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Amazon.com, Inc. (NASDAQ:AMZN) has raised the Prime membership fee on Thursday, but in relief to the users the increase is only the half of which the retailer said it was considering a month ago. The online retailer announced that the annual membership has been increased from $79 previously to $99 a year, and for a student the membership will cost $49 annually.

“For the first time since it was introduced nine years ago, the price of Prime is going up. ………. Current members will still receive all the benefits of Amazon Prime, including unlimited FREE Two-Day Shipping for eligible purchases, unlimited streaming with Prime Instant Video, and the ability to borrow books from the Kindle Owners’ Lending Library.”

Prime membership fee unchanged for last 9 years

Amazon.com, Inc. (NASDAQ:AMZN) said that it was considering raising the price to $119 a year, in February. Prime members get many benefits including two-day shipping on many items without an extra charge, borrowing Kindle books, streaming movies and television shows.

The retailer blamed the increasing fuel and shipping costs as the primary factor responsible for the rise in fee. Amazon also said that the price of the Prime membership has not been changed since it was launched nine years ago.

Some experts are speculating that some of the members might drop their service owing to a higher fee, which will be good for the traditional brick and mortar retailers, who have been facing downturn due to Amazon’s quick, free delivery and wide product offering. However, even at a higher rate, Prime membership may be beneficial for the users, depending on the frequency they utilize the benefits offered under the membership.

Benefits have also increased

Apart from increasing the price, the company said it has increased the benefits under the membership. Nine years ago, only one million items were eligible for free shipping, but, now, the list includes 19 million items.  Also, in 2011, the company launched the video streaming service, and recently it came up with the Amazon-produced shows.

According to the company, the Prime offering has become so popular that it restricted the new Prime membership registration in December, which is the peak period. The increase in price would surely bring in additional revenue for Amazon.com, Inc. (NASDAQ:AMZN), and will help it in coming up with the same-day delivery model.