BBC Home
Explore the BBC
BBC News
Launch consoleBBC NEWS CHANNEL
Last Updated: Friday, 7 April 2006, 11:31 GMT 12:31 UK
Lovefilm and Video Island link up
DVD sent out by online rental firm
Video Island and Lovefilm dominate the UK market
Online DVD rental firms Lovefilm and Video Island, the largest two such providers in the UK, are to merge.

The firms will join under the Lovefilm brand, with the equal merger giving them greater scale to compete against US rivals Blockbuster and Amazon.

It will also enable Lovefilm and Video Island, who are both backed by private equity groups, to generate marketing and operational savings.

Video Island currently has 200,000 subscribers to Love Film's 120,000.

The two groups also run the online DVD rental operations of a number of other companies.

Video Island - whose main brand is Screen Select - operates Tesco, ITV, MSN and Easycinema's operations; while Lovefilm handles Sainsbury's, WH Smith, CD Wow and Film Four's services.

'Stronger company'

Revenues from the combined group totalled 25m last year, and both firms have been expanding into Europe.

Simon Calver, chief executive of Video Island, will take up the same role at the merged group.

"For three years both companies have done an excellent job changing the way DVDs are rented in the UK and Scandinavia, by providing customers with unparalleled value, choice and convenience," he said.

"Together we will be a stronger company offering better features and service."

Renting DVDs via the internet was first pioneered in the US by American market leader Netflix.

It is currently suing Blockbuster, claiming its rival copied its way of doing business.


SEE ALSO:
Netflix sues Blockbuster on DVDs
05 Apr 06 |  Business
The online DVD rental war
22 Mar 06 |  Business
DVD sales grow but spending dips
23 Jan 06 |  Entertainment
DVD boom 'bucks European trend'
16 Feb 06 |  Entertainment
Blockbuster steps up cost cutting
08 Nov 05 |  Business
Blockbuster hurt by online rivals
10 Aug 05 |  Business


RELATED INTERNET LINKS:
The BBC is not responsible for the content of external internet sites


PRODUCTS AND SERVICES

Americas Africa Europe Middle East South Asia Asia Pacific