Amazon Is Raising Prime Membership Prices

Amazon is raising the price of Amazon Prime memberships for the first time in four years. The price increase reflects not just content production, but also live sports streaming and its other program benefits, including Prime free shipping, Amazon Music, Prime Reading, Prime Gaming and Amazon Pharmacy. 

The company is increasing the cost of an annual membership by $20 to $139, reports The Hollywood Reporter. Monthly memberships will cost $14.99 per month, or $2 per month more than before. During Amazon's earnings call on Thursday, CEO Brian Olsavsky said the price hike will pay for new Prime Video content, as well as the hefty TNF contract, which kicks in for the 2022 regular NFL season in September. The new costs will go into effect on Feb. 18 for new members and after March 25 for current Prime members, reports CNN.

"Since 2018, Prime Video has tripled the number of Amazon originals," Olsavsky told analysts. "The continued expansion of Prime member benefits, and the increased use we have seen, along with increased costs and inflation" played roles in the decision to increase prices for the first time since 2018. Aside from the new content, Amazon has expanded the same-day delivery options and added other benefits like pharmacy and grocery delivery.

The Thursday Night Football deal will reportedly cost Amazon $1 billion. Amazon is also adding pricier shows like a new Lord of the Rings series that is expected to cost about $500 million for the first season. The Boys and Wheel of Time also aren't cheap to produce. Amazon thinks it's all worth it though, as over 200 million Prime members worldwide have streamed Prime Video content, the company said.

Amazon reported $137.4 billion in net sales and $14.3 billion in net income during the fourth quarter of 2021. Over the span of the past year, Amazon reported $470 billion in net sales and a $33.4 billion net income. Amazon also revealed advertising revenue for the first time, reporting $31 billion for all of 2021.

Last month, Netflix announced it would increase its prices by $1 or $2 per month, depending on the plans. The price increase went into effect almost immediately for new subscribers after it was announced. The basic Netflix plan now costs $10 per month. The standard plan, which includes HD streaming, will cost $15.50 per month. The premium plan is now $20 per month, and includes Ultra HD streaming and allows subscribers to stream on four screens at once.