Let's talk about the Amazon Prime price hike

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Source: Amazon

By now I'm sure you've heard that Amazon is raising the cost of its Prime service from $79 to $99 starting on April 17th, 2004 (for renewals; new subscribers only have a few days to get the old price). Amazon sent out emails to customers pointing out that despite rising costs and adding features to the service, this is the first price increase since the service launched in 2005.

It's a fair point, isn't it? If you're a Prime member, what do you think of the price increase? Will it cause you to re-think renewing? Please share your thoughts in the comment section below.

For me the increase comes at a bad time in my relationship with Amazon. I've actually been a Prime member since the program started and I was happy to pay $79/year for 2 day shipping when that was all you got for your money. Since then they've added Amazon Prime Streaming and Kindle book borrowing to the service. I use the former somewhat regularly.

For years I've been a hardcore Amazon user. The UPS delivery person and I are on very close terms. I get everything from Amazon, right down to my morning coffee (via 'subscription' delivery of T-discs for my Tassmio coffee maker). It's not unusual for Amazon packages to arrive at my apartment 3 or 4 times a week.

But recently two things have changed. The first is that Amazon started collecting sales tax in my state. That's not really their fault, but it still means pricing on everything effectively jumped up for me. The second thing, though, is on Amazon. They've started utilizing the US Postal Service for their deliveries. They send a package from the Amazon warehouse to the local USPS office, who then delivers the package to me.

The problem is that my '2 day Prime shipping' has been turning into 3 or 4 day shipping regularly, and packages sometimes takes as much as a week to arrive. Amazon delivers them to the local Post Office promptly but the mail carriers don't seem in much of a hurry to actually deliver these packages.

I know these are definitely #firstworldproblems but I can't help but be irked when I choose 2-day delivery and something takes a week to arrive. If I really need something quickly I now pay for next day delivery, and admittedly Prime gets you a solid discount on that. But now I'm paying shipping and sales tax and suddenly it makes sense to just get into my car and drive to a store and get what I need there. Same day delivery and much better for the local economy!

And that's where my head was at when Amazon announced the Prime pay raise. So is it still worth it? I'm fortunate, I guess, because my Prime membership just renewed earlier this month, so I have almost a year to decide.

I think it'll come down to how much Amazon Streaming I watch. $99 breaks down to $8.25/month. If you think about it as just the cost of streaming, it's only 26 cents/month more than Netflix ($7.99/month for streaming). A few years ago I don't think there was enough on Amazon Streaming to justify paying essentially the same as Netflix, but last year I used Prime Streaming to watch 17 seasons of various Stargate shows, and three seasons of Downton Abby (neither of these was available on Netflix). That's easily $100 worth of streaming. Plus Amazon keeps adding exclusives (most recently, BBC's Orphan Black which you should check out if you haven't yet).

If I had to decide today I'd probably cancel Prime in a fit of pique, but by next March I'll probably just let it renew. But if this is really about fuel costs, maybe Amazon should offer a $79 Prime tier that doesn't include 2-day shipping but does include Amazon Streaming Video and Kindle book borrowing.

So that's me and my situation, but what I really want to know is what you think. Are you sticking with Prime or ditching it? Any why?

Read more of Peter Smith's TechnoFile blog and follow the latest IT news at ITworld. Follow Peter on Twitter at @pasmith. For the latest IT news, analysis and how-tos, follow ITworld on Twitter and Facebook.

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