CEO of LOVEFiLM on Leadership, Talent, and the Digital Marketplace
Simon is CEO of LOVEFiLM International, a leading European film and TV subscription service that merged with Video Island in April 2006. Prior to the merger Simon was CEO of Video Island. Before joining Video Island in July 2005, he held senior management positions at Riverdeep, Dell, Pepsi and Unilever, where he gained a wealth of relevant experience. Previously Simon was Worldwide COO and President at Riverdeep, one of the fastest growing interactive digital education and productivity software companies. He was also General Manager and VP of Dell¹s UK and Ireland Home and Small Business operations. Before that he was International VP of Sales Operations for PepsiCola, based in the US for three years and as General Manager and VP of PepsiCola UK where he launched Pepsi Max, Pepsi Blue and development of the Pepsi Music activity.
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The company is a result of a belated rush by a number of UK entrepreneurs to ape the success of a model invented by Reed Hastings, an American art house cinema fan.
Inspired by a $40 video store fine, Hastings launched Netflix in the US in 1996, revolutionising video rental by eschewing overdue charges and then promoting a fledgling rent-by-post model.
The UK was slow to tap into the emerging market for online DVD rental, however, and no similar service emerged here until 2002, when three rival start-ups – Video Island, Screen Select and Online Rentals Ltd (which subsequently rebranded as LoveFilm) – adopted the idea. Within three years, they had claimed 20pc of the total DVD rental market.
ScreenSelect merged with Video Island in 2004, and Video Island founder Saul Klein, now a partner at one of LoveFilm’s numerous backers, Index Ventures, brought former Dell executive Simon Calver in to lead his company’s expansion as the industry consolidation continued in 2005.
When Video Island merged with LoveFilm in 2006, adopting the latter’s brand, the affable Calver found himself leading Europe’s largest online DVD rental service.
Despite stiff competition, the emerging company received a resounding vote of confidence when Amazon, which had previously been targeting the DVD-by-post market, sold its online video rental service in the UK and Germany to Lovefilm in 2008 in return for a cash investment and an equity stake which saw it become LoveFilm’s largest shareholder.
Amazon doesn't often exit a market it is targeting, so today’s purchase isn’t surprising, especially in the context of the threat posed by Netflix’s planned international expansion.
While LoveFilm and its rivals sounded the death knell for traditional high street rental stores, Amazon will now be determined that the same doesn’t happen to LoveFilm’s core DVD-by-post operation. Calver has already been working hard to diversify into the on-demand online streaming options that should eventually remove the need for its costly logistical exercise of moving millions of DVDs in the post. Since last November, for example, users of the PlayStation 3 console have been able to stream films via their LoveFilm subscriptions.
The company’s fragmented origins are helping to spawn a number of other UK technology companies. For example, Graham Bosher, co-founder of Online Rentals Ltd, has re-employed the model for his new business, Graze, which provides healthy snacks by post.