SAN FRANCISCO (07/26/2000) - The battle of the network giants escalated today as television and Internet powerhouse NBC threw its support behind efforts by Walt Disney Co. and others to bury the America Online Inc. -Time Warner Inc. merger under a pile of regulatory mandates.
In a letter to the U.S. Federal Communications Commission, NBC, which is owned by General Electric Co., said it feared that the merger partners would have too much control over distribution of content that goes out over the Internet and over cable wires. The network asked the FCC to impose stringent anti-discrimination conditions on AOL and Time Warner that would prohibit the new company from discriminating against unaffiliated content providers.
"If the combination of AOL and Time Warner is to go forward at all, the imposition of such nondiscrimination safeguards is essential to help ensure that the development of the infant broadband services market will be characterized by competition and unimpeded access for consumers," NBC wrote in the letter.
AOL and Time Warner have consistently said they would not discriminate against unaffiliated content providers, either on television or on the Internet. The companies have also pledged to share their broadband cable lines with other Internet service providers.
Disney has led the charge against the merger and wants the FCC to require the companies to shed or otherwise separate their cable holdings from the bulk of the combined companies' assets.
Both sides will have their say at an FCC hearing on the merger on Thursday afternoon. Speakers will include AOL CEO Steve Case and Time Warner CEO Gerald Levin. Representatives of merger opponents Disney and instant messaging provider Tribal Voice, and from consumer groups, will also offer their views.