Yahoo Finance Amazon raising price of Prime membership for new and current members
Amazon is raising the price of its Prime membership for the first time since 2018.
An annual membership will go up $20 from $119 to $139 and the monthly fee will go up $2 from $12.99 to $14.99, the company said Thursday.
Jamil Ghani, Amazon Prime vice president, said in a statement, that the price of Prime is increasing with "the continued expansion of Prime member benefits as well as the rise in wages and transportation costs."
For new members, the price change will go into effect Feb. 18. For current Prime members, the new price will apply after March 25 on the date of their next renewal.
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Neil Saunders, managing director of research firm GlobalData, told USA TODAY that he wasn’t surprised Amazon was raising fees and called it “long overdue.”
Amazon’s 2018 Prime hike also was $20 when the membership fee went from $99 to $119. The 2014 increase was $20, too.
“Amazon is facing much higher costs and is still investing heavily in Prime, so there is a real justification for hiking fees,” Saunders said. “While no one likes to pay more, Prime remains a very attractive, good value for money program which most members use extensively.”
Other membership programs have also hiked prices. Netflix raised the rates for its streaming plans in January after last hiking prices in 2020. Hulu also raised the monthly price of its on-demand video plans last year.
Saunders doesn’t expect there to be a significant number of Prime cancellations from the hike.
“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.
Shares of Amazon spiked nearly 17% in after market trading when Amazon released its results.
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Amazon said U.S. Prime members received more than 6 billion free deliveries in 2021 while over 200 million members worldwide streamed shows and movies.
Here are some of the top benefits:
Free two-day delivery on millions of items
Free one-day delivery on more than 10 million items
Free same-day delivery in select areas for orders $35 or more
Streaming and digital benefits with Prime Video, Amazon Music
Prime member deals at Whole Foods Market
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Contributing: Associated Press
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This article originally appeared on USA TODAY: Amazon Prime price increase 2022: Membership fee to go up $20 to $139
