Amazon looks to purchase MGM Studios for $9 billion
Whilst the companies themselves remained tight-lipped on the matter, multiple sources are reporting that Amazon is involved in discussions to acquire one of Hollywood’s most historic studios, MGM.
The story was first reported by the technology news website The Information and followed up with reports in other media outlets including Yahoo Finance, BBC News, The New York Times, and the Financial Times.
MGM is one of the most recognized names in Hollywood and their Leo the Lion logo has been synonymous with the company for nearly a century. If the sale goes ahead, it will give the tech giant’s streaming service, Amazon Prime Video, access to a huge catalog of iconic content.
Since its founding in 1924, MGM has been at the forefront of the Hollywood movie and TV business. The catalog that they have built up during these decades is undoubtedly one of the big temptations for Amazon. Such an acquisition would instantly provide Amazon’s streaming service with a dazzling array of some of the biggest movies and TV shows of all time.
This catalog includes classic films such as The Wizard of OZ and Ben Hur, The Pink Panther, and the Rocky movies. In more recent times the James Bond franchise, and TV shows such as The Handmaid’s Tale, Vikings, and Fargo have all been hugely successful for the studio.
Amazon first introduced an internet streaming service in 2006, which at the time was called Amazon Unbox. This was the precursor to its Amazon Prime Streaming service which was made available to its Prime membership in 2011. Since then, it has recorded year-on-year growth and last month Jeff Bezos said that 175 million people are now subscribed to the service.
But the marketplace is becoming crowded and there is a lot of maneuvering going on as companies seek to enhance their portfolios and grow their audience share. This move by Amazon is seen by analysts as a move to acquire content as more rivals enter the arena.
Within the last couple of years, Disney+ and Apple TV+ have both launched streaming services and the Disney+ channel recently reported phenomenal growth figures.
AT&T prepares for battle
In another move, this week AT&T announced it was merging its media arm (Warner Media) with Discovery. This deal will create a new streaming service that will include existing giants like HBO, CNN, and the suite of Discovery Channels. The HBO streaming service has 64 million subscribers and the Discovery Channel has a reach that covers more than 88 million US Homes and a subscription service with 15 million subscribers.
These figures are dwarfed by the likes of Amazon Prime, Netflix (with its 208 million subscribers), and even new kid on the block, Disney+, with 100 million subscribers.
Speaking to the BBC, Dan Ives, an analyst for Wedbush Securities said – “This is a streaming arms race and AT&T is making an offensive strategic move to further bulk up its content in the battle versus Netflix, Disney, and Amazon.”