Feeds

FTC mutes AOL/Time Warner wedding bells

Uncle Sam to demand a prenup on broadband

  • alert
  • submit to reddit

Designing a Defense for Mobile Applications

US Federal Trade Commission (FTC) lawyers are prepared to challenge the proposed merger between AOL and Time-Warner unless the betrothed assent to liberal policies governing access to their broadband networks by competitors. Otherwise, consumers located in regions where Time-Warner dominates cable lines could find themselves inundated by AOL/Time-Warner TV programming and Web content, the Commission fears.

The FTC had originally been more supportive of the merger, but Time-Warner's big hissy fit enacted back in May, in which the company briefly blocked ABC programming to more than three million subscribers over a contract dispute with ABC parent company Disney, betrayed an inclination to hold consumers hostage to corporate interests, and is the likely red flag inspiring the Commission's apparent distrust.

FTC officials declined to comment on their negotiations with the two companies, which, if they were merged, would possess 40 per cent of the ISP market and 20 per cent of cable subscriptions.

To be fair, Time-Warner recently opened its cable lines to New-York ISP Juno Online Services, America's third largest Internet service provider after AOL and EarthLink, and AOL has trumpeted the agreement as an example of the benevolent goodwill and commitment to open access which the two companies espouse.

"AOL and Time-Warner are fully committed to open access and just recently announced the first ever open-access agreement with independent ISP Juno," AOL spokeswoman Kathy McKiernan is quoted as saying by the Washington Post.

But FTC lawyers remain to be convinced that this accomplishment is more than a hollow public relations gesture. They want assurance that similar deals will be offered after the merger is approved, and the federal legal team can be expected to recommend tough language in some form of consent decree. The companies, predictably, are dead set against locking themselves into terms and can be expected to use every tactic at their disposal to discourage the Feds from pre-empting their ability to cut lucrative deals in future.

It will be tricky to craft a decree which will preserve the merged behemoth's God-given right to negotiate the most profitable third-party access deals it can cut, while at the same time preventing it from discouraging competitors by selectively pricing itself out of the reach of those it wishes not to accommodate.

An over-zealous inclination towards consumer protection could discourage the companies from merging at all, so the FTC will have to guess the maximum regulatory burden under which the companies will still regard the merger as worthwhile, press hard for it, and then give in a little and finally accept some sort of compromise engineered to enable both sides to claim a moral victory on behalf of grateful consumers everywhere. ®

Related Story

Europe to say no to AOL, Time-Warner, EMI merger

Using blade systems to cut costs and sharpen efficiencies

More from The Register

next story
BBC goes offline in MASSIVE COCKUP: Stephen Fry partly muzzled
Auntie tight-lipped as major outage rolls on
iPad? More like iFAD: We reveal why Apple fell into IBM's arms
But never fear fanbois, you're still lapping up iPhones, Macs
Nadella: Apps must run on ALL WINDOWS – PCs, slabs and mobes
Phone egg, meet desktop chicken - your mother
White? Male? You work in tech? Let us guess ... Twitter? We KNEW it!
Grim diversity numbers dumped alongside Facebook earnings
HP, Microsoft prove it again: Big Business doesn't create jobs
SMEs get lip service - what they need is dinner at the Club
ITC: Seagate and LSI can infringe Realtek patents because Realtek isn't in the US
Land of the (get off scot) free, when it's a foreign owner
Dude, you're getting a Dell – with BITCOIN: IT giant slurps cryptocash
1. Buy PC with Bitcoin. 2. Mine more coins. 3. Goto step 1
There's NOTHING on TV in Europe – American video DOMINATES
Even France's mega subsidies don't stop US content onslaught
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
How modern custom applications can spur business growth
Learn how to create, deploy and manage custom applications without consuming or expanding the need for scarce, expensive IT resources.
Reducing security risks from open source software
Follow a few strategies and your organization can gain the full benefits of open source and the cloud without compromising the security of your applications.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.
Consolidation: the foundation for IT and business transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.