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Word Count: 293
America Online To Unveil Flat Fee For Internet Access The Internet is becoming more popular and more widelyused and the Market for internet access is growing rapidly To stay competitivein this fast-moving industry America Online has announced that they willswitch their price plan for internet accessto a flat-fee rate of 1995per month After the changed in price decrease the Supply curveS will shift to S1 An increase in Supply curve will increase Quantity people using America Online and decrease Price America Online has announced a change to their price planfor internet access before they charged a rate of 1995 for only 20 hoursof internet access One of the many reasons is that it could help the serviceagainst Internet competitors by doing this Keith Benjamin says there maybe some short-term negative impact on margins Negative impact on marginsmeans that there will be decrease in earnings Another reason for this pricingmove is part of a broader effort to add new features to the service and makeit more compelling than rivals Since America Onlines price is lower people willtend to use America Online more This is a competitive market as AmericaOnline lowers their price other competitors will lower their price tooThis will happen until they reach the Equilibrium By staying in this fast-moving industry America Onlinehas unveiled a set of features that include enhancements to listening toaudio on-line better methods for viewing video on-line and tools for mediacompanies to spruce up their on-line fare In Addition to that America Onlinealso expected to unveil another initiative whereby Internet-service providerscould offer their subscribers easy access to America Online in return forad revenue
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