As expected, Amazon.com raised the fee on its Prime service by $20 to $99 a year. Prime, with some 20 million members, offers two-day shipping for millions of items at no extra cost, as well as free access to its streaming video service.
The move brings risks, chiefly that many members will go away. On the other hand, as the Seattle Times’ Jay Greene reported, when Amazon announced the move Thursday its shares rose while the broader market declined. They climbed again this morning.
There’s controversy, such as lawsuits alleging that Amazon encourages sellers to inflate prices. And a big question about how far the company can push customer loyalty. But many analysts and investors say that Amazon is finally getting serious about making money and improving its margins.
What do you think?
This Week’s Links:
• How Bank of America is killing the paper check | Wonkblog
• Silicon Valley’s youth problem | NY Times Magazine
• Why are so many traders killing themselves? | The Big Picture
• The free market’s weak hand | Baseline Scenario
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Today’s Econ Haiku:
Lawmakers are like Greek gods