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Amazon is Raising the Price of Prime Monthly Memberships by Nearly 20 Percent (recode.net)

Posted by msmash on from the making-money dept.

Amazon is boosting the price of its monthly Prime membership fees for new and existing members by nearly 20%. The online retailer said Friday its annual membership fee of $99 will not change. From a report: The increase comes less than two years after Amazon first introduced the monthly payment option as a way to attract new Prime members who either couldn't afford the annual membership of $99, which is not increasing, or didn't want to commit to using the service continuously. Prime is the engine at the center of the Amazon commerce machine -- Prime members buy from Amazon more frequently than non-Prime members and also spend more, hence why Amazon introduced the monthly option to lure new members. So if the company is raising the fee, you can bet that it discovered the current $10.99 was just not sustainable.

14 of 158 comments (clear)

  1. Not sustainable? by Anonymous Coward · · Score: 4, Insightful

    Or they just like money... Is that possibility really too crazy to consider?

    1. Re:Not sustainable? by Espectr0 · · Score: 5, Interesting

      of course it's sustainable, otherwise they would have raised the $99 yearly fee. The price hike is just to make some people to switch to the full year price, thinking they will get the better deal. It will work for some, and savvy people will only subscribe for november (black friday) and july (prime day)

      --
      Open Source Java Web Forum with LDAP authentication
    2. Re:Not sustainable? by Kenja · · Score: 5, Insightful

      What seems to have been happening, is that people would order a pile of stuff and find that paying for one month of Prime cost less than shipping. So they would sign up and then cancel.

      --

      "Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
    3. Re:Not sustainable? by Anonymous Coward · · Score: 4, Interesting

      Back when I was on a free trial of Prime, I switched all of my preorders to the free two-day shipping option. After the free trial was up, all of my preorders (some of which would not ship for several months) retained the free two-day shipping. So yeah, I can totally see people signing up for a month of prime in order to place a bunch of orders.

    4. Re:Not sustainable? by gnick · · Score: 3, Informative

      ...savvy people will only subscribe for november (black friday) and july (prime day)

      Or they'll keep piggy backing off someone else's subscription. I can't stream Prime video, but I get free 2-day shipping thanks to a family member who pays yearly. I can't be alone in this.

      --
      He's getting rather old, but he's a good mouse.
    5. Re:Not sustainable? by obenchainr · · Score: 4, Insightful

      As soon as I read the post, I assumed this was what was happening. Especially for something larger, the shipping will likely be more than $10, so signing up for Prime to get, say, a lawn mower or something big delivered (especially around the holidays) and then cancelling again would be a fiscally smart way to (ab)use the system.

    6. Re:Not sustainable? by PhrostyMcByte · · Score: 3, Interesting

      It seems more to prevent people from paying $10 and binge-watching all of Amazon's exclusives in a single month.

    7. Re:Not sustainable? by unrtst · · Score: 3, Interesting

      THIS. Or, at the very least, this is probably part of the decision making process. I doubt there's any one issue.

      * greed/wanting more money... this doesn't make sense as a reason, because it relies on the chance that people will still get the monthly sub, which is more expensive than the yearly sub.

      * seasonal shipping.. this is probably part of the reason.

      * binge watching amazon exclusives (or other vids)... prime video alone, IMO, isn't worth the full prime price. If someone isn't reaping many of the other benefits, then a periodic binge on a one month sub is the only way it'd make sense.... and then, who cares if it's a few bucks more?

      * possibly a buffer in prep for the lack of Net Neutrality... if they need to start shelling out cash for fast lanes to ISP's, that has to come from somewhere

      If they had had a monthly option when I signed up, and it was close to the same price, I would have gone monthly only when needed/wanted.

  2. The new price by EvilSS · · Score: 5, Informative

    The new price is $12.99/month if anyone was wondering.

    --
    I browse on +1 so AC's need not respond, I won't see it.
    1. Re:The new price by cayenne8 · · Score: 4, Insightful

      It wasn't worth it at the old price. Their streaming service is substandard and the "free" shipping is just added on to the price of the item.

      I find for the small sum of $99/yr, it is VERY much worth it to me.

      I like the 2x day shipping, and I do most of my shopping there online, rather than brick and mortar.

      I really have been using Amazon Music to stream in my car lately.

      I like the free eBooks I get monthly for reading.

      I believe there is also free online storage you get for photos and something called Twitch.tv too, but I"ve not explored those yet.

      I do shop around online for best prices, but most of the time, I find it at Amazon, and I have just enough patience for most things to get here in 2x days.

      Their video streaming content is getting better, I have both it and Netflix....Netflix seems to have less and less and Amazon seems to be starting to have more and more movies I want to watch these days.

      Again....$99 a year is nothing, as I mentioned elsewhere, I've had bar tabs that high, so for all that entertainment AND "free" 2x day shipping, it is more than worth it to me.

      --
      Light travels faster than sound. This is why some people appear bright until you hear them speak.........
  3. Long-term lock-in by Anonymous Coward · · Score: 5, Insightful

    Sustainable my ass. Now that they've got people hooked Amazon wants to make sure they don't leave again and lock them in for a full year.

    Bonus side effect: they get to charge people who cannot afford a lump sum of 100$ more. Being poor is expensive.

    1. Re:Long-term lock-in by Anonymous Coward · · Score: 5, Insightful

      I don't think you understand just how slim some people's margins are. Something might come up one month that requires that $10 you were going to put into Prime (and $10 from groceries, and $10 from something else, and $10 from something else, and..).

      If you still want to argue that Prime is a luxury not an entitlement, by all means go ahead. But at least try to argue sensibly.

  4. Unreasonable conclusion. by plague911 · · Score: 4, Insightful
    "So if the company is raising the fee, you can bet that it discovered the current $10.99 was just not sustainable."

    Talk about jumping to conclusions. There are a myriad of reasons why the company could be choosing to raise its price and dozens of factors at play. Yet the author picked one, because "reasons." There likely is a analysis out there 100 pages thick about the implications of rising the price yet you think the answer is of-course a one word statement of "sustainability."

  5. Re:What if.. by aardvarkjoe · · Score: 5, Funny

    Same with `flix and `lu.

    Does "Hulu" really need a 3-character abbreviation, 'onymous 'ward?

    --

    How can we continue to believe in a just universe and freedom to eat crackers if we have no ale?