Amazon Prime May Get Much More Expensive

Subscription fee could be hiked $20 to $40 in the next year or so

By Arden Dier,  Newser Staff

Posted Jan 31, 2014 6:29 AM CST | Updated Jan 31, 2014 7:25 AM CST

(Newser) – Amazon Prime may cost you more in the near future—quite a lot more, in fact. Thanks to rising fuel and shipping costs, the company revealed in yesterday's quarterly earnings call that it's looking into bumping up the current $79 subscription fee $20 to $40 in the next year or so, VentureBeat reports. It would be the first price hike for the annual membership—which comes with "free" 2-day shipping plus access to Prime Instant Video and the Kindle's library-lending program—in nearly a decade.

USA Today reports that Amazon's stock took a 10.6% hit in after-hours trading yesterday after the company reported Q4 revenue of $25.59 billion, a good deal below the expected $26.06 billion; net shipping costs increased 19% to $1.21 billion for the quarter. "They can't keep losing so much. This is their profit margin," an analyst tells USA Today. "Drones aside, they have to find a way to get the package from the warehouse to the user in a timely way but also in a cost-effective way." He suspects most subscribers will likely swallow the price hike—"Where are these customers going to go?" VentureBeat notes, however, that a $120 price tag might turn off only occasional buyers. A way around that? It suggests making Prime Instant Video as tempting as Netflix.

Stacks of Amazon.com boxes with merchandise for shipment, at the Amazon.com fulfillment center in Fernley, Nevada.
Stacks of Amazon.com boxes with merchandise for shipment, at the Amazon.com fulfillment center in Fernley, Nevada.   (AP Photo/Ben Margot, File)
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