AT&T to FCC: Bar AOL-TW Merger

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WASHINGTON -AT&T Corp. is calling on the Federal Communications Commission to block the merger of America Online Inc.and Time Warner Inc., citing anti-competitive concerns that dovetail with objections raised by consumer groups and its own business interests.

"As currently structured, the AOL-Time Warner merger disserves the public interest and should not be approved," AT&T told the FCC in the Nov. 28 filing.

AT&T said the deal could be approved only after the FCC had forced AOL-Time Warner to negotiate the sale of AT&T's interest in Time Warner Entertainment, which includes 9.7 million cable subscribers and key programming interests. AT&T could use such a sale to meet federal conditions imposed on its acquisition of MediaOne Group Inc.

As the dominant partner in TWE, a merged AOL-Time Warner could refuse to restructure TWE unless AT&T agreed to favor AOL as an Internet portal over a rival like Yahoo! Inc. and unless AT&T Broadband agreed to carry its AOL TV interactive-TV service in lieu offerings provided by Microsoft Corp. and Liberate Technologies Inc., AT&T said.

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