Amazon.com has revealed plans for significant layoffs affecting hundreds of employees across its streaming giant, Prime Video, and newly acquired MGM Studios, Reuters reports.
The internal memo, released on Wednesday, Jan. 10, by Mike Hopkins, Senior Vice President of Prime Video and Amazon MGM Studios, detailed the company's ongoing restructuring efforts in response to the changing demands of the entertainment industry.
Amazon Hit by Another Round of Layoffs
Amazon's latest round of layoffs is set to touch various regions, with staff in Prime Video and Amazon MGM Studios in the Americas receiving notifications on Wednesday and employees in most other regions expected to be informed by the end of the week.
This move follows the company's staggering 27,000 job cuts in the previous year, reflecting a broader industry trend of downsizing among tech giants post-pandemic.
In the internal note viewed by CNBC, Hopkins outlined the rationale behind the layoffs, indicating a strategic shift.
"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," he wrote.
This restructuring aligns with Amazon's commitment to positioning Prime Video as the go-to entertainment destination worldwide.
What's Next for Amazon?
The online retail behemoth has spared no expense in fortifying its media business, making headlines with the $8.5 billion MGM deal and a staggering $465 million investment in the inaugural season of "The Lord of the Rings: The Rings of Power" on Prime Video in 2022.
The company is poised to introduce an ad-free subscription tier for Prime Video, mirroring strategies adopted by industry rivals such as Netflix and Disney.
Amazon's move to streamline its workforce follows similar strategies implemented by tech peers. Recent layoffs in Amazon's Alexa division and Microsoft's LinkedIn network underscore the broader industry trend of reevaluating resources and prioritizing strategic initiatives.
In tandem with the Prime Video and MGM Studios layoffs, Amazon's Twitch service is set to cut 500 jobs, constituting about 35% of its workforce, according to media reports on Tuesday.
Mike Hopkins' Memo
Hopkins' memo to the affected employees shed light on the company's vision and the challenging decisions made. "This is a difficult decision to make and one that my leadership team and I do not take lightly," he stated.
"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," Hopkins said.
The memo also outlined the support measures, including separation payments, transitional benefits, and external job placement support.
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