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The Federal Trade Commission voted Nov. 9 to extend its review of the proposed America Online-Time Warner merger, as negotiations between the companies and the government dragged on. AOL and Time Warner already have agreed to allow competing Internet service providers to lease the use of their cable wires to provide high-speed Internet access. But the companies and the regulatory agency’s lawyers have been unable to nail down the precise terms and conditions for “open access.” The FTC has taken sworn depositions from AOL competitors and is prepared to go to court to block the merger if the two sides can’t reach an agreement. But last Thursday’s delay puts off the ultimate day of reckoning for now. In a statement, the FTC said the companies will submit new proposals in an attempt to address the agency’s concerns. “The commission has elected to delay action for a period of not more than three weeks,” the statement said. The FTC fears that AOL and Time Warner could dominate the market for broadband access in the 20 percent of U.S. households reached by Time Warner’s cable wires. Without open-access conditions, the companies could quash competition by excluding competing ISPs. In negotiations so far, the companies appear ready to accept a condition prohibiting Time Warner from offering a high-speed AOL service in any market unless it already has signed a deal with a competing ISP in that same market. Time Warner would then have to sign with at least two more ISPs within 90 days of offering AOL. The final deal also is expected to include provisions forbidding AOL and Time Warner from discriminating against other content providers in interactive-TV offerings. The merger also must be approved by the Federal Communications Commission, which has said it will wait until the FTC approves the deal before acting. Although the FCC is not expected to request any deal-breaking concessions, the agency’s review could take two to four weeks. Related Articles from The Industry Standard: Give Us Some Closure, Any Closure Do You, Time Warner, Take AOL to Be Your … AOL, Time Warner Say Merger Is on Schedule Copyright � 2000 The Industry Standard

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