BRENDOFF

Amazon announced on Thursday that it will be increasing the cost of Amazon Prime from $79 a year to $99, a first ever price increase for the service.

Amazon Prime – a service which provides unlimited 2-day shipping on millions of eligible products – was introduced in the U.S. in 2005 and then in various other countries in the years that followed. Since its inception the low cost shipping service has cost $79 in the U.S., but that price increased on Thursday by $20 to $99 per year. Current subscribers were notified via email that the price would increase for them on their next renewal date.

We are writing to provide you advance notice that the price of your Prime membership will be increasing. The annual rate will be $99 when your membership renews on XXXX.

Even as fuel and transportation costs have increased, the price of Prime has remained the same for nine years. Since 2005, the number of items eligible for unlimited free Two-Day Shipping has grown from one million to over 20 million. We also added unlimited access to over 40,000 movies and TV episodes with Prime Instant Video and a selection of over 500,000 books to borrow from the Kindle Owners’ Lending Library.

For more information about your Prime membership, visit our Prime membership page.

Sincerely,

The Amazon Prime Team

For some customers, the price increase will probably put them off of renewal, but for others it will be a mere blip on the radar. At a break down of now $8.25 per month, it is now 26 cents more expensive than Netflix if you’re looking at just as a Netflix competitor, but if you use more than one of the features Amazon Prime offers, your cost per service drops dramatically. If rumors are to be believed, a streaming music service is in the not too distant future, and that could also play into the new price increase.

Amazon had warned in its latest quarterly earnings report of the potential price increase and had stated it could be anywhere from $20 to $40 annually. Luckily it came in at the low end of the projection.

Chatter on Twitter and other social media currently appears mixed at the time of this post about whether or not the increased cost will be worth it to a large number of consumers. Only time will tell if Amazon sees a marked decrease in its subscribers to the Prime service.