[Random-bits] Alec Klein: AOL Restricts Alleged

[James Love]

http://washingtonpost.com/wp-dyn/articles/A40250-2000Oct9.html
AOL Restricts Alleged

By Alec Klein  Washington Post Staff Writer
 Tuesday, October   10, 2000; Page E01 

America Online Inc. has imposed contractual conditions on Walt Disney
Co. in recent years that aim to deter users from leaving AOL's network
to reach competitors on the Web, according to sources who have reviewed
the confidential documents.</B> </FONT></P>   

The Disney contracts, from 1996 to 1999, offer a window into AOL's
business practices as the world's largest Internet service provider
seeks regulatory approval of its $183 billion takeover of Time Warner
Inc. A key issue for regulators is whether the combined company would
use its corporate power to discriminate against competitors.</P>
  
Critics say the terms contradict public pronouncements by the
Dulles-based online company that it does not--and will not--favor its
content over that of its rivals.
 
But AOL executives say customers can freely leave their online offerings
to surf wherever they wish on the Web. They say the contract language is
intended to prevent companies from using AOL resources to promote
competitors of AOL or its partners.

Under one contractual provision, Disney's ABC News unit agreed in 1997
to deter users from leaving the AOL network by limiting or removing
special highlighted connections called hyperlinks to other Web sites. If
25 percent or more of the traffic left AOL's offerings, AOL could cancel
the contract. Disney, of Burbank, Calif., agreed to similar restrictions
in online shopping agreements with AOL in 1998 and 1999.

"What these contracts are [is] evidence of the games AOL is playing,
which is to use its power through contracts and through architecture to
channel people into their service, which discriminates against people on
the outside," said Lawrence Lessig, professor of law at Stanford
University and author of "Code and Other Laws of Cyberspace."

Lessig added, "That should make us more skeptical of AOL's claims that
it wants to give people nondiscriminatory access to the Internet. This
belies that claim."

          [snip]

          
-- 
James Love  mailto:love@cptech.org http://www.cptech.org
Consumer Project on Technology, P.O. Box 19367, Washington, DC 20036
voice 1.202.387.8030  fax  1.202.234.5176