By Ben Fritz and Laura Stevens
America's biggest online retailer is now the first internet
company to earn an Academy Award nomination for best picture.
Little more than a year after launching its original movies
business, Amazon.com Inc.'s drama "Manchester by the Sea" earned
six Oscar nominations Tuesday, including best picture.
The film's nominations included two for writer and director
Kenneth Lonergan; and for lead actor Casey Affleck; supporting
actress Michelle Williams and supporting actor Lucas Hedges. The
Iranian drama "The Salesman," for which Amazon also holds U.S.
distribution rights, received a nomination for best
foreign-language film.
Amazon bought the distribution rights to "Manchester," a somber
drama about recovery from grief, at last year's Sundance Film
Festival for $10 million. It was the second-costliest acquisition
of the 2016 event.
The e-tailer has also made the biggest acquisition so far of
this year's Sundance: $12 million for comedy "The Big Sick,"
according to a person close to the deal.
Both purchases show that Amazon wants to be taken seriously as a
player in the prestige-movie business, which has shrunk in recent
years as major studios like Walt Disney Co. and Time Warner Inc.'s
Warner Bros. have exited and established players like Weinstein Co.
have struggled.
Amazon Studios chief Roy Price says the traditional studios'
retreat represents an opportunity for his company to carve out a
distinct identity that pairs well with its original television
shows, including the Emmy-winning "Transparent." The films and
programs stream on Amazon's Prime Video subscription service.
"If you bring to customers really distinct, excellent, artful,
memorable films worth talking about, then I think you have added
value," said Mr. Price, a 12-year Amazon veteran who previously ran
the company's video-on-demand service after a stint developing
animated television shows for Disney.
Prestige movies have the added benefit of typically appealing to
more educated, affluent viewers -- the same kind of people likely
to pay $99 a year for Prime, whose primary selling point is
unlimited two-day shipping.
"They are often very good retail customers," said Mr. Price. "So
that's not a bad thing."
Analysts estimate that Amazon now has more than 50 million Prime
members in the U.S. -- a number the company won't confirm -- a
group that typically spends significantly more with the retailer
than others do. Amazon has been tacking features on to Prime to
spur growth, including book downloads and music streaming.
Tuesday's seven nominations should draw more attention to Amazon
Prime movies and reinforce its identity as an alternative to the
superheroes and sequels favored by the major studios.
Netflix Inc. also releases prestige films, but they are part of
a broader slate that also includes Adam Sandler comedies and a
coming big-budget action movie with Will Smith. Netflix earned its
fifth Oscar nomination this year for documentary feature "13th."
All of its prior nominations have been in the same category.
Amazon has in the past year released 15 movies, from well-known
filmmakers including Woody Allen, Spike Lee, Nicolas Winding Refn
and Jim Jarmusch.
Its post-Golden Globes party earlier this month was one of the
glitziest thrown by any studio, packed with A-listers like
"Manchester" producer Matt Damon, Chris Hemsworth, Ben Affleck, and
Billy Bob Thornton. Amazon CEO Jeff Bezos hobnobbed with stars at
the event; later that night, as he sipped champagne in his tuxedo
at a party thrown by talent agency William Morris Endeavor
Entertainment, he told a reporter, "I had a really great time
tonight."
In addition to a strategy centered on arthouse films, the
company offers producers access to its extensive digital-marketing
capabilities. Its movies are highlighted on the Amazon-owned IMDb,
the most popular movie website, and on the lock screens of its
Kindle e-readers.
Though it initially toyed with streaming movies on Prime shortly
after they made its debut in theaters, Amazon quickly realized that
to attract top-tier filmmakers, it would need to respect
traditional "windows." Its movies now don't usually reach Prime
until at least five months after they debut in theaters.
It is an unusual tactic for the company, which is known for
shaking up business models when it enters new markets.
"I don't think our intention today and for the foreseeable
future is to be disruptive to the existing ecosystem of independent
film," said Jason Ropell, Amazon's world-wide head of motion
pictures. "Most of what we've done is really to be supportive of
the space."
"Manchester" has grossed $39 million, a solid number given the
price Amazon paid for distribution rights and its subject matter.
Some other releases haven't fared so well, including Mr. Refn's
"The Neon Demon," a horror movie set in the fashion industry, which
grossed just over $1 million.
Though the company uses data to understand the types of
programming Prime subscribers enjoy, it largely relies on the
oldest of Hollywood tools, executives' guts, to pick movies. Its
small staff includes respected indie-film veterans who had been
struggling to find a place in an increasingly unwelcoming
Hollywood.
In the future, Amazon says it will rely less on festival
acquisitions and release more movies it develops and produces
itself, including "Last Flag Flying," from Richard Linklater,
director of "Boyhood." "Last Flag Flying" comes out later this
year.
"Having had more time to put together these projects, I think on
average they will have a higher budget and higher box office," said
Mr. Price.
Write to Ben Fritz at ben.fritz@wsj.com and Laura Stevens at
laura.stevens@wsj.com
(END) Dow Jones Newswires
January 24, 2017 10:10 ET (15:10 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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