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FTC starts gearing up for AOL/Time Warner battle

Okay, so now we're getting somewhere

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Right. After too many days of aimless newspaper articles, we're finally getting an indication as to what is going on with the AOL/Time Warner merger.

If you remember correctly, the FTC has to pass on the instant messaging malarkey (swiftly picked by the FCC) but is now getting its teeth into the rest of it. Apparently the FTC has started asking for sworn testimonies from the two companies' rivals and this has given them the confidence they needed to start talking to the press about their concerns.

Not that the FTC asking for testimonies means that the merger won't eventually go ahead, but then it also wouldn't go to the trouble unless it was serious. The FTC would be a poor poker player - it's bluffing is rubbish.

The FTC is worried about two main groups: ISPs - who could be wiped out by an all-powerful AOL and broadband providers, who will have to deal with Time Warner's cable system. Now, seeing as AOL is a basically just an ISP, the FTC would have to work out some kind of framework to save the others from its boot. But with the cable system, it could force Time Warner to sell off part of all of it since that is one of the smaller pies that the company has its fingers into.

Oh, and then there's the music side of it. What about the EMI takeover? It looks like the Bertelsmann alliance is a dead duck. It is these issues that have formed the bulk of competitors' complaints. As for how to come to agreement, quite a few people are keen on the idea of an independent panel to decide disputes on a one-month start-to-finish basis. Apparently this was the system that was used when Vodafone was eating up Mannesmann.

We'll keep you informed but it's all up in the air at the moment. It looks as though the FCC suddenly felt it had bitten off more than it could chew because it started leaking that it was going to let the whole thing go through. Now the FTC has started play hardball, we might find the FCC gets brave again. ®

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