AOL reups with CBS News

As TW merger gets scrutinized, America Online maintains relationship

America Online has reupped its deal for CBS News to serve as its exclusive broadcast news provider to for an additional year.

Agreement comes despite the coming merger of America Online with Time Warner, which industryites expected would have made CNN the dominant news service to AOL’s more than 23 million subscribers.

CBS News said it would continue to provide news packages to AOL and is subsid Compuserve, in return for revenue, believed to be seven figures annually. CBS also provides AOL with promotional announcements at the end of its news programs.

CBS and AOL initially entered the pact in early 1999, giving the Eye’s news division significant online exposure, with AOL retaining the right to extend or terminate the deal after 18 months. ABC News was its previous news dealer.

With this past January’s merger still under regulatory scrutiny, it most likely behooves AOL to maintain its relationship with CBS instead of pairing with corporate brother CNN. Critics of the merger claim that the combination of AOL’s online subscribers and Time Warner’s cable audiences may deny fair competition to other content providers.

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