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What is Amazon Prime?

Hint: It's more than two-day shipping.

Claudia Cruz/CNET

In 2005, Amazon introduced a service called Prime -- and it's not an exaggeration to say it transformed online shopping. As of April, 2018, the company boasts over 100 million subscribers.

But what the heck is Prime? How much does it cost? And what benefits does it offer? Let's take a look at what this service is all about.

A brief history of Prime

When it debuted in 2005, Amazon Prime was all about shipping. For an annual fee of $79, you could get unlimited 2-day shipping (within the continental US) on just about anything Amazon sold. More amazing still, there was no minimum purchase required; you could order a $2 cable and get it in two days.

That was back in the days when free shipping was still something of a rarity -- and 2-day shipping meant spending extra. With Prime, you could buy discounted (or at least competitively priced) products that might otherwise have required a trip to a store. As long as you weren't in a huge rush, ordering via Amazon Prime meant saving both time and money.

And if you were in a rush? You could upgrade to overnight shipping for a nominal fee.

Prime then vs. Prime now

In the 13 years since its debut, Amazon Prime has greatly expanded the scope of its benefits. For example, it now includes a Netflix-style streaming-video service, one that's home to a large library of movies and TV shows. Some of those are Amazon originals that have earned Emmy or Oscar nominations or awards.

Prime also lets you stream music -- about two million tracks' worth -- to your phone, tablet, PC or Amazon Echo ($42 at Amazon) smart device. That's far shy of the 30 million or so afforded to Apple Music and Spotify users, but it's included at no extra charge.

Need a place to store your digital photos? Prime subscribers get unlimited cloud storage for their photos and 5GB of space for documents and videos.

Those are just a few of the current Prime perks. Amazon continues to expand the list, most recently with a selection of free PC games offered each month.

Read more: 22 benefits every Amazon Prime member gets.

It's worth noting that whether you take advantage of some or all of these benefits, the price remains the same. So it's to your advantage to wring every freebie you can out of Prime.

How much does it cost?

As noted earlier, Prime started out at $79 per year. In 2014, Amazon raised the annual price to $99. And earlier this year, the price of Prime increased to $119.

Is it worth it? That's the $119 question, of course. It's challenging to calculate the real-world value of the service because that value varies from person to person.

But consider the shipping benefit alone. Prime's cost amortizes out to about $9.92 per month. If you're able to eliminate, say, four errands per month by having items shipped to you, that saves you money on gas and wear-and-tear on your car. It also saves you time: Maybe an hour or two, maybe more.

Does all that add up to $9.92? Again, it's tough to say, but when you add all the other perks on top of that -- the free books, games, music, etc. -- it's not hard to justify the cost of the service. 

Amazon Prime Tips

Here are some of our most recent Amazon Prime guides.

What are the Amazon Prime benefits? It's not just two-day shipping. Here's everything you get with your Prime subscription, including little-known perks like discounted groceries.

Here are the best perks. Yes, there are more than 20 benefits, but these are our favorites.

Is it a good deal? Maybe. Our guide walks you through Amazon's recent pricing changes and what that means for you.

Prime Day 2018 guide. Amazon's biggest sale event happens in July. Here's everything you need to know.

5 surprising things about Amazon. We dug up some of the little-known things about the Internet's favorite store.