Thursday, January 4, 2001
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Posted on: Thursday, January 4, 2001

Regulators put finishing touches on AOL, Time Warner mega-merger

Associated Press

WASHINGTON — Communications regulators are laboring to wrap up their review of the merger between America Online and Time Warner — the final hurdle before the companies can seal their mammoth media deal.

At least one of the five members of the Federal Communications Commission — Harold Furchtgott-Roth — has voted to approve the deal, his office confirmed yesterday. A majority must sign off on the merger for it to go through, but all commissioners must cast their vote before the agency can announce a final decision.

The five members don’t have a fixed deadline by which they must vote. In addition, any commissioner that votes to approve the deal can later change his or her vote if substantive alterations are made by the others.

While FCC approval of the deal — worth about $82 billion — is expected, some commissioners continue to examine the deal and hammer out final details.

Antitrust authorities at the Federal Trade Commission cleared the merger in December after winning a range of assurances aimed at protecting consumer choice for Internet services and content.

The FCC, in turn, has authority to evaluate whether communication deals serve the public interest.

Commissioner Gloria Tristani still harbors concerns about some issues raised in connection with the merger, according to sources familiar with the review.

Those include AOL’s popular instant messaging service — the short, instant, text messages that consumers can send each other. AOL rivals have lobbied the commission to impose conditions on the merger so that their instant messaging services will work with the system used by AOL.

That way consumers using different providers — like Microsoft, ExciteAtHome or AT&T — could communicate with AOL users.

So far, the FCC has leaned toward a more modest condition that would force AOL to make its system work with at least one other provider, but only on advanced instant messaging services offered over Time Warner’s cable lines.

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