September 29, 2000

Ms. Deborah Lathen

Chief, Cable Services Bureau

Federal Communications Commission

445 Twelfth Street, S.W.

Washington, D.C. 20554

**Re: In the Matter of Applications of America Online, Inc. and Time
Warner Inc.**

> **for Transfers of Control (CS Docket No. 00-30)**
>
> **Written *Ex Parte* Presentation**

Dear Ms. Lathen:

This letter summarizes and elaborates upon the information submitted by
America Online, Inc. ("AOL") and Time Warner Inc. ("Time Warner" and,
together with AOL, the "Applicants") concerning the merged company's
plans for offering interactive television ("ITV") services. The high
degree of interest in the promise of ITV has been reflected, to some
degree, by comments submitted in this merger proceeding. Certainly AOL
and Time Warner hope and expect that our merger will help drive consumer
awareness and adoption of interactive television offerings.

However, a number of concerns raised in this proceeding regarding AOL's
current ITV offering, AOLTV, are factually incorrect and/or irrelevant.
A handful of competitors---most conspicuously The Walt Disney
Company---have argued that AOL Time Warner will harm competition by
discriminating against non-affiliated program providers or unaffiliated
ITV providers in the provision of video and interactive services.

As discussed below, these contentions lack a grounding in fact and the
related requests for Commission action lack any basis in law. Several of
the expressed concerns relate to services that do not, in fact, exist.
Furthermore, none of these contentions is specific to the AOL/Time
Warner merger; rather, any issues relevant to the provision of
interactive TV services are industry-wide in character and not
appropriate for merger-specific regulation.

In order to help clarify these issues, the information set forth below
provides a brief overview of the current state of evolution in ITV
services, a detailed description of how AOLTV operates, and a showing
that any fears about "downstream" or "upstream" provision of video or
interactive content are unfounded. Furthermore, the discussion below
points out that recent Commission precedent---particularly the
*AT&T/MediaOne Order*---makes clear that these claims warrant no FCC
action. Broader policy issues that may remain unsettled, such as the
extent of cable operators' obligations to carry broadcasters' digital
signals, should be (and are being) resolved in rulemaking proceedings of
general applicability.

# I. Interactive Television is a still-nascent service with a range of entrants whose offerings incorporate a variety of different functions.

Although the concept of interactive television has been around for more
than two decades, ITV services have only recently become available to
consumers. Given that ITV is still a nascent business, it is not
surprising that even the term "interactive television" has meant
different things to different people. Even now, as a new generation of
ITV services are emerging, the term encompasses a diverse set of
potential "enhancements" to the television viewing experience, including
Internet-on-the-TV-set, various hybrids of traditional TV and Internet
features on the TV, video-on-demand services, interactive program guides
and consumer electronic devices that permit viewers to interact with
their television sets.

What remains to be seen is whether any particular enhancements or
combination of these potential ITV features will succeed in the
marketplace. To date, many attempts at ITV have failed, either because
of lack of consumer interest or limits of the technology.[^1]
Nevertheless, an industry-wide interest in offering interactive TV is at
an all time high now, thanks largely to technical advancements and a
perception that consumers now have a greater understanding of---and
interest in---interactive services generally.[^2]

Many companies, both well known and new start-ups, have endorsed this
perception by entering the ITV marketplace with services in some form.
The largest ITV company, Microsoft, has attracted approximately one
million subscribers in its four years of offering its WebTV interactive
service.[^3] WebTV provides consumers with an interactive electronic
program guide, interactive content, Internet access, e-mail, chat, and
Microsoft's own instant messaging system---and Microsoft is embedding
its Microsoft TV software into its next-generation Windows operating
system.[^4]

A brief review of some of the interactive television services now
available suggests the varying forms of offerings that fall under the
ITV label:

1.  Microsoft is using a dial-up telephone link to provide, as noted
    above, TV screen access to the World Wide Web;

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1.  TiVo and consumer electronic companies are creating interactive
    Digital Video Recorders;

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1.  Companies like Wink and RespondTV, are exploring "e-commerce"---or,
    as some are beginning to call it, "t-commerce"---opportunities over
    the television;

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1.  GemStar is creating interactive electronic program guides and
    services;

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1.  Along with efforts by cable operators to offer video-on-demand and
    other innovative services, WorldGate Communications, Inc., ICTV,
    Inc., MoreCom, Inc.,[^5] Diva Systems and Peach Networks, Ltd., are
    using the television to provide video-on-demand and other
    interactive services such as e-mail, instant messaging, and
    on-screen shopping;[^6] and

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1.  Liberate Technologies and other software and hardware companies are
    creating middleware packages to enable the display of interactive
    television content.[^7]

All of these interactive services, separately and in combination, are or
soon will be available over a variety of transmission mediums, including
satellite, cable, DSL, and narrowband connections.

In short, the ITV marketplace is a nascent and fluid one: the number of
entrants is high, consumer demand is uncertain, innovation is ongoing,
and no one party can claim to know what the marketplace will determine
to be a successful interactive TV offering.

# II. AOL's entry in the newly emerging ITV marketplace---AOLTV---is built upon open standards and platform independence. 

It is into this emerging arena that AOL recently announced the launch of
its interactive television service---AOLTV.[^8] Designed to enhance the
consumer television experience by offering some of the convenience and
empowerment found today only on the computer, AOLTV comprises a broad
array of interactive features. These include:

1.  **Improved channel navigation---**AOLTV provides state-of-the-art
    interactive navigation features designed to help viewers more
    quickly and easily select their favorite channel or TV program,
    including the ability to "bookmark" their own favorites.

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1.  **Interactive communication features---**AOLTV offers popular
    Internet features designed for enabling users to read and send
    e-mail, exchange instant messages, and chat online.

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1.  **Internet access---**AOLTV provides open Internet access to all
    content available on the World Wide Web.

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1.  **Enhanced interactive content ---**AOLTV enables users to interact
    with any programming in which the programmer chooses to put
    interactive content.

Consumers can receive the benefits of AOLTV by acquiring a set-top box
from a retailer and subscribing to the AOLTV service for a monthly fee.

One of AOL's fundamental business premises is that consumers will be
attracted in large numbers to this new product only if AOL can persuade
a wide variety of video programmers---broadcasters and cable programmers
alike---to build new, innovative interactive components into their
television programming. There is no question that easier-to-use
navigation, interactive communications, and Internet access on the
television set will appeal to those that have built interactivity into
their lives . . . but only when the television experience is
dramatically transformed through the power and convenience of
interactivity will this new form of interactive experience take off. We
do not know how, when or even if that will happen. And it will happen
only if a large number of the most popular television networks and
programs experiment with new interactive elements.

AOL---joined together with the skills, resources and creativity of Time
Warner brands---can begin to address this "chicken-and-egg" problem, but
that alone will certainly not be enough to create compelling interactive
TV product. AOLTV's success depends on working with others in the
industry to create additional interactive content. Quite contrary to the
suggestion of our competitors, we believe strongly that there is no
advantage in denying consumers access to a full array of content
sources. Indeed, AOL and Time Warner's surest route to failure in
interactive television would be to restrict or degrade consumers' access
to a true diversity of interactive content and service offerings.

With these fundamental principles in mind, the AOLTV service has been
designed to be accessible by all potential providers of video
programming, including any enhanced programming that the provider might
wish to supply. This understanding, in turn, has driven the "openness"
of AOLTV's technical design, described in more detail below.

As a threshold matter, the AOLTV service simply passes through to
subscribers the video signal just as that signal is provided by their
existing video programming source. AOLTV's interactive functionality
accompanies that video programming without altering the video signal
itself. That interactive data stream requires two-way connectivity to
the Internet. The current AOLTV set-top box relies upon a built-in
dial-up modem to connect to the Internet. Likewise, AOL's planned
second-generation set-top box, which will work in conjunction with DBS
operator DirecTV's MVPD service, also will utilize a narrowband Internet
connection.

AOLTV uses software developed by Liberate Technologies. This software
enables AOLTV's interactivity by incorporating the open ITV standards
established by the Advanced Television Enhancement Forum ("ATVEF"). In
order to make available the widest possible variety of ITV content and
thereby drive consumer demand for this new service, AOL enables any
video programmer (working with the ATVEF standard) to provide
interactive content to AOLTV subscribers---regardless of whether that
video programmer has any agreement or relationship with AOL.

Interactive content is created for the AOLTV service using the HTML open
Internet standard (*i.e.*, the language used to design web pages). That
interactive content is then transmitted by a video programmer in
accordance with ATVEF standards. ATVEF-enabled ITV requires the use of a
consumer electronic device---in this case the AOLTV set-top box, but
also other consumer electronic devices, such as television sets and
third-party set-top boxes---that is capable of receiving and
interpreting ATVEF data embedded into a video programmer's signal. In
the provision of ITV, ATVEF data performs two functions. First, it lets
the AOLTV set-top box know that interactive content is available through
what is known as a "trigger." When the device detects a trigger, it
displays on the television screen an icon that the user can click on
(using, for example, a remote control device or a wireless keyboard) to
access interactive content. Second, ATVEF provides for the delivery of
the interactive content itself. That delivery can either be accomplished
directly, by embedding the actual content into the video signal, or
indirectly, by instead embedding a link to a web site from which the
content can be retrieved over an Internet connection. Finally, the
interactive content is delivered by the user's chosen MVPD and/or via an
Internet connection to (again, in this case) the AOLTV set-top box,
which synchronizes that content with the video signal and displays it on
a TV set.

The AOLTV set-top box displays the video programmer's content on the
television screen in the way that the video programmer has chosen. As
AOL has previously described, this would allow the display of its
interactive content as a "wrap-around" contemporaneously with its video
programming (via the "picture-in-picture" technique) in the same manner
that an AOLTV partner's content is displayed. Indeed, to enable
subscribers to enjoy consistent quality and presentation in interactive
content regardless of the source, AOLTV freely publishes a style guide
to help programmers create and display their interactive content over
the service. This style guide allows (but does not require) unaffiliated
programmers to format and fashion their interactive content to appear
just like that of AOL's interactive content partners.

AOL recognizes that one of the main reasons why ITV has yet to fulfill
its promise to revolutionize the television-viewing experience is that
there has been an insufficient amount of quality interactive material to
attract viewers. AOL has taken the steps described above to address that
problem---by allowing AOLTV subscribers access to the widest possible
range of innovative, dynamic, and entertaining interactive content.

# III. The "cable return path" model advanced by some does not exist, may not lawfully be mandated, and is not necessary to ensure the viability of competitive interactive TV.

As described above, AOLTV enables *any* video programmer to offer ITV to
AOLTV subscribers. Thus, a video programmer (whether working as an AOLTV
partner or independently) has the option of (1) taking advantage of the
ATVEF-enabled capabilities of the AOLTV service, (2) working with one of
the many other ITV providers, or (3) developing its own set-top box
and/or interactive service, as Congress and the Commission have made
possible

for it to do through the equipment compatibility[^9] and commercial
availability of navigation devices rules.[^10]

Some, however, have questioned whether a merged AOL Time Warner will be
able to preclude the introduction of other interactive TV services
because of its ownership of broadband cable infrastructure. As
demonstrated by our explanation of how AOLTV and other ITV services
operate, the answer is no. Simply put, AOLTV and other ITV services
simply are not dependent on cable in order to provide interactive
services to consumers who receive their video service from cable (or any
other MVPD).

In any case, for AOL's interactive service to by truly successful,
moreover, it must be available nationwide. To offer a nationwide
interactive television service utilizing a cable set-top box that
integrates ITV and MVPD service, a national set-top box standard for
cable must be developed. Otherwise, an ITV provider would be burdened
with the need to develop a service that complied with each MSO's
distinct standard. AOL, which would remain an unaffiliated ITV provider
as to more than eighty percent of the cable marketplace even after this
merger, is thus incented to ensure that its interactive service works
nationwide, regardless of the MVPD. (This explains why the first
generation AOLTV set-top boxes use a dial-up connection to the Internet
and open, ATVEF-compliant standards.) For the same reason, no cable
operator or ITV provider will be in a position to preclude the success
of other ITV services.[^11]

Yet some would argue that cable must provide a "return path" to
interactive services of all content providers. As ITV services continue
to emerge into a viable business, however, there is no need for any such
regulatory action in general, much less in the limited context of a
merger review proceeding. Indeed, any such requirement would, in effect,
be the imposition of what amounts to "Internet must-carry"
obligations---*i.e.*, governmentally mandated free Internet access
service. If applied in the context of this merger, it would constitute
Internet must-carry imposed upon a single cable MSO. There is no basis
in fact, policy, or law to support such an expansion of the regulation
of cable operators generally, much less one cable operator in
particular.

First, any argument relating to how the cable operator will provide a
"return path" for interactive services is entirely speculative. With
respect to Time Warner, for example, Time Warner offers no ITV cable
return path today, either to itself or to third parties, and neither the
hardware, software, nor business model necessary to provide such a
return path exists today.

Moreover, as explained above, there are two distinct components to ITV:
(1) the video programming component, which involves the one-way,
downstream transmission of full-screen, broadcast quality video to the
consumer, and (2) the interactive component, which allows the user to
interact with web-style content, some of which is embedded in the video
programming signal and the rest of which is accessed over a
full-fledged, two-way connection to the Internet.

The ATVEF standard enables the interactive component in two ways:
(1) directly---by embedding that data in the video signal (the ATVEF-B
standard); and (2) indirectly---by providing, not the actual interactive
content itself, but rather the address (*i.e.*, the universal resource
locator, or "URL") of a web site from which the ITV hardware (typically
a set-top box) can obtain that content (the ATVEF-A standard). In the
first scenario, everything needed for the interactivity is contained
within the video signal. In the second scenario, however, there must be
available both an upstream path---so that when the user clicks the
on-screen trigger containing a URL, that web site request is able to
reach its destination---and a downstream path---over which the content
located at that web site is transmitted to the user's ITV hardware,
which then displays that content on the television screen. Thus, rather
than merely a "return path," what is required to fully enable web-based
interactive services is a complete Internet connection.

There is no basis, however, for the claim that the two distinct
components of ITV are now, let alone must be, provided over cable
systems. Merely because cable (the MVPD service), and cable modem
service (the Internet access service) can both operate over the same HFC
facilities does not mean that cable modem service is necessarily a
better option for the interactive component of ITV, let alone the *only*
option.

There are, in fact, a range of options for both video programming
distribution and Internet connectivity which can be offered in virtually
any combination as "ITV service." With regard to the provision of the
video programming component, there are a number of choices: while cable
is obviously a popular MVPD, there is also DBS---an increasingly
successful MVPD alternative, and the video programming component for the
next generation of both AOLTV and Microsoft's UltimateTV[^12]---as well
as various other forms of MVPD service and over-the-air broadcast as
well. And in terms of the interactive component, any of the alternatives
for Internet access---dial-up, DSL, cable modem service, satellite,
wireless, etc.---are capable of providing the necessary two-way Internet
connectivity. Moreover, because the bandwidth requirements of ITV are
not necessarily substantial, there is no requirement that this Internet
connection be high-speed; as is the case with AOLTV, a dial-up 56 kbps
modem connection will fully suffice.

Beyond the fact that there is no practical need for any "return path"
requirement to be imposed on cable, there is absolutely no basis for
doing so here. The must-carry obligations of cable operators are either,
in the analog context, the subject of Commission regulations,[^13] or,
with respect to digital television, currently the subject of an FCC
rulemaking proceeding.[^14] In neither instance, however, has Congress
or the Commission even considered requiring cable operators to provide
broadcasters with a free upstream path, let alone full, two-way Internet
access. Time Warner cable systems will pass through any and all video
programming-related information that it is required to by the
Commission, and is open to commercial negotiations regarding the
carriage of additional data outside that scope.[^15]

# IV. In any event, "cable return path" concerns are not caused by or specific to the AOL/Time Warner merger.

As several Commissioners reflected in their statements during the July
*en banc* hearing on our proposed merger, it is well-established FCC
policy that a merger proceeding is the wrong forum for making broad
legal and policy decisions affecting an entire industry.[^16] For
example, Commissioner Ness stated that:

> \[W\]e must ask ourselves whether the potential harms are caused by or
> exacerbated by the merger of these parties; an issue that does not
> implicate the fundamental concerns of the Commission, no matter how
> timely or interesting it might be, or is not merger-specific should
> not affect our decision whether to grant, condition, or deny the
> merger application.[^17]

Commissioner Powell further observed that:

> It is very difficult to grasp the effect of this combination on
> consumers in markets that have barely emerged or have yet to be
> created at all.... It is important to emphasize that many of the
> interesting challenges, questions and concerns that might arise from
> this combination are not within the scope of our review, nor are we
> necessarily empowered to address any and all such questions.[^18]

While ITV-related concerns raised in this proceeding obviously target
Time Warner's cable systems, their premise---the notion of cable as a
"bottleneck provider"---would (however misplaced in the ITV context)
equally apply or not apply to almost every local cable system in the
country. Indeed, the focus of, and basis for, these contentions is
really the future of Title VI cable regulation, not this merger. Issues
concerning cable's place in the evolving FCC regulatory scheme will
affect the entire cable industry, not just AOL Time Warner. Imposition
of such "Internet must-carry" obligations would constitute policy
determinations of industry-wide significance which are without precedent
or enabling legislation. At a minimum, they should be dealt with in
proper notice-and-comment rulemaking proceedings, affording all
interested parties the opportunity to address the industry-wide
implications of any particular proposal.[^19]

\* \* \*

The facts now before the Commission in this proceeding show that the
interactive television arena is a young but highly competitive one, with
many new entrants offering a wide array of different services under the
ITV label. AOL's current ITV offering, AOLTV, is designed to incorporate
many attractive components into one service---and, in doing so, to
employ open standards that allow unaffiliated program providers to
deliver interactive or enhanced content with their traditional video
transmissions. This approach reflects our understanding that interactive
television will make good on its potential only if it offers viewers the
widest possible array of content from the broadest possible number of
sources. Video

programmers and others surely have much creativity to offer in this
interactive TV marketplace of tomorrow. Unfounded invention of "Internet
must-carry" obligations for a single cable operator, however, is better
suited to stifling---rather than fueling---the promising ITV future.

Respectfully submitted,

**AMERICA ONLINE, INC**. **TIME WARNER INC.**

\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_

+-----------------------------------+-----------------------------------+
| George Vradenburg, III            | Timothy Boggs                     |
|                                   |                                   |
| Senior Vice President             | Senior Vice President             |
|                                   |                                   |
| Global and Strategic Policy       | Global Policy                     |
|                                   |                                   |
| **America Online, Inc.**          | **Time Warner Inc.**              |
|                                   |                                   |
| 1101 Connecticut Avenue, N.W.     | 800 Connecticut Avenue, N.W.      |
|                                   |                                   |
| Suite 400                         | Suite 800                         |
|                                   |                                   |
| Washington, D.C. 20036            | Washington, D.C. 20006            |
+-----------------------------------+-----------------------------------+

+----+-----------------------------------------------------------------+
| c  | William Johnson, Deputy Chief, Policy and Rules Division, Cable |
| c: | Services Bureau                                                 |
|    |                                                                 |
|    | Royce Dickens, Deputy Chief, Policy and Rules Division, Cable   |
|    | Services Bureau                                                 |
|    |                                                                 |
|    | Darryl Cooper, Cable Services Bureau                            |
|    |                                                                 |
|    | Nancy Stevenson, Cable Services Bureau                          |
|    |                                                                 |
|    | Peter Friedman, Cable Services Bureau                           |
|    |                                                                 |
|    | Linda A. Senecal, Cable Services Bureau                         |
|    |                                                                 |
|    | Dale Hatfield, Chief, Office of Engineering and Technology      |
|    |                                                                 |
|    | David J. Farber, FCC Chief Technologist, Office of Engineering  |
|    | and Technology                                                  |
|    |                                                                 |
|    | Robert Pepper, Chief, Office of Plans and Policy                |
|    |                                                                 |
|    | Michael Kende, Office of Plans and Policy                       |
|    |                                                                 |
|    | James Bird, FCC Assistant General Counsel                       |
|    |                                                                 |
|    | Magalie Roman Salas, Secretary (2 copies)                       |
|    |                                                                 |
|    | International Transcription Service                             |
+----+-----------------------------------------------------------------+

[^1]: The Myers Group, LLC and eMarketeer, Inc., Interactive Television
    Outlook 2000 at 18-19 (June 2000). (Submitted as attachment to
    Letter of Lawrence R. Sidman, Counsel to the Walt Disney Company, to
    Magalie Roman Salas, Secretary, Federal Communications Commision, CS
    Docket No. 00-30 (September 7, 2000).

[^2]: *Id*.

[^3]: *See* Microsoft Press Release, *Philips Electronics and WebTV
    Networks to Deliver New Personal TV Hardware and Services for
    Customers*, January 6, 2000,
    \<http://www.webtv.net/company/press/archive/philipspr.html\>.

[^4]: *See* Stephanie Miles, *Will Microsoft's Next OS Run Your TV?*,
    September 5, 2000,
    \<http://dailynews.yahoo.com/htx/cn/20000905/tc/will microsoft s
    next run your tv 1.html\>

[^5]: MoreCom's ITV service, for example, provides Internet access and
    services to subscribers through two-way modems built directly into
    digital set-top boxes by equipment manufacturers such as
    Scientific-Atlanta, Inc.

[^6]: *See* Fred Dawson, *WorldGate, ICTV, Others See ITV Momentum*,
    December 13, 1999,
    \<http://www.multichannel.com/weekly/1999/51/webtop51.html\>.

[^7]: *See* *AT&T to Test Liberate Middleware*, September 25, 2000,
    \<http://www.multichannel. com/daily/31d.shtml\>.

[^8]: *See, e.g.,* AOL Press Release, *America Online Launches AOLTV --
    The First Interactive Television Service for the Mass Market*, June
    19, 2000, \<http://media.web.aol.com/media/press.html\>. AOL
    announced the launch of the new service on June 19, 2000. AOLTV is
    currently being test marketed in select cities and will be
    introduced through a much larger roll-out as the system is refined.

[^9]: 47 U.S.C. § 549.

[^10]: 47 C.F.R. § 76.1200.

[^11]: As Commission analysis demonstrates, compliance with the national
    cable ownership cap rules, in combination with the growing
    availability of alternative broadband platforms ensures the
    competitive functioning of the interactive content and services
    marketplace. *See* *Applications for Consent to the Transfer of
    Control of Licenses and Section 214 Authorizations from MediaOne
    Group, Inc., Transferor, To AT&T Corp., Transferee*, CS Docket
    No.99-251 (rel. June 6, 2000) at ¶ 59, 116 ("*AT&T/MediaOne
    Order*"). Specifically, in *AT&T/MediaOne*, the FCC concluded that
    compliance with the cable cap restrictions will prevent a vertically
    integrated cable system/content provider from being able to stifle
    competition from a broad array of rival "content providers"---a
    group that the agency defined as including unaffiliated video
    programmers and "interactive service providers." The Commission
    found that competition in the national MVPD arena guarantees that
    rival content providers will be able to reach a sufficient number of
    consumers to succeed and flourish in the marketplace. "We find that
    our requirement that AT&T \[comply with the cable cap\] will
    circumscribe AT&T's purported ability to harm unaffiliated content
    providers \[defined elsewhere as unaffiliated video programming
    networks and interactive service providers\], unaffiliated EPGs, and
    other MVPDs...." *AT&T/MediaOne Order* at ¶ 90. In addition, as to
    set-top box devices used in providing any such service, the
    Commission ruled that "by requiring MVPDs to grant all equipment
    manufacturers an opportunity to sell equipment to the MVPDs'
    subscribers, the navigation devices rules limit MVPDs' ability to
    exercise market power and dominate the equipment market." *Id.* at
    ¶ 100.

[^12]: See Press Release, *Microsoft, DIRECTV and THOMSON multimedia
    Join Forces To Make Television More Personal and Interactive*, June
    12, 2000, \<http:www.microsoft.com/press/
    2000/jun00/DirecTVpr.asp\>.

[^13]: *Petition for Special Relief Seeking Commission Order to
    Discontinue Stripping Information from Broadcast VBI*, CSR 5528-Z,
    DA 00-670 (March 24, 2000).

[^14]: *Review of the Commission's Rules and Policies Affecting the
    Conversion to Digital Television,* CS Docket No. 98-120, 2000 FCC
    Lexis 3468 (June 30, 2000).

[^15]: In any event, the existence of growing competition among rival
    facilities providers means that "action taken by the merged firm to
    disfavor unaffiliated broadband content and applications providers
    is likely to threaten the networks' ability to attract and retain
    customers." *AT&T/MediaOne* at ¶ 123. The Commission in
    *AT&T/MediaOne* thus reached the exact determination that AOL and
    Time Warner did in deciding to forge the new company: consumers who
    have grown up with the emerging online medium expect and demand that
    any Internet-based service provider afford them access to all
    possible content, regardless of the source.

[^16]: *See, e.g.,* *AT&T/MediaOne Order* at ¶ 143 ("\[T\]he potential
    harm alleged by the commenters is not specific to the merger\....
    \[T\]he merger is not the cause of this alleged competitive threat,
    and the merger license transfer proceeding is not the appropriate
    forum to address this issue."); *AT&T/TCI Order* at ¶ 43 ("\[T\]his
    is like other cases where the Commission has declined to consider,
    in merger proceedings, matters that are the subject of rulemaking
    proceedings before the Commission because the public interest would
    be better served by addressing the matter in a broader proceeding of
    general applicability.").

[^17]: *En Banc* Hearing on America Online, Inc. and Time Warner Inc.
    Applications for Transfer of Control, CS Docket No. 00-30, July 27,
    2000 ("*En Banc Hearing*").

[^18]: *Id.* Commissioner Furchtgott-Roth also observed that the FCC's
    "asking whether a particular license transfer would serve the public
    interest, convenience and necessity entails a significantly more
    limited focus than contemplating the industry-wide effects of a
    merger between the transferee and transferor. Our inquiry should be
    limited to whether the proposed transferee has and will comply with
    applicable Commission regulations. Our inquiry should not consider,
    for example, how the combination of the two companies might affect
    other competitors ...." *Id.*

[^19]: Disney and ABC themselves strenuously advocated precisely this
    position in their own groundbreaking merger: "Obligations imposed in
    a piecemeal fashion that result in certain broadcasters (*i.e.*,
    broadcasters targeted by transfer-of-control petitioners) having to
    carry programming that other broadcasters are not required to carry
    would be arbitrary and unfair, putting those broadcasters at a
    competitive disadvantage." *Opposition of the Walt Disney Company to
    Petition to Deny*, File Nos. BTCCT-950823KE-KZ, BTCH-950823LA-LJ,
    FCC 96-48, at 26 (filed Oct. 12, 1995). The Commission
    agreed---thereby adding to its long history of consistent precedent
    on the point. *In re Capital Cities/ABC and the Walt Disney Company
    Applications for Transfer of Control*, 11 FCC Rcd 5841, 5858 (1996).
    No commenter addressing ITV issues has presented the FCC with any
    grounds for departing from that precedent here. To the contrary, the
    Commission already is addressing some of the key issues in
    administratively appropriate forums: the ongoing digital must-carry
    rulemaking and the pending GemStar proceeding.