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Fri, Mar 02, 2001 EST
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FCC's Conditions for AOL-Time Warner Deal
Associated Press
Some conditions that the Federal Communications Commission attached to the merger of America Online and Time Warner:

Internet Access

The FCC built on conditions already imposed by antitrust regulators requiring Time Warner to offer on its high-speed cable lines Internet providers other than AOL. That means subscribers to Time Warner's superfast Web service could select an Internet provider besides AOL, such as EarthLink or Juno Online Services.

The FCC determined that consumers should be allowed to see their selected Internet provider as their first screen when they log on to their computers. That prohibits AOL from making its service the first screen and requiring consumers to open another link to get to their preferred provider.

The commission also required that AOL rivals carried on Time Warner's high-speed lines be allowed to directly bill their customers.

Instant Messaging

The FCC required the combined company to make AOL's popular instant messaging service work with competing services. But the condition does not apply to the real-time text messages that millions of consumers currently use. Instead, it would only apply once AOL Time Warner begins offering the next generation of instant messaging services over Time Warner's high-speed cable lines. This could include, for example, consumers being able to video conference each other or send streaming video clips instantly.

Before AOL Time Warner can offer such advanced services, it must either implement an industrywide standard to make different services communicate with each other or enter contracts to show its system can operate with at least three rivals within six months.

This would mean that consumers using advanced instant messaging services by an AOL rival could communicate with an AOL user, similar to the way consumers now on different systems can exchange e-mail.

Relationship With AT&T;

AOL Time Warner is prohibited from entering certain types of special arrangements with AT&T;, the nation's top cable company. The FCC addressed a major concern of consumer groups last month when it required AT&T; to shed its 25 percent interest in Time Warner Entertainment, a subsidiary that owns most of Time Warner's cable systems. The commission reasserted Thursday that it had severed that link between the two big cable players.

Interactive Television

While not imposing any specific conditions on the companies, the FCC said it would start a proceeding to look at whether it should intervene in the market for the new service — which allows consumers to access the Internet from their televisions. For example, the commission will study whether steps are needed to ensure cable companies will not steer viewers away from interactive programming offered by rivals.

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