Amazon is increasing the price of its annual Prime subscription for just the second time since 2005.
(CCM) — Amazon has announced a 20% price hike for its Prime subscription program, with the annual membership cost jumping from $99 to $119. The move coincides with the company announcing that its quarterly profits have more than doubled to $1.6 billion.
Amazon launched Prime in 2005 with an annual cost of just $75, but this was increased to $99 in 2014. The company says that the rising cost of the program is to blame for this year's price rise. New members will pay $119 from May 11, 2018, while existing members will pay the higher fee for renewals from June 16, 2018.
The company says that the rising cost of the program is to blame for the latest price rise. The company has expanded Prime over the last few years to include features such as one and two hour delivery, original video content, free Kindle books, and Prime Now delivery of Whole Foods groceries in 10 U.S. markets.
"The value of Prime to customers has never been greater," said Brian Olsavsky, Amazon's chief financial officer, in a Wall Street Journal report. "It’s much different than it was in 2014,” he added. “This is a better reflection of the cost value of the program.”
Amazon now has over 100 million paid Prime members around the world and over 100 million items eligible for two-day shipping.
Earlier this week the company announced a new service called In-Car Delivery which allows Prime customers to have their purchases delivered to their car trunks.
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