Amazon has announced an increase in the cost of its Prime subscription service for Australian customers.

Customers received an email from Amazon on Wednesday alerting them to the hike from $79 a year to $99 a year.

The ecommerce titan will begin billing the higher amount starting from the customers’ first renewal date on or after November 25.

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Amazon explained the price jump was to “continue supporting” the services offered with a Prime subscription.

“The range of products and benefits available through Prime has continued to grow,” Amazon’s email states.

The company explained the only change Prime customers will see is in the price, with its current services running as normal.

“All other parts of your Prime membership stay the same, including free delivery as fast as same day on eligible orders, Prime Video, Amazon Music Prime, Prime Reading, games with Amazon Luna, and member events such as Prime Day and Prime Big Deal Days,” the email reads.

An Amazon spokesperson told 7NEWS.com.au the price rise is in line with the expansion of features and benefits the service provides customers.

“Prime members in Australia love the combined value Prime gives them, including shopping, delivery, savings, deals and entertainment benefits in a single membership,” the spokesperson said.

“We are committed to growing the value of Prime for members, and in just the last six months we have brought Prime Free overnight delivery before 8am on hundreds of thousands of products to four cities, expanded Prime Free Same-Day Delivery available now in nine regions across Australia, added new TV series and movies to Prime Video plus live sport, given free access to Alexa+, provided exclusive deals through events like Prime Day, and more.

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“With the continued expansion of Prime member benefits, and so we can continue growing the offering, we will change the price of Prime to $12.99 per month or $99 per year. Prime has never offered as much value for members as it does today.”

Price hike follows court case, layoffs

It comes after Amazon was sued by the ACCC in June for allegedly leaving Prime Video customers with no choice but to pay more if they wanted to avoid ads under allegedly unfair contract terms, according to a lawsuit.

The lawsuit alleges contracts with more than a million Prime subscribers contained five unfair contract terms, one or more of which it relied on to introduce ads in July 2024.

Amazon has announced it is increasing the cost of its Prime subscription service to $99 per year. Credit: AP

“It is also alleged that Amazon AU later relied on one or more of these unfair terms when it introduced ads to Prime Video in Australia in July 2024,” the ACCC said.

“Prior to that, Amazon Prime Video was almost entirely ad-free.”

In January, Amazon’s senior vice president Beth Galetti revealed the company would be cutting about 16,000 jobs.

Galetti announced the worldwide cuts in a blog post, marking the second major round of layoffs in three months after the company paxed 14,000 jobs in October.

The company blamed artificial intelligence and concerns over shifting corporate culture for the October layoffs.