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Cost of Amazon Prime membership goes up

Want that free two-day shipping, access to instant video, and the Kindle Library? Amazon Prime members are now going to have to pony up an extra $20 for access to Amazon's premium service.

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Ross D. Franklin/AP/File
An Amazon.com employee stocks products along one of the many miles of aisles at an Amazon.com Fulfillment Center in Phoenix. The company is increasing the price of its Prime membership from $79 to $99 per year.

Amazon thinks their Prime service is worth an extra $20.

The Amazon Prime premium service price will increase from $79 to $99 per year for annual subscribers with a renewal date after April 17 - new subscribers have until March 20 to lock in the old price. The student Prime membership is jumping even more - from $10 to $49 per year. Though the fee is increasing, Amazon says it has been implementing extra services to offset the fee increase. Is it still worth the price?

Amazon spokeswoman Julie Law says the price hasn’t change in nine years since Prime was first offered, though the cost of delivery has increased.

“If you consider things like inflation and fuel costs, a Prime membership valued at $79 in 2005 would be worth more than $100 today,” Ms. Law told the LA Times.

The company hinted at a price increase at their January earnings call.

Though Prime first started mostly as a way to get free, quick delivery, since then it has expanded to cover access to Amazon’s increasing coterie of services. Current Amazon Prime customers have access to free two-day shipping, access to over 40,000 movie and TV episode through Prime Instant Video, and over 500,000 titles through access to Kindle Owners’ Lending Library.

Comparatively, websites that just offer streaming video, such as Netflix and Hulu Plus, fall at around $96 per year.

There are also rumors that Amazon is getting into the music streaming business, which could add to the Prime membership benefits, but also cost. The Wall Street Journal reports that Amazon is holding licensing negotiations with record companies and music executives for a music service. Amazon declined to comment, but the Journal added that in the January conference call Amazon warned the price of Prime could rise to $119.

In the meantime, Amazon is upping financial incentives on joining Prime. In October, it bumped the free shipping on eligible items for non-Prime members threshold from $25 to $35.

Amazon hit an all-time high Prime membership blitz in December, when it added over a million customers in one week. The company has not released official enrollment numbers, but analysts estimate there are around 23 million customers in the United States.

One thing is staying the same, however - Prime Fresh grocery delivery will still be set at $299 per year.

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