Time Warner announced Monday it is making good on its promise to open its cable network to third-party Internet service providers, giving Juno Online Services Inc. access to TW Cable’s high-speed Internet lines.
Whether the deal appeases federal officials worried about the consequences of the proposed AOL/Time Warner merger remains to be seen. Last week, TW chairman-CEO Gerald Levin alluded to the pending Juno arrangement as evidence that the merger won’t result in a digital despot controlling both distribution and content.
Although a nationwide company, Juno’s free service is still, however, considered a minor threat with 3 million subscribers when it comes to Internet service providers, with AOL and EarthLink much more dominant and with millions more subs (AOL has 23 million).
Under terms of the deal struck by Juno and Time Warner Cable, both will market Juno Express to their customers. TW will be responsible for installing the service in customers’ homes.
Juno would become the first Internet access provider other than Time Warner’s Road Runner to ink a deal with Time Warner Cable for broadband Internet access.
At last week’s FCC hearing, Time Warner and AOL were drilled about the consequences of the proposed marriage. Critics claim both companies already have monopolistic traits likely to become full-blown personality disorders .
Also Monday, Sen. Edward Kennedy (D-Mass.) became the latest congressional member to send a letter of concern to the Federal Trade Commission, which also must approve the merger.
“AOL-Time Warner will own the cable wire that runs into millions of American homes, and will also own some of the programs delivered over the same wire. That puts them in a position to discriminate in favor of programs they own, and to filter information and commercial opportunities presented to cable subscribers,” wrote Kennedy.
Kennedy urged the FTC to hold AOL-TW “accountable” for their expressed commitment to open access.
A Time Warner spokesman said the Juno deal does just that, and that more such ISP deals will be struck will by the end of the year.
Rollout of the Juno service isn’t expected to take place until after Time Warner’s exclusive deal with Road Runner expires later this year.
Juno said it plans to offer existing customers in Time Warner Cable’s service area the ability to upgrade to the high-speed service and will begin in trials in Columbus, Ohio.
New York-based Juno offers a variety of Internet plans, including one that costs $9.95 a month and includes customer support and another that is free but requires members to view a stream of banner advertisements while logged on.
Time Warner has more than 12.6 million customers nationwide; more than 11.5 million homes passed are capable of receiving high-speed Internet service over the Time Warner Cable system.
Levin said the company has already begun installing routers and plans to work with third-party software companies to develop a billing system for handling multiple ISPs on its network.
“We look forward to reaching agreement with other ISPs as quickly as possible and to offering our customers a broadening array of choices in how they experience the Internet,” said Glenn Britt, prexy of Time Warner Cable.