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Amazon's $8.45 billion deal for MGM is historic but feels mundane

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AMZNMGM Studios Plaza entrance on February 28, 2015 in Niagara Falls, Ontario, Canada.Raymond Boyd | Michael Ochs Archives | Getty Images

It finally happened. After years of waiting, a large technology company finally acquired a significant legacy media company. Amazon has purchased legendary MGM Studios for $8.45 billion.

So why does it feel so underwhelming?

Perhaps it’s because this is, in essence, a bolt-on acquisition for Amazon. There’s nothing about the MGM deal that’s particularly revolutionary or leans into cutting-edge technology.

Rather, Amazon needs more content for Prime Video to stay relevant against Netflix, Disney+, Hulu, HBO Max and the many other streaming services competing for eyeballs. Buying MGM not only gives it library favorites like “James Bond,” “Rocky,” “Real Housewives” and “Survivor.” It also improves its odds of making better originals with a fully fledged studio that has made recent hits such as “The Handmaid’s Tale” and “Fargo.”

Perhaps it’s because the essence of this deal isn’t about media or technology at all. Amazon is playing a different game than every other entertainment company. The primary rationale behind buying MGM is getting more consumers to pay for Prime.

More than 175 million Prime subscribers have streamed TV shows and movies in the