The Top Retailers in Home Entertainment 2021: Juggling Act in a Global Pandemic

Welcome to Media Play News’ fourth annual look at the top home entertainment retailers.

Here, we celebrate the retailers who are engaged in the business of distributing home entertainment product on a transactional basis, not via subscription services.

These are the top third-party operators where consumers go to buy or rent movies, TV shows and other filmed content — either digitally or physically on DVD, Blu-ray Disc or 4K Ultra HD Blu-ray.

These transactional players span several categories, from brick-and-mortar and e-commerce retailers that sell physical discs to digital retailers on both the broadband and cable side that sell and rent movies and other filmed content digitally.

Some retailers are hybrids. Amazon sells discs but also sells and rents content digitally. Redbox rents DVDs and Blu-ray Discs through a network of kiosks while also offering consumers the chance to buy or rent movies digitally through its Redbox On Demand Internet service (in addition to its new streaming service). And Walmart, Best Buy and Target, in addition to their dominant footprint in physical disc sales, also sell discs via their growing e-commerce websites.

The past year has posed unprecedented challenges and unique opportunities for transactional retailers. In addition to the COVID-19 pandemic that resulted in store closures and reduced capacity in physical stores, transactional retailers had to juggle a shifting home entertainment model as content owners battled stay-at-home orders and shuttered theaters by experimenting with new business models. Studios jumped in with premium-priced digital purchase and rental schemes that had never before been tried and pushed titles into the digital marketplace more quickly than ever.

Retailers rose to the occasion. For all of 2020, boosted by stay-at-home orders, transactional digital spending posted significant increases, with digital rentals up 18.3% in 2020 over 2019 and digital sales, or electronic sellthrough (EST), up 16%, according to numbers from DEG: The Digital Entertainment Group. Consumers spent more than $2.3 billion renting movies and other filmed content through digital retailers (both cable and Internet) in 2020, compared with just under $2 billion in 2019, and nearly $3 billion on purchases, up from $2.6 billion the prior year.

Meanwhile, physical disc sales continued to slide in 2020. Consumers spent an estimated $2.5 billion on buying Blu-ray Discs, DVDs and 4K Ultra HD Blu-rays in 2020, down 25.6% from $3.3 billion the prior year, according to DEG estimates. Disc sales had been declining for years, but in 2020 sales were further diluted by retail store closures and capacity restrictions.

In the first quarter of this year, uncertainty over what the summer would bring led to a pronounced lack of fresh product, as studios held back releases in anticipation of movie theater reopenings and capacity ramp-ups once vaccination rates increased to the point of herd immunity. Not surprisingly, digital sales fell nearly 18%, while digital rentals (VOD) slipped 26.7%. And combined Blu-ray Disc and DVD sales continued their freefall, declining 25% from the first three months of 2020, when the pandemic had yet to take a significant toll.

Premium video-on-demand (PVOD) figures, not included in DEG consumer spending totals, were anecdotally strong for both the year and first quarter as digital retailers benefited from first-run films hitting their services — usually as $20 rentals — instead of multiplexes. These titles regularly topped the digital retailer charts. In fact, speaking Jan. 27 during an online presentation for DEG: The Digital Entertainment Group, Paramount Pictures’ president of worldwide home entertainment Bob Buchi said, “From our estimates, if you include PVOD … 2020 was the first year that we’ve seen growth in the transactional home entertainment business in well over a decade, and that’s despite the significant lack of new releases due to theatrical closures.”

While digital led the way, brick-and-mortar retailers with a business centered on DVD and Blu-ray Disc did a yeoman’s job of maintaining the physical transactional business.

“As we begin to see bright light at the end of the long COVID-19 tunnel and a return to a more normal business, we thank all our retail customers for their resiliency in delivering products and services to the community at large and for continuing to support our category during these challenging times,” says Eddie Cunningham, the former Universal Pictures Home Entertainment president who now runs Studio Distribution Services, the Universal-Warner Bros. disc distribution joint venture.

“It’s been a remarkable year, on so many levels, and I have tremendous gratitude for our retail partners,” says Mike Takac, EVP and head of global platforms and retail at Warner Bros. Home Entertainment. “Not only did store personnel continue to support the category during what can only be described as an extraordinary year, but our retailers actively helped us transition our WB business into Studio Distribution Services. With a dearth of new releases, they remained committed to our catalog business, which has performed remarkably well.”

“I have been truly inspired by the incredible resilience, agility, innovation and sheer hard work of all of our retail partners and distributors over the last 12 months,” says Craig White, EVP of worldwide sales and distribution at Paramount Home Entertainment. “The pandemic created myriad challenges for physical and digital retailers alike. Meeting consumer demand for quality entertainment at home meant a rapid pivot to focus on catalog and premium windows, which required extreme flexibility from our retail partners. Without them, we could not have delivered the escape and entertainment consumers so desperately needed.”

Not only did retailers help consumers escape, but they also joined the conversation when many took to the streets to protest racial injustice. Retailers responded with content promotions and company programs. Redbox, for instance, launched its “Black Voices. Black Stories.” campaign last June, which is an ongoing initiative that spotlights the African-American experience.

“At a time when our country most needed to listen, learn, reflect and respond, elevating stories like Selma became a priority,” White notes. “I thank our retail partners for their support and their broader efforts throughout 2020.”

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Top Brick-and-Mortar Retailers

Brick-and-mortar sales and rentals of DVDs and Blu-ray Discs over the past year were a smaller portion of the market than in years past as digital purchases and rentals and streaming accelerated. While mass merchant disc sales may have benefited from the fact that consumers were buying a panoply of goods at mass merchants during the pandemic, COVID-19 proved fatal for longtime top rental chain Family Video, which shut its doors in early 2021. A lack of new content, too, hampered disc sales and rentals during the pandemic. Fortunately, retailers and studios helped fill the void with catalog releases and promotions.

“Physical retailers, including Best Buy, Target and Walmart, adapted admirably while always putting their customers first with extensive safety protocols,” Paramount’s White says about the past year. “As a result, they’ve all seen year-over-year catalog performance ahead of industry forecasts and expectations.”

Now, new releases are poised to boost the business.

“In physical home entertainment, as we begin to see more new releases arrive to complement the incredibly strong catalog sales during the pandemic, we are hugely excited by the opportunity to make a real impact at retail again, bringing the excitement back and helping drive shoppers into stores,” says Cunningham.

“The early signs are very positive, with strong new-release performances on the sequels to The Croods and Wonder Woman. The recent early new-release results on Tom & Jerry, The Little Things, The Marksman and Judas and the Black Messiah have all been significantly ahead of even our own lofty expectations, which augurs well for the future.”

On the rental side, Redbox continues to rent discs at its thousands of kiosks while expanding into digital delivery.

“Redbox continued to drive new business initiatives, achieving enviable growth in digital and AVOD while serving physical renters with great catalog offers,” White says.

“We’re proud to be one of the most recognizable and trusted brands in entertainment,” says Galen Smith, CEO of Redbox. “As we expand the business into new areas, we’re building Redbox into the go to destination for entertainment that offers customers the widest possible choice from new-release movies to free entertainment.”

Despite the growth of digital, Cunningham notes that the physical disc business is still vibrant.

“The physical home entertainment business is still worth about $7 billion worldwide at retail (around seven times the size of the much-lauded music vinyl business),” he says. “It brings theater and excitement to stores, it adds fun, is a relatively high-basket addition to most retailers, and helps complement the consumer products sales opportunities on many properties.

“We still have around 25% of transactional consumers who are completely dedicated to purchasing physical content, having never (ever) transacted digitally at this point, with another 37% consuming both digitally and physically, a total of 62% still buying discs. So we have a very long runway left in the physical business where gifting, seasonal and general impulse buying opportunities abound.”

Best Buy

Minneapolis

The consumer electronics chain has more than 1,100 stores in the United States, Mexico and Canada. The chain is known for its exclusive Steelbook Blu-ray cases for catalog and new releases.

Barnes & Noble

New York

The largest brick-and-mortar bookseller in the United States, the chain has more than 600 stores in all 50 states and sells a large breadth of disc titles.

Meijer

Walker, Mich.

The family-owned supercenter chain, featuring groceries, electronics and other items in addition to discs, has more than 250 stores throughout the Midwest in Michigan, Ohio, Indiana, Illinois, Kentucky and Wisconsin.

Redbox

Oakbrook Terrace, Ill.

The company rents DVDs and Blu-ray Discs via more than 40,000 kiosks and has rented 6 billion discs to date. It has 40 million customers and 39 million loyalty members (up from 34 million in 2020). Via Redbox on Demand, the company also rents and sells content digitally. Redbox has also launched two ad-supported free digital streaming products, Free Live TV and Free On Demand, and more than 8 million devices have accessed the free platform since launch. The company continues to distribute original movies through Redbox Entertainment (16 to date with 24 in the pipeline). In May, Redbox announced a merger with Seaport Global Acquisition Corp. to become a publicly traded company (see Q&A with CEO Galen Smith, page 9).

Target

Minneapolis

The chain has more than 1,900 stores in the United States. On the home entertainment front, Target often includes gallery booklets with releases and has other exclusive packaging and products as well. Discs are often displayed prominently on endcaps near the front registers.

Walmart

Bentonville, Ark.

The chain, long the top seller of discs, has approximately 10,500 stores and clubs under 48 banners in 24 countries and e-commerce websites. On the physical disc side, in addition to exclusive add-ons such as toys, Walmart offers some Warner DVDs at lower prices with limited or no bonus materials.

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Top E-Commerce Retailers

E-commerce entertainment sales became even more important during the pandemic at both online goliath Amazon and brick-and-mortar stores with strong online presences.

“DotComs, inclusive of Walmart, Target and Best Buy, served customers well through online and in-store or curbside pick-up initiatives, and achieved record growth, due in no small part to [distributors] AEC and Ingram, whose support was crucial,” says Paramount’s White.

Amazon.com

Seattle

A top seller of discs online, the e-commerce pioneer posted record 2020 results. Annual revenue topped an eye-watering $386 billion, up almost 38% from $280.5 billion in 2019. Online sales for the year topped $197 billion. E-commerce includes myriad products, but the company points out that revenue includes media products available in both a physical (DVD and 4K UHD and Blu-ray Disc) and digital format, such as books, music, videos, games and software. These product sales include digital products sold on a transactional basis.

Bestbuy.com

At the consumer electronics chain, online sales grew almost 90% to a record $6.7 billion for the quarter ended Jan. 31, and made up 43% of a total $15.4 billion in domestic sales.

Target.com

In the first quarter of 2021, the chain reported that digital comp-sales grew 50%, on top of 141% growth a year ago.

Walmart.com

Online sales at the chain exploded 69% in the quarter ended Jan. 31, and 79% for the fiscal year.

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Top Broadband Digital Retailers

Online digital sales and rentals, like e-commerce, got a boost as consumers stayed home during the pandemic. While much of the hype surrounded SVOD and AVOD services, “transactional sort of quietly had a moment in 2020,” said Fandango VP of home entertainment Cameron Douglas at the American Film Market in November. Fandango owns both FandangoNow and Vudu, top transactional digital services.

Other key factors in the growth of digital sales and rentals were premium-priced digital sales (PEST) and rentals (PVOD). With theaters closed, studios began to offer first-run movies digitally via $20 premium rental or premium-priced purchase in a window before traditional digital rental and EST. The move saw titles originally intended for the multiplex top the charts at services such as Vudu, FandangoNow and Microsoft Movies & TV.

“Fandango offers consumers the ultimate choice in their premium viewing experience, whether it’s through Fandango ticketing or through TVOD,” says Douglas. “We’re there to support fans who want to watch more movies in a premium, first-run window, whether they’re buying their tickets on Fandango for that unique big-screen experience in a movie theater, or renting or purchasing a movie at home with Vudu or FandangoNow.”

Microsoft’s Dametra Johnson-Marletti, corporate VP of Microsoft Digital Stores Category Management, told Media Play News in January that “digital movies are as collectible as discs. … In many ways digital movie collections offer a level of security, portability, and confidence that discs cannot. Your entire library can be accessed from almost any device, it travels with you seamlessly, and you never have to worry about damaged or lost discs.”

Indeed, digital transactional retailers took the pandemic as a chance to grow the business.

“Digital retailers delivered more content to existing customers, captured lapsed users and acquired entirely new digital customers with a combination of early new-release windows and innovative catalog promotions,” says Paramount’s White. “Among the standouts were Amazon’s Prime Video Cinema branding and its breadth of promotion across the Prime Video store, Vudu/FandangoNow’s unique retail promotions, and Apple’s franchise and bundle offers. Google also performed exceptionally well capturing planned and impulse consumption across Google Play and YouTube.”

“Our digital transactional retailers have been very nimble, especially with respect to varied windowing and pricing approaches on PVOD and PEST,” says Warner’s Takac. “Their support and flexibility have been critical as we adapt to the marketplace and measure results. It’s been amazing to watch the creativity and inventiveness of retailers like Vudu/FandangoNow, who make big merchandising statements each week with less content firepower than usual. We also appreciate the partnership with platforms like Apple, who are working in lockstep with us to sell subscriptions to HBO Max while featuring transactional content in harmony with key events, like the ‘Friends’ reunion special.”

All of these top digital transactional retailers are part of the Movies Anywhere cloud-based locker service, which allows consumers to keep all their digital purchases in one place.

Amazon

Seattle

The online retailer not only offers the Prime streaming service and e-commerce disc sales, but also allows consumers to rent or buy titles digitally.

Apple TV

Cupertino, Calif.

The app, offering digital purchases and rentals of movies, is available on Apple devices, smart TVs, gaming consoles and more.

Google/YouTube

Mountain View, Calif.

The online behemoth offers digital rentals and purchases of TV shows and movies.

Microsoft Movies & TV

Redmond, Wash.

The service offers digital rentals and purchases of TV shows and movies on the app, on the Xbox console or a Windows device.

Vudu/FandangoNow

Beverly Hills, Calif. (parent Fandango)

Both Vudu (formerly owned by Walmart) and FandangoNow are transactional digital rental and purchase services owned by movie-ticketing site Fandango, which is owned by Comcast and also owns movie-rating goliath Rotten Tomatoes.

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Top MVPD Retailers

Multichannel video programming distributors, such as cable and satellite services, through their value-add, on-demand services also helped to deliver transactional content as consumers stayed home. Oft overshadowed in the media by the flashier streaming services of many of their corporate parents, these MVPD transactional services offered subscribers a choice of many films not available for streaming.

“MVPD’s strength in family/holiday entertainment and promotion became abundantly evident as they delivered at a time of real need for their customers,” notes Paramount’s White.

Some of these providers, Comcast Infinity, DirecTV and Verizon Fios, are among the handful of digital retailers that support the cloud-based movie rights locker system Movies Anywhere.

Altice

New York

The U.S. broadband communications and video service provider serves approximately 4.9 million residential and business customers across 21 states through its Optimum and Suddenlink brands.

AT&T TV

Dallas (parent AT&T)

The service offers on-demand content and is expected to spin off into a separate entity with DirecTV.

Comcast Xfinity

Philadelphia (parent Comcast)

The Xfinity service, owned by Comcast Corp., offers digital content to buy or rent. Access is promoted through Comcast’s cloud-based X1 set-top box. The service is also available via the Xfinity Flex streaming device.

DirecTV

El Segundo, Calif.

A division of giant telecom AT&T, the satellite provider offers digital sales of movies and TV shows as well as rental of movies to subscribers. DirecTV is expected to spin off into a separate entity.

Dish Network

Englewood, Colo.

The satellite service offers its subscribers titles on demand, including premium early access.

Spectrum

Stamford, Conn.

The brand of services from cable operator Charter Communications offers on demand titles.

Verizon Fios

Keller, Texas

Parent Verizon Communications uses the brand to market Internet, telephone and TV service. The television service offers purchases and rentals of titles.

Amazon/MGM Deal to Be Reviewed by Federal Trade Commission

Amazon’s $8.45 billion acquisition of Metro-Goldwyn-Mayer Studio, including the lucrative “James Bond” movie franchise, will reportedly be reviewed by the Federal Trade Commission and its just-confirmed chair Lina Khan.

Per policy, mega corporate mergers are scrutinized by federal antitrust divisions within either the Justice Department or the FTC. The latter reportedly sought review of the Amazon/MGM deal as part of a separate antitrust investigation of Amazon, according to The Wall Street Journal, which cited sources familiar with the situation.

The FTC has made no official announcement.

Prior to becoming chair of the FTC, Khan, 32, was an associate professor of Law at Columbia Law School. She also previously served as counsel to the U.S. House Judiciary Committee’s Subcommittee on Antitrust, Commercial, and Administrative Law, legal adviser to FTC Commissioner Rohit Chopra, and legal director at the Open Markets Institute.

More importantly, Khan, who was born in London, has reportedly been a longtime critic of what she characterizes as lax antitrust enforcement within the technology market, especially among giants such as Facebook, Google and Amazon.

“Lina has been very clear-eyed in recognizing that the core questions have to do with power, with the ability of private entities to coerce and to bully,” Stacy Mitchell, co-director of the advocacy group Institute for Local Self-Reliance, told The Journal in May.

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How the Amazon/MGM merger might negatively affect consumers remains an unknown. The two companies do not deal with entities vital to consumers such as telecommunications or pay-TV — two issues former President Trump’s DOJ cited in their failed legal objections to AT&T’s acquisition of Time Warner.

In fact, the Amazon/MGM asset merger deals largely with the acquisition of catalog movies, TV shows and franchise rights — not the type of commodities that typically invite much regulatory concern. But with Amazon’s massive fiscal resources — founder/chairman Jeff Bezos is the world’s richest person — and forays into different markets worldwide, the ecommerce behemoth’s moves are apparently garnering increased scrutiny.

Amazon Founder Jeff Bezos to Fly Into Space in July Aboard Private Spacecraft

Amazon founder Jeff Bezos has announced that he and his brother, along with an auction winner, will be aboard his Blue Origin aerospace manufacturer’s first manned spaceflight in July.

The New Shepherd spacecraft will reportedly lift off from a facility in Van Horn, Texas. In addition to Bezos and his brother Mark, the 30-minute flight will include the winner of an ongoing live auction that has seen 6,000 entries from more than 140 countries push the winning seat price to $2.8 million. The craft will reportedly reach the edge of space, allowing passengers to float within the capsule, before returning to Earth.

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Blue Origin will donate the winning seat price bid to its foundation promoting space exploration among younger generations.

Bezos, who made the announcement on social media, has long been a fan of private commercial space travel and exploration, including seeding Blue Origin with $500 million in funding in 2016. Bezos is reportedly the world’s richest man with a net worth of $186 billion.

Amazon to Buy MGM for $8.45 Billion

Amazon and MGM May 26 announced that they have entered into a definitive merger agreement under which Amazon will acquire MGM for a purchase price of $8.45 billion. MGM has nearly a century of filmmaking history and complements the work of Amazon Studios, which has primarily focused on producing TV show programming.

MGM’s vast catalog features more than 4,000 films, including 12 Angry Men, Basic Instinct, Creed, Legally Blonde, Moonstruck, Poltergeist, Raging Bull, Robocop, Rocky, Silence of the Lambs, Stargate, Thelma & Louise, Tomb Raider, The Magnificent SevenThe Pink Panther, The Thomas Crown Affair, the “James Bond” movies, and many others, that have won more than 180 Oscars. The venerable studio’s 17,000 TV shows have produced 100 Emmy wins, including “Fargo,” “The Handmaid’s Tale” and “Vikings,” among others.

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“The real financial value behind this deal is the treasure trove of IP in the deep catalog that we plan to reimagine and develop together with MGM’s talented team,” Mike Hopkins, SVP of Prime Video and Amazon Studios, said in a statement. “It’s very exciting and provides so many opportunities for high-quality storytelling.”

Kevin Ulrich, chairman of MGM’s board, said the deal represents a transformation for the fabled studio.

“I am very proud that MGM’s Lion, which has long evoked the Golden Age of Hollywood, will continue its storied history, and the idea born from the creation of United Artists lives on in a way the founders originally intended, driven by the talent and their vision,” Ulrich said. “The opportunity to align MGM’s storied history with Amazon is an inspiring combination.”

Completion of this transaction is subject to regulatory approvals and other customary closing conditions.

Report: Amazon, MGM Acquisition Deal Imminent

Amazon’s reported $9 billion interest in MGM Holdings is reportedly set to happen as early as this week. The Wall Street Journal, citing sources familiar with the situation, reported the deal, which would jumpstart Amazon’s movie and TV show ambitions, would be the e-commerce retailer’s second-largest purchase following the $13.7 billion agreement to buy Whole Foods in 2017.

MGM, which is owned by private-equity group Anchorage Capital, has been on the sales block since last year — enticing would-be buyers with a 4,000-movie catalog that includes the “James Bond,” “Rocky,” “RoboCop,” “Pink Panther,” “Tomb Raider,” “Chucky” and “Legally Blonde” franchises, among others, in addition to TV show productions.

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Streamers Eyeing Audio Podcasts as Next Market Growth

Netflix has quietly posted a job listing looking for an executive with “audio/podcast programming” experience. The move mirrors other streaming video platforms such as HBO Max, Amazon Prime Video and Apple TV+ seeking to expand their platform beyond video and into audio content.

Podcasts, like audio books, are a series of audio files covering fiction, non-fiction ideas, stories that can be downloaded via the Internet on myriad portable devices. The global podcasting market topped $9.2 billion in value in 2019 and is projected to grow 27.5% annually through 2027 — driven by easy consumer access while multitasking activities such as driving, commuting, walking, gardening, exercising, or cleaning.

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“Podcasts are an excellent way for fans to connect with our stories and talent, and our marketing team plans to make more of them,” Jonathan Bing, a Netflix representative, said in a media statement first reported by the Los Angeles Times.

The average podcast runs from 20 minutes to 45 minutes, with opportunities to sell advertising within story breaks. Even better: Research suggests podcast ads can run as long as 90 seconds, with viewer attention reaching 85%. A 2017 Edison Research report found that the average podcast consumer listens to five podcasts weekly.

That’s enticing to major media brands such as Google, WarnerMedia, ViacomCBS, Facebook, Spotify and Apple.

This fall, Apple TV+ will launch original docu-series “The Line,” about former Navy SEAL Eddie Gallagher’s alleged war crimes in the Middle East. The streamer is now offering a six-part podcast series as a primer leading up to the video series debut.

“Large new-content platforms like Facebook and YouTube will [soon] build audio-specific products and begin to distribute podcasts en masse,” Conal Byrne, president of iHeartPodcast Network, said in a statement.

Indeed, HBO Max, like Netflix, has already used podcasts in limited fashion, offering greater depth into select video programming and movies.

Last year, Max parent WarnerMedia inked a deal with iHeartMedia to create podcasts for numerous original TV series such as “Search Party” and “Raised by Wolves,” among others.

“WarnerMedia Entertainment’s networks and brands have long been a marvel in the entertainment industry, and we’re ecstatic for the opportunity to be a part of their legendary storytelling and to bring this trove of new content to the iHeartPodcast Network,” Byrne said at the time.

HBO Max Launches Alexa Voice Discovery Feature

HBO Max has launched the “HBO Max Recommends” skill for Amazon Alexa, an interactive voice discovery feature allowing users to quickly browse titles from the HBO Max catalog.

Available on Alexa-enabled devices, “HBO Max Recommends” is “a solution for users looking for something great to watch and who would like a little guidance from HBO Max and Alexa,” according to HBO Max.

To build personalized watchlists, users begin by saying, “Alexa, open HBO Max Recommends” followed by answering a series of verbal yes or no questions. They can filter recommendations by genre or ask for show descriptions, character lists and other information for hundreds of select titles.

“HBO Max Recommends” also has a multiplayer mode that interacts with up to three co-viewers, curating a list of recommendations that satisfy all members of the group. Once a session is complete, HBO Max Recommends will text them their list with links to stream the content on HBO Max.

“HBO Max continues to build on its mission of providing fun and interactive experiences to fans with their skill ‘HBO Max Recommends,’” Jason Mulderig, SVP of brand marketing for HBO Max and HBO, said in a statement. “Working with Amazon and adding this additional avenue of content discovery is another way we’re enhancing our customers’ overall viewing experience.”

The “HBO Max Recommends” skill for Alexa will also include “Spotlight Sessions,” a human-curated list of 10 titles related to current and upcoming holidays, events, anniversaries and premieres. The feature will launch in June.

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“We are so proud to work with HBO Max to launch the ‘HBO Max Recommends’ skill for Alexa and reach HBO Max users — and their family and friends — with a simplified, fun and satisfying journey as they decide what to stream from HBO Max’s premier catalog,” Steve Bernstein, director of Alexa Skills at Amazon, said in a statement. “We look forward to seeing how fans respond to and engage with this new offering with HBO Max Recommends as their guide.”

“HBO Max Recommends” was developed in partnership with Skilled Creative.

HBO Max is scheduled to launch an ad-supported subscription tier and to begin its global expansion across 39 territories in Latin America next month.

Comcast, Apple Kicked MGM Tires, Valued Studio Less Than Amazon Does

NEWS ANALYSIS — With Amazon reportedly considering spending $9 billion to acquire MGM to supercharge its movie and TV production ambitions, questions remain just how valuable the vaunted Hollywood studio is.

MGM, which is owned by private-equity group Anchorage Capital, has been on the sales block since last year — enticing would-be buyers with a 4,000-movie catalog that includes the “James Bond,” “Rocky,” “RoboCop,” “Pink Panther,” “Tomb Raider,” “Chucky” and “Legally Blonde” franchises. Some of the titles would require new sequels to jumpstart renewed moviegoer interest. Comcast and Apple looked at the books and valued the studio at around $6 billion, according to the New York Times.

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Sanchit Jain, media analyst with Enders, believes Amazon would be willing to pay more since it eyes movies and TVs as a marketing extension of its Prime membership platform.

“They may be prepared to pay more because you get people into Prime Video, and two or three weeks later they go for fully charged Amazon Prime with e-commerce, music, etc.,” Jain said. “It makes the entry point to the Amazon flywheel more appealing. With Amazon it is all about subscription growth.”

While MGM Chairman Mike De Luca pitched Amazon the studio’s upcoming movie slate that includes biopic Respect, on the life and career of Aretha Franklin, starring Jennifer Hudson, and House of Gucci, starring Lady Gaga and Adam Driver — the fact remains MGM only controls 50% of the vaunted Bond franchise, with the remainder owned by Barbara Broccoli and her brother Michael Wilson through their production company. The siblings reportedly have total control on who plays Bond, script dialog, casting decisions, stunts and related marketing. Previous attempts to spin off the Bond character in TV series have been rebuffed by the sister and brother.

No Time to Die, the 25th Bond movie, and last with Daniel Craig in the title role after 15 years, is slated to hit theaters Oct. 8 after multiple delays due to the pandemic.

Amazon, which paid more than $13 billion for Whole Foods, is one of the few companies with the deep pockets required to pull the trigger on an acquisition. The e-commerce behemoth recently re-hired Jeff Blackburn, an architect of of its Prime streaming service, to head the company’s global media and entertainment operations. Jennifer Salke heads Amazon Studios — a studio that has remained loyal to the ever-shortening theatrical window.

“MGM is a production studio that, with an injection of capital, could do really great,” Tim Richards, CEO of the VUE theatrical chain in the U.K., told the Evening Standard. “When you have films that are grossing well in excess of $1 billion, any business in the world would look at that and not change the [business] model.”

Richards contends that until pandemic hit, the theatrical business was booming compared with declines in home entertainment.

“2019 was a $43 billion box office year,” he said. “This was growing every single year.”

 

Amazon Said to Be in Talks to Buy MGM

On the heels of AT&T’s stunning announcement that it is unloading WarnerMedia comes word that Amazon may be looking to buy the MGM movie studio.

The Information on May 17 reported that Amazon is in talks to acquire the celebrated studio, citing “a person familiar with the situation.”

Such a deal, the Information noted, would be the e-commerce giant’s “biggest move yet to expand in entertainment.”

MGM owns a huge film library and several top movie franchises, including “James Bond” and “Rocky.” MGM holdings also include the Epic cable channel and a production studio behind such TV shows as “The Handmaid’s Tale,” “Fargo,” “Shark Tank” and “Survivor.”

Amazon, meanwhile, has been a perpetual also-ran in the original content game to Netflix and even Disney+, while no one really knows for sure how many people tune in to the Amazon Prime Video streaming service because the subscription price also includes free shipping for online purchases.

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Amazon won’t comment on the Information report, but in December 2020 it was widely reported that MGM was exploring a sale. The Wall Street Journal, first with the story, reported that “people familiar with the matter” said MGM is betting that its rich film and TV library would be attractive to companies looking for growth in streaming.

MGM has engaged investment banks Morgan Stanley and LionTree LLC and begun a formal sale process, the people said, according to the Wall Street Journal report. The company has a market value of around $5.5 billion.

Shortly after the Information report, Variety reported that Amazon “is weeks into negotiations on a deal to acquire MGM for about $9 billion,” citing “industry sources.”

Musical ‘Cinderella’ Starring Camila Cabello to Bow Exclusively on Amazon Prime in September

The musical Cinderella, starring Grammy nominated singer-songwriter Camila Cabello, Idina Menzel and Billy Porter, will launch exclusively around the world in more than 240 countries and territories on Prime Video this September, Amazon announced.

The musical incorporates pop songs from contemporary global artists and original songs by Cabello and Menzel.

A new take on the traditional story, Cinderella features a heroine (Cabello) who is an ambitious young woman with dreams bigger than the world will allow. With the help of her Fab G (Porter), she is able to persevere and make her dreams come true.

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Cinderella is a classic we all know and love, but this time with a modern unique twist and starring the sensational Camila Cabello and an all-star cast,” said Jennifer Salke, head of Amazon Studios. “Producer James Corden and the filmmaking team have taken this beloved fairytale and revamped it with a fresh, empowering perspective that will resonate with audiences and families around the world. We couldn’t be more excited for our global customers to sing and dance along to director Kay Cannon’s reimagination of this classic story.”

Cinderella is written for the screen and directed by Kay Cannon with covers of songs written by some of the top-selling musical artists of all time. The cast also includes Minnie Driver, Nicholas Galitzine and Pierce Brosnan. Producers are Leo Pearlman, James Corden, Jonathan Kadin and Shannon McIntosh, and executive producers are Louise Rosner and Josephine Rose.