Amazon likely to add $20-$40 more to cost of Amazon Prime

“The price of ‘free’ two-day shipping is about to go up,” Marcus Wohlsen reports for Wired. “hat was the message from Amazon executives last week, who said that shipping costs would probably force them to raise the price of the company’s popular Amazon Prime program. Now $79 per year, the cost could go up $20 to $40 more.”

“Judging from Amazon’s balance sheet — and Wall Street’s negative reaction to those balances after its most recent earnings report — the company really has no choice. The irony is that Amazon Prime has worked out just like Amazon wanted it to,” Wohlsen reports. “Unlike most companies, Amazon hasn’t had to worry much about its near-total absence of profits. While Apple’s share price wavers despite pocketing tens of billions annually, Amazon’s stock jumped by nearly two-thirds last year after ending its fiscal 2012 in the red.”

“What investors do care about, however, are sales,” Wohlsen reports. “As long as Amazon keeps growing into the world-dominating retail giant that Bezos aspires to become, Wall Street has seemed content. But its $25.6 billion in fourth-quarter sales reported last week missed analyst expectations by about $400 million. Worse, sales aren’t growing as fast as shareholders would like. After reporting its results Thursday, investors finally spanked Amazon shares with an 11 percent loss.”

Read more in the full article here.

13 Comments

  1. I actually just subscribed to a student account of Amazon Prime, which is about half of the normal cost. And to be honest, I’m not sure we’re getting that much value out of it. We got it so that we could watch shows that we couldn’t watch on Hulu Plus, only to find that they’re not really available on Amazon Prime either (well, some are, but not a lot). And the Kindle Lending Library doesn’t do much for me either, given that I would never get to a book I’m “loaned” because I’m already behind on the books I’ve already gotten for free anyway. If you’re getting lots of actual physical books (or other physical merchandise) then that can be valuable, but since we don’t do that, I’m really not getting why I want to sign up for it.

  2. Hmmm, I was already feeling bad about using Amazon Prime. This might be the straw that broke the consumer’s back. At $100-120 it may not be worth it. I never watch Amazon Prime and packages are getting fewer and fewer from Amazon.

    1. Damn straight, increasinngly, some Amazon Prime items as of late are more expensive despite the fee shipping than other web shopping source alternatives , which negates the value of Amazon Prime in the first place…

      Amazon has been getting too greedy and demanding i hope they raise their prime rates and lose customers that they’ll never get backto alternatives AND i hope alternatives opo up like mushrooms.

  3. I buy a lot from Amazon, and I’ve made my money back easily with Prime. Even if it went up $40 it would still be worth it to me. Perhaps to appease those who are adverse to such an increase, it would be wise for Amazon to make more Instant Video content available to Prime members.

    1. Honestly, they should make more video content available to Prime subscribers anyway, and I’m sure they’d like to for the sake of increasing their subscriber base. Unfortunately, we know that it’s not up to Amazon, but rather to the TV production studios, who object to digital distribution in general because they want to keep viewers locked into cable TV subscriptions (or for off-the-air shows, DVD sales). They’ve relented to limited digital distribution, maybe to try and stem piracy, but they’re not going to make it too easy because they don’t want too many people to cut the cord.

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