Amazon has made a takeover offer for movie-rental firm Lovefilm, which values it at close to 200 million pounds, or over $300 million. "Amazon already owns a 42% stake in privately-held Lovefilm after combining its own European rental operation with Lovefilm in 2008 and through buying out one of the company's venture capital backers," reports Reuters. The Sunday Times first reported the news, without citing sources. Earlier this month, Reuters reported that Amazon had approached media companies with a proposal for a subscription service that gives users unlimited access to some TV shows and movies over the Internet in …

Google did it. Microsoft did it. Even MySpace did it. Now, Facebook is building its own mobile phone, reports TechCrunch, citing a single source. "They're building the software for the phone and working with a third party to actually build the hardware," writes TechCrunch. "Which is exactly what Apple and everyone else does, too." Of chief concern for Facebook, is the ability to integrate deeply into consumers' contacts lists, and other core functions of their phones, say TechCrunch's source. "It can only do that if it controls the operating system."

New York startup Solve Media says it can swap out the random, hard-to-read text of captchas with clear, concise English. Better yet, "it says it can turn captchas into revenue generators for publishers, by transforming them into ad units," reports MediaMemo. "Assuming it does work, CEO Ari Jacoby has an interesting product on his hands. He's pitching it specifically to display advertisers and big brands that put a lot of money into TV spots but have a hard time doing much with click-per-action schemes offered by Google's AdWords and others." The ads require users to engage with them, by …

Holding company Internet Brands has entered into a definitive merger agreement to be acquired by an affiliate of private equity investment firm Hellman & Friedman Capital Partners VI. The transaction is valued at about $640 million. "Under the terms of the agreement, stockholders of NASDAQ-listed Internet Brands will receive $13.35 in cash for each outstanding share of common stock they own, a premium of approximately 46.5% over the closing price last Friday," reports TechCrunch. The Idealab-backed company presently owns and operates over 100 vertical Web sites, including Autos.com, Gardens.com, Loan.com and DoItYourself.com. "Why potentially go private again?" asks CEO …

Following a week of bad press and service issues, local social-shopping sensation Groupon must be glad it's Friday. First, a cafe owner wrote a contemptuous blog post about Groupon's sales team, service and customers, claiming that her experience using the service nearly bankrupted her business. "After three months of Groupons coming through the door, I started to see the results really hurting us financially," wrote Jessie Burke, owner of Posies Cafe in Portland, Oregon. "There came a time when we literally could not make payroll ... It was sickening." Then, …

Don't expect a brand new social network from Google this fall, CEO Eric Schmidt told reporters at the company's Zeitgeist conference this week. Rather, the search giant plans to launch what it's calling "social tools," reports The New York Times' Bits blog. "Google will add social components to its core products," writes Bits. Still, that doesn't mean that Google doesn't need all the help it can get to execute its social strategy. As Fortune reported earlier this week, Google has been offering "huge" bonuses to keep its top engineers from defecting to Facebook. On the mobile …

Following the disastrous launch of its ill-fated Kin mobile phone, Microsoft has all but sworn off hardware, reports The Wall Street Journal. "We are in the software business and that is where our business will be focused," Tivanka Ellawala, Microsoft's mobile-communication business, told investors at a conference in San Francisco on Thursday. According to The Journal's Digits blog, Ellawale made the remark in response to a question about rumors that Microsoft is working on a new phone. "Ellawala's comments come as Microsoft tries to rejuvenate its mobile-phone business with a new operating system, dubbed Windows Phone 7," …

Earlier this year, how did McDonald's increase foot traffic 33% in one day with an investment of less than $1,000? With Foursquare, reports Econsultancy.com. The money went to 100 gift cards, which McDonald's offered to Foursquare users who checked into local establishments on April 16. Says Rick Wion, head of social media at McDonald's: "I was able to go to some of our marketing people -- some of whom had never heard of Foursquare -- and say, 'Guess what. With this one little effort, we were able to get a 33% increase in foot traffic to the stores.'"

ReadWriteWeb takes a look at Footprint Feed -- a new mobile app that lets people set up feeds to share their location with contacts via Facebook, Twitter, RSS or specific individuals via text message or email. "We usually talk about geofencing for advertisers, where a customer's proximity to a business can trigger a text message or push notification," the blog writes. "But geofencing for individual users is just fun -- if not more." (Fun's one way to put it.) "Death to the check in," said Director Rob Cleghorn, in reference to popular location-based networks like Foursquare, which …

Windows Phone 7 hasn't even launched, and it's already suffering major setbacks. Verizon Wireless, the largest U.S. mobile-phone carrier, on Thursday said it won't sell handsets with Microsoft's mobile operating system until 2011. "Verizon Wireless won't offer a device at the planned fall introduction or at any point this year," Brenda Raney, a Verizon spokeswoman, tells Bloomberg. The carrier does plan to support the new operating system, and will "probably" release a phone in 2011, said Raney. "The more carriers and the more devices [Microsoft] can bring early on, the more chance they have for mainstream success," …