Jeff Bezos, founder and CEO of Amazon, has closed a deal with MGM Studios. As Amazon absorbs the lion’s share of more than 4,000 films and 17,000 TV shows for Amazon’s streaming service, MGM’s James Bond and Rocky franchises will begin streaming free for Amazon Prime subscribers.
With his estimated net worth of over $200 billion, the $8.3 billion purchase price for MGM Studios won’t make much of a dent in Bezos bank account. There is, of course, the regulatory hurdles to get past. Judging from Amazon’s successful acquisition of Whole Foods for nearly $14 billion in 2017, Double-O-Seven and Rocky Balboa will most certainly be available on demand in Amazon’s growing online library soon.
Amazon’s first-quarter 2021 net income nearly matched the purchase price of MGM with a net income of $8.1 billion. That was more than triple the $2.5 billion a year ago, for a fourth straight quarterly profit.
So, Amazon is heating up the streaming competition dominated by Netflix and Disney, who both have vast libraries. Before the Covid-19 quarantine, Americans were already abandoning expensive cable service in favor of internet streaming to computer screens and smart televisions.
Follow the money. Premium cable and satellite TV services can run as high “with prices starting at” $65, where the price can automatically jump up after two years. Sure, the transmission quality is usually excellent, and many offer an astonishing 33+ Channels, including unlimited reruns of Green Acres and Mr. Ed.
The alternative to the talking horse is the current explosion of over 200 streaming services. Consumers pay $8.99 for basic Netflix streaming services, or for $15.99 per month subscribe to Netflix 24/7, which could take more than four years to watch everything in the Netflix content library.
Budget streaming offerings include Hulu and Disney+ at under $7 a month. National networks have also seen the writing on the wall. NBC’s Peacock and CBS’s All Access charge less than $10 per month for both original and network reruns.
For Amazon Prime subscribers, the service offers Prime Video, which is unlimited streaming of movies and TV episodes and the option to add subscriptions to Showtime, Starz, A&E, AMC and other streaming channels.
Will your home internet router make your TV aerial obsolete? Netflix chief executive Reed Hastings thinks so. According to a report on Raconteur.net Hastings “has long predicted that streaming will become the norm for TV viewing, and cable and traditional channels will evolve or die.” In the next ten to twenty years Hastings predicts “all television will be watched on the internet.”
So, should you dump your broadcast television stock? Not necessarily. Smart money is on broadcast giants like NBC Universal and ViacomCBS, who are already evolving. It’s more about content than how it is broadcasted. For example, both those big players are already invested in entertainment producers like Showtime. You don’t need cable to access Showtime. A Showtime subscription add-on through Hulu will do.
With big players like Jeff Bezos, of course, “evolving” really means “buying out and absorbing”—especially if you have a spare $8 billion to spend.