billion deal is set to boost Amazon Prime Video with new programming mined from MGM, and to reinforce Amazon Studios, the existing original production arm of Amazon. 

Amazon said it will tap into MGM’s intellectual property to make new content. Mike Hopkins, Amazon’s senior vice president of Prime Video and Amazon Studios, said in a release: “The real financial value behind this deal is the treasure trove of IP in the deep catalog that we plan to reimagine and develop together with MGM’s talented team.” Hopkins said the acquisition provides a range of opportunities for high-quality storytelling.

Acquiring the MGM is Amazon’s biggest deal since 2017 when it acquired the Whole Foods grocery chain for $13.7 billion.

MGM also operates a TV studio that makes shows for other networks and streaming services they don’t own. The company also runs the cable TV network and app called Epix. MGM was put up for sale in December and was also courted by Apple and Comcast, the owner of Sky. 

Photo credit: Ajay Suresh/ Wikimedia Commons

But Amazon’s acquisition of MGM may not necessarily mean that Amazon Prime Videos will exclusively air new and classic MGM movies. Amazon didn’t give any comment regarding MGM’s library of content.

MGM and ViacomCBS’ Paramount Plus have a licensing agreement that allows the latter to stream films like House of Gucci, Creed III, and the new James Bond film, No Time to Die, after the movies’ full theatrical releases and exclusive airing at Epix. The terms in the licensing agreement between the two companies are confidential. 

It’s also not guaranteed that Amazon will immediately air MGM classics like The Wizard of Oz and Singin’ in the Rain since those movies stream over at HBO Max because its parent company has owned the movies for years. 

Paramount Plus and HBO Max have yet to comment on streaming licenses. 

Amazon’s MGM acquisition is big news, especially with the fierce competition over video streaming. In the last year, several streaming services were launched, including Apple TV Plus, Disney Plus, HBO Max, and Peacock. 

The fierce streaming competition has also triggered some media companies to consolidate. Disney acquired Fox, Viacom and CBS merged, and AT&T acquired Time Warner, which it sold last week to Discovery. Because of the stiff competition, smaller media companies are consolidating with the giants in the industry for survival. 

Amazon’s acquisition of MGM still needs regulator approval and is subject to other customary conditions before the deal closes. 

Source: Cnet

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