Amazon Acquires MGM for $8.5 Billion
Expanding Further Into Entertainment
Amazon (AMZN) closed its deal to buy Metro-Goldwyn-Mayer last week. This brings a massive amount of content to Amazon Studios and Prime Video, with an additional 17,000 television episodes and 4,000 film titles now controlled by the tech giant. The deal is Amazon’s second largest, after its 2017 acquisition of Whole Foods for $13.7 billion.
The company’s appetite for entertainment spending has also extended to sports lately. Last year it snagged exclusive national video rights to Thursday Night Football, which costs the company $1 billion per season. It’s also currently looking into a football subscriber package, which currently exists in the form of DirecTV’s Sunday Ticket.
FTC Chiming In
Amazon provided requested documentation to antitrust regulators and sat out the required wait period for the review process. With that hurdle cleared, the company proceeded to close the deal.
Even so, the Federal Trade Commission says it’s taking an extended look. The five-person commission currently has one vacant spot, and has now received more than three million documents from Amazon to sift through. The commission’s chairwoman has been critical of Amazon’s market power, and the deal could end up being challenged.
Disney+ and Netflix on Alert
Disney has successfully developed content based on spinoffs from its acquisitions like its popular Star Wars show The Mandalorian, which was made possible by its purchase of LucasFilm. With James Bond and other popular characters now in the Amazon family, the tech giant could look to create similar offerings. Others ultimately wonder: might consolidation limit creativity and variety?
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