Yesterday morning Amazon emailed it customers to let them know that its Prime delivery service, after more than nine years, was getting its first price hike, from $79 a year to $99. In some ways it seemed like a risky move. After Amazon first hinted it might raise Prime prices, a study conducted by analysts at Piper Jaffray found that 66 percent of customers said they would rather cancel their subscription or let it lapse than pay a higher fee. But a closer look at the marketplace, and human psychology, shows why Amazon felt confident it could increase its rates without suffering serious fallout.
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