Amazon Prime’s price bump is only half as much as expected

The price of an Amazon Prime membership was raised Thursday, but only half as much as the online retailer had said it was considering a month ago. Amazon announced the annual membership will now cost $99 a year, up from $79. A student membership will cost $49 annually. In February, Amazon said it was considering raising the price to $119 a year. The company said blamed the increase on increase fuel and shipping costs. 

Amazon has announced that the annual membership for Prime will increase from $79 to $99 starting next week. The change marks the first time that the fee has gone up since the free two-day shipping service launched in 2005. Since then, however, the company has also been adding perks, including a catalog of movies and TV shows available for streaming and the option to lend up to one Kindle e-book a month. The company first hinted at the move in an earning’s conference call with analysts back in January, when Chief Financial Officer Thomas Szkutak said they were considering a $20 to $40 price hike. Szkutak explained that the increase had more to do with rising transportation costs and customers using Prime shipping more, rather than covering costs associated with Prime Instant Video or the Kindle Owners’ Lending Library.