Amazon
The move came late last week after the acquisition received the approval of the European Commission. The Tuesday decision stated that the Commission "found that the transaction...would not significantly reduce competition in the markets for the supply of AV content." American regulators, however, might remain an obstacle in the future.
The stance towards big tech firms by members of the Federal Government has become increasingly staunch. While FTC Chief Lina Khan didn't have the necessary commission votes to launch a lawsuit to block the merger, she has indicated in a letter to Amazon that the regulator is still set to investigate the purchase. Additionally, Amazon was recently referred to the Department of Justice for perjury to Congress, which could bring further scrutiny to the firm.
However, the merger will continue due to the FTC's lack of action before the closure of the deal. The acquisition will give Amazon control over MGM's properties, such as the 'James Bond' and 'Rocky' franchises and classic films such as 'The Pink Panther' and 'Poltergeist'.
Like other streaming giants after acquiring a library of existing properties, Amazon is expected to retool, repackage, and relaunch MGM's properties. The studio has existing distribution agreements, which could see certain movies left off Prime despite the acquisition. Additionally, the deal is the opposite of traditional norms in the industry, with Amazon taking the risks of distributing new properties instead of outside partners.
However, the failure of a few film releases will likely do little to damage Amazon's financials. Even despite recent setbacks such as the rapid disintegration of Amazon's Indian retail investments, the firm's powerful ecommerce presence has helped offset the blowback from a risky investment.
