New York - Several days after facing scrutiny from regulators for its planned merger with America Online (AOL), Time Warner has made its first deal to allow an independent Internet service provider (ISP) access to its cable system.
Time Warner Cable was going to announce yesterday a preliminary agreement with Juno Online Services to offer high-speed Internet service to cable customers, the companies said.
New York-based Time Warner's promise to open its cable system to competing ISPs is being carefully monitored by regulators.
The issue was highlighted last week during Federal Communications Commissions (FCC) hearings on the Time Warner-AOL merger.
The merger has been criticised by some television networks and consumer groups, who fear that the combination could result in an unfair concentration of power.
Glenn Britt, president of Time Warner Cable, said: "This groundbreaking agreement underscores Time Warner Cable's commitment to offer its cable customers a choice of Internet service providers."
Britt said the company would try to sign agreements with other ISPs.
At last weeks regulatory hearings, William Kennard, the chairman of FCC, challenged AOL chairman Steve Case and Time Warner chief Gerald Levin to offer details about when the cable systems would begin carrying other Internet providers.
Levin said the company was working to open access by restructuring an agreement with Road Runner LLC, a joint venture between Time Warner and AT&T, and the only ISP available to Time Warner Cable subscribers.
Levin said the firm was conducting technical trials of how such a system would operate.
Levin also issued an open invitation to any Internet provider that wanted to talk to Time Warner about operating on the company's cable systems, and predicted that an agreement with a separate online service business was forthcoming.
Time Warner Cable and Juno said rollout dates for the Juno service would depend on Time Warner renegotiating its exclusive agreement with Road Runner.
Time Warner Cable has more than 12,6 million customers nationwide.
New York-based Juno offers both free and paid Internet access.
It had 3 million active subscribers in March, making it the third largest ISP after AOL and EarthLink.