Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: E. Davies who wrote (14582)	8/16/1999 12:48:00 PM
From: Ron Dior	Read Replies (2) \| Respond to of 29970

August 16, 1999 12:00am AOL In Talks With AT&T, MCI By Steven Vonder Haar and Louis Trager Inter@ctive Week America Online, seeking new ways to access broadband networks and sell long-distance services online, is negotiating with both AT&T and MCI WorldCom over a range of possible business combinations, according to industry executives familiar with the discussions. AOL's talks with the long-distance giants set the stage for the company to forge a far-ranging alliance that would make AOL accessible via the broadband connections it covets while providing its partners a platform for marketing traditional long-distance services to AOL subscribers. While industry analysts have said that any partnership likely is months away from completion, AT&T acknowledged last week in a statement it has engaged in recent talks with AOL on issues related to access on high-speed data services delivered via AT&T's cable television systems. But AT&T added that "no formal proposal" is currently under discussion with AOL. AOL and MCI WorldCom officials declined comment. One hostage of the ongoing AOL talks appears to be the Excite@Home service, which now holds exclusive rights to deliver packaged high-speed access services via AT&T's cable systems through 2002. AOL has been spearheading aggressive lobbying efforts to win rules that would open AT&T's network to other content providers. AT&T said that it will stand by its exclusivity arrangements with Excite@Home but is open to negotiating partnerships with outside companies that would take effect once the Excite@Home deal expires. Judging AT&T's intent based on its statement last week, though, is a matter of interpretation. By publicly stating intentions to open its network, AT&T could be turning up the heat on Excite@Home so that it can broker its deal with AOL. "AT&T would be in trouble if they tried to shake out the minority [Excite@Home] shareholders for their own benefit," one source familiar with AOL's talks said. "So they are saying: 'Play, or we will kill you in two years.' " Others, such as Lehman Bros. Internet analyst Brian Oakes, see the pronouncements as stonewalling by AT&T designed to deflect political pressure mounting on AT&T to open its cable network to outsiders, creating more time for Excite@Home to build its franchise in the broadband space. Ultimately, though, a partnership with AOL would make sense for AT&T as it seeks to build traffic volume. "[AT&T Chairman C. Michael] Armstrong doesn't want to be a content guy," Oakes said. "He wants to be a pipe guy." Dealing with MCI WorldCom could be a risky proposition for an AOL seeking access to AT&T's cable systems. While MCI WorldCom is growing its base of wireless broadband offerings, it offers a fraction of the broadband distribution held by AT&T following the latter's acquisition of cable giant Tele-Communications Inc. earlier this year. If AOL partners with MCI WorldCom, "AT&T for sure would cut them [AOL] out of a future deal" involving AT&T's crucial cable network, the industry executive familiar with the talks said. Ron Dior