Published in March 2001 as "Open-Access Issues for Non-affiliated ISP on Page 20-21

The underlying FCC and FTC Orders relating to the TWC/AOL merger dealt with of number of the initial concerns of the ISP community including Instant Messaging, AIHS, Video Streaming, Default Home Page, Quality of Service, ISP direct billing, non-discriminatory ISP selection, and AT&T carriage. Many of these concerns were triggered by the Mindspring carriage MOU released prior to hearings. After to speaking with several industry people and others in this space, the concerns of non-affiliated ISP's relating to the AOL/TWC Open Access issue post ruling are:

Though the FCC Opinion requires equal technical playing field for affiliated and non-affiliated ISP's, it is clear that customer service differences could develop as a result of TWC/AOL being a single unit and the non-affiliated ISP being discrete company. Here's a simple example, a cable modem subscriber calls TWC with a performance problem. If the customer has AOL and the TWC Customer Service Representative (CSR) had access directly to the AOL network to troubleshoot the problem, the problem may be resolved in a single phone call. Whereas, a cable customer with an Earthlink connection may have to be handed off to Earthlink Customer Service, if the CSR determines the problem is probably not in in the TWC equipment after some simple checks. In the first case, problems are handled with a single call whereas in the second case customers have to manage problem resolution through two companies both of whom could believe the problem is in the others' domain. If TWC were to adopt a "prove its not your ISP first and then call us back" position, operational costs for the ISP could rise since the burden of proof for every trouble instance could fall to them. Similar issues could arise in the area of billing information. For example, quarrels over usage based billing records made to a non-affiliated ISP could have to be researched by someone at TWC and reported back to that ISP where in the case of an affiliated ISP they might be available on-line to TWC CSR. Dispute resolution times would vary dramatically in these two situations.

 Pricing mechanisms are not directly addressed by the FTC Opinion but direction is given that "favored nations" pricing be granted to at least the first three non-affiliated ISP's using the Open Access mechanism. Because AOL/TWC are one company, TWC could "full load" broadband transport costs for all ISP's, including AOL, such that the broadband ISP makes much less profit on broadband than it does on narrowband. Because TWC and AOL are in the same company, whether or not AOL or TWC make the lion's share of the revenue is irrelevant because all the money stays in under the same roof. However, to non-affiliated ISP's, the business becomes marginal and unattractive. In this scenario, the lion's share of the money goes to the broadband transport company for all players hence TWC is not in violation of the affiliate/non-affiliate equal pricing principle. This kind of thing has happened in the past in the cable industry in the video "leased access" arena when cable operators have been forced to make video carriage available to anyone who wants to pay for it. Rates charged to "leased access" time segment providers have been substantially higher than long term carriage networks. From a billing perspective, the same "fully loaded" costing model could be applied to calculation thus making "TWC non-affiliated billing" expensive and forcing ISP's to direct bill at a higher incremental cost than TWC who is most likely already sending a cable bill to home.

Since a broadband data access customer is likely also a AOL/TWC cable customer, TWC has a number of marketing channels and cost saving opportunities that are available to it. Such opportunities include running commercials for AOL in the "unsold advertising spots", inserting AOL promotional materials in the customer's bill without incurring additional postage, customized preferential billing messages, leveraging knowledge of the customer's cable video preferences and viewing habits into customized Internet content, AOL ISP commercials on cable Customer Service PPV and "on-hold" messages", reductions in TWC video pricing to those who are AOL customers, and a number of other opportunities.