AOL rivals, Microsoft want instant messaging conditions

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WASHINGTON (AP) -- Companies that compete with America Online in the growing market for instant messaging are making last-minute pitches for conditions on the company's merger with Time Warner. Microsoft Chairman Bill Gates is among those lobbying the government.

As the Federal Communications Commission inches toward a final decision on the $111 billion marriage of AOL and Time Warner, a deal announced almost a year ago, rivals are stepping up efforts to extract concessions they say would promote competition. Time Warner is the parent company of CNN.com.

Companies, including ExciteAtHome, Microsoft and AT&T, are urging the agency to require AOL to work toward making its instant messaging service operate with their systems.

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Microsoft's Gates has even made personal calls to members of the Federal Communications Commission on the subject, according to documents made public Tuesday.

The lobbyists want customers to be able to send real-time short messages to each other even while using different services. That would make instant messaging similar to how people now communicate using different e-mail providers or make a phone call over more than one telephone network.

On Tuesday, instant messaging providers met with FCC members and staff to press them to attach requirements to AOL's merger.

The FCC staff already has recommended an instant messaging condition to the five commissioners. That recommendation, however, would apply more narrowly to advanced instant messaging services offered over Time Warner's cable lines and would require AOL only to make its system work with one other provider, according to sources familiar with the review.

Rivals are pushing for a broader standard that would let customers of all other providers send messages to AOL users.

The current recommendation "falls short of the need for consumers to be able to communicate seamlessly across platforms," said Estela Mendoza of ExciteAtHome.

Gates emphasized similar points in phone calls to FCC Chairman William Kennard and two other commissioners last week, the documents made public Tuesday said.

Gates stressed that without having to satisfy conditions on the merger, AOL will be able to further strengthen its position in the market. AOL already boasts about 140 million registered users through its AIM and ICQ services.

Gates also noted that instant messaging is evolving into more than just a text service. It can support audio and video teleconferencing and could be a key feature in interactive television that allows consumers to access the Internet through their TV sets.

Sen. Conrad Burns, R-Montana, who heads the Senate Commerce subcommittee on communications, urged the agency in a letter Tuesday to "prevent the Balkanization of this new service and all its potential."

Earlier this month, AOL Chairman Steve Case met with Kennard and various agency staff members to argue that other companies are gaining footholds quickly in the instant messaging market. He also said any attempt to intervene in how the service is delivered could stifle innovation and growth, according to company filings.

Company executives have said they want to make their systems work with other providers but first need assurances that security and privacy of consumers will be protected.

AOL and Time Warner received antitrust approval for their deal last week. The FCC is expected to act by year's end or early January.

Copyright 2000 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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