- Amazon has agreed to buy MGM, the studio behind the James Bond franchise, for $8.45 billion.
- The deal could help Amazon founder Jeff Bezos realize his dream of owning a Hollywood powerhouse.
- Here’s what the merger means for key execs like MGM’s Mark Burnett and Amazon’s Jennifer Salke.
- See more stories on Insider’s business page.
Amazon’s incoming CEO Andy Jassy is on the cusp of realizing founder Jeff Bezos’ Hollywood dreams.
Amazon has agreed to buy storied Hollywood studio MGM, the owner of megafranchises including James Bond, for $8.45 billion, the companies announced on Wednesday.
The deal, if approved by regulators, promises Amazon a library of classic and blockbuster films that, in addition to the James Bond slate, includes “Rocky,” “Silence of the Lambs,” “Pink Panther,” “Legally Blonde,” and more. It also gives the tech company a plethora of TV and film IP to potentially build on. MGM has developed shows included Hulu‘s “The Handmaid’s Tale,” FX’s “Fargo,” and Netflix‘s “Viking,” for example.
“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,” Mike Hopkins, SVP of Amazon Studios and Prime Video, said in a statement.
Since MGM is mainly an IP play for Amazon, it’s unclear what role the studio business will play once it’s integrated into Amazon. Amazon has its own TV and film studio that’s run by former NBC Entertainment president Jennifer Salke.
The company has not said if it would combine the studios or leave them to operate independently.
However, Amazon said in its announcement that MGM’s movie business complements its own production arm, saying Amazon Studios “has primarily focused on producing TV show programming.”
Indeed, Amazon’s biggest successes to date have been series like “The Marvelous Mrs. Maisel,” “The Boys,” and “Tom Clancy’s Jack Ryan.”
On the film side, Amazon has broken through with indie and mid-budget film acquisitions like “One Night in Miami” and “The Big Sick.” But, recent bigger-budget acquisitions, like “Borat Subsequent Moviefilm” and “Coming 2 America 2,” signal its larger ambitions for more mainstream fare.
Bezos in general has pushed Amazon Studios to pursue blockbusters like its “Lord of the Rings” TV show over niche hits like “Transparent.”
Its film business is lead by motion-picture group chairman Michael De Luca, a prolific producer of movies such as “The Social Network,” “Moneyball,” and “Fifty Shades of Grey,” who also helped launch franchises like “Blade,” and “Austin Powers” earlier in his career. His number two is Pamela Abdy, president of the motion-picture group, who was previously a top exec at Makeready, New Regency, Scott Stuber’s Bluegrass Films, and Paramount Pictures.
The best comparison to Amazon’s acquisition of MGM its likely its 2017 purchase of Whole Foods. The big difference being that Amazon didn’t already have a robust brick-and-mortar retail business, like it has a studio business.
Still, in that case, Amazon kept on Whole Foods founder John Mackey and buttressed him with veteran Amazon execs. Some other high-level Amazon execs departed.
The MGM integration could follow a similar model.
One Hollywood source close to MGM said there’s not a lot of fat to trim at the top of the company, which might bode well for MGM execs.
“Amazon runs a lean, mean fighting machine,” this person said. “MGM is not top heavy, so I don’t see there being a huge integration.”
Amazon exec Jeff Blackburn, a protege of Jeff Bezos, will run the integration plans, this same source said.
Blackburn recently left the venture capital world to rejoin Amazon as head of its media and entertainment businesses, which include Amazon Studios, Prime Video, Audible, gaming and Twitch, as Variety reported.
Hopkins, who reports into Blackburn, led the deal with MGM board chairman Kevin Ulrich, people close to the deal said.
One lingering question is what will become of MGM’s TV boss Mark Burnett, best known for reality shows including “Survivor” and “The Apprentice.” The reality producer took the helm of the TV studio in 2015.
But some of MGM’s biggest recent TV hits, including “The Handmaids Tale” and “Fargo,” were produced by the company’s former head of scripted TV Steve Stark. The Hollywood Reporter also reported that Burnett has caused strife among staffers at MGM while delivering little in the way of new hits.
With Amazon preparing to absorb MGM, below are some of the executive head-to-heads to watch out for. Their futures may depend on Amazon’s integration plans, including whether MGM will remain a standalone business or merge with Amazon Studios:
- Studio boss: Former NBC Entertainment president Jennifer Salke is the head of Amazon Studios, where she oversees TV and film. The studio funnels its projects to Prime Video and IMDB TV. Salke’s role is unlikely to be threatened by the MGM acquisition. MGM has gone without a CEO since Gary Barber was ousted in 2018.
- TV business: This is where things gets a little thorny. Albert Cheng and Vernon Sanders are co-heads of TV at Amazon Studios. Cheng, who’s been with the company since 2015, is also the studio’s operating chief. Since the TV business is the part of Amazon Studios that works best, it’s unclear if Amazon will look to shake up the division’s top brass. That said, MGM Worldwide TV Group chairman Mark Burnett is a Hollywood heavy-hitter, and Amazon Studios hasn’t made a significant push into the unscripted genre, so Amazon might see Burnett as an asset.
- Movie studio: Matt Newman and Julie Rapaport oversee Amazon Studio’s film output as the unit’s co-heads of movies and have been hunting for a bigger budget slate. While they’ve had success with recent films like “One Night in Miami” and “Borat Subsequent Moviefilm,” MGM’s execs are undoubtedly the bigger names. Michael de Luca, MGM’s motion-picture group chairman, was a former executive at Sony, New Line, and DreamWorks, and produced “The Social Network” through his own production company. Pamela Abdy, who joined MGM last year as motion-picture group president, oversaw films including “Queen & Slim,” “Gone Girl,” and “The Big Short,” in past roles. Additionally, Alana Mayo oversees Orion Pictures, including recent projects like “Just Mercy” and Netflix’s “Raising Dion,” which was a coproduction.
- Marketing: Amazon Studios and MGM both have marketing chiefs. Amazon hired Ukonwa Ojo last year to oversee marketing for Amazon Studios and Prime Video. The veteran brand marketer was most recently CMO at MAC Cosmetics and before that, Coty. Stephen Bruno is MGM’s chief marketing officer, with prior marketing roles at Netflix, The Weinstein Company, and Miramax.
- International: Amazon Studios and MGM also each have their own international leads. Rola Bauer is MGM’s president of international TV, where she oversees development, production and co-productions. She’s a seasoned international production exec who was previously a partner at Studiocanal TV. James Farrell heads up local original TV and film at Amazon Studio. He joined from Sony Pictures Entertainment in 2015.
- Distribution: Chris Ottinger heads up distribution at MGM, while Mark Boxer oversees distribution at Amazon Studios. Amazon has been experimenting with its movie release model in recent years, in some cases opting for shorter theatrical windows or taking films direct-to-streaming, as it did with “Borat the Subsequent Moviefilm” while theaters were closed. It remains to be scene how the streamer will influence MGM’s distribution plans, particularly around blockbusters like new Bond films.
- Epix: The future of MGM’s streaming service Epix also remains to be seen, given that Amazon already has two streaming services, Prime Video and IMDB TV. It also sells myriad subscription services through its Channels platform. Epix is lead by Michael Wright, who’s also MGM’s president of scripted TV. Wright developed shows including “Godfather of Harlem” and “Pennyworth” at Epix.
- Operations: Chris Brearton is MGM’s chief operating officer. He joined the company in 2018 from the law firm Latham & Watkins. He’s represented MGM for roughly 20 years, including through its acquisitions of United Artists Media Group and Epix.
- Administration: Administrative roles like finance, legal, and human resources also come into question during any merger as the companies look to eliminate duplicative roles.
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