Amazon is laying off “several hundred” staffers from its Prime Video and MGM Studios division.
Mike Hopkins, the SVP of Prime Video and Amazon MGM Studios, informed employees of the decision via email on Wednesday; read it in full below.
“Our industry continues to evolve quickly and it’s important that we prioritize our investments for the long-term success of our business,” his email reads, in part. “We’ve identified opportunities to reduce or discontinue investments in certain areas while increasing our investment and focus on content and product initiatives that deliver the most impact. As a result of these decisions, we will be eliminating several hundred roles across the Prime Video and Amazon MGM Studios organization.”
Additional details were not disclosed, When reached, Amazon told IndieWire the layoffs represent a relatively small percentage of Hopkins’ staff.
Amazon purchased MGM in 2022 for $8.5 billion. Amazon said today’s decision was partially informed by carryover issues created by that deal.
Hopkins says impacted staffers will be notified this morning; he expects the outreach (for employees on the Americas) to be completed this morning (Pacific Time). Amazon’s FAST service, Freevee, is also under his purview.
“This is a difficult decision to make and one that my leadership team and I do not take lightly,” Hopkins continued. “It is hard to say goodbye to talented Amazonians who’ve made meaningful contributions on behalf of our customers, team and business. Thank you for your dedication and work.”
Future spend at Prime Video and MGM will focus on programming, marketing, and product, Hopkins said, as well as other initiatives that “move the needle.”
Perhaps Amazon shouldn’t have spent all of that money on “The Lord of the Rings: The Rings of Power.” With a $465 million budget, Season 1 was the most expensive season of television ever created. The season’s viewership did not end up justifying that giant investment.
To help offset economic factors and large investments, Amazon’s Prime Video service is adding an ad-supported tier on January 29. Remaining commercial-free will cost an additional $2.99 per month. Here’s why Amazon would love it if you didn’t opt-out.
Prime Video is primarily considered an add-on service for Amazon Prime, which most folks still subscribe to for free, two-day shipping on retail items. It’s a loss leader, but one Amazon is pretty easily able to absorb. In the Summer 2023 quarter alone, the most recent one that we have financials for, Amazon turned a profit of nearly $10 billion.
Read the full note Hopkins sent to his staff, provided to IndieWire by Amazon, here:
Team,
We’ve taken significant steps towards our long-term vision of making Prime Video the first-choice entertainment destination for customers worldwide, and I’m proud of everything we’ve accomplished as a team to date. Our investments in programming, marketing, and technology have enabled us to expand our selection of blockbuster movies, hit tv series, live sports, the world’s largest TVOD catalog along with over 650 partner Channels worldwide, and AVOD services including Freevee – all available in a single destination, delighting customers around the globe. And, through our acquisition of MGM, we’ve increased our investments in theatrical films and driven growth in MGM+ and our licensing and third-party production businesses.
Yet, at the same time, our industry continues to evolve quickly and it’s important that we prioritize our investments for the long-term success of our business, while relentlessly focusing on what we know matters most to our customers. Throughout the past year, we’ve looked at nearly every aspect of our business with an eye towards improving our ability to deliver even more breakthrough movies, TV shows, and live sports in a personalized, easy to use entertainment experience for our global customers. As a result, we’ve identified opportunities to reduce or discontinue investments in certain areas while increasing our investment and focus on content and product initiatives that deliver the most impact. As a result of these decisions, we will be eliminating several hundred roles across the Prime Video and Amazon MGM Studios organization.
Today, we will begin to reach out to colleagues who are impacted by these role reductions. Notifications will be sent out shortly, and we expect all notifications in the Americas to be completed this morning (Pacific time), and most other regions by the end of the week. We are following local processes, which may include time for consultation with employee representative bodies, possibly resulting in longer timelines to communicate in some countries.
This is a difficult decision to make and one that my leadership team and I do not take lightly. It is hard to say goodbye to talented Amazonians who’ve made meaningful contributions on behalf of our customers, team and business. Thank you for your dedication and work. To help with the transition, we are providing packages that include a separation payment, transitional benefits as applicable by country, and external job placement support.
Our prioritization of initiatives that we know will move the needle, along with our continued investments in programming, marketing and product, positions our business for an even stronger future. Prime Video is one of the most popular benefits for Prime members, and one of most widely used entertainment destinations in the world. I’m proud of the work you do every day on behalf of our customers, and I’m looking forward to continuing to build our business for the future.
-Mike
