The arrival of streaming services opened up a new way to consume movies and television, fueling a transition from traditional TV to internet-based entertainment that will linger for the foreseeable future. The past few years have seen a surge in streaming subscription and service provider options. The arrival of these new players has generated fierce competition between media companies which are now trying to find new ways to increase their video offering to differentiate themselves from the rest and attract more subscribers to their platform.

The production of original content has traditionally been the norm towards achieving this differentiation, with media companies dedicating increasing portions of their budgets towards producing compelling, worthy shows and movies. However, original content alone has proven to be insufficient to hold off the competition and companies are also targeting acquisitions of other media players to add to their portfolio.

A prime example of this trend is the recent acquisition of Hollywood studio Metro-Goldwyn-Mayer (MGM) by Amazon in a $8.45 bn deal (pending regulator approval). The sale will give the tech giant's Prime streaming service access to a huge back catalogue of content of more than 4,000 films and 17,000 hours of TV content such as James Bond, The Wizard of Oz or Rocky. This deal comes only weeks after AT&T and Discovery announced the creation of a new streaming giant and we expect this buying spree to continue in the months to come as other competitors will also look for potential integrations that help them solidify their position in the entertainment sector.

This type of operations where IP is at the center of the transaction bring along a series of legal challenges that need to be carefully addressed. Below are some key considerations media companies should think about when managing their copyright portfolios whether they are looking at acquiring or being acquired:

  • Proper chain of title review
  • Value of underlying rights
  • Term of IP rights
  • Third party licenses in place
  • Integration of creative teams

Mike Hopkins, senior vice president of Prime Video and Amazon Studios, added: "The real financial value behind this deal is the treasure trove of Intellectual Property in the deep catalogue that we plan to re-imagine and develop together with MGM's talented team."