1. A two part tariff

Charge everyone a fixed fee to belong to the system and a small (often zero) charge per unit of use of the system. This allows suppliers to set the marginal price equal to the (near zero) marginal cost, but cover fixed costs through the fixed fee for membership of the system Example Annual charges for belonging to America Online AOL or Compuserve, which then provide internet access free for usage during the year. This simply extends practices long used by BT (a monthly rental plus price-per-call), Sky (a monthly rental, subsequent viewing free, and special pay-per-view programmes for popular events), and the BBC (an annual rental, zero charges for marginal usage).

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