Why does Amazon run a streaming video service? Why does it run a Hollywood movie studio? Businesses generally try to make money. We don’t know that to be the case for Amazon’s streaming, and its film and digital production, because film and television are not broken out as separate revenue streams. Prime Video comes with an Amazon Prime account, and in its earnings releases, digital video revenue (like rentals) is bundled in with all the other subscriptions the company sells, including Prime. Amazon Studios, which does theatrical releases and produces shows for Prime Video and other networks, doesn’t split out its earnings either.
In 2020, Amazon spent $11 billion on film and TV production, along with licensing music for both its programming and its music streaming service. It’s literally impossible to know whether it’s recouping those costs. In the meantime, Amazon is plowing more money into entertainment. It just announced its intent to purchase MGM, a legacy studio that has fallen behind some of the other behemoths (like Disney) but still remains a “mini-major,” for $8.45 billion.
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