Amazon has purchased the Hollywood studio Metro Goldwyn Mayer. The purchase price was 8.45 billion dollars, which makes it the second largest purchase made by Amazon in its history. The question is, what has Amazon achieved with this purchase?
Before getting into the matter, it should be noted that the studios of the famous roaring lion have made famous films such as: the James Bond saga, 12 Men Without Mercy, Rocky, West Side Story, The Silence of the Lambs, Gone with the Wind and The Wizard of Oz.
The company, as it is now known, came into being with the merger of Metro Pictures (a film studio founded in Florida), Louis B. Mayer Productions (a company founded by Louis B. Mayer, who was working at Metro Pictures) and Goldwyn Pictures (company that joined the first one and from which the lion Leo comes from).
The studio opened in April 1924 and quickly established itself in Hollywood. The company’s fame was brought about mainly by Goldwyn (owner of Goldwyn Pictures) and Thalberg (a producer of Metro Pictures) who moved in the most closed circles of Hollywood and got the company to close a lot of contracts with great actors of the moment. For decades they made incredible movies, but there came a point where the company had huge debts that it could only solve by making blockbusters, but then it would spend the money on more movies and go back into huge debt.
Between 2002 and 2004, Time Warner and Sony fought a bidding battle to take over MGM. Sony ended up winning the battle. MGM filed for bankruptcy in November 2010 and has been trying to reinvent itself through MGM Holdings ever since.
For its part, Amazon is no longer just a Marketplace, it is much more. The company extends its arms like an octopus in all directions and with this purchase it proves us right once again.
The largest acquisition in its history is Whole Foods Market, which cost it 13.7 billion dollars and with it it entered the food sector. A company that has allowed him to carry out many experiments in the sector. Another of its major purchases is Twitch, which is not one of the ones that has cost it the most, but it is the one that is having the greatest impact right now.
The acquisition of MGM will be Jeff Bezos’ big farewell, relieved on July 5 by his successor, who has acquired more than 4,000 movies and 17,000 episodes of series for the Amazon Prime Video catalog. In the press release sent to the American media by the company, a very striking phrase could be read: “we plan to reimagine and develop together with MGM’s talented team”.
The New York Times has found the key to Amazon’s move. In the article they explain that the real reason would be that Bezos wants the company to create its own series and movies. Developing this line of business could allow, among other things, to include ads in the series/movies to encourage buyers to spend more money in its Marketplace. We will have to wait and see how far the company will go with this new addition to its ecosystem.