Amazon is tacking $20 onto the price of its Amazon Prime service, bringing the yearly cost to $99.
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This is the first price hike for Amazon Prime since it was introduced nine years ago. The service originally included just free two-day shipping on most orders, but has since expanded to offer Prime Instant Video streaming, a selection of free e-book rentals on Kindle devices and discounts on expedited delivery.
The price hike goes into effect on April 17 for both new and existing members. Existing members will only get charged the higher rate when it's time to renew.
For students, the price of Amazon Prime is also going up, from $39 to $49 pear year.
Amazon hinted at higher prices in January, saying that rising fuel and transportation costs and more frequent purchases from Prime members necessitated a $20 to $40 price hike. Although Amazon's royalty payments to Hollywood studios for video streaming are also a major cost, the company said that's not the major reason for raising prices. (Compared to Netflix, which costs $8 per month, Amazon Prime now costs $3 more per year.)
Still, Amazon may try to add more perks to Prime at some point. The Wall Street Journal reported this week that Amazon is negotiating with record labels to offer a streaming music for Prime members. It's unclear exactly how the service would work, but it could include limited-time streaming that would encourage users to buy MP3s after time expires, the Journal reported.
While it raises prices for Prime, Amazon is also reportedly looking to expand its $299 per year Prime Fresh service, which offers same-day or next-day delivery for orders over $35. Officially, the program is only available in Los Angeles and San Francisco, with a focus on groceries, but GigaOM reports that members in New York are now seeing the offer for Prime Fresh as well.