Amazon Prime fee jumps to $99 a year

The cost of the premium service is rising by $20, with members paying the higher fee on their renewal date. The discounted student fee also heads north.

A worker loading orders in one of Amazon's factories. Amazon

Amazon's Prime premium service just got a little more expensive.

For the first time, the online retailing giant will raise the membership fee for Prime, hiking it by $20 to $99 a year. Amazon Student Prime will rise $10 to $49 a year. Prime members will pay the higher fee when their accounts come up for renewal.

The critical cut-off date is April 17. If your renewal comes up before then, you'll still pay the original $79 fee. If comes up on April 17 or after, you're stuck with the higher fee.

Prime, introduced nine years ago, has become one of Amazon's key drivers of revenue growth, with consumers increasingly willing to pay the premium for free two-day shipping, access to more than 40,000 online videos, and the ability to borrow more than 500,000 books from Kindle Owners' Lending Library. The company has been working to make Prime even more attractive, including adding original programming in page taken from Netflix's playbook.

In its note to customers, Amazon makes the argument that the company hasn't ever raised prices on the service despite rising fuel and transportation costs.

The hike comes as Amazon continues to post losses despite its immense reach and brand recognition. It isn't a complete surprise, as Amazon's chief financial officer hinted at a price increase of up to $40 in January.

Amazon just celebrated a record holiday season for Prime, boasting that it signed up more than a million new customers in the third week of December. The signups were coupled with Amazon launching the ability for customers to give a Prime membership as a gift. In October, Amazon raised the threshold for free shipping for non-Prime customers from $25 to $35 while also plugging its Prime program.

If you're really keen on keeping your $79 membership fee going for an additional year, Slickdeals.net has a workaround that involves buy a Prime gift membership and having it delivered to you as your current membership expires.

Amazon said it has been alerting Prime and Student members about the increase and specific renewal date.

Here's the note:

Screenshot by Joan Solsman/CNET

Updated at 6:09 a.m. PT: To include the cutoff date for when the higher fee takes in effect.

About the author

Roger Cheng is the executive editor in charge of breaking news for CNET News. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade. He's a devoted Trojan alum and Los Angeles Lakers fan.

 

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