Published on April 26th, 2018 | by Brad Gibson0
Amazon to hike annual Prime – and Prime Video – price $20 on May 11
Amazon is increasing the price of its annual Prime membership that includes its Prime Video service from $99 to $119 starting on May 11, marking the second price hike in the programs 10-year-plus history.
The company announced the price increase Thursday on its first quarter earnings conference call, saying the increase is due to the service’s overall rising costs.
Amazon Prime, which has more than 100 million members worldwide, gives members free two-day shipping on a variety of products, as well as access to exclusive TV shows through the Prime Video app on Apple TV, movies, and music.
New users will have to pay $119 for Prime starting on May 11, though existing Prime members will have until June 16 to renew their membership at the current $99 price-point, the company announced.
Amazon Prime Video has been available on Apple TV since December 2017.
But despite the revelation the company has rising costs, Amazon’s confirmed in its first-quarter earnings that “subscription services revenue,” which includes Prime memberships, grew 60 percent to $4.1 billion. As for the company overall, it more than doubled its profits in the quarter to $1.6 billion—just under its record of $1.9 billion from the holiday fourth-quarter—as revenue surged about 43 percent.
While saying Prime’s value “has never been greater,” Amazon chief financial officer Brian Olsavsky tried to head off criticism of the move revealing that “the cost is also high” for shipping and the digital benefits of service like Prime Video.
“We continue to see rises in costs,” Olsavsky commented. “Prime provides a unique combination of benefits, and we continue to invest in making this Prime program even more valuable for our members. As a reminder, we haven’t increased the U.S. annual price Prime since our single increase, which was in March of 2014.”
Amazon Prime Video has been available on Apple TV since its much-talked-about debut in December of 2017. Within days the app was the most downloaded of any tvOS app ever in its first seven days.