Foundering: Amazon Part 3 - The Bumpy Road to Hollywood

Introduction

In the third installment of Bloomberg's award-winning serialized podcast, "Foundering," listeners are taken deep into Amazon's tumultuous journey into the Hollywood landscape. Hosted by Brad Stone, this episode dissects Amazon's strategic maneuvers, internal struggles, and the profound personal transformation of Jeff Bezos as his company strives to become a dominant player in the entertainment industry.

Jeff Bezos' Strategic Ambition: Acquiring MGM

The episode kicks off by highlighting Jeff Bezos' relentless pursuit of growth through strategic acquisitions. Amazon's purchase of MGM for nearly $8.5 billion in May 2021 is portrayed as a pivotal moment that underscores Bezos' commitment to embedding Amazon deeply into consumers' daily lives. Narrator Brad Stone emphasizes, "When Amazon struggled to sell shoes, they bought Zappos...now they bought MGM," illustrating a pattern of Amazon stepping into diverse markets to solidify its influence.

Lucas Shaw, an entertainment industry reporter, observes the surprise within Hollywood regarding the MGM deal. He notes, “The response was at first shock at the number Amazon was paying almost $9 billion for MGM, which far exceeded what anybody really thought it was worth on paper” ([02:52]).

Building Amazon Studios: Roy Price and Early Successes

Under the leadership of Roy Price, Amazon Studios embarked on creating original content with an initial focus on unique and artist-driven projects. Roy Price believed in leveraging passionate creators to produce compelling stories, a philosophy he articulated during Amazon's annual shareholder meeting:

“We can reimagine and develop that IP for the 21st century. It’s going to be a lot of fun work and people who love stories are going to be the big beneficiaries” ([03:57]).

This strategy bore fruit with the creation of critically acclaimed shows like "Transparent," which won a Golden Globe in January 2015, marking Amazon as a serious contender in the streaming wars. Joey Soloway, the show's producer and writer, publicly thanked Jeff Bezos, signaling the significance of Amazon's investment in genuine, meaningful content ([15:40]).

Shifting Gears: Bezos Pushes for Blockbuster Content

As streaming giants like Netflix began dominating with massive hits such as "Stranger Things," Amazon's initial niche approach faced challenges. Jeff Bezos, desiring broader appeal, directed a strategic pivot towards tentpole shows and blockbuster franchises. This shift is encapsulated in Bezos’ directive to Roy Price:

“Bring me my Game of Thrones” ([21:00]).

Bezos introduced a formulaic approach to storytelling, outlining key elements he believed were essential for a successful show, including a heroic protagonist, a compelling antagonist, and diverse world-building. This analytical mindset aimed to systematize creativity, reflecting Bezos’ belief that “remarkable storytelling always finds an audience” ([16:32]).

Controversies and Leadership Changes

The episode delves into the darker side of Amazon Studios' evolution. In 2017, amidst a broader #MeToo movement shaking Hollywood, allegations emerged against Roy Price involving inappropriate behavior and sexual harassment. Issa Dick Hackett, the executive producer of "The Man in the High Castle," recounted a distressing incident where Price made explicit and unwelcome remarks ([23:03]).

Roy Price publicly apologized, claiming his comments were "failed jokes" and expressing regret for any offense caused ([25:23]). However, the scandal led to his resignation, coinciding with Harvey Weinstein's downfall, and marked a turning point for Amazon Studios. Jen Salkey was appointed as the new head, signaling a shift towards more mainstream and commercially viable content ([30:11]).

Rebranding and Mainstream Appeal: Jen Salkey’s Leadership

Under Jen Salkey’s leadership, Amazon Studios steered towards projects with broader appeal and higher commercial viability. Shows like "Jack Ryan" and "The Boys" emerged, targeting a wider audience while maintaining creative integrity. Danny Gabai, a former Hollywood agent and Vice Studios executive, noted the company's urgent push for "big blockbuster content" and the pressure to meet Bezos' high expectations ([32:17]).

This period saw significant financial investment, with Amazon increasing its Prime Video budget from $5 billion in 2018 to an astounding $11 billion in 2020. Brad Fuller, producer on "Jack Ryan," highlighted Amazon's aggressive promotion strategies, which marked a departure from their previously more restrained approach ([34:48]).

Jeff Bezos' Personal Transformation and Hollywood Integration

Parallel to Amazon Studios' strategic shifts, Jeff Bezos experienced a personal transformation. Once a figure more reserved and focused on business metrics, Bezos began embodying the Hollywood persona he helped shape. His increased presence at high-profile events, such as hosting Campfire—an exclusive gathering for entertainment elites—and his visible role at award shows like the Oscars, showcased his rising celebrity status.

Visual transformations were also noted, with Bezos adopting a more action-star physique and demeanor, symbolizing his deepening involvement in the entertainment world. Journalist Kim Masters critiqued this evolution, suggesting that Bezos learned traditional Hollywood lessons the hard way: “The old rules exist for a reason” ([38:22]).

Conclusion: The Intersection of Business and Celebrity

The episode concludes by reflecting on how Amazon's foray into Hollywood is emblematic of broader trends where tech giants attempt to disrupt traditional industries. Jeff Bezos' journey from an internet bookstore founder to a Hollywood magnate encapsulates the complex interplay between business ambition, creative endeavors, and personal reinvention.

As Amazon continues to navigate its dual identity in tech and entertainment, "Foundering" sets the stage for exploring how these parallel paths influence each other and shape the future of both the company and the industries it touches.

Notable Quotes

• Lucas Shaw ([02:52]): “The response was at first shock at the number Amazon was paying almost $9 billion for MGM, which far exceeded what anybody really thought it was worth on paper.”

• Roy Price ([03:57]): “We can reimagine and develop that IP for the 21st century. It’s going to be a lot of fun work and people who love stories are going to be the big beneficiaries.”

• Jeff Bezos ([16:32]): “Is the creator of this show incredibly passionate about this topic?... remarkable storytelling always finds an audience.”

• Roy Price ([21:00]): “Bring me my Game of Thrones.”

• Jen Salkey ([30:46]): “There had been a lot of negativity and a little bit of trauma around the company, understandably. And then there had been a lot of healing that had already started, which I was really happy about.”

Final Thoughts

"Foundering: Amazon Part 3 - The Bumpy Road to Hollywood" offers an intricate look at Amazon's ambitious yet fraught journey into the heart of the entertainment industry. Through strategic acquisitions, leadership changes, and the personal evolution of Jeff Bezos, the episode captures the high-stakes drama of a tech giant grappling with creative ambitions and cultural challenges in Hollywood.