AOL to Offer New Price Plan; TV Foray Planned

America Online Inc., the No. 1 online service, plans to announce today a new pricing plan and its first foray into the television business as it attempts to fend off increasingly stiff competition from the Microsoft Network and other Internet service providers.

Under the new pricing scheme, AOL will charge $19.95 a month for unlimited access time, sources said. Current rates are $9.95 for five hours or $19.95 for 20 hours, plus $2.95 for every additional hour. Microsoft announced similar pricing changes last week.

AOL executives would not confirm the new plan Monday. The company is expected to announce a series of strategic initiatives today.

For its new television effort, AOL will join forces with onetime NBC programming whiz Brandon Tartikoff to develop projects for TV, online services and books.

The first project, “Beggars and Choosers,” about intrigue and back-stabbing at a television network ranked last in ratings, will air on Showtime in 1997 as a made-for-TV movie. Its story will be published by Hearst Corp.’s Avon Books.

“AOL has acknowledged for quite some time that they need to diversify their revenue stream,” said Adam Schoenfeld, a senior analyst at Jupiter Communications.

“The model of owning proprietary content and housing it on proprietary servers has changed. Consumers now really want Internet access, which is more of a commodity.”

That leaves online service providers such as AOL slashing prices and looking for new venues where they can make money. The Dulles, Va.-based firm’s stock closed at $24.625 on Monday, half the price at which it traded in June.

AOL and Tartikoff are also developing a game show for kids and a pop culture magazine.