What the Amazon-MGM Merger Means for Theatrical Windows, Distribution Deals, and That 98-Year-Old Library

Amazon Studios and Prime Video officially welcomed MGM into their sizable Seattle home on Thursday, all for the low, low adoption rate of $8.5 billion. Will the newfangled streaming service and the near-century-old studio (MGM, founded in 1924, has produced more than 4,000 film titles and 17,000 episodes of television) play nice together inside their new living arrangement?

Well, for starters, James Bond isn’t about to go straight to the small screen — so theatrical plans won’t be shaken (nor stirred) too much, to paraphrase what an Amazon spokesperson told IndieWire for this story.

Amazon Studios and Prime Video (now with 100 percent more MGM!) will continue to support theatrical releases, the spokesperson said, but there will not be a universal (nor Universal, but more on that in a bit) approach to deciding where a movie goes and when. Over time, leadership at the combined company will evaluate what is best on a film-by-film basis. While there will be no hard line against theatrical, there is also no window commitment in place. And perhaps there will never be: Window flexibility works out almost entirely in the favor of the movie producer that also owns the streaming platform.

Of course, even that notion has not been one size fits all. Then again, not everyone owns a major SVOD service. Sony, which does not have its own streaming service (one could argue that Sony effectively freelances for Netflix at times), is still committed to an exclusive theatrical window, though its length has proven to be a sliding scale based on project and performance. In general, Universal Pictures and Focus Features have both vowed 17 days (three full weekends) of theatrical exclusivity — or 31 days (five weekends) if the movie opens north of $50 million. The two studios are owned by Comcast’s NBCUniversal, which has the struggling Peacock under its plumage.

There are exceptions to every rule, however. Jennifer Lopez’s Valentine’s Day 2022 release, “Marry Me,” went day-and-date on Peacock. That one worked out: “Marry Me” was “the most-streamed movie we’ve had,” Comcast chief Brian L. Roberts said recently during Morgan Stanley’s Morgan Stanley Technology, Media & Telecom Conference.

Barry Wetcher /© Universal Pictures / Courtesy Everett Collection

MGM, through its United Artists Releasing joint venture with Annapurna, and Amazon each have existing distribution operations. UA, which handles MGM titles (“No Time to Die”), UA (“House of Gucci”), Orion (“Child’s Play”), and Annapurna (“Vice”), has been an active theater-release-centered company, with domestic box office in 2021 over $300 million. The joint venture deal for domestic theatrical distribution will continue, the insider told us.

Amazon, which initially used other distributors (such as Roadside Attractions) for films like “Manchester by the Sea,” transitioned to an in-house operation. Initially theatrically based (“Late Night”), it more recently provided at most only limited dates for top titles like “Being the Ricardos” before showing early on Prime.

Both distribution operations have existing staffs, with United Artists, led by industry veteran Erik Lomis, having the most experience and the larger operation. Amazon Distribution is led by Mark Boxer, a veteran of the independent community (previously at IFC).

There will be no changes to the destinations of current MGM film-slate projects, the spokesperson told us, like “Dark Harvest,” “Creed III,” and “Legally Blonde 3.”

Historical MGM movies are even more complicated. In August 1986 Turner, which is still technically part of AT&T for the next few weeks, purchased the entirety of the pre-May 1986 MGM movie catalog (as well as the pre-1950 Warner Bros. movies and old “Popeye” cartoons). Soon, Turner parent WarnerMedia, which is also the home to Warner Bros., will be spun off from AT&T into a brand-new company merged with Discovery, Inc., forming Warner Bros. Discovery. So that’s who will own the first six decades of MGM classics.

You would think things on the series side, which does not have the theatrical issue, would be simpler. They are not.

Hulu

Future series will not automatically go to Prime Video, the spokesperson told us, and Amazon is not attempting to make all of MGM’s content exclusive to its own streaming platform. Due to the complications that come with licensing rights deals, it will take time to sort out MGM’s television library. Among its most prominent recent productions is “The Handmaid’s Tale,” which is released by Hulu.

Unlike with most mergers, there are no anticipated layoffs, an Amazon corporate spokesperson told IndieWire; offers are going out to all MGM employees. While Mike Hopkins, senior VP of Prime Video and Amazon Studios, will lead the combined teams, there is currently no word on the senior leadership structure below him. Amazon told us that MGM’s senior leadership team will be a part of Hopkins’ team. It is likely that Amazon Studios head Jen Salke will lead the combined studios, though what that leaves for MGM Motion Picture Group Chair Michael De Luca and MGM Worldwide Television Group Chairman Mark Burnett is unclear at this point.

Amazon provided no comment or additional guidance on potential future M&A activity, which is pretty standard for them (and, let’s face it, for everyone).

“MGM has a nearly century-long legacy of producing exceptional entertainment, and we share their commitment to delivering a broad slate of original films and television shows to a global audience,” Hopkins, who reports directly to Jeff Bezos himself, said as part of Thursday’s announcement. “We welcome MGM employees, creators, and talent to Prime Video and Amazon Studios, and we look forward to working together to create even more opportunities to deliver quality storytelling to our customers.”

“We are excited for MGM and its bounty of iconic brands, legendary films and television series, and our incredible team and creative partners to join the Prime Video family,” Chris Brearton, chief operating officer of MGM, added. “MGM has been responsible for the creation of some of the most well-known and critically acclaimed films and television series of the past century. We look forward to continuing that tradition as we head into this next chapter, coming together with the great team at Prime Video and Amazon Studios to provide audiences with the very best in entertainment for years to come.”

Additional reporting by Tom Brueggemann.

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