AOL/Time Warner Merger Impact on Cable Access

by Andy Oram
January 28, 2000

Since last week’s summary of telecom issues was published, some readers have asked me whether the merger of AOL and Time Warner will change the issue I discussed there of “open access” to cable modems. This issue was also the subject of my earlier Web Review article, A Pyrrhic Victory Faces Either Side in the Cable Access Controversy.

Many commentators, having viewed the AOL stance for open access with cynicism from the beginning, believe that now Steve Case has control over the largest cable company in America, AOL will start acting like other cable companies and back off from open access. But AOL itself has promised to keep promoting open access with vigor on two fronts: by offering its own cable systems to all ISPs on a fair basis, and by pursuing the issue before regulators and law-makers as it has done in the past. You can attribute their promise to PR if you like, but it’s still pretty binding. Even if they quietly tone down their support for the open access position, the strength of that position among a large coalition of ISPs and consumer groups ensures that it will continue to be heard.

I cannot work up the same anxiety as many consumers and media watchers over the potentially monopolistic effects of AOL Time Warner. I think that people seeking fun will continue to be attracted to expensive productions by a few big studios, while those with an urge to expand their horizons will take the effort to look for alternative media; what’s changed? The Internet is still a source for alternatives.

But the merger is disturbing in at least one area. The Telecommunications Act of 1996 was meant to stimulate further investment in the infrastructure (like new lines to homes). But the big players (AT&T and AOL) who could provide that infrastructure are buying up the old infrastructure instead. So there’s no new channel for competitors; no new benefits to end-users.

My personal attitude is that AOL’s promise to offer access to its cable modems is a wonderful experiment. There have been a couple other cable companies that allowed multiple ISPs to offer service (notably Knowledgy in the southern U.S.). But no one has pulled off such an experiment on a large scale. Even in Canada, where the government regulates cable companies as common carriers and has written open access into law, there’s been very little real movement in that direction.

AOL should try it, because we’ll then be able to answer a lot of questions that have been plaguing the debate.

Yes, we can learn a lot if AOL really puts its money where its mouth is.

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Andy Oram is an editor at O’Reilly Media. This article represents his views only. It was originally published in the online magazine Web Review.