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MGM becomes Amazon’s second-largest acquisition after Whole Foods. This acquisition will significantly bolster Amazon’s video content library giving Amazon Studios an edge in the competitive streaming market.
On Wednesday, May 26, e-commerce behemoth Amazon struck a deal for the complete acquisition of the much popular MGM Studios. This is one of the biggest moves from Amazon.com Inc (NASDAQ: AMZN) to expand its dominance in the entertainment industry.
As per the reports, this is the second-largest acquisition in Amazon’s history. The first was Amazon’s $13.7 purchase of Whole Foods four years back in 2017.
Metro-Goldwyn-Mayer (MGM) has over a century of history in filmmaking. It has over 4000 films under its belt and over 17,000 popular TV shows suggesting its wide market presence. After MGM showed its interest last year in selling its operations, Amazon made a quick move.
The tech behemoth aims to leverage MGM’s massive bank of entertainment content thereby boosting its own film and TV division – Amazon Studios. Mike Hopkins, Senior Vice President of Prime Video and Amazon Studios said:
“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. It’s very exciting and provides so many opportunities for high-quality storytelling.”
Amazon and MGM: Gaining Edge Over Market Competitors
This deal also shows that Amazon doesn’t mind putting big money to gain an edge over its competitors in the fastly evolving streaming market. Amazon is currently competing for the market share with other giants like Disney and Netflix. These companies have been pouring billions to improve their content libraries and win global customers.
Amazon has been keen enough to boost their video content library to further surge their Prime memberships. Amazon CEO Jeff Bezos is confident that such investments attract more subscribers to the platform thereby boosting the company’s revenue. Speaking about Amazon’s recent MGM deal, Kevin Ulrich, Chairman of the Board of Directors of MGM said:
“I am very proud that MGM’s Lion, which has long evoked the Golden Age of Hollywood, will continue its storied history, and the idea born from the creation of United Artists lives on in a way the founders originally intended, driven by the talent and their vision. The opportunity to align MGM’s storied history with Amazon is an inspiring combination.”
Amazon is also making close ties with the top representative from Hollywood. Last week, Amazon announced that Jeff Blackburn is returning back to Amazon to oversee its Global Media & Entertainment division. Blackburn is one of the most influential personalities in Hollywood and also one of the most highest paying employees in Amazon. After a brief hiatus, Blackburn is returning back to the company again.