Prodigy to Hike Its Rates, Offer More Services

The Prodigy electronic information service today will announce price increases and a host of new features. The moves are meant to draw more computer users to the fast-growing service while providing much-needed financial help.

Prodigy, introduced nearly two years ago, also will trumpet its “nationwide rollout.” Starting today, more than 90% of U.S. households will have access to Prodigy with a local, toll-free phone call, company officials say. Previously, Prodigy was available toll free to 65% of the nation’s homes, including most of Southern California.

Backed by IBM and Sears, Roebuck & Co., Prodigy is the nation’s No. 2 “on-line” service for home computer users. It claims 465,000 subscribers in 267,000 households, second only to Compuserve, which serves 580,000 households.

Prodigy has made an unprecedented effort to hook a broad cross-section of consumers on computerized shopping, stock trading and other electronic publishing features.

But the venture has yet to turn a profit and by one account has produced $750 million in losses--a figure called a “gross overestimate” by Prodigy. Critics have questioned whether Prodigy charges subscribers enough and also fault it for limited features and technical shortcomings.

In response, Prodigy officials confirm that today they will announce new features including an encyclopedia and an expanded Consumer Reports library.

The price for Prodigy services, however, will rise for some subscribers. Until now, subscribers have paid $9.95 a month. Now, if they continue to pay on a monthly basis, the charge will rise to $12.95.

But subscribers now also can buy a one- or two-year subscription: a one-year subscription would cost $119, the equivalent of $9.95 a month, and the two-year deal is $200, which equals $8.33 a month.

Also, Prodigy will scrap its policy of unlimited free electronic mail messaging. Instead, it will let users send, free of charge, up to 30 messages a month that go directly to other subscribers. Beyond that, it will charge 25 cents a message.