There’s been much gnashing of teeth and annoyance at the appearance of this graphic on Amazon.co.uk a few days ago. I’m a big Amazon fan as a shopper, author stocked by them and seller but even I got a little hot under the collar when I discovered, not through the Learn more button but via their press release, that Prime was going to cost £79 for everyone from their next renewal.
In practical terms this makes absolutely no difference to me as I took up their offer of reduced-price Lovefilm Instant by linking to my Prime account last year, so I’m already paying £79. I reckoned that an extra £2.50 per month for instant video was worth it and, overall, it has been – especially when you compare it to the cost of buying DVD box sets.
So, I like to think I approach this from a pro-Amazon, or at least neutral, point of view. Initially I was bloody annoyed that there was no option, as previously, to have streaming video or to stick to the (essentially) post-only version. But, as I thought about it and looked through the arguments on Amazon’s forum (most of which included the intention to unsubscribe) I came to believe I could see what was happening here.
Here’s the thing: Amazon, in my view, sees itself as a digital media company in the medium to long term. Hence its range of ereaders and tablets – all sold at cost. From its perspective, Prime only makes sense if it’s made up of customers who share this vision – committed, digitally aware, profitable customers. If, when faced with the prospect of free next day postage, free Kindle lending library titles and instant video for a year, a subscriber decides, for whatever reason, £79 is too much – Amazon will be happy to lose those Prime customers. There are many good reasons why people would want to unsubscribe – dodgy broadband or the fact that they’re already signed up to Netflix for example – and that’s absolutely fine by Amazon because their Prime postal service isn’t profitable at £49 per year so either way the cost was going to rise.
For Amazon, it makes more sense to nurture a smaller group of committed customers eager to consume digital content than a larger group using the service purely for the free postage of old media. Amazon may have begun as a company shipping physical books and this will remain a massive part of its business for many years but I believe their mid to long term goal is to be entirely digital so their Prime is now a “like it or lump it” service aimed to appeal to people like me who just can’t get enough digital content options.