To be fair, Amazon Prime is pretty competitively priced when you consider all the benefits you get for the subscription. I'm sure the reason they aren't raising the price of Prime is because of the way Prime is bundled into the shopping experience and their other services.
I'm not thrilled with downgrading the quality of service (by adding ads) or forced price hikes, but this doesn't seem like a terribly egregious thing to me. What makes it distasteful is that we know the reason is because Amazon is "penny pinching" to keep its profits high - it isn't really hurting financially so it doesn't actually have to do this.