Amazon's stand-alone streaming targets Netflix

NEW YORK -- Amazon.com Inc. is taking on Netflix and Hulu with its own standalone video streaming service just weeks before Netflix raises prices for longtime subscribers.

New customers can pay $8.99 a month to watch Amazon's Prime video streaming service. Previously, the only way to watch Amazon's videos was to pay $99 a year for Prime membership, which includes free two-day shipping on items sold by the site and other perks.

At $8.99 a month, Amazon's standalone streaming service is $1 less than Netflix's standard membership and $1 more than Hulu's basic subscription.

Netflix said earlier this year a "substantial number" of its longtime members who paid $7.99 monthly -- and were protected from price hikes -- will pay an additional $2 beginning in May.

Amazon's decision to break off its video-streaming service could cause defections at Netflix, wrote Wedbush analyst Michael Pachter in a note to clients.

Both companies have invested heavily in original and exclusive programing. Netflix has "Orange is the New Black," "House of Cards" and a couple of series based on Marvel comic characters.

Amazon's offerings include "Transparent," "Mozart in the Jungle" and previously aired HBO shows.

With Hulu, users can watch many current TV episodes a day after they air on a network. Hulu also is growing its exclusive offerings, with "The Mindy Project" and "Difficult People."

Netflix Inc. declined to comment. Representatives for Amazon and Hulu did not respond to a request for comment.

Amazon may be a rival, but Netflix is an Amazon customer. The Los Gatos, California-based streaming company uses Amazon Web Services to store its content and help run parts of its site and apps.

Besides its standalone video service, Amazon is offering a pay-as-you-go option for its full Prime membership for $10.99 a month comes with free two-day shipping, video streaming and other perks.

Amazon's website said users who opt to pay $10.99 monthly, instead of the $99 annual fee, can cancel at any time. The $99-a-year option remains the cheapest way for most people to get free two-day shipping and video streaming, equaling about $8.25 a month.