Amazon Agrees To Buy MGM for $8.45 Billion

Amazon said it agreed to acquire MGM for $8.45 billion, giving the tech company a foothold in Hollywood as it takes on competitors in the video streaming wars.

The acquisition gives Amazon access to more than 4,000 films and key franchises including James Bond and Rocky, plus 17,000 TV shows including Fargo and The Handmaid’s Tale.

“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,” said Mike Hopkins, senior VP of Prime Video and Amazon Studios.

Amazon said it agreed to acquire MGM for $8.45 billion, giving the tech company a foothold in Hollywood as it takes on competitors in the video streaming wars.

The acquisition gives Amazon access to more than 4,000 films and key franchises including James Bond and Rocky, plus 17,000 TV shows including Fargo and The Handmaid’s Tale.

“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,” said Mike Hopkins, senior VP of Prime Video and Amazon Studios.

Last week, AT&T made a deal to spin off its WarnerMedia unit and merge it with Discovery to create an entity large enough to compete with the leaders. Between WarnerMedia, which runs HBO Max. and Discovery, which launched Discovery Plus earlier this year, the combined company spends $20 billion on content.

Speaking at the  J.P. Morgan Global Technology, Media and Communications Conference, Discovery CEO David Zaslav said he was happy with the Amazon-MGM deal because of the value it puts on content.

“It’s all about the IP,” Zaslav said. He recalled people saying that Disney overpaid for Pixar and Star Wars, but that those business have both generated billions in revenues and become pillars supporting the success of Disney Plus.

“So we look at what Warner has, and it’s the greatest treasure of global IP that’s loved by everyone in the world, with the treasure we have, and you look at the value of MGM and you say ‘wow.’ What does that mean we’re worth if we can make this all come together? And I think we can,” he said.

Scott Schiller, chief commercial officer at digital media company Engine, said the Amazon-MGM deal is the tip of the iceberg as tech companies take a stepped-up approach to content and streaming video.

“The next likely scenario is a more aggressive merger or acquisition of one of the remaining traditional assets, like an NBCUniversal  or ViacomCBS,” Schiller said.