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September 9, 1997updated 03 Sep 2016 4:43pm

AOL-WORLDCOM-COMPUSERVE DEAL TO FACE ANTI-TRUST SCRUTINY

By CBR Staff Writer

This week’s three-way deal between America Online Inc, WorldCom Inc and CompuServe Corp is to face an anti-trust probe from the Department of Justice and New York State, which are both to look into whether it leaves AOL with the ability to unilaterally raise prices to consumers or whether WorldCom will now have an unfair advantage among businesses supplying network service to online service providers. However, most anti-trust observers do not think the deal will be blocked, especially when Microsoft Corp is one of the competitors pushed into a very distant second place by the deal, in terms of online service subscribers. Justice – or possibly the Federal Trade Commission (FTC) – will also have to decide whether AOL-CompuServe’s market, that of proprietary online services, can be lumped in with the greater internet when considering such a deal. If it can, then surely there is no way the deal can be held up for long, but if not, then AOL’s near 80% market share on the online business could cause a delay.

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