Feeds

AOL, Warner, EMI fail to calm Euro merger fears

Companies pledge not to stiffle competition for three years. Eh?

  • alert
  • submit to reddit

Mobile application security vulnerability report

The European Commission remains unsatisfied with attempts by AOL and Time Warner to make their proposed merger more palatable, an industry source has claimed.

Last week, it emerged that the EC's competition watchdog is set to block the merger, according to a leaked preliminary judgement. Following the leak, AOL, Time Warner and EMI - which is hoping to fold its music operation into Time Warner's own - said they would work to calm European fears that the mergers would "create a dominant position in the markets for online music... Internet dial-up access [and] broadband Internet."

However, the source, cited by Reuters, claim that they have failed to allay the Commission's concern that "effective competition" would be "significantly impeded" if the merger was allowed to proceed, as the draft EC report puts it.

According to the source, AOL offered to change its stake in AOL Europe, a joint venture with German media giant Bertelsmann, and to promise not to force content providers signing up with the US operation to sign exclusively to AOL Europe too, for a period of three years after the merger. EMI, meanwhile, pledged not to give preferential treatment to online music providers allied to AOL-Time Warner, for the same period. The promise, you'll note, only covers music, not other, potentially more lucrative content, such as movies.

You can see why the EC isn't happy: essentially the companies are admitting that they do indeed plan to provide EMI and Time Warner content exclusively over AOL's network, or at least make it harder to get that content from other sources. Sure, they won't do this for three years, but it's clear that that's what they intend once that period is passed.

In short, three years down the post-merger line, the AOL-Warner-EMI operation will become potentially as anti-competitive as the EC fears.

The EC's final verdict on the EMI/Warner merger will take place before 18 October, and on the AOL/Time-Warner by 24 October. Commission insiders, however, reckon the organisation's decisions will be revealed by 4 October. ®

Related Story

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

The Power of One Brief: Top reasons to choose HP BladeSystem

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
Stick a 4K in them: Super high-res TVs are DONE
4,000 pixels is niche now... Don't say we didn't warn you
Amazon Reveals One Weird Trick: A Loss On Almost $20bn In Sales
Investors really hate it: Share price plunge as growth SLOWS in key AWS division
Bose says today is F*** With Dre Day: Beats sued in patent battle
Music gear giant seeks some of that sweet, sweet Apple pie
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
Too many IT conferences to cover? MICROSOFT to the RESCUE!
Yet more word of cuts emerges from Redmond
Chips are down at Broadcom: Thousands of workers laid off
Cellphone baseband device biz shuttered
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.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.