Amazon’s acquisition of the legendary Hollywood studio MGM (Metro Goldwyn Mayer) should not take place, say American unions.
“Amazon’s influence on the health and diversity of the film industry is likely to be negative if the company is allowed to grow even further”, argued, Monday, November 22, the Strategic organizing center, a federation which claims to represent nearly four million employees, in a press release. It calls on the American competition authority (FTC) to oppose this takeover announced last May.
For an amount of 8.45 billion dollars (approximately 7 billion euros at the time of the takeover), Amazon has offered more than 4,000 films, including the James Bond saga, Thesilenceofthelambs, Robocop, Basic Instinct, Raging Bull Where Thelma & Louise, as well as an extensive catalog of series, such as The Handmaid’s Tale, Fargo and Vikings.
“Amazon’s current control over already massive amounts of content means that the merger will give it even more power to exclude its competitors”, continues the federation in its letter. She estimates that, thanks to the takeover, Amazon will control around 56,000 titles, far ahead of Netflix which would have just under 20,000 titles.
Horizontal and vertical power
The unions further argue that Amazon’s market power is not only horizontal but also vertical, with the sale of electronic devices for video streaming (the range « Fire ») and cloud services (remote computing) for storing the content of its competitors, starting with Netflix, the most popular of the platforms.
Solicited by Agence France-Presse (AFP), Amazon highlighted the variety of choices currently available to consumers, citing in particular Netflix, Disney +, Apple TV +, HBO Max and Peacock. The company also notes that neither MGM nor Amazon were involved in the production or distribution of any of the 20 most successful films around the world in 2018, 2019 and 2020.
The FTC and many American states have launched investigations and lawsuits against GAFA (Google, Apple, Facebook and Amazon) which they accuse of abusing a dominant position in their various markets, from social networks to digital advertising. through online commerce. Amazon largely dominates the cloud, but it is above all its e-commerce platform that makes the teeth cringe. The firm is both judge and party: it sets the rules and markets its own products.
“The company has become accustomed to using its power to tackle new markets thanks to practices that we believe to be unfair and contrary to competition law”, write the unions. “This merger would allow Amazon to use the same methods against the video streaming industry, inevitably affecting producers and consumers, and reducing diversity”.
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US unions worry about Amazon’s acquisition of Hollywood studio MGM