I think when you have millions of people paying you all at once, you can drop your prices to be competitive. There are many people who would rather pay the membership fee for the year in order to have access to: Free 2 Day Shipping and Amazon Prime Video and whatever else they offer.
It is a win for Amazon: People who get free shipping are probably making more purchases on Amazon than those who hesitate because of a shipping cost.
It is a win for Amazon: People who get free shipping are probably making more purchases on Amazon than those who hesitate because of a shipping cost.