Amazon has closed its deal to acquire film studio MGM after US and European competition regulators declined to block the move, despite growing concern over the ecommerce giant’s size.

The $8.45bn acquisition, which includes debt, is Amazon’s largest ever in the media space and its biggest of any kind since the $13.7bn purchase of Whole Foods in 2017.

It brings into Amazon a host of entertainment content, including the rights to the James Bond franchise, allowing it to gain ground on the huge libraries of Netflix, HBO and other streaming players.

“We welcome MGM employees, creators and talent to Prime Video and Amazon Studios, and we look forward to working together to create even more opportunities to deliver quality storytelling to our customers,” said Mike Hopkins, senior vice-president of Prime Video and Amazon Studios, in a blog post published on Thursday morning.

The deal, first announced last May, came under immediate scrutiny from regulators on both sides of the Atlantic, against a mounting political backlash against Big Tech groups.

But the US competition regulator has, at least at this initial stage, decided not to block the acquisition, letting a 30-day review period — which began once the companies filed necessary documentation — elapse without a challenge.

On Thursday, Amazon said the deal had closed, signalling that the US’s Federal Trade Commission, led by noted Amazon critic Lina Khan, had declined to delay or block the acquisition.

Doing so would have required the majority backing of the FTC board, currently deadlocked between two Democrats and two Republicans. The process to place Georgetown university visiting professor Alvaro Bedoya into the fifth and final seat, which has been vacant since October, has stalled in the Senate.

It temporarily limits the power of Khan, a Biden appointee, to achieve the goal of reining in not just Amazon, but tech peers such as Alphabet, Apple and Facebook’s parent company Meta.

Once a full board is in place, the FTC could retrospectively challenge the Amazon-MGM deal in court, a move it is preparing, according to a previous report by The Information. The FTC declined to comment.

The FTC’s go-ahead for the deal comes after the European Commission on Tuesday said it did not see sufficient overlap between the two companies. It said: “The addition of MGM’s content into Amazon’s Prime Video offer would not have a significant impact on Amazon’s position as provider of marketplace services.”

Khan rose to prominence following the 2017 publication of her Yale Law Journal paper, Amazon’s Antitrust Paradox, which dissected the company’s business practices. In particular, it examined the company’s multiple roles as shopkeeper, logistics provider and seller for its online store.

Last year Amazon sought to have Khan recuse herself from investigations involving the company, citing her previous work and criticism of the ecommerce giant. However, Khan refused to step aside, saying she met none of the financial or personal conflicts that would form the basis for a recusal.

The closing of the MGM deal will not alleviate scrutiny over Amazon’s business practices. This month, the House judiciary committee accused the company of obstructing its investigation into anti-competitive behaviour — referring the matter to the Department of Justice for a possible criminal investigation.

“While Amazon has reportedly closed on their acquisition of MGM Studios, anti-trust officials can still hold Amazon accountable for the wide range of anti-competitive tactics they’ve used to hurt workers, small businesses, and consumers,” said Krista Brown, senior policy analyst at the American Economic Liberties Project. 



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here