AOL Time Warner Hit in DSL-Ad Flap

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Chicago— Four consumer groups have urged the Federal Trade Commission to investigate allegations that Time Warner Cable refused to carry advertisements for telcos that market competing high-speed Internet services.

The request to the FTC came Monday in a letter sent by Consumers Union, the Consumer Federation of America, the Media Access Project and the Center for Digital Democracy. The advocacy groups said the marketing restriction apparently violates the letter and spirit of the FTC order that approved the America Online Inc.-Time Warner Inc. merger last December.

"Time Warner Cable has denied requests for carriage of DSL advertisements in markets around the country," the groups said. "This anti-competitive behavior appears to violate the letter of the consent decree, as the decree provided an unmistakable requirement that AOL Time Warner [Inc.] must promote the DSL services of other carriers."

The groups said the FTC's order specifically required AOL Time Warner to market and promote DSL services to subscribers.

"It is hard to understand how the [FTC] could have intended anything but the prevention of exactly the kind of behavior in which AOL Time Warner is engaging," the groups said.

When the merger was approved, it was widely believed the FTC's order did not oblige AOL Time Warner to accept ads from competing DSL providers. Rather, it was a requirement that the company not withdraw from offering AOL's online service over DSL lines that compete with Time Warner Cable's Road Runner service.

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