28th May 2021
Amazon announces MGM acquisition
As competition between streaming services such as Netflix, Disney+ and Amazon Prime Video rises, there has been increased investment from all sides into producing new content. In keeping with this strategy, Amazon has recently announced a $US8.45 billion deal to buy the world-renowned movie studio, Metro-Goldwyn-Mayer (MGM), home to several iconic franchises featuring the likes of James Bond and Rocky. It is also one of the world’s oldest movie studios, having been in business since 1924, and as such hosts a deep catalogue of feature films spanning multiple decades.
Amazon's founder, Jeff Bezos, stated during Amazon’s annual shareholder meeting that "MGM has a vast, deep catalogue of much-beloved intellectual property,".
"With the talented people at MGM and the talented people at Amazon Studios, we can reimagine and develop that IP for the 21st century," he added.
To further improve competitiveness Amazon has also been adding live sports to its content library including a potentially lucrative deal with the NFL. Moreover, Amazon Prime Video has the unique advantage of being bundled in with Amazon Prime, which is the company’s standard subscription for lower shipping rates and times. More than 175 million Prime members watched content on Amazon in the past year, and streaming hours were up 70 per cent.
Banks struggle to keep up with Crypto Revolution
For years financial authorities have been comparing bitcoin and other altcoins to lottery tickets. Over the last few weeks, the volatility of cryptocurrency has been displayed as tweets from Elon Musk, news from China about banning bitcoin and panic from retail investors has sent all cryptocurrency plummeting from all-time highs reached earlier this month.
Unlike other securities, cryptocurrencies tend to be deflationary as they are not tied to money printing central banks. Stocks and futures have fallen due to inflation fears as US consumer prices climbed in the greatest rise since the global financial crisis.
Cryptocurrencies are revolutionising finance by threatening to eliminate the middlemen in transactions, whether they be private banks, lawyers, and potentially even central banks. Stablecoins have been introduced as banks try to keep up with the demand for cryptocurrency. Stablecoins are similar to altcoins, however, are backed with safe and liquid assets in a domestic currency. According to the Bank for International Settlements, 80% of countries are studying the concept of stablecoins and how they might implement them.
Carol Alexander, a cryptocurrency expert at the University of Sussex in the United Kingdom, believes that “young people and computer geeks” are leading a digital revolution to reinvent what finance is. These revolutionaries are not using standard products and protocols and are “going under the radar of the establishment.”
The establishment in Washington and other capitals are concerned as cryptocurrency expands and traders are evading taxes. Recently the US treasury announced an adoption of new policies such as cryptocurrency transfers of over $US10000 required to be reported to the Internal Revenue Service.
As cryptocurrency is adopted by more and more people, there has been an eagerness to shift to digital currency. This has been accelerated by the COVID19 Pandemic, as governments failed to transfer relief money to members of the public who lack bank accounts, and businesses stop accepting physical cash due to the infection risk.
The views expressed within this article are those of the authors and do not represent the views of the Finance Student's Association. All images and references in this article are for fair and educational purposes only. The content in this article is not intended as legal, financial or investment advice and should not be construed or relied on as such.