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I thought I'd pass along word of the cost increase seeing as it was a recent front-page topic. I received an email stating my renewal next year will be at $99 due to the increased fuel usage and the popularity of Free second day shipping. It might actually take me 2 months now to have it pay for itself . Actual text below:

Amazon Prime Email wrote:

We are writing to provide you advance notice that the price of your Prime membership will be increasing. The annual rate will be $99 when your membership renews on February 25, 2015.

Even as fuel and transportation costs have increased, the price of Prime has remained the same for nine years. Since 2005, the number of items eligible for unlimited free Two-Day Shipping has grown from one million to over 20 million. We also added unlimited access to over 40,000 movies and TV episodes with Prime Instant Video and a selection of over 500,000 books to borrow from the Kindle Owners' Lending Library.

I still think it's easily worth it. For those of you that didn't know, they allow a few other accounts to be tacked onto your own to give out the free second day, prime, etc on. So you essentially could go in on the Prime membership with some friends for $25 a piece. The actual text says "invite up to 4 other family members living in the same household" - not that I have abused it but I haven't lived with my parents in some time, but they get great use out of it. Do note that prime benefits as far as streaming etc do NOT extend to those you share it with.

It's still $79 at the time of this posting however, so if you were considering it now is better than later!

I got this email as well. I, as well, still think it's more than worth it.

Given how much of my consumption of goods flows through Amazon and the video watching the wife & kids do it'd be cheap at twice the price.

FWIW, my membership renews this year in October. It did say the price hike would apply to that renewal if I chose to renew it then. So, I'm not sure when the date is that this is going into effect.

edit: also, we should talk to bruno about all the extra space in signatures now. It seems to only be happening with the new subscribers stuff.

DancinJack wrote:

also, we should talk to bruno about all the extra space in signatures now. It seems to only be happening with the new subscribers stuff.

It's not extra space in signatures, it's just the subscriber graphic on the left makes the minimum post size bigger, compare the first post from Steelcity with Ned's post.

notfred wrote:

DancinJack wrote:

also, we should talk to bruno about all the extra space in signatures now. It seems to only be happening with the new subscribers stuff.

It's not extra space in signatures, it's just the subscriber graphic on the left makes the minimum post size bigger, compare the first post from Steelcity with Ned's post.

I noticed that, and was wondering. Thanks.

Lemme adjust by pixels!

Still a damn good deal and I'll keep my membership up.

edit: I guess it'll depend on what you use it for. We have prime and a subscription to size 5 diapers and wipes, which saves a *lot* of money vs regular store prices, plus free shipping on books and heat mats and UV lights for my reptiles. But if you primarily use it for streaming, I can see this making you switch to Netflix

I'm pretty sure the shipping alone has paid for it, and I like to stream video every so often, and my wife borrows stuff from the Kindle lending library constantly. So overall at $99 it's still a great deal.

Amazon has problems. They haven't been profitable since, well, ever. This small increase won't help them. Frankly I don't think Prime is worth it because their regular free shipping is, well, free.

Vrock wrote:

Amazon has problems. They haven't been profitable since, well, ever. This small increase won't help them. Frankly I don't think Prime is worth it because their regular free shipping is, well, free.

They have to be turning a profit somewhere or else their stock wouldn't be at 371 per share. Heck even their P/E ratio is at 635. (although it could be overpriced for the high P/E but scanning the financials I dont think so.)

2013 they made like 275 Million or something, I think. Not much, but still a profit.

We'll be keeping our membership as well.

I use it to watch old tv shows (remember when people actually bought DVD seasons), and of course for the free shipping.

It's great value as far as I'm concerned.

I think Amazon's share price reflects their goal of increasing sales at the expense of margins. They are the opposite end from Apple in that way. If you remember the sprint commercials from the 80s and 90s... volume.

And, there was a great SNL parody of those commercials about a company that makes change when you need change for the bus, toll booth, or public phone.

tanker27 wrote:

Vrock wrote:

Amazon has problems. They haven't been profitable since, well, ever. This small increase won't help them. Frankly I don't think Prime is worth it because their regular free shipping is, well, free.

They have to be turning a profit somewhere or else their stock wouldn't be at 371 per share. Heck even their P/E ratio is at 635. (although it could be overpriced for the high P/E but scanning the financials I dont think so.)

Right, because investors have never buoyed a company on faith before!:D

Seriously though, there are two schools of thought on Amazon. One says that they could be profitable tomorrow if they wanted to, but instead they re-invest their revenue on growth and innovation, with the intent of clawing their way to the top of the heap. Once they are there, they "flip" the profitability switch, and bam! Profit.

The other viewpoint is that their business model is fundamentally unprofitable and will remain so until they fold. Many in the investor community are coming around to this line of thinking. Fact is, Amazon has only turned a profit for a handful of quarters since they've been in business. And they've been in business for a while now. If they could be profitable, they would be. Now, I don't think they'll fold overnight, but their stock is way out of line with reality. If a traditional retailer continually reported earning like that, they'd be slaughtered. Why is Amazon different? The company admits that they lose money on Prime memberships and that shipping in general hurts them. This price increase won't change that.

DancinJack wrote:

2013 they made like 275 Million or something, I think. Not much, but still a profit.

Sorry, I was referencing the all important 4th quarter, where they tanked, and profitability in general since they started up. They had $274 million net income on $74.2 billion for 2013. Anemic at best.

Vrock wrote:

Seriously though, there are two schools of thought on Amazon. One says that they could be profitable tomorrow if they wanted to, but instead they re-invest their revenue on growth and innovation, with the intent of clawing their way to the top of the heap. Once they are there, they "flip" the profitability switch, and bam! Profit.

As an investor and a consumer I am ok with this. Any new company should reinvest in itself for growth. Established businesses should reinvest for innovation. This is how it should be done.

Vrock wrote:

The other viewpoint is that their business model is fundamentally unprofitable and will remain so until they fold. Many in the investor community are coming around to this line of thinking. Fact is, Amazon has only turned a profit for a handful of quarters since they've been in business. And they've been in business for a while now. If they could be profitable, they would be. Now, I don't think they'll fold overnight, but their stock is way out of line with reality. If a traditional retailer continually reported earning like that, they'd be slaughtered. Why is Amazon different? The company admits that they lose money on Prime memberships and that shipping in general hurts them. This price increase won't change that.

I wouldnt be surprised if Amazon has some super secret (well not secret just not well known or publicized) arm of its business elsewhere like investments/funding. It's not unheard of for a business to look for other revenue sources outside of its 'normal' business.

NInja Edit: I just read that Amazon is planning its own fleet of delivery trucks to control its delivery and transportation costs. link