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Amazon Prime cost jumps nearly 20 percent for monthly subscription

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Isiah Jone
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The online retailer on Friday said it raised the monthly fee for Prime to $12.99 from $10.99, up 18 percent and effective immediately.

Customers of the Prime service, now estimated to reach 90 million US households, routinely spend about twice as much on Amazon as non-Prime shoppers.

With Prime serving as Amazon's engine for retail sales and customer loyalty, any price hikes come with risk of a blowback from consumers.

But, with Amazon's shipping costs constantly increasing, the e-commerce giant also needs to balance customer satisfaction against its own bottom line.

An Amazon spokeswoman said the increase resulted from Prime members' "tremendous appetite" for Prime benefits including unlimited two-day shipping, as well as Amazon's continued investment in Prime perks.

Friday's price increase is the first one Amazon has instituted since it created the monthly payment option in April 2016.

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