Feeds

Europe to OK $135bn AOL/ Time Warner merger

But EMI/Warner deal set to be nuked, claims insider

  • alert
  • submit to reddit

Next gen security for virtualised datacentres

European Commission anti-trust officials have decided to let the $135 billion AOL and Time Warner merger go ahead after all, but the merger operation will not be allowed to take over EMI's music operation.

The plan, leaked to Reuters by a Commission insider, follows earlier claims that the EC was planning to block the AOL/Time Warner/EMI merger because it felt the deal would seriously stifle competition in the digital media and Internet access markets.

That claim proved correct - AOL, Time Warner and EMI representatives admitted they were indeed having to make further concessions in order to allay EC anti-trust concerns over the deal.

The EMI connection certainly appears to be the main stumbling block. With media company Bertelsmann owning half of AOL Europe and one of the world's 'big five' music companies, BMG, merging EMI and Warner Music into AOL would, the EC feared put too much of the market in the online service provider's hands.

"The more content AOL acquires and the bigger its community of users, the less reasons for a subscriber to abandon AOL's walled garden and the more reasons for potential Internet users to join AOL," noted the Commission's draft report on the merger. "AOL could refuse to distribute third-parties' film content or threaten to refuse to distribute in order to negotiate the most advantageous commercial terms."

AOL offered to buy out Bertelsmann's share of AOL Europe, but that clearly hasn't proved sufficient for the EC.

The solution: kill the $20 billion EMI/Warner deal, and everything will be hunky-dory. "If [the EC] sorts out the EMI/Warner Music problems, either by blocking the deal or resolving the issues of market dominance, it's hard to imagine the Commission having any problems with AOL-Time Warner," Reuters' source said.

"Discussions are still going on with [EMI and Time Warner], and they could still produce further commitments, but they'd have to be pretty clear-cut and that could be difficult."

The Commission is due to announce its verdict on the AOL/Time Warner merger by 24 October, though insiders say its decision will be made public next week or the week after. The deadline for the EMI/Warner team-up is 18 October. ®

Related Stories

FTC starts gearing up for AOL/Time Warner battle
AOL, Warner, EMI fail to calm Euro merger fears
FTC mutes AOL/Time Warner wedding bells
Europe to say no to AOL, Time-Warner, EMI merger

Secure remote control for conventional and virtual desktops

More from The Register

next story
6 Obvious Reasons Why Facebook Will Ban This Article (Thank God)
Clampdown on clickbait ... and El Reg is OK with this
No, thank you. I will not code for the Caliphate
Some assignments, even the Bongster decline must
Kaspersky backpedals on 'done nothing wrong, nothing to fear' blather
Founder (and internet passport fan) now says privacy is precious
TROLL SLAYER Google grabs $1.3 MEEELLION in patent counter-suit
Chocolate Factory hits back at firm for suing customers
Mozilla's 'Tiles' ads debut in new Firefox nightlies
You can try turning them off and on again
Facebook to let stalkers unearth buried posts with mobe search
Prepare to HAUNT your pal's back catalogue
Sit tight, fanbois. Apple's '$400' wearable release slips into early 2015
Sources: time to put in plenty of clock-watching for' iWatch
prev story

Whitepapers

5 things you didn’t know about cloud backup
IT departments are embracing cloud backup, but there’s a lot you need to know before choosing a service provider. Learn all the critical things you need to know.
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.
Backing up Big Data
Solving backup challenges and “protect everything from everywhere,” as we move into the era of big data management and the adoption of BYOD.
Consolidation: The Foundation for IT Business Transformation
In this whitepaper learn how effective consolidation of IT and business resources can enable multiple, meaningful business benefits.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?