In a long-expected deal Amazon acquired all of Lovefilm, the online video rental service for around £200 million (€237m). The move bolsters Amazon’s DVD business and puts it in a straight fight with Netflix as both progressively shift their business online. Lovefilm has 1.6 million subscribers, Amazon already held a 42 per cent stake acquired in 2008 in return for Amazon’s DVD customers.
Lovefilm reported revenues of £97.2 million and pre-tax losses of £934,000 in 2009. It operates services in UK, Germany, Sweden, Norway and Denmark and bringing its digital streaming service to Internet-connected TVs from Sony and Samsung, as well as the PlayStation 3.
“The deal is a winner for the members who love Lovefilm because of its value, choice, convenience and innovation in home entertainment,” said Simon Calver, chief executive of Lovefilm. “With Amazon’s unequivocal support we can significantly enhance our members’ experience across Europe.”