| AOL Time Warner (AOL 49.38 +0.93) (TWX 73.76 +1.16): After almost a year, the FTC has unanimously voted to approve the merger of the country's largest ISP and the country's largest media content provider. Antitrust concerns have lead to the attachment of significant conditions to the approval. After the Earthlink deal, AOL has 90 days from the time AOL appears on TWX's cable system to sign two more ISPs to access deals -- this was no surprise. Furthermore, in Time Warner's smaller cable divisions, the company will have to sign at least three non-affiliated ISPs within 90 days after making AOL's broadband service available. In addition, after the first three ISPs are signed, the company must negotiate with any other ISP that wants to provide service on their cable lines. AOL Time Warner will be allowed to nix a deal only for technical reasons such as bandwidth capacity constraints, in other words, competitive or financial considerations are not sufficient to refuse a deal. AOL is also required to charge the same or a comparable price for DSL service in Time Warner cable areas where AOL cable broadband ISP service or RoadRunner is available as AOL charges for its DSL service in areas in which neither AOL cable broadband ISP service nor RoadRunner is available. AOL must also equally market and promote DSL services in such areas. Regarding Interactive TV content, the company is prohibited from interfering with or discriminating against content on their cable lines from competing ISPs. The main concern that we had brought up a few times as a potential deal breaker, equal access to TWX content for other ISPs, is thankfully absent from the conditions. The FTC approval was the major hurdle, but FCC approval is still required and expected to come by the end of the month. While approval was largely expected by analysts and the investment community, today's announcement is a big victory, not only for the company, but for the future of broadband media. - Matt Gould, Briefing.com |
