Amazon Steps Up Netflix Rivalry in U.K., Germany

Alpha House Key Art - P 2013

Alpha House Key Art - P 2013

The e-tail giant drops its LoveFilm Instant brand and switches to its U.S. model, combining its Amazon Prime and online streaming services.

LONDON – Amazon is dropping its Lovefilm Instant online brand in the U.K. and Germany, renaming it Amazon Instant Video, after opting to combine its subscription postal DVD rental business Amazon Prime and the streaming service.

When the two combine, Prime will be offered in the U.K. at $130 (£79). The company is also offering a launch offer of $81 to attract new customers to sign up.

Amazon said it aims to bolster its investment in exclusive content and original programing only available through Prime.

PHOTOS: 25 of the Most Anticipated Foreign Films of 2014

Members will have unlimited access to exclusive film titles such as The Girl with the Dragon Tattoo, The Hangover Part II, One Direction: This Is Us, Friends with Benefits and Alvin and the Chipmunks: Chipwrecked, as well as TV shows such as The Walking Dead, Dexter, Vikings, Downton Abbey and Desperate Housewives. They will also have exclusive access to Amazon original TV series Alpha House at launch and Betas, which debuts soon.

"We’ve worked hard to offer the best selection of TV shows and movies for Prime Instant Video -- in fact, we’ve more than tripled selection since Lovefilm became part of the Amazon family," said Tim Leslie, vp of Amazon Instant Video for the U.K. and Germany.

"We also added high definition video and introduced apps for popular devices like Xbox One, PlayStation 4, Samsung and Sony TVs and iPads and iPhones. Customers who love movies and TV will love Amazon Prime Instant Video."

The move in Europe mirrors the U.S., where customers have video streaming included as part of their Prime membership.

Greg Greeley, vp of Amazon Prime said: "We are delighted to be bringing that same combination of services to the U.K., providing members truly unique benefits they can enjoy every day of the year."

STORY: Amazon Studios Announces Second Slate of Pilots

Britain-based research group IHS analyst and director of broadband Richard Broughton said the move by Amazon to combine its services reflects a need to react to "intense competition competition in the U.K. subscription streaming video sector, with the entrance of Netflix and NowTV, and the expansion of Sky, Virgin Media and BT’s on-demand services."

Broughton also noted that a "desire to duplicate the U.S. success of Amazon Prime" is an ambition.

"Amazon had accrued more than 20 million Prime subscribers worldwide by the end of 2013 -- the vast majority in the U.S.," Broughton said. "Amazon achieved significant growth in this market last year with Amazon Prime, in part due to its strong video content lineup via Amazon Instant Video in North America. Replicating this success in the U.K. and Germany, with video as a key pillar supporting Prime, will help to sustain Amazon’s wider retail business."

The change-up at Amazon in Europe will also offer a one-stop-shop for digital media with its ebook service, U.K. and German music offerings with the launch of AutoRip and the relaunch of its subscription online video service.

Broughton said: "Amazon will begin to provide download-to-own and video-on-demand rental films -- similarly to services such as iTunes and Blinkbox. By bringing its video content offer under the core Amazon brand alongside books and music, the online retail giant is attempting to position itself as the hub for digital entertainment in both the U.K. and Germany, encourage uptake of its Kindle Fire tablets and use its device and media presence to further strengthen its ecommerce lead."