Amazon and Metro Goldwyn Mayer (MGM) have signed a merger agreement whereby the e-commerce company acquires the century-old Hollywood studio. The Jeff Bezos-owned company has paid out $ 8.4 billion (€ 6.91 billion).
With this purchase, Amazon gets part of MGM’s catalog of movies and series, including the James Bond franchise and iconic titles such as Poltergeist (1982), Robocop (1987), The silence of the lambs (1991), Thelma y Louise (1991) the The Pink Panther (1963). The catalog also includes series such as The Handmaid’s Tale, Fargo and Vikings. In total, 4,000 titles will become part of Amazon.
Thanks to the merger, MGM will complement with its catalog the work carried out by Amazon Studios, mainly focused on the production of television series. For its part, Amazon will help preserve the heritage and the Metro library of films and will disseminate them through its platform of streaming, Prime Video, which has more than 200 million subscribers worldwide.
However, Amazon will not be able to dispose of the pre-1986 films, which were bought by media mogul Ted Turner and are now owned by WarnerMedia, in the process of merging with Discovery.
Amazon’s maneuver is framed at a time when the services of streaming, with platforms such as Netflix, HBO or the most recent Disney + growing in number of users around the world.
On the one hand, the acquisition of MGM allows Amazon to expand its audiovisual catalog with great film classics, in addition to incorporating future films from sagas such as James Bond or the new work by Paul Thomas Anderson, still in production.
On the other hand, for Amazon, having better content on Prime Video makes it possible to offer new content to attract more subscribers to the global Amazon Prime service, which today has large competitors such as the retail chain Walmart Inc.
Previously, Amazon had acquired companies such as the shoe brand Zappos, the gaming platform Twitch or the robot manufacturer Kiva. Its largest acquisition to date was the grocery chain Whole Foods Market.
For MGM, this deal marks the end of a difficult time since it filed for bankruptcy in 2010.
The history of MGM
The Metro Goldwyn Mayer was one of the great studios –majors– from the golden age of Hollywood along with Paramount, 20th Century Fox, Columbia, Warner Bros and RKO. In this district of the city of Los Angeles, on the west coast of the United States, film production was concentrated since the first decades of the 20th century and today it is known as “the mecca of cinema”.
America’s first film industry developed in New York, under the auspices of Thomas Edison. The famous inventor had bought the patents for the technologies needed to produce and show films. Thanks to that, he managed to monopolize the cinema and studios and producers had to pay him a fee.
Some of his competitors decided to leave New York to avoid paying the patents and went to the other side of the country, to California, to start an industry from scratch.
Among those who went to California was Marcus Loew, who founded Metro Pictures, where Louis B. Mayer served as secretary, before creating his own production company. Unhappy with the quality of his films, in 1919 Loew decided to buy another production company, Goldwyn Pictures, founded in 1916 by Samuel Goldwyn.
From the union of these three names, Metro Goldwyn Mayer was born, destined to be one of the largest Hollywood studios. With its popular lion as a mascot, its motto was “More stars than in the sky” and great classics came from its sets such as gone With the Wind (1939), Singing under the rain (1952) the Ben-Hur (1959).
In the 1950s, MGM went into crisis and, during the following decades, the study would go from hand to hand. Great tycoons like Kirk Kerkorian, Ted Turner and Giancarlo Parretti owned MGM in the 70s, 80s and 90s respectively, while in 2004 the major it passed into the hands of Sony, before declaring bankruptcy in 2010. With Amazon, the Metro begins a new phase.
The future of cinema
Amazon’s purchase of MGM reopens the debate on the future of cinema and how film production and distribution is being left in the hands of the platforms of streaming.
The emergence of video on demand services (video on demand – VOD) started a few years ago. The pandemic and the change in consumer habits has accelerated the growth of these platforms. Now, these companies are fighting to get the best content to offer their users.
The presence of companies from streaming in the cinema business, it has promoted changes in the so-called “distribution windows”.
Films were traditionally released in a movie theater, after a few months they were released on video or DVD, and later they were broadcast on television. With these new platforms the logic has changed and the premieres are made indistinctly in theaters, online or in both formats simultaneously, modifying consumer uses.
Some experts point to the risk that the streaming put an end to theatrical display. The key to its survival is to have great productions to premiere in theaters.
However, there is the paradox that Netflix recently bought the Egyptian Theater in Hollywood, an emblematic cinema in Los Angeles that it is now renovating to host its own screenings.
Sources: Amazon, Cinemania, Variety.
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Amazon buys Metro Goldwyn Mayer studios