Amazon.com Inc said on Wednesday it is buying MGM, the fabled U.S. movie studio home to the James Bond franchise, for $8.45 billion, giving it a huge library of films and TV shows and ramping up competition with streaming rivals led by Netflix and Disney+.

The deal aims to bolster Amazon’s television-focused studio with new and historic filmmaking from MGM, which has created lucrative cinema series including 2001: A Space Odyssey, Rocky and Pink Panther since its founding in 1924.

The MGM logo is among the most iconic:

From the press release:

Metro Goldwyn Mayer’s vast library has over 4,000 beloved film titles, including 12 Angry Men, Basic Instinct, Creed, James Bond, Legally Blonde, Moonstruck, Poltergeist, Raging Bull, Robocop, Rocky, Silence of the Lambs, Stargate, Thelma & Louise, Tomb Raider, The Magnificent Seven, The Pink Panther, The Thomas Crown Affair, and many other icons

MGM has one of the industry’s most exciting upcoming film slates, including House of Gucci, No Time to Die, Respect, The Addams Family 2, and the untitled Paul Thomas Anderson film

Catalog also includes 17,000 TV shows, including thousands of fan favorites like The Handmaid’s Tale, Fargo, and Vikings

Collectively, MGM has won more than 180 Academy Awards and 100 Emmys.

MGM also made the highest grossing film of all time when adjusted for inflation: Gone With The Wind.

They have produced such science fiction classics as Forbidden Planet (1956), 2001: A Space Odyssey (1968), Soylent Green (1973), Logan’s Run (1976), War Games (1983), RoboCop (1987), Species (1995) and the science fiction parodies Spaceballs and Hot Tub Time Machine.

Streaming video helps the world’s largest online retailer draw consumers to subscribe to Prime, a club with fast shipping, and to shop more once they’re members. Privately-held MGM, or Metro Goldwyn Mayer, also owns the Epix cable channel and makes popular TV shows including The Handmaid’s Tale, Stargate franchise, Fargo, Vikings and Shark Tank.

Mike Hopkins, senior vice president of Prime Video and Amazon Studios, said in a news release that MGM’s library is rich with established IP.

“The real financial value behind this deal is the treasure trove of (intellectual property) in the deep catalog that we plan to reimagine and develop together with MGM’s talented team,” he said.

Amazon’s Prime Video faces a long list of rivals including Netflix Inc (NFLX.O), Walt Disney Co’s Disney+ (DIS.N), HBO Max and Apple Inc’s Apple TV+. The companies have increased spending and expanded in international markets, capturing the pandemic-led shift to binge-watching shows online.

To stay competitive in streaming, Amazon has also courted fans of live sports and picked up lucrative licenses to stream games, touting a long-term deal with the National Football League that was estimated to cost about $1 billion per year. This puts Prime in direct competition with ABC, CBS, and NBC.

The increase and expansion of streaming services is causing a scramble for brands they can grow and libraries of older shows and movies to offer. Analysts have said this is a big motivation for another round of consolidation of media properties after a brief hiatus during the pandemic.

The MGM deal is announced a few days after the AT&T Inc announcement of a $43-billion deal to spin out its WarnerMedia business and combine it with Discovery Inc, one of the most ambitious yet in the streaming era.

MGM started a formal sale process in December, when it was estimated to be worth about $5.5 billion. The substantial premium of $3B Amazon offered is a small amount for the $1.5 trillion company that is spending 1B on a single TV show (Lord of the Rings).

(Worth noting that the deal for The Hobbit was for different rights than the LOTR TV series. But now they are in one place.)

The news can be viewed as a doubling down on business strategy that Jeff Bezos, Amazon’s CEO, articulated at a conference in 2016: “When we win a Golden Globe, it helps us sell more shoes,” he said.

Amazon shares rose on the news.

Still, efforts by Amazon to profit off the library won’t be easy or cheap.

In many cases, MGM’s content is tied up in multi-year deals with television networks, former Amazon executives said. Amazon cannot simply air MGM’s reality show The Voice for instance, which is contractually distributed by NBC, and Handmaid’s by Hulu.

Bringing a new installment of the James Bond saga to Prime viewers may be a particularly difficult task, the sources said. The terms under which MGM acquired the franchise leave control in the hands of the Broccoli family, the Bond films’ producers. They insist on a worldwide theatrical release of all Bond films, and Amazon agreed to that point.

In other Amazon news, Jeff Bezos will step down as Amazon CEO on July 5. Andy Jassy, the head of Amazon’s cloud business, will take the exec role.

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