Amazon is raising the cost of Prime in the UK effective February 26, 2014. However, Amazon is offering a lower Prime price to new users if they sign up by the 26th. Try out the service with a free 30-day trial, and Amazon UK will charge the old rate of 49 pounds instead of the new rate of 79 pounds for a year’s membership.
Prime members in the UK are seeing the price increase in the wake of Amazon’s 2011 purchase of LoveFilm. That company’s offerings will become the linchpin in Amazon UK Prime’s streaming movie and TV service, which will provide unlimited viewing and access to such content across a broad variety of devices.
The rise in price likely comes about not only because of the addition of streaming video to Prime. In the US, Amazon Prime’s popularity will lead to a $20 to $40 annual increase in the annual fee, the company announced last month.
US Prime members have had streaming video as a feature for some time. Rather, the reason for the cost increase according to an Amazon earnings call reflects rising fuel prices and other costs associated with providing Prime’s core feature – free two-day shipping.
Setting a new price for Prime presents a challenge in finding a point where customers perceive the service to have ongoing value, while earning Amazon a good return. Amazon UK has an advantage in being able to point to new streaming video as an added benefit, something Amazon won’t be able to do should they try to pass along a higher price to US customers.