Front Burner - Prime Time: Amazon's MGM streaming bid

Episode Date: May 28, 2021

Rocky, Legally Blonde, The Hobbit and even part of the James Bond franchise could soon be under the ownership of Amazon. Film critic John Semley joins host Jayme Poisson for a closer look at what the tech giant's bid to buy MGM Studios could mean for the shows and films that end up on your screens.

In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. This is a CBC Podcast. Hello, I'm Jamie Poisson. Oh, hi. My name is Elle Woods. And for my admissions essay, I'm going to tell all of you at Harvard why I'm going to make an amazing lawyer. I admire your luck, Mr. Bond.

James Bond. Amazon is real close to owning some of the most beloved stories in film and TV history. This week, the e-commerce giant purchased Metro Goldwyn Mayer, better known as MGM, for $8.5 billion. MGM's catalog includes Rocky, Legally Blonde, The Hobbit, and part ownership of the James Bond franchise. The acquisition is just the latest in large media mergers. AT&T merged its Warner Media brand with Discovery earlier this month. And two years ago, of course, the Walt Disney Company took over most of the

20th Century Fox at a cost of more than $70 billion. John Semley is a friend of the show, a film critic, and a TV writer. His work appears regularly in The New Republic and The Baffler Magazine. He's here for a closer look at what this kind of big-time media ownership concentration means for the movies and shows that ultimately end up on your screens. Hey, John, so great to have you. Good to be here, Jamie. Under such circumstances. I understand that while you were trying to get on the Zoom call to come onto this podcast,

you actually missed an Amazon package at your door. Yeah, that is the irony. They tried to deliver a desk fan for my overhot home office. But alas, I missed it so that I could Zoom with you and criticize them for the next 25 minutes. So maybe that's my cosmic punishment. The irony, the irony. So before we do get rolling here, give me a sense of what Amazon has been offering on its current streaming service, Amazon Prime, or like they seem to be hauling it Prime Video mostly. It's important to remember that Prime is kind of this name for the subscription umbrella service

that you can get from Amazon where you get all kinds of extras. And those extras include stuff like free one or two day delivery, but also access to their streaming video library. There's a pretty deep catalog of films that they've acquired or bought, but they also have original productions from

Amazon Studios. I think probably the best known examples would probably be Kenneth Lonergan's film Manchester by the Sea. I'm sorry, I've got to go. We couldn't have lunch. I'm really sorry, I don't think so. Thank you for saying everything you said. You can't just die. I'm not, I'm not, I'm not.

Or the new Borat movie. Whoa, whoa, whoa, a high five! Was on Amazon. And then there's also original TV shows like, you know, The Marvelous Mrs. Maisel, Transparent, and the forthcoming Lord of the Rings TV show. My precious!

Which I believe is already being billed as the most expensive television show ever produced. I actually cannot believe I didn't know until right now that there's a forthcoming Lord of the Rings TV show. Of course there is. You have to get a true rings head like me on the line to get the scoop on that stuff. So yeah, I mean, these are some of the sort of Amazon Studios productions you can find on Prime in addition to, you know, a lot of other stuff. And in addition, as a Prime subscriber, like I say, you can get toilet paper delivered to your house in 24 hours. Right. I think we're going to come back to that toilet paper delivery in just one minute. But first, what does Amazon get from this deal with MGM?

does Amazon get from this deal with MGM? MGM, I think we probably all know the name, no matter how invested in movies you are. You know, we know the lion's roar at the beginning of the films. You know, they have a catalog of about 4,000 films, which Amazon got for about $8.5 billion. Now, that sounds like a lot of money to people like you or I, or most people listening, I imagine. But remember when Disney bought 21st Century Fox, I mean, that deal was about $70 billion. So comparatively, the MGM deal is a bargain for Amazon. So they get all of MGM's titles, and that includes some films people probably recognize, like Rocky and Robocop and Silence of the Lambs. And it also includes these sort of intellectual property rights to those franchises. So I think these kind of IP plays, it's a new trend that we're seeing.

Not entirely new, but it's certainly accelerating. Warner Brothers recently released the trailer for their forthcoming film Space Jam, A New Legacy, which is a sequel to the Michael Jordan Looney Tunes crossover movie from the 90s. And I think a lot of people were surprised in that trailer. You know, you don't only see LeBron James kind of interacting with Bugs Bunny and Daffy Duck. I'm a cartoon? What's up, Doc? But you also see characters from other Warner Brothers properties,

you know, like Fred Flintstone. Welcome to... the Space Jam. Or the Joker from Batman, or even the characters from Stanley Kubrick's A Clockwork Orange, all in this one kind of fictional universe. So when we talk about IP repurposing, these are the things that people are kind of thinking about. So, you know, hypothetically, Amazon could make a movie in which Rocky boxes Robocop, you know?

Drop it! Dead or alive, you are coming with me. Amazon CEO Jeff Bezos went straight there on Wednesday. Hey, like, so here's a quote from a call that he did. MGM has a vast, deep catalog of much-beloved intellectual property, and with the talented people at MGM and the talented people at Amazon Studios, we can reimagine and develop that IP for the 21st century.

So this is exactly what you're talking about, Rocky versus RoboCop. Yeah, or you have the jurors from A Twelve Angry Men decide that the Joker is guilty or something like that. Yeah, I mean, when I hear Jeff Bezos talk about intellectual property and all these things, it doesn't exactly pour out of him like he has the heart of an artist or a poet or a filmmaker or something like that. I think it's important to realize that, you know, fundamentally, this is a business arrangement, no matter who's fighting who on the big screen. Let's talk about that a little bit more then. And we'll go back to the toilet paper here. So I saw one pretty funny tweet from Scott Galloway, co-host of the New York Magazine Pivot podcast, about Bezos' and Amazon's ultimate goal here, a 26-year-old online retailer buys century-old entertainment icon in order to sell paper towels. And so talk to me a little bit more about what he means by that. Yeah, absolutely. Well, I'll use an example from

my own life, if I may. I used to work at a chain record store, which no longer exists. Maybe I won't say the name. But in retail, we used to have this thing there called loss leaders, right? And a loss leader essentially means you price down a CD or a DVD to get people in the store. And then while they're in there, you kind of hope that they'll buy some other stuff. And this strategy is something that anyone who uses Amazon in any capacity is probably familiar with, right? I mean, I think it's possible to conceive of something like these huge $8 billion deals, which, again, are nickels and dimes to people like Jeff Bezos. They're essentially

loss leaders, right? It's a way to get people to subscribe to the Prime service. And then while they're subscribed to the Prime service, they think, well, maybe instead of, you know, hoofing it three blocks to Foot Locker to buy some new sneakers, I'll get them from Amazon because they'll be at my door in 24 hours. So I think that that is the ultimate play. I mean, Bezos has made lots of comments about his entree into entertainment, you know, somebody even published a list of all his ideas about how to make good movies and TV, which includes such a great list. Yeah, it was all these terrific insights. Like, you have to have a great villain.

It's like, wow, let me get this down. You have to have sad emotions, but also happy emotions. Yes, it's good to have different settings that include geographic diversity. settings that include geographic diversity, which in that respect, I think he's probably happy that, as you mentioned, he acquired the James Bond franchise because that guy's always kind of jet setting from one continent to the other. So, yeah, I mean, like I say, at the end of the day, it's a business deal. It's designed to get you to buy toilet paper and sneakers. And if the trick to getting you to do that is saying that, you know, we have a new sparkly 4K remaster of The Wizard of Oz that you can stream, then that's how they'll do it. In the Dragon's Den, a simple pitch can lead to a life-changing connection.

Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. Hi, it's Ramit Sethi here. You may have seen my money show on Netflix. I've been talking about money for 20 years. I've talked to millions of people and I have some startling numbers to share with you. Did you know that of the people I speak to,

50% of them do not know their own household income? That's not a typo, 50%. That's because money is confusing. In my new book and podcast, Money for Couples, I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. Also probably worth mentioning here, since you brought up James Bond, that it's quite likely that in this deal, Rocky probably isn't going to be boxing James Bond

because there's this other company in the mix that also holds the rights to that franchise, right? That's right. Eon Pictures, which I believe is owned by the amusingly named Broccoli family, have the reins of the James Bond franchise and have for decades. It's really their only kind of mega franchise that is at the level of, you know, an Avengers or a Star Wars or something like that. And I think that Eon Pictures has certainly tried to maintain a level of quality over the James Bond movies, right? I mean, there's one comes out every few years. It's not like we get five a year, like a superhero film. And, you know, they've put off production to make sure they can get the right scripts and the right directors that they like. So I'm sure that Amazon will be involved in those

conversations, but I don't necessarily think that we'll see, you know, five James Bond pictures a year. If anyone can even stomach that, that many gizmos and gadgets and girls, I don't know. Important to note here that this is not a done deal, hey, like, of course, Amazon is facing antitrust scrutiny in the US and abroad for a range of its business practices. Lots of people who believe that it has gotten way too big. Less than 24 hours before this deal was announced, we found out that Amazon is actually being sued because of allegedly overly restrictive rules for third party sellers on its site. So basically,

for running a marketplace and selling and prioritizing its own stuff in that marketplace, the argument is that this harms competition and makes prices higher. And, you know, this deal with MGM, it has to be approved by US regulators, and Minnesota Senator Amy Klobuchar is already saying that she'd subject to a federal probe. But how likely do you think it is that this will actually go through? I mean, I think it's quite likely. I mean, you look at the Disney-Fox merger, which, again, was nearly 10 times the value of this. And that went through after a couple years. I mean, there are people who speak out against this. But when you look at the reaction to this, it's sad to say, but I think most people just kind of shrug. I think we're so accustomed to the idea of media consolidation and monopolization that I really have no doubts that this will happen and that really the box office, given that so many theaters were closed.

But 21 out of 25, so 84% of the top grossing films were produced by just five big companies, Disney, Warner, Universal, Paramount, Sony. So what is the outcome of this kind of concentration on film, on television, on art? Well, yeah, I mean, the biggest change is, you know, there used to be kind of dozens of studios and major studios and minor studios, and there was maybe a sense of healthy competition. And again, now I think we're seeing Disney, we're seeing Netflix, we're seeing Amazon. Disney is by far the biggest. And already, they kind of run the table. They own Marvel and Star Wars and, of course, all the Disney animated stuff like Frozen. And they can basically dictate what happens theatrically. I mean,

when they release a movie, that determines when other studios will do so. Because who in their right mind would want to go up against, you know, a Marvel movie or a Star Wars movie or Frozen 2? And the problem, of course, is that with Disney owning so many properties, there's a new Marvel movie or a Star Wars movie or some new anthropomorphic Pixar creature in theaters every two weeks. So these cultural juggernauts, I mean, it's not just like a tendency, it's a reality that they kind of crowd out the competition and not only the competition, but any conceivable alternative. I mean, we live in a world where what makes money tends to dominate, right? And films are a very expensive form of entertainment or even art if you want to

go there. So when these huge companies are controlling the distribution, controlling the theatrical schedule, increasingly controlling what we can even see at home, yeah, it becomes much more difficult, if not impossible, for smaller players to even compete. And I also think it's correct to sneer at this a bit. I mean, when you look at the movies that Amazon got from MGM, one of the ones we talked about was Paul Verhoeven's Robocop from 1987. And that's a movie that's set in this kind of dystopian future where a company called Omni Consumer Products basically controls the world. Three dead police officers, one critically injured.

Police union leaders blame Omni Consumer Products, OCP, the firm which recently entered into a contract with the city to fund and run the Detroit Metropolitan Police Department. Dick Jones, division president, OCP. Every policeman knows when he joins the force that there are certain inherent risks that come with the territory. Ask any cop, he'll tell you, if you can't stand the heat, you better stay out of the kitchen. There's this corrupt super monopoly that has hands in everything from the police force to entertainment. And these are the enemies in movies like this.

And if they have an analog in real life, it's, you know, Disney and Amazon. You know, Amazon used to be known as the everything store. Now that concept of everything means literally everything. You know, not just DVDs and books and sneakers, but premium cable fantasy shows and Hollywood classics. Is there not still a market for smaller, more intimate, more sort of critically acclaimed movies? Like, aren't they still being made? Amazon just put up Barry Jenkins' The Underground Railroad. I mean, I agree. And I mentioned, you know, Kenneth Laudergate's Manchester by the Sea, which I rewatched recently on Prime and, you know, really enjoyed. I think it's a great film. I mean, obviously there are exceptions, but I think that these exceptions, to use the cliche, are the exceptions that prove, you know, Barry Jenkins and Kenneth Lonergan?

These are Oscar-winning filmmakers. Like, what about the actual young upstart filmmakers, you know? So I think that there will always be a place for these films. But I still think that in a certain way the market is kind of being dominated by these major players. And it's not only new movies. I think an important thing to think about is our access to old movies you know if you go on a service like netflix and look at classic films you know a classic film on there will be like scream 2 like there's not it's not they're not exactly going deep into the

annals of hollywood history necessarily uh and and there's a way in which they kind of gatekeep these films now to talk about the disney fox, this was a thing that was on my radar a few years ago, but Disney has this habit of kind of relegating titles to their vault. And they put a lot of these Fox movies in their vault. And I was thinking like, you know, once upon a time, a holiday ritual might be that you go down to a local single screen cinema and you see Home Alone or Die Hard. You can really do that because these movies,

these Fox movies were owned by Disney. And anyone who's ever worked as a booker at a cinema can tell you how difficult and annoying it is to book Disney movies. You know, it borders on impossible. What's the fix to this then, John? Is there a fix? Well, yeah. I mean, you mentioned Amy Klobuchar and these kind of antitrust cases. And, you know, I always think about how back in 1948, the U.S. Supreme Court broke up movie monopolies like this. There's a tech clash happening right now, as they say, where these major companies are being scrutinized. But I don't think they're being scrutinized in their capacity as streamers because it seems so minor. But like I say, whether it's because you care about what kind of new movies get made or whether it's because you care about access to old movies that you might love, I think that you should care about this. I mean, I think that this has kind of been met with a shrug, with media, hold on to their DVDs and Blu-rays. And of course there's always other ways of acquiring these titles if they want to see them without going through Amazon or Netflix or Disney. All right.

John Semley, thank you so much. This is really fascinating and very entertaining. And I hope you get that fan before this goes to air and maybe Amazon cancels it. Yeah. I have to go to the Amazon Depot at the end of my street and get it probably. So I'll be humbling myself before them as I do probably

five times a week. Okay, thank you. Thank you so much. Thanks, Jamie. All right, that is all for this week. FrontBurner is brought to you by CBC News and CBC Podcasts. The show is produced this week by Imogen Burchard, Elaine Chao, Shannon Higgins, Ali Janes, Jeremy Allingham, and Miriam Kaja. Our sound design was by Derek Vanderwyk, Devin Nguyen, and Mackenzie Cameron. Our music is by Joseph Chavison of Boombox Sound. The executive producer of FrontBurner is Nick McCabe-Locos. And I'm Jamie Poisson. Thanks so much for listening,

and we'll talk to you next week.