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Amazon’s restaurant delivery service launches in London to take on Uber, Deliveroo

Amazon has launched its restaurant food delivery service for Prime customers in London, its first market outside of the U.S., the e-commerce giant said on Wednesday, as it looks to take on Uber and Deliveroo.

Prime members can use the "Prime Now" app to select their post code, choose a restaurant and order food with deliveries arriving from local restaurants in an hour or less.

Amazon Restaurants delivery first launched in September in 2015 in Seattle before rolling out to a number of other U.S. territories including Manhattan, San Francisco and Miami.

London marks the company's first foray outside of its home country with its restaurant delivery service. The Amazon Prime Now app launched in 2015 and allows Prime customers to get deliveries for items such as soap or books in one hour or less. Amazon Prime costs $99 a year in the U.S. and £79 in the U.K, with members able to get access to the company's video and music streaming services as well.

A picture taken on June 9, 2016 shows Amazon warehouse in Paris, part of the new service 'Prime Now'.
Eric Piermont | AFP | Getty Images
A picture taken on June 9, 2016 shows Amazon warehouse in Paris, part of the new service 'Prime Now'.

But the London market already has some major players. Incumbent Deliveroo as well as the newly-launched UberEATS service are among Amazon's closest rivals. Uber declined to comment when contacted by CNBC. Deliveroo said competition is good and will help it "drive innovation".

"We've also learnt a great deal about hungry Londoners in the last three years, innovating to suit their needs through initiatives such as our 15-minute lunch delivery option and RooBox, which brings restaurant supply to areas of demand," Dan Warne, U.K. and Ireland managing director for Deliveroo, told CNBC by email.

RooBox is the company's project where it is opening up its own kitchen spaces nearer to places out of reach to a restaurant. For example, if a single restaurant in the center of London wanted to deliver to the suburbs, this wouldn't be possible via Deliveroo at the moment as the logistics wouldn't work. But having a kitchen away from the main restaurant could allow the establishment to cook food closer to areas where it previously couldn't deliver.

Amazon said that it will deliver to areas in the City, West End, Westminster, Pimlico and Victoria in central London; Whitechapel, Bethnal Green, Bow, Clapton, and Homerton in the east; Islington, Stoke Newington and Stamford Hill in the north; Kensington and Chelsea in the west; and Southwark, Lambeth, Vauxhall and Kennington in south London, with plans to expand further.

The U.S. e-commerce giant said there are no menu mark-ups or hidden service fees and deliver on all orders is free for Prime members with a minimum order value of £15. Amazon said that if a customer finds a restaurant item that is priced higher than what is on the establishment's online menu within 24 hours of placing the order, the company will refund the user the price of the item.

Some of the restaurants listed on the app include Italian chain Strada, Indian restaurant Benares and healthy eating firms like Pod.