STREAMLAND Should Amazon Bother Buying MGM?
Does it really make sense for Amazon to spend 9 billion dollars to acquire MGM?
Mere hours ago, The Hollywood Reporter came out with the news that Amazon is actively in negotiations to acquire MGM, primarily to bolster Prime Video’s not particularly stellar content library (the most egregious cases are in countries where dubbing is commonplace, with multiple films being made available only in the local language). It’s a strategy everyone was expecting, especially when it pertains to MGM, whose recent financial history justifies an acquisition.
Per available reports, Amazon is offering 9 billion dollars for the purchase of the MGM assets. That’s more than twice what Disney spent on Lucasfilm, and that’s the company in charge of Star Wars and Indiana Jones. Is MGM really worth that much? Well, yes and no, to be honest.
There is certainly value connected to name recognition: first established in 1924, Metro-Goldwyn-Mayer rapidly became one of the five major studios in Hollywood and was in fact the dominant studio from 1925 to 1959 (amusingly, this era was bookended by two different versions of Ben-Hur). Contract players included Joan Crawford and Clark Gable, and the MGM logo, featuring the famous logo, was synonymous with musicals and prestige.
But that was then: in the decades that followed, the studio’s fortunes changed so drastically it even filed for bankruptcy in 2010. And that was just the most recent of the company’s financial troubles, some of which were so severe MGM doesn’t even own most of its back catalogue anymore.
Specifically, since 1986, every single film and television series produced by MGM prior to that year has been the property of Turner Broadcasting System (which in turn became a subsidiary of what is not WarnerMedia). This includes animated shorts like the Tom and Jerry and Droopy series, and classic films such as Gone with the Wind, The Wizard of Oz and 2001: A Space Odyssey.
Sure, the company still holds the rights to the very lucrative Rocky franchise, soon to continue its expansion with a third Creed movie, and to other notable IP like RoboCop and Poltergeist. There’s also the James Bond factor, but that one is a bit more complicated as the actual rights are controlled by EON, while MGM merely handles distribution in the US. In fact, one wonders how the acquisition would affect the Prime Video library worldwide, since international rights to most of the MGM titles currently belong to other companies.
Of course, this is Amazon we’re talking about, so 9 billion isn’t that much of an expenditure as far as they’re concerned. Still, the question is inevitable: is it worth to spend that amount on a studio that, prestigious though its name is, has been way past its prime for many years now?