Buying MGM may only be the beginning of Amazon’s content dominance

Ignore Amazon Prime Video, and the company's entertainment ambitions, at your own peril.

Streaming video from home during the pandemic was as natural as drizzling butter over popcorn, as people hunkered down and glued themselves to their devices for entertainment—and sweet distraction. Now, those who tap Amazon’s Prime Video service may, at some point in the future, have access to a wealth of new content from the stalwart Hollywood studio MGM. The companies announced today that Amazon intends to buy the studio for about $8.5 billion, although it will need regulatory approval for the deal to be finalized. 

MGM is famous for its partial ownership of the James Bond franchise, but its content library is much broader than that. Mike Hopkins, senior vice president of Prime Video and Amazon Studios, said in a statement that the studio—known for its roaring lion—boasts “a vast catalog with more than 4,000 films” and also has “17,000 TV shows.” Beyond Bond, notable MGM films include Silence of the Lambs, Legally Blonde, and Basic Instinct. And television shows include the likes of Fargo and The Handmaid’s Tale

Hopkins added in the statement: “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.” 

However, streaming customers should not hold their breath for instant access to that library if the deal is in fact approved. Amazon is not disclosing more details about what they plan to do with its new potential property; an Amazon spokesperson noted via email to PopSci: “We don’t have anything to share today about MGM’s library of content or access to it on Prime Video or anywhere else.”

Amazon’s Prime Video service is sometimes overlooked compared to flashier competitors like Netflix, although it comes for free with a Prime membership, which gives it an ample boost in streaming wars. (Over the last 12 months, it garnered more than 175 million streamers, Variety reported in late April. Netflix, meanwhile, has 207 million subscribers.) 

But unlike subscribing to Netflix—which gets you just Netflix—joining Amazon Prime is a broader ticket to Amazon services that also includes video. And the Prime service has evolved, says Brad Stone, the author of Amazon Unbound: Jeff Bezos and the Invention of a Global Empire

Buying MGM may only be the beginning of Amazon’s content dominance
Amazon Prime is now “an -you-can-eat access ticket to the best of Amazon’s content library,” says Brad Stone. Amazon

“Amazon has been making increasingly larger bets on entertainment, and making content the center of its Prime universe,” he says. What began as just a ticket for consumers to receive two-day shipping is now a nonetheless important feature that feels more like table-stakes, he notes, when it comes to e-commerce—people simply expect their packages to arrive quickly whether they are Prime members or not, and Amazon has succeeded at making rapid fulfillment common. 

“Whether you pay $119 a year or not [for Prime], you’re going to get the package in a day or two,” he notes. “It was a perk 15 years ago, and now it’s something that Amazon can offer anyway.” Prime is more than that now. “It’s now an all-you-can-eat access ticket to the best of Amazon’s content library,” he says. That includes not just video, but also services like Amazon Music. “It’s really evolved much more in the direction of a content club than a shipping club.” 

It comes back to the behemoth’s operating strategy, Stone notes: “The key thing with Amazon is they always have multiple ways to win.”

The MGM deal gets Amazon something else that’s been key for other streaming services, like Disney+ and its Star Wars properties: a franchise. “The streaming game now is increasingly a battle between juggernauts,” Stone says. “With MGM, Amazon’s getting into the franchise game.” Note that MGM not only has Bond, but also Rocky and Tomb Raider.

By scooping up MGM, Amazon now has more entertainment content possibilities. That gives the company, Stone says, “a lot of potential for spinoffs, TV series, and other entertainment properties based on the MGM vault.” 

Amazon has not made promises about the availability of MGM’s content to Prime members, which Stone speculates is likely due to existing deals that MGM has with other outlets that need to be reconciled first. 

Rob Verger

Rob Vergeris the Technology Editor at Popular Science. He covers aviation, the military, transportation, security, and other complex tech topics. A graduate of Columbia Journalism School, he's also written for The Boston Globe, Newsweek, The Daily Beast, CJR, VICE News, and other publications. Contact the author here.