It has been revealed that Amazon will use the MGM brand to launch a significant push towards cinema distribution.
Stocks in cinema chains surged yesterday as reports emerged that Amazon will be devoting a slice of its gargantuan wealth to developing films that will debut exclusively in cinemas.
Ever since the company purchased MGM, questions have lingered over the direction Amazon would move in with regards to film production. As well as obtaining a staggering amount of films from the iconic studio’s back catalogue, the MGM name still holds great value from a theatrical standpoint.
Amazon’s decision to relaunch the MGM name and produce up to a dozen films a year with windows of theatrical-exclusivity – with a $1bn investment – signals another step in the overall direction that streamers appear to be moving in. Following pandemic experiments in day and date releasing, it appears that streaming companies are coming to accept the important role that an exclusive theatrical release plays in building up the value of a film. Netflix has taken a significant step in this direction with its recent decision to give the upcoming Glass Onion: A Knives Out Mystery a wide theatrical release, whilst Amazon now seems to be pushing even further in this direction.
Whilst this is no doubt a welcome step, we wonder what the eventual trajectory is here. With streamers having tried the route of minimising cinemas, this ideological U-turn creates a step in the revenue chain that they can’t fully control. If there’s one thing the multi-national corporations that own these streaming platforms abhor, it’s losing a dollar or three, even whilst they’re making plenty. As such, how long will it be before one of the big streaming companies seeks to plug that gap by purchasing its own cinema chain to help regulate that corner of the market?
Despite the 1948 Paramount Decree ending a couple of years ago (meaning that film studios can once again purchase and own cinema chains,) we haven’t yet seen a streaming company look to make this move. It’s worth remembering though that the global pandemic made the future of cinema exhibition look rather unstable, resulting in streaming companies instead aiming to largely bypass cinemas.
That hasn’t worked as intended though, so as economic markets settle over the next few years, we wonder if this ambition might be on the horizon.
Given Disney’s current struggles and Netflix’s well-documented woes, if there is a company that might look to branch in this direction, Amazon would be a safe bet. We wait and see…
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