ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Friday, September 13, 1996 TAG: 9609130138
SECTION: BUSINESS PAGE: A-9 EDITION: METRO
DATELINE: NEW YORK
SOURCE: Associated Press
THE AGREEMENT creates the world's largest media conglomerate, much to the chagrin of consumer advocates.
Nearly a year after Time Warner Inc. agreed to buy Turner Broadcasting System Inc., the Federal Trade Commission has approved the deal with modifications that it says preserve cable TV competition.
But consumer advocates said Thursday the agency should have pushed for more concessions before deciding to permit the $6.8 billion buyout that would create the world's biggest media and entertainment conglomerate.
They fear the new company will still have too much power over cable TV prices and programs.
The FTC voted 3-2 on Wednesday in favor the the revised deal.
FTC Chairman Robert Pitofsky said the deal preserves competition by ensuring that cable customers won't face higher prices and reduced choices. At the same time, it will make sure other programmers will have access to Time Warner/Turner's cable systems, he said.
Bradley Stillman, head of telecommunication policy for the Consumer Federation of America, said ``We are still disappointed they didn't take more aggressive action against the proposed merger.''
He said even though steps have been ordered to insulate Time Warner from Turner shareholder Tele-Communications Inc., the two cable companies still have ``an incentive to work toward the same goals.''
Pitofsky and Commissioners Janet Steiger and Christine Varney joined in approving the settlement, key elements of which its staff negotiated in July.
Among other things, the modifications would limit TCI's influence over the new company's business, encourage Time Warner to give rival programmers access to its cable channels and discourage the new company from forcing its cable networks on carriers who may not want all of them.
TCI's role in the deal has been of keen interest because it is the nation's biggest cable system operator and has stakes in a wide array of cable programs. Together, TCI and Time Warner serve nearly half of the nation's cable subscribers.
TCI owns 22 percent of Turner and would be required under the agreement to put its 7.5 percent stake in Time Warner in a separate company.
The agency's decision won't be final until a public comment period ends in 60 days, but its action clears the way for shareholders of both companies to vote Oct. 10 on the pact.
Time Warner hopes to close the deal within days after getting shareholder support for it. The companies want another agency, the Federal Communications Commission, to approve a transfer for Turner's WTBS television license. Spokesman Ed Adler said the deal can close before final FTC approval.
Time Warner owns such cable services as HBO, the Warner Bros. movie and TV studios, and the nation's second biggest collection of cable systems.
Atlanta-based Turner, built by the charismatic cable pioneer Ted Turner, owns some of the best-known cable services, including CNN, Turner Network Television and the Cartoon Network, as well as New Line Cinema studios.
LENGTH: Medium: 61 linesby CNB