Time Warner finally, after all this time, realized that they are far behind other big players on the market and decided to make AOL free.

This move comes as they want to boost the online advertising sales.

“This is the next logical step for AOL to capitalize further on the explosive rise in broadband usage and online advertising,” said Time Warner President and Chief Operating Officer Jeff Bewkes.

The AOL transition is set to be completed in early September and the services to be offered for free include e-mail, instant messaging, a local phone number with unlimited incoming calls as well as safety and security features. AOL said it would continue to offer dial-up Internet access but will not aggressively market the service.

AOL tried to reinvent itself a few times until now in their attempt to keep the pace.

“AOL has gone through at least four revisions of how it was going to evolve as people connect (to the Internet) via broadband instead of via dial-up,” said Joe Laszlo of JupiterResearch.

“AOL’s core strategy is still dial-up…but (dial up) is clearly waning and they do need to find a way to stay relevant in the broadband world,” he said. “Longer term, the AOL strategy is definitely one of being a media company that maybe makes a little money on the side off subscription revenues.”

AOL is also partnering with those companies it can’t beat. For instance, the company made a deal with Google late last year in which Google will pay $1 billion for a 5 percent stake in AOL. The deal also involves partnering on ads, search, instant messaging and video.

They try to attract many people to their portal because we all know that the more visited your webpage is, the more bucks you get from ads revenues.

To do this, AOL said on Monday that it would preview a new video portal with more than 45 on-demand channels, a programming guide, video search and the ability to upload and share video.