A former Metro-Goldwyn-Mayer (MGM) executive says he believes Amazon will continue to license MGM titles to third parties should it close on a proposed acquisition of the movie studio.
Jim Packer spent a decade at MGM, helping the company distribute its content library across various new television pipelines, including the pay channel MGM HD and the broadcast digital network This TV.
Speaking at an investor’s conference earlier this week, Packer said MGM has not put out new titles at the same pace as some of its rivals, among them Lionsgate, where Packer now serves in a similar role.
“In the last 10 years…they’ve had 44 wide releases. We’ve had 21,” Packer said Monday during an interview at a Bank of America’s investment conference focused on media companies. He later added that, during the same time period, Lionsgate had put out around 700 movies compared to just 160 at MGM, and that MGM’s box office revenue over the last decade was about half of what Lionsgate earned with its releases.
MGM’s slowdown in releasing new films has resulted in a situation where much of its content library comprises older films and television shows. That still has a place in the industry — streaming services like Fox Corporation’s Tubi and ViacomCBS ad-supported service Pluto TV have generated hundreds of millions in dollars tapping into their library of retro shows and movies while simultaneously licensing older content — but it is likey not enough to convince Amazon that keeping MGM’s films for itself is the best road ahead.
“What I’ve seen from all the platforms that license from us — and we’re in business with everyone — is, there’s cycles that every single platform goes through,” Packer said. “So they don’t necessarily want to buy something and keep it up for 36 months straight.”
Instead, Packer said, most companies that operate streaming services want to lease a title for a set amount of time, long enough to evaluate it through “algorithms” before putting it to “rest.”
Amazon is one of several companies that uses this cycle for its streaming service: It is common for a licensed film or TV show to appear on Prime Video for a few months, only to have it disappear. Often, the content re-surfaces at a competing streaming service like Netflix, Hulu or Starz, where the cycle repeats itself.
Content providers like MGM benefit from this cycle: Over the last two years, the studio’s popular James Bond franchise has bounced between ViacomCBS’s Pluto TV, Comcast’s Peacock, Netflix and even Google-owned YouTube.
And the life cycle of licensed content on a streaming platform is getting shorter and shorter.
“Ten years ago, you’d do a year window [or] 18-month windows — you’d do longer windows of your content whether it be film or TV,” Packer said. “And while TV [windows are] still a little bit longer, film [windows] have gotten shorter. So the ability for us to cycle [our content] between different clients, and also make sure we have films in place for Starz, has been made much easier because of that.”
The same could be true at Amazon, if the company decides to go in that direction. And it may have a good reason to: The time between a major motion picture being released in a theater and its debut on a streaming service is getting shorter.
Disney recently announced plans to offer its feature films in theaters for 45 days before they’re eligible to appear in other places, including digital rental stores and its own streaming service, Disney Plus. Other movie studios have announced similar measures; some, like AT&T’s WarnerMedia and Comcast’s Universal Pictures, released movies in theaters and on streaming services simultaneously during the pandemic.
“I think it’s going through an experimental phase…[and] I think it’s a smart move,” Packer said. “We’re very pro-theatrical, we want to make sure the theatrical market is healthy, but I don’t think that the days of experimentation are over…if there’s anything that the pandemic has shown us, it’s that each movie is its own business.”