By Brooks Barnes and Nicole Sperling
The New York Times
LOS ANGELES — In the ultimate symbol of one Hollywood era ending and another beginning, Metro-Goldwyn-Mayer, home to James Bond and Rocky, finally found a buyer willing to pay retail: Amazon.
The e-commerce giant said Wednesday that it would acquire the 97-year-old film and television studio for $8.45 billion — or about 40% more than other prospective buyers, including Apple and Comcast, thought MGM was worth. The studio, which had been shopped around for months, was once home to “more stars than the heavens,” as Louis B. Mayer liked to brag. But its vast production lot and pre-1986 film library were sold off decades ago.
MGM does come with one Hollywood crown jewel: James Bond.
But even 007 has an asterisk. Amazon will own only 50% of the spy franchise. The balance is held by Barbara Broccoli and her brother, Michael G. Wilson. The siblings also have ironclad creative control, deciding when to make a new Bond film, who should play the title role and whether television spinoffs get made.
The 25th installment in the Bond series, “No Time to Die,” is scheduled for pandemic-delayed release in theaters on Oct. 8, with Universal Pictures handling overseas distribution.
Jeff Bezos, Amazon’s founder and chief executive, is known as a conservative buyer. The purchase of Whole Foods for $13.4 billion in 2017 was the biggest acquisition in Amazon’s history. Its next-largest deals — until MGM — were for Zappos ($1.2 billion, 2009) and the smart doorbell company Ring ($1.2 billion, 2018).
The Whole Foods deal was a major strategic change for the company, pushing it into new markets of groceries and physical stores, which it had largely avoided. MGM is more about augmenting a current strategy: Amazon most likely paid more than others thought MGM was worth because of its all-important Prime membership program.
In addition to paying Amazon $119 a year or $13 a month for free shipping and other perks — notably access to the Prime Video streaming service — households with Prime memberships typically spend $3,000 a year on Amazon. That is more than twice what households without the membership spend, according to Morgan Stanley. About 200 million people pay for Prime memberships.
“More and more Prime members are using video more often, spending more hours on there, so I think this is a way to add more content and more talent around movies,” said Brian Yarbrough, a senior analyst at Edward Jones.