COMPANY TOWN

Amazon chases Netflix with foray into film production

Amazon plans to produce about a dozen 'indie' films a year with budgets of $5 million to $25 million each

Amazon.com is ready to join the big picture show.

After proving it can rub elbows with television's elite, the Web giant best known as a one-stop online retail shop announced it is joining the fray to produce and distribute movies. The move follows a similar push by Netflix, and could challenge the film industry's long-standing business model.

The Seattle-based company said Monday that it plans to acquire and produce about a dozen small-budget "prestige" films a year — about the same sized slate as some Hollywood studios — as part of its Amazon Original Movies initiative. Amazon intends to release movies in theaters before making them available on its Prime Instant Video streaming service a few months later.

"The movies in this program will be 'indie' movies," Amazon Studios Vice President Roy Price said in an email. "We will be looking for visionary creators who want to make original, unforgettable movies. We expect budgets to be between $5 million and $25 million."

The announcement comes one week after Amazon made history as the first streaming service to win a Golden Globe for television series, musical or comedy for "Transparent." Its brand-building has noticeably amplified since then, with the company announcing a deal for Woody Allen to create a scripted series.

Amazon's film effort could become an alternative to specialty studios, such as Focus Features or Fox Searchlight Pictures, that make a tidy profit out of finding and distributing independent films that increasingly have been cleaning up during awards season.

"We hope this program will also benefit filmmakers, who too often struggle to mount fresh and daring stories that deserve an audience," Price said.

Amazon's strategy chases the move by Netflix, which found success in original TV programs with "House of Cards" and "Orange Is the New Black," to also produce movies.

Netflix's first theatrical feature, coming this summer, will be a sequel to "Crouching Tiger, Hidden Dragon." That film is produced in conjunction with the Weinstein Co. The streaming service also signed an exclusive deal with Adam Sandler for his next four films.

The big difference between the two competitors: Netflix will release films simultaneously online and in theaters, while Amazon will be more friendly to theater chains.

Whether it will result in cooperation from theater owners, who have been faced with long-term declines in attendance, is to be seen.

"Amazon Prime is now a threat to Netflix," said Jeffrey Cole, director of USC's Center for the Digital Future. "And now with successful original programming and theatricals, it's a movie studio and a network, with very deep pockets."

Analysts don't expect seismic shifts to the way movie studios release films. But Amazon's move is planting a seed in Hollywood.

"We live in an always on, connected world where consumers walk around with an HD movie screen in their pockets," said Richard Greenfield, a senior analyst at investment firm BTIG Research. "Yet the movie industry lives by antiquated release windows that not only frustrate consumers, but fail to maximize studio profitability."

Amazon has shown an interest in film for some time. The launch of its studio arm in 2010 included the solicitation of submissions for full-length movies. At the time, the company said the top submissions would be developed into commercial feature films.

That initiative will be unaffected by the company's new film endeavor, according to Price. However, movies to be made under the new Amazon Original Movies program will probably not come from that source.

Helping to decide which auteurs and films help usher Amazon into this new frontier is veteran independent film producer Ted Hope ("21 Grams," "The Savages"), who has been tapped as head of production for Amazon Original Movies.

"Audiences already recognize that Amazon has raised the bar with productions in the episodic realm, tackling bold material in unique ways and collaborating with top talent, both established and emerging," Hope said in a statement.

"To help carry the torch into the feature film world for such an innovative company is a tremendous opportunity and responsibility."

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