What Does Judy McGrath's Appointment Mean for Amazon?

PHOTO: Judy McGrath joins Amazon.coms board of directors effective October 1, 2014.
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What does Amazon's newest addition to its board of directors signal? A desire for the Seattle-based tech company to get a seat next to Hollywood's power players? A stronger commitment to women in the boardroom?

Amazon gets all of the above with Judith "Judy" McGrath, the former chief executive officer and chair of Viacom's MTV Networks Company.

"Her experience as a CEO and her entrepreneurial leadership will make her an outstanding addition to our board," an Amazon spokesperson told ABC News.

PHOTO: Judy McGrath at the The Edison Ballroom in New York City on April 14, 2011.
Taylor Hill/Getty Images
PHOTO: Judy McGrath at the The Edison Ballroom in New York City on April 14, 2011.

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In addition to her skills as a chief executive of a large company, McGrath, 62, will likely fit in with Amazon's entrepreneurial ventures. As Amazon points out in the company's SEC filing about McGrath's appointment, she has been the president of Astronauts Wanted: No Experience Necessary, a multimedia joint venture between McGrath and Sony Music Entertainment, since June 2013.

Amazon Prime's streaming video business is fiercely competing with Netflix's award-winning content making machine that includes "Orange Is the New Black" and "House of Cards."

McGrath's Astronauts Wanted produces off-beat online video content with a focus on millenials. (Just visit Astronauts Wanted's website and you might think you wandered upon the Urban Outfitters site.)

But the addition of McGrath doesn't necessarily signal a potential acquisition of a studio or production company, said RJ Hottovy, analyst with Morningstar.

"I think it does reinforce Amazon's commitment to content," he said.

Hottovy added that the announcement comes on the heels of the conference call during which CFO Tom Szkutak mentioned that original content will represent $100 million in costs during the third quarter.

Hottovy said the $100 million investment is relatively small for a company with $8 billion in cash on its balance sheet, but it’s the most the company has spent on original content in a quarter that he can recall.

Amazon already has a selection of lesser-known original shows, including "Alpha House," a comedy starring John Goodman.

McGrath will bring her expertise of entertainment to a board that is heavy with tech and finance backgrounds. She is now the third woman on Amazon's board of 10 directors.

Seven of the Fortune 500 companies have boards that have a female presence of at least 40 percent.

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