Feeds

Amazon loves LoveFilm (true)

Enough to buy out the company?

Internet Security Threat Report 2014

Amazon is mulling a £200 million bid for Lovefilm, the UK's answer to Netflix, the Sunday Times reports.

Techcrunch UK's Mike Butcher is sceptical - he reckons The Sunday Times is often used as a stalking horse to help investors achieve a "liquidity event" - i.e. cash in some or all of their shares.

Unlike Mike we cannot claim any inside knowledge, but an Amazon-Lovefilm tie-in makes sense to us, even if nothing is on the cards now.

First up, Lovefilm is running the slide rule over a stock market flotation - at a time when IPOs are unpopular.

Secondly, the act of preparing a flotation often smokes out a buyer - it is easier, cheaper and gives investers the chance to sell out in full.

Third, and this is crucial, Amazon is already Lovefilm's biggest shareholder,, with a 42 per cent stake, after reversing its European film rental operation into the company in 2008 and later buying out one of the VC backers.

Lovefilm has the customers - 1.4 million all told - that Amazon wants. And it does something that Amazon used to do and wants still to do.

Most Lovefilm customers rent their films by post, rather than by Internet or TV, and Techcrunch thinks that buying a" legacy physical operation" would be a distraction for Amazon.

We disagree: Amazon does physical distribution as good or better than anyone. It is also managing the transition to online - witness The Kindle - rather well. As an independent Lovefilm will struggle to convert all its customers to a world of media players and video on demand. It is simply too small to take on the internet giants. This makes it a perfect fit for Amazon.

Top 5 reasons to deploy VMware with Tegile

More from The Register

next story
Chipmaker FTDI bricking counterfeit kit
USB-serial imitators whacked by driver update
Xperia Z3: Crikey, Sony – ANOTHER flagship phondleslab?
The Fourth Amendment... and it IS better
DOUBLE BONK: Testy fanbois catch Apple Pay picking pockets
Users wail as tapcash transactions are duplicated
Microsoft to enter the STRUGGLE of the HUMAN WRIST
It's not just a thumb war, it's total digit war
Google Glassholes are UNDATEABLE – HP exec
You need an emotional connection, says touchy-feely MD... We can do that
FTDI yanks chip-bricking driver from Windows Update, vows to fight on
Next driver to battle fake chips with 'non-invasive' methods
prev story

Whitepapers

Why cloud backup?
Combining the latest advancements in disk-based backup with secure, integrated, cloud technologies offer organizations fast and assured recovery of their critical enterprise data.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
New hybrid storage solutions
Tackling data challenges through emerging hybrid storage solutions that enable optimum database performance whilst managing costs and increasingly large data stores.