Last year, Amazon started talks to buy MGM, and yesterday, the merger, worth $8.5 billion, closed. MGM, one of the most storied film studios and one of the last survivors of the Golden Age of Hollywood, is now a subsidiary of Amazon, like Zappos and Whole Foods before it.
Truly, the merger mania of the last few years signals the end of an era in American film, as legacy studios are being absorbed into massive conglomerates. Or being absorbed by one conglomerate only to be unceremoniously dumped on a smaller conglomerate, as in Warner Brothers’ case. In the IP arms race brought about by streaming this kind of consolidation is inevitable, but it’s still kind of sad to see legacy studios reduced to pure “content”, valuable only as hydrants for the content fire hose. In previous eras of consolidation, conglomerates wanted to be in the film business because of the glamor and the perception of cultural contributions, now it’s just about leveraging data for subscription rates. This is not the Hollywoodization of Big Tech, but the techification of Hollywood.
There is a long history in Hollywood of companies storming in from other sectors to try and “save” or “fix” Hollywood in its time of need—which is pretty much always, according to Wall Street—and no matter what company it is, or how much money they pump into their new studio, the story always ends the same, with the corporate savior slinking away, tail between its legs. A famous example is Coca-Cola, which bought Columbia Pictures in 1982, only to spin it off with Tri-Star five years later after Ishtar flopped, and then sell the whole thing to Sony in 1989. Rumors about Sony wanting to sell off their studio have persisted ever since. More recently, it’s been telecommunications companies buying up studios, the latest return coming from AT&T, who couldn’t get out of the movie business fast enough.
Now, tech companies are investing in Hollywood, determined that their algorithms and data can save Hollywood (from what?), but what we’ve got is the content fire hose spewing so much stuff at everyone no one can keep up, and also, a growing suspicion that streaming is going to make everyone less money than traditional theatrical and home video/VOD releases (which is true, we’re already seeing the effect of that as stars like Scarlett Johansson sue for the equivalent of back-end bonuses when movies go to streaming and undercut their box office performance). But what happens if and when Big Tech decides the movie business isn’t for them? Who is left to pick up the pieces? What happens to historic film libraries if there is no one to buy the rights? Or if legacy studios, once gutted by a new master, are abandoned to try and stand on their own once again?
Over the last forty years, studios have been traded like poker chips, but there are fewer players at the table than ever, and an increasingly limited pot to play with. And no one knows what will happen if the current players decide the game isn’t for them. Movies, TV shows, they’re not permanent. They can be lost, or they can simply fall through the cracks due to apathy or an unwillingness to cough up expensive licensing fees—it’s rumored Moonlighting remains unstreamable because of exorbitant royalties for the series’ extensive soundtrack. In some form or other, cinema will always survive. But with every round of consolidation, Hollywood has gotten smaller and less stable, and at this point, if any of these mergers fail, it could wipe out a chunk of film history. And what will cinema look like then?
Live long and gossip,