AOL changes mobile messenger pricing model

From...

By Rick Perera

(IDG) -- In a bid to boost sales of its wireless messaging device, America Online (AOL) is slashing the price of the AOL Mobile Communicator, but at the same time increasing the cost of monthly service.

The Mobile Communicator, which gives two-way access to e-mail and instant messaging services, will now retail to AOL subscribers for $99.95, with a monthly service fee of $29.95, the company said Wednesday. The device was priced at $329.95 plus $19.95 per month when it was introduced last November. The charges are in addition to AOL's regular monthly fees. (AOL Time Warner is the parent company of CNN.com.)

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When asked if the price slash was due to low sales of the Communicator, AOL spokeswoman Anne Bentley replied, "No, absolutely not."

"We have been testing pricing with the idea that the price would come down," Bentley said. "This kind of pricing curve is normal for mobile devices."

AOL would not disclose how many units of the product had been sold.

The company is also rolling out a new version of the software that drives the Mobile Communicator, with improvements including faster display of e-mail messages, time and date stamps on instant messages, and better indication of low coverage areas, the company said.

The device, which weighs 116 grams, features a built-in miniature keyboard and six-line display, and is manufactured by Research in Motion Ltd., based in Waterloo, Ontario.