AOL Gets OK To Add Video To IM - InformationWeek

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AOL Gets OK To Add Video To IM

The Federal Communications Commission will lift a restriction imposed in 2001 when America Online and Time Warner merged.

The Federal Communications Commission will allow AOL Time Warner Inc. to add videoconferencing to its popular instant-messaging software, lifting a restriction imposed in 2001.

The Republican-dominated FCC voted 3-2 to approve the change, with the two Democrats dissenting, said an FCC official who spoke on condition of anonymity. The vote should be made public soon, the official said.

FCC spokesman David Fiske declined to comment.

When the government conditionally approved the merger between America Online and Time Warner in 2001, it limited AOL's inclusion of advanced services in its instant-message software.

The restriction was to last until the FCC decided it wasn't needed or the company agreed to allow customers of rival services, such as those from Microsoft Corp. and Yahoo! Inc., to send electronic messages to AOL software users.

Although AOL publicly has said it would work to allow such interoperability, company officials continue to cite technical and security concerns.

AOL formally asked the FCC in April to lift the limits, noting that its market share among instant-message services has fallen from roughly 65 percent in early 2001 to 58.5 percent, which it said indicated it was no longer "dominant" in the category. Microsoft had 22.2 percent, and Yahoo had 18.3 percent, according to figures AOL supplied to the FCC.

FCC Chairman Michael Powell opposed the restriction as a commissioner in 2001, saying the agency was "restricting AOL's incentives to innovate" and "favoring competitors." Powell's father, Secretary of State Colin Powell, resigned from AOL's board the same day the merger was approved.

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