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FCC Lifts AOL IM Limits
TypoNAM writes "'The Federal Communications Commission has agreed to lift restrictions that have barred AOL Time Warner from offering advanced instant messaging services including videoconferencing, according to a source familiar with the decision.'" A couple of years ago, the FCC made a big fuss about how it was watching out for the public interest in approving the AOL/TW merger.
Aim has encryption now! Check out AIM Encrypt for a crude (everyone shares the same key) method of AIM encryption. For a more sure method, grab a free key from Thawte and use that instead. It works (I tried it), and will give you a unique keypair. (It gives you a padlock next to your screen name in AIM).
One of the key players in the persuading the FCC to let AOLIM be kept is William P. Rogerson, former FCC chair and economist at Northwestern. I couldn't find his paper but the dissenting opinions of Gerald R. Faulhaber and David J. Farber; both UPenn Econmics professors give a great opinion on why AOL has been behaving badlly (All gentlemen have held high ranking positions on the FCC). Its in PDF but their criticisms of Rogerson's draft are striking,
"AOL Time Warner's strategic behavior has not changed, and that is perhaps the most compelling evidence that they believe they can eventually tip the market by refusing to interoperate. Such strategic behavior only makes sense if the market leader expects the market to tip in its favor; otherwise, interoperation is their best strategy. But the Petition and the Affidavit are strangely and tellingly silent on this key piece of evidence.
We also note that AOL Time Warner failed to exploit its newly acquired cable assets to deploy an AOL Broadband service. Since the firm had no Broadband service, it had little reason to care about advanced IM services such as two-way video that are not feasible on dial-up connections. However, AOL Time Warner has just recently begun marketing AOL Broadband, apparently now trying to capitalize on its cable assets. It should not come as a surprise that as AOL Time Warner rolls out its new broadband offering, it wishes to be relieved of the requirement to interoperate if it offers an IM-based high-speed service. Their behavior suggests that they may well have such a service ready to roll out soon as a feature of their AOL Broadband, and wish to keep their network effects proprietary. In fact, it is precisely this case that the Merger Order anticipated when it imposed the IM condition.
We urge the FCC to proceed cautiously. While conditions have evolved since the Merger Order that suggest network effects and tipping are not as urgent today, other evidence suggests that it is perhaps even more urgent. The FCC needs to recall that AOL Time Warner has in its own hands the ability to offer advanced IM-based highspeed services without let or hindrance: it need only interoperate with its competitors, as it promised the world it would do two years ago, to the benefit of all customers."