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Microsoft is now telling the FTC that TW is refusing to negotiate further, preferring to deal with the weaker EarthLink adding that Microsoft said that TW, to ensure real competition, should offer better terms than those in the EarthLink deal.
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Just when it seemed like things were looking up for the proposed merger of America Online and Time Warner, tech behemoth Microsoft has raised its voice against the planned union.

The software colossus is raising questions with antitrust enforcers about the effect the merger would have on high-speed Internet access for consumers, The Wall Street Journal reports. Microsoft's behind-the-scenes move could complicate the deal's gaining of approval by the Federal Trade Commission.

The FTC has already received a number of concessions from AOL and TW and is now expected to vote on the deal by the middle of next week. But, with the FTC's review nearing an end and only a few issues remaining unresolved, the Journal reports Microsoft could take on the role of spoiler in the deal.

The FTC has a tentative agreement with TW in which the cable giant would open its high-speed cable lines to AOL's competitors before AOL itself can offer Internet service over those same lines. TW last month struck a deal with EarthLink to meet the FTC's demands. The FTC is now reviewing the EarthLink deal to determine whether it goes far enough, a decision that could make or break the merger. The Journal added Microsoft tried to get an access deal with TW, but the conglom chose EarthLink instead.

Microsoft is now telling the FTC that TW is refusing to negotiate further, preferring to deal with the weaker EarthLink, the paper said, adding that Microsoft said that TW, to ensure real competition, should offer better terms than those in the EarthLink deal.

The Journal said Microsoft is seeking a deal based on a flat fee for wholesale Internet access that would decline over time, and TW has declined, those close to the talks say.

Microsoft isn't the only competitor that's been in to see the FTC. Walt Disney Co. has complicated matters by seeking conditions on the merged companies' interactive-TV plans; the FTC also sought the views of telephone giant Verizon.

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