Disney Weighs In on AOL-Time Warner

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Washington-The Walt Disney Co. is asking regulators to impose "strong and meaningful" safeguards before allowing America Online Inc. to merge with Time Warner Inc.-the largest corporate merger ever at the time of its Jan. 10 announcement.

In a filing at the Federal Communications Commission, Disney said AOL Time Warner Inc. would have the power and incentive to foreclose competing cable and Internet content providers unless it is forced to provide equal treatment.

"Broadband must remain a highway on which all can travel, and not become a proprietary cul-de-sac," Disney said. "Purely voluntary pledges will not suffice."

The filing hardly came as a surprise, as Disney lobbyists have complained for weeks on Capitol Hill about the scope of the AOL-Time Warner merger.

But Disney has stopped short of outright opposition, and last week's filing did not explicitly call on the FCC to block the $152.8 billion deal.

Disney claimed that AOL Time Warner's control over cable systems and programming content for TV and the Internet on a massive scale would justify government intervention.

"As we migrate to broadband and interactive television, we must have government mandates to preserve unfettered consumer choice," Disney said.

In its own filing, AOL Time Warner repeated its pledge to carry competing Internet-service providers and to provide consumers with a wide range of content choices, claiming that those commitments dovetailed with its business interest.

"Given the vast and diverse availability of content choices, the economic incentives for a mass-media company militate for the widest possible distribution to the largest audience attainable-everywhere and anywhere," AOL Time Warner said.

AOL Time Warner added that market forces, rather than FCC regulation, should determine the winners and loser in the digital economy, citing no less an authority than FCC chairman William Kennard.

AOL spokeswoman Kathy McKiernan said AOL Time Warner's "commitment to open access and content diversity could not be stronger." She added that the companies codified their commitments in a detailed memorandum released to the public Feb. 29.

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