Untitled Essay, Research Paper

America Online To Unveil Flat Fee For Internet Access The Internet is becoming more popular and more widely

used, and the Market for internet access is growing rapidly. To stay competitive

in this fast-moving industry, America Online has announced that they will

switch their price plan for internet access.to a flat-fee rate of $19.95

per month.

After the changed in price (decrease), the Supply curve

“S” 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 plan

for internet access. before they charged a rate of $19.95 for only 20 hours

of internet access. One of the many reasons is that it could help the service

against Internet competitors, by doing this “Keith Benjamin says there may

be some short-term negative impact on margins.” Negative impact on margins

means that there will be decrease in earnings. Another reason for this pricing

move is part of a broader effort to add new features to the service and make

it more compelling than rivals. Since America Online’s price is lower people will

tend to use America Online more. This is a competitive market as America

Online lowers their price, other competitors will lower their price too.

This will happen until they reach the Equilibrium. By staying in this fast-moving industry, America Online

has unveiled a set of features that include enhancements to listening to

audio on-line, better methods for viewing video on-line, and tools for media

companies to spruce up their on-line fare. In Addition to that America Online

also expected to unveil another initiative whereby Internet-service providers

could offer their subscribers easy access to America Online in return for

ad revenue.