Amazon Buys LoveFilm For $200 Million

Amazon has acquired online movie rental service LoveFilm by purchasing the remaining 58 per cent stake in the London-based company for $200 million.

LoveFilm, which started out as an online-based DVD postal rental service, has 1.4 million users in the UK and across Europe. Users can either order a TV show or a movie DVD via post or watch them online over broadband connection.

The service had been facing stiff competition from Netflix, and it is likely that LoveFilm has tied up with Amazon to challenge the domination of the US-based streaming service.

The online retail giant originally acquired a 42 per cent stake in the company back in 2008.

LoveFilm chief executive Simon Calver said in a statement: “The deal is a winner for the members who love Lovefilm because of its value, choice, convenience and innovation in home entertainment. With Amazon's unequivocal support we can significantly enhance our members' experience across Europe.”

Calver also told the BBC that he was not concerned by the fact that an American firm had bought out the British company.

"It's not about location. The big question is who is going to be the best partner to work with. There are few that offer the expertise that Amazon do, which is why it is perfect for Lovefilm", he said.