10 October 2000

The $127 billion merger between Time Warner and America Online is expected to receive final approval by the European Commission tomorrow.

There had been concerns that the deal would close off the market for downloading music from the web. However, these were assuaged by the collapse of EMI’s proposed deal with Time Warner last week in the face of EU hostility.

The two groups have also undertaken to end their links with German media giant Bertelsmann and offer music stored on the web to other companies at the same price as AOL for five years.

Music will be distributed via websites unaffiliated to AOL, and will be available on three kinds of software. AOL has also promised not to push US content providers into exclusive deals with the firm in Europe.

The Commission is also expected to clear a similar deal between Vivendi and Seagram on Friday, which will see online music available through mobile phones.

News source: Financial Times