Amazon.com Inc. (NASDAQ: AMZN) wants it all. The online retailer wanted to conquer book retail fifteen years back, and they’ve crushed all of their opponents save for Barnes & Noble (NYSE: BKN).
They wanted to play big box retailer for the Internet, and a decade later they have Wal-Mart (NYSE: WMT) and Target (NYSE: TGT) slashing overhead even further just to compete with Amazon’s cheap shipping prices.
Even as print periodicals have crawled towards a digital grave, people thought that there was no way to make electronic books affordable, accessible, and desirable to readers. Yet the Kindle is celebrating its third birthday. Now, like all pretty 16 year-olds who want it all, Amazon is preparing to go to Hollywood.
After years as a major film retailer, the Seattle, Wash. based company announced its first major foray into film making: Amazon Studios. The new website invites independent filmmakers to host their scripts, trailers and films where they well be judged by a set of panelists. Award winners will then receive money from a $2.7 million fund established by Amazon and refreshed annually. According to the Wall Street Journal, Time Warner (NYSE: TWX) subsidiary Warner Bros. Pictures has established a “first look” deal with Amazon Studios, giving them the option to pick up any particularly popular entries on the website. If Warner Bros. choose not to develop a given award winner’s project, Amazon will be free to shop it around to other major studios like Sony Pictures (NYSE: SNE), Paramount, (NYSE: VIA), Universal (NYSE: GE), or any of the other surviving major studios hungry to produce the next Inception or Avatar.
Amazon Studios aims to bring the broad democracy of Internet video websites like Google‘s (NASDAQ: GOOG) YouTube to the theatrical filmmaking process, but it remains to be seen if Web commentators are reliable for predicting what will live and die on the big screen. Hollywood has come to rely on major semi-annual film franchises in recent years, more than in any other era of big budget filmmaking, and it’s hard to imagine that the fickle Web crowd can be applied toward approving and fostering a sustainable brand. Studios like Warner Bros, who are about to see one of their tent poles finally come down when they release the final Harry Potter film next summer, is looking for a low-cost breakout like the Twilight series, not the next Chocolate Rain viral hit.
Amazon shouldn’t be underestimated though. The company has failed few times since opening for business in 1994, and even now, they tend to get what they want. The Amazon way is to first try to make it yourself, and if you can’t succeed with your own product, buy up a competitor. Amazon wanted to get into online shoe retail, so they bought out Zappos. The company’s getting beat out in the household and baby goods game? They buy Diapers.com and Soap.com in one fell swoop. It would not be surprising is Amazon ended up purchasing a movie studio to bolster Amazon Studios’ future.
As of this writing, Anthony Agnello did not own a position in any of the stocks named here.
