Nicole Nguyen reports in the Wall Street Journal:
Amazon has been ratcheting up the annual fee for Prime, from $79 a decade ago to $139 now. Delivery from Whole Foods, got hit with an extra fee in 2021. Last week, Amazon started inserting ads into Prime Video content—and charging customers an extra $2.99 monthly to eliminate them. In 2023, the company raised the shopping-cart minimum for free delivery on Amazon Fresh grocery orders from $35 to $150. Months later, after customer backlash, Amazon reset the minimum at $100. Many Prime benefits now come with a surcharge. a fully loaded Prime subscription with the add-ons could cost $320 a year. And that’s before you order a single bag of groceries for delivery.I had to escape a long-term relationship earlier this year. I broke up with
Prime.Maybe you’ve considered a similar split. Last week, Amazon started inserting ads into Prime Video content—and charging customers an extra $2.99 monthly to eliminate them. Some headed for the exits.
For me, my recurring costs were going up across the board, and a subscription audit revealed I wasn’t taking advantage of many of the membership’s offerings. Amazon has been ratcheting up the annual fee for Prime, from $79 a decade ago to $139 now. And my most-used perk, delivery from Whole Foods, got hit with an extra fee in 2021.
When I quit, I realized I could get Amazon deliveries free of charge, without a Prime membership. They just arrive a few days later.
Still, Prime feels like a deal because it bundles so many services together. Free and fast shipping. On-demand entertainment. Grocery discounts. But over the past few years, changes Amazon has made to the membership’s benefits—from new fees to higher delivery minimums—have many customers asking the same question I did: Is Prime still worth it?
Whether you’re getting a deal depends on how you use Prime’s benefits and how much you think you get in return for the price hikes. Read on for some useful math.
But wait, there’s less
It’s hard for consumers to assess the value of bundles such as Prime, and that’s by design, said Kirthi Kalyanam, a marketing professor at the Santa Clara University Leavey School of Business. Subscriptions are successful in part because many customers don’t keep track of usage or changing offerings—and often forget to cancel.
For them, said Kalyanam, “There is a lot of bookkeeping that needs to happen.”
If you adjust for inflation, Amazon Prime’s 2005 fee of $79 is about $127 in today’s dollars, less than the current $139. (If history is any indication, we can anticipate the next spike in 2026, to $159.)
AMAZON TAKETH AWAY
AMAZON GIVETH
2018
May: Prime subscription
fee increase
($99 to $119 a year)
2019
April: Free one-day
shipping
Oct.: Free Fresh
grocery delivery
(drops
$14.99-per-order
fee)
Nov.: Photos 100 GB storage fee increase
($11.99 to $19.99
a year)
2020
Nov.: Amazon Pharmacy free delivery and discounts
(up to 80% off
on prescriptions)
2021
Oct.: Whole Foods $9.95 delivery fee
2022
March: Prime subscription fee increase
($119 to $139
a year)
May: Music Unlimited fee increase
($79 to $89 a year)
Nov.: Prime Music library expansion (two million to 100 million songs)
2023
Feb.: Fresh increases delivery minimum ($35 to $150)
Aug.: Music Unlimited fee increase
($89 to $99 a year)
Oct.: Fresh decreases delivery minimum (from $150 down
to $100)
2024
Jan.: Ads on Prime Video (pay $2.99 monthly for no ads)
Source: the company
That price alone doesn’t tell you much, though. Amazon has added seemingly countless benefits since Prime launched as a “free” shipping deal. Of course there’s video and music streaming, and a growing library of books and magazines. In 2019, the company made millions of items available for same-day shipping to Prime subscribers. Later that year, it removed the $14.99 fee for two-hour Amazon Fresh grocery delivery orders $35 and up.
During the pandemic Amazon didn’t make big changes to its Prime offerings. According to the analytics firm Consumer Intelligence Research Partners, the number of Prime users in the U.S. grew from 112 million in 2019 to 176 million in 2023.
The company that giveth can also taketh away. In 2021, Amazon started charging that $9.95 Whole Foods delivery fee, citing operating costs. In 2023, the company raised the shopping-cart minimum for free delivery on Amazon Fresh grocery orders from $35 to $150. Months later, after customer backlash, Amazon reset the minimum at $100. Orders below that threshold can incur a delivery fee of up to $9.95. Non-Prime members still pay a delivery fee, no matter the order size.
Many Prime benefits now come with a surcharge. The freshest example: Paying $2.99 a month to remove ads in Prime Video that were never there before. Prime includes unlimited full-resolution photo storage, a fantastic perk, but it doesn’t include unlimited storage for your videos. If you exceed 5 gigabytes of video files, you need to buy a storage plan. Amazon has increased the fee on the 100GB plan twice in five years. It’s now $23.88 a year.
Amazon expanded its ad-free Prime Music catalog from two million to 100 million songs in 2022, in line with Spotify and other paid competitors. The catch: customers can no longer play songs on demand. Prime Music now functions as a Pandora-like radio station, on shuffle mode only. On-demand music requires an additional Music Unlimited plan, which also recently went up in price. It’s $9.99 a month.
In case you weren’t keeping track on your calculator app, a fully loaded Prime subscription with the add-ons above could easily cost you around $320 a year. And that’s before you order a single bag of groceries for delivery.
Keep or cancel?
“Prime has always delivered disproportionate value to its members and will always do so. We improve the membership each year with more selection, value and convenience,” said an Amazon spokesman. “Members recognize the appeal of Prime’s shopping, savings and entertainment benefits, and we continue to see strong benefit engagement and high renewal rates.”
Putting ads in Prime Video will enable the company to continue developing content and investing in the streaming platform over time, he added.
Every household has a different assessment of how much it gets from Prime. Frequent ordering alone might balance the cost. If you stream Prime Music daily, it’s a better deal than Spotify or Apple Music. As with anything, the less you use it, the more money you’re throwing away.
The math looks even better if you qualify for discounted Prime membership. Higher-education students and anyone ages 18 to 24 can join Prime Student. The first six months are free, followed by a $69-a-year fee, until you’re 25 or out of school. Eligible government assistance recipients can also receive Prime for $6.99 a month.
The best way to get your money’s worth is to share the benefits. You can add another adult and up to four teens to your Amazon Household. They don’t have to be family or live under the same roof. They’ll get free, expedited shipping and access to Prime Video and other perks, but logins and purchase history will remain separate. You do have to share payment methods, though.
I canceled because I hadn’t watched Prime Video regularly since “Fleabag” ended, and I found myself shopping at other retailers more often. Target,
and all now offer free two-day shipping on many items.When I do need something from Amazon, it’s easy to hit the $35 minimum for free delivery—and I don’t mind waiting up to five days for the items to arrive. Some orders even come in two days.
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