Title: Amazon Prime Was Too Good to Be True After All | WIRED
Headings: Amazon Prime Was Too Good to Be True After All
Amazon Prime Was Too Good to Be True After All
Amazon really has no choice but to raise the price of its "free" two-day shipping program. The irony is that Amazon Prime has worked out just like Amazon wanted it to.
Amazon's Growth Engine Needs a Tune-Up
Profits Aren't Even the Problem

Content: When customers spent more, Amazon's volumes increased, so it could lower shipping costs and negotiate new deals with vendors." Stone writes. " That saved the company money, which would help pay for Prime and lead back to lower prices." Amazon's Growth Engine Needs a Tune-Up
But now that cycle appears to be breaking down. The first sign may have been the Christmas 2013 shipping debacle that led Amazon to offer $20 gift cards to customers whose orders came late. Amazon itself denied culpability, blaming the carriers. But it's hard not to see the specter of overpromising in those million pre-Christmas Prime sign-ups. Shipping rates can't get any lower once the system is maxed out. Exclusive Offer
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Even though there's no other indication that Prime's fabled reliability has otherwise been compromised, the price of keeping its two-day promise has apparently become too much for Amazon to bear.