ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Monday, November 4, 1996 TAG: 9611040032
SECTION: BUSINESS PAGE: A-7 EDITION: NEW RIVER VALLEY
DATELINE: NEW YORK
SOURCE: Associated Press
MEMO: NOTE: Shorter version ran in Metro edition.
America Online's attempt to spiff up its service by offering a flat-rate price is drawing fire not for what it will do, but for what it won't.
The on-line provider won't be asking subscribers whether they want to switch over to the new service, but will double their rates automatically unless the user takes the initiative to notify the company otherwise.
``How can they not notify you?'' asked AOL user Marcia Gelbart, a senior editor at the Hill newspaper in Washington. ``That really aggravates me.''
``I just wish they were more straightforward about it.''
AOL also won't continue giving free time to its ``guides,'' the volunteers who police areas and offer newcomers a helping hand, prompting the guides to talk about striking.
The nation's largest on-line service announced this week that it will offer a new $19.95 monthly fee, effective Dec. 1, that will provide unlimited access to America Online's electronic services as well as the Internet.
What the announcement didn't say was that its 7 million subscribers, who currently pay $9.95 a month for 5 hours and $2.95 an hour thereafter, will automatically be switched to the $19.95 plan unless they contact the company.
Subscribers are being notified of a change in pricing in the monthly e-mail from AOL Chief Executive Steve Case. The letter can also be accessed from the AOL opening page.
In his four-page letter, Case explains that AOL is offering new pricing, and lists three new options:
* A standard monthly plan of unlimited use of AOL and the Internet for $19.95.
* A ``bring-your-own-access'' rate of $9.95, offering unlimited access to AOL features for those who already have an Internet connection.
* A light-usage program offering 3 hours of AOL per month for $4.95, with additional time priced at $2.50 per hour.
What the letter doesn't do is make any mention of the extra effort needed to avoid the higher rate. Members have to ask for more information, then comb through a list of topics such as ``What is the default pricing plan?'' to find out their rates will go up unless they ask to remain on the current plan.
Another prompt, ``Can I keep my current $9.95 basic plan?'' informs the user that, ``We will grandfather you to your $9.95 plan upon your request'' and goes on to say that the request must be made by March.
Calls to AOL headquarters in Dulles, Va., were not returned Friday.
Jack Gillis, a spokesman for the Consumer Federation of America in Washington, said the new unlimited pricing structure will ultimately be good news for America Online users, but that the complex way the information is being provided is unfair.
``They can change their price as long as there is full disclosure,'' he said. ``While disclosure may mean the letter of the law, it could be that it's not in the spirit of giving consumers the information they need to make an informed choice.''
He said the good news is that the flat-pricing structure may be good for inexperienced on-line users who could run up huge monthly bills with the $9.95 fee for five hours and then $2.50 charge for each additional hour.
He said AOL users will have to assess their needs, just like they do when choosing a long distance company for their telephone, and decide which plan ultimately offers them the best deal.
The AOL guides are upset about the new pricing plan because they will no longer receive free time in exchange for their service. Instead, they will get a discount on the $19.95 plan.
Richard Pettys Jr., an AOL guide based in Atlanta, said the savings will mean he'll be working for about 40 cents an hour.
The guides are volunteer AOL members who agree to watch areas of AOL, help newcomers and enforce the AOL ``terms of service,'' which means they check for profanity and other violations.
Pettys said the guides are planning a strike in protest.
LENGTH: Medium: 74 linesby CNB