Amazon Prime has become one of the most convenient services with free two-day shipping on most orders for an annual subscription fee.
It just got a bit more expensive. The company is raising the annual price from $119 to $139 per year. The monthly fee also increased from $12.99 to $14.99, the company announced Thursday.
Amazon Prime vice president Jamil Ghani said in a statement that the price increase is due to “the continued expansion of Prime member benefits as well as the rise in wages and transportation costs.”
The price hike will go into effect on Feb.18 for new members. For current members, prices will increase on their renewal date after March 25.
Neil Saunders, managing director of the research firm GlobalData said he wasn’t surprised by the rise in prices, noting that Amazon’s last two increases in 2018 and 2014 were also $20.
“Amazon is facing much higher costs and is still investing heavily in Prime, so there is a real justification for hiking fees,” Mr. Saunders told USA Today. “While no one likes to pay more, Prime remains a very attractive, good value for money program which most members use extensively.”
The increase comes in the wake of several price hikes by other streaming services. Netflix raised rates in January and Hulu increased its monthly rate last year.
Mr. Saunders believes that the changes will not result in a significant amount of cancellations by Amazon Prime members.
“Amazon will have done the math on this and their view will be that they have more to gain than lose from this move,” he said.
• Peter Santo can be reached at psanto@washingtontimes.com.
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