Lovefilm DVD / Game Rental Service Acquired By Amazon

Haven't heard of Lovefilm? If you live in North America (or anywhere outside of Europe, really), we wouldn't be surprised. But have you heard of Netflix? Essentially, Lovefilm is Netflix for Europe, and soon, Lovefilm will be a part of Amazon. It's likely that Netflix was simply too pricey for Amazon to pick up, but Lovefilm is another story. Amazon already has a Video on Demand service of their own, but there's nothing quite like swallowing the competition in order to grow your own business.

In fact, this acquisition also puts Amazon in the DVD-by-mail business, which it hasn't been a part of until now. The new agreement states that Amazon will acquire "the remaining shares" of Lovefim, which currently rents DVDs and video games by mail. They also stream films and TV shows to PCs and PlayStation 3 consoles, currently operating in the UK, Germany, Sweden, Norway and Denmark.

For those that have followed this saga, you may know that this isn't the first time that Amazon and Lovefilm have tied the knot. In 2008, Lovefilm acquired Amazon Europe's DVD rental business, so the two already have a working relationship. It looks as if service will keep on going without interruption, with Lovefilm simply benefiting from Amazon's cash pool and reach. The acquisition still has to clear all regulatory hurdles, and both companies expect it to do so by the end of this quarter.

Amazon to Acquire LOVEFiLM International Limited

LUXEMBOURG & LONDON ­ January 20, 2010 ­, Inc. (NASDAQ: AMZN) today announced that it has reached an agreement to acquire the remaining shares in LOVEFiLM International Limited ( <> ). LOVEFiLM is a leading European subscription entertainment service which combines the benefits of online DVD and games rental-by-post as well as streaming films and TV shows instantly over the internet to PCs, internet enabled TVs and Playstation®3. LOVEFiLM operates today in the UK, Germany, Sweden, Norway and Denmark.  Amazon already has a significant minority shareholding in LOVEFiLM and does not itself operate any similar business in Europe.

³LOVEFiLM has been innovating on behalf of movie rental customers across Europe for many years and with the advent of the LOVEFiLM player, they are further delighting customers by streaming digital movies for their immediate enjoyment,² said Greg Greeley, Amazon¹s Vice President of European Retail.

³LOVEFiLM and Amazon have enjoyed a strong working relationship since LOVEFiLM acquired Amazon Europe¹s DVD rental business in 2008, and we look forward to a productive and innovative future.²

³The deal is a winner for the members who love LOVEFiLM because of its value, choice, convenience and innovation in home entertainment,² said Simon Calver, Chief Executive of LOVEFiLM International. ³With Amazon¹s unequivocal support we can significantly enhance our members¹ experience across Europe.²


The acquisition is subject to customary closing conditions, including regulatory approvals, and is expected to close in the first quarter of 2011.