CompuServe beats earning estimates and moves to flat pricing

CompuServe posted a loss of $4.1 million today, compared to a loss of $29.6million in the same quarter last year. The loss was less than expected, butthe company also reported a loss in revenues, which it attributed to acontinuing fall in its U.S. subscriber base.

CompuServe also announced plans to change its pricing plan to a $24.95 flatfee, with certain value-added services carrying an additional charge. Thenew flat-fee pricing will begin in the United States and Canada on Octoberfirst. Though the new pricing is expected to hurt CompuServe's revenues inthe short run, most analysts think the company is back on track.

"We expect that the online services market will accelerate during the second half of this year, and will continue to grow rapidly during the nextthree to four years, with international subscriber growth being a primary driver," said Marc Usem, an analyst with Salomon Brothers