WATCHDOG GROUP BARKS AT
AOL-TW MERGER

Leading U.S. consumer watchdog Consumers Union said Friday it will unveil on Monday a legal challenge to the combined ownership links between AT&T Corp. and the proposed America Online Inc.-Time Warner Inc. merger.

Together, the companies would control more than half of the cable lines in the United States and almost half of the most-watched cable channels, according to Consumers Union.

Further, they would also control access to over half of the Internet subscribers who connect through traditional modems and three-fourths of the high-speed, broadband Internet customers, the consumer advocacy group said.

The boards of AOL and Time Warner overwhelmingly voted on Friday (hitsdailydouble.com, 6/23) to approve a proposed $123 billion merger that would create the largest U.S. media company. The transaction must receive the blessing of both U.S. and European regulators and the European Commission earlier this week said it has opened a four-month probe into the deal (hitsdailydouble.com, 6/19).

Also on Friday, the Federal Communications Commission issued a second request for additional information about various components of the two companies as they reviewed the merger, following a demand sent earlier this month (hitsdailydouble.com, 6/12).