Amazon execs rn

Last night, the first two episodes of The Lord of the Rings: The Ring of Power debuted on Amazon Prime Video. And expectations are quite high – considering it’s the most expensive show ever created and all.

🍿 A deeper dive… The season’s eight episodes cost a reported $435 million to create – or about 1.5x what it cost to make Peter Jackson’s entire first trilogy ($280 million).

But to understand the investment, we have to understand the development process.

💰 Back to the beginning: In 2016, when Game of Thrones fever was sweeping America, Amazon founder and then CEO Jeff Bezos sent execs in search of a blockbuster title for its own streaming service.

Lo and behold, TV rights for the wildly popular fantasy trilogy Lord of the Rings were becoming available, and Bezos was a big fan of J.R.R. Tolkien’s work. A match made in Middle Earth heaven… but with one big problem. Heavyweights like Netflix, Apple, and HBO were also bidding.

• Per the LA Times, Bezos wrote a note to the various LOTR rights holders, including the author’s heirs, communicating his love for the material and promising that his company would handle any adaptation/expansion on the books with care.
• To sweeten the deal, crates of Amazon Echo speakers were even sent to the Tolkien estate and its law firm. Which obviously led to many jokes about eavesdropping on the negotiation (🤔).

In the end, Amazon reportedly paid ~$250 million to secure the IP – but that wasn’t even the highest offer. What ultimately swayed the Tolkien estate, per insiders, was Amazon’s ability to turn content into commerce. Think: selling Tolkien’s novels, series merch, etc.

📝 Bottom line: So if you’re counting at home, $435 million + $250 million + tens of millions in marketing, promotion, and red carpet events = a total sunk cost approaching ~$1 billion. "If it's not the highest-performing thing Amazon [Studios] has ever done, it's a failure," a source told Insider.

Nbd, or anything.

+In the know: How does Amazon measure streaming performance?