Amazon Prime and Lovefilm are to merge, creating a new Prime Instant Video service that combines movie streaming with the online retail firm’s next day delivery.
LoveFilm, which was bought out by Amazon in 2011 in a deal worth nearly £200m, will be folded into the online retailer’s British website next week, creating a one-stop service for digital streaming, DVD rental and books.
The move also brings a new pricing setup for Prime Instant Video, with the service costing £79 per year for both movies and full Amazon Prime membership.
The price brings the ability to stream from a catalogue of 15,000 movies and TV shows, alongside unlimited next day delivery on Amazon products, as well as access to Kindle books to borrow.
For current Lovefilm users, all they will see is a rebrand and a new logo within what had been Lovefilm’s apps, while pricing will stay the same. Those who currently pay for Amazon Prime will see video streaming added to the service at no extra cost.
Amazon’s more blockbuster-orientated pay per view movie library will also be available within Prime Instant Video.
“Consumers will be able to shop for what they want, read what they want and watch they want anywhere at any time,” said Tim Leslie, vice-president of Amazon Instant Video for the UK and Germany.
“Even if you have another service you are going to want our service. It is the only place you are going to be able to find certain great TV shows, movies and original content all in one place. It is the most complete digital video service in the UK.”
Amazon is hoping to challenge Netflix by bundling Amazon Prime with LoveFilm at a knockdown price. Netflix charges its estimated 2 million UK customers £5.99 a month, about £72 a year, the same price as the existing LoveFilm service.
Amazon Prime costs £49 annually. The new combined package will be charged at £79, about £6.58 a month, making it 35% cheaper than subscribing to each service separately.
“All of these things in one package for less than £7 a month, we think this is best value out there,” said Leslie.
Users who only want access to Prime Instant Video can continue to pay £5.99. The LoveFilm brand will continue to be used for the DVD by post rental business Amazon is continuing to run.
The service will launch on the February 26. Those who sign up before then will get the £49 deal.