Win-Win Reached for Parceling of AOL Time Warner Entities

After almost two years of wrangling and negotiating, AT&T, Comcast and AOL Time Warner are poised to announce a $9 billion settlement agreement over AOL's Time Warner entities, with all three companies claiming victory over the settlement terms. The agreement reportedly grants AOL Time Warner exclusive control of Time Warner Entertainment, including HBO and Warner Brothers film studio media properties. The agreement could also provide AOL's America Online Internet division with a much needed face lift, in the form of a large cash infusion and access to high speed cable for its subscribers.

As part of the deal, it is rumored that AOL Time Warner will give AT&T nearly $2 billion in cash, $1.5 billion in AOL Time Warner shares, and approximately 21% of Time Warner Cable, a newly formed unit that includes all of AOL Time Warner's nearly 12.9 million cable subscribers in the U.S. Comcast will receive the aforementioned cash, AOL Time Warner shares and the percentage of Time Warner Cable when Comcast concludes its pending acquisition of AT&T cable operations before December 31st of this year. AT&T and Comcast reportedly plan to jointly offer America Online high-speed cable modem services to approximately 7.5 million subscribers in Boston, Seattle, Nashville and Indianapolis and their vicinities after completion of the AT&T cable operations acquisition, and hope to eventually expand the high-speed cable modem services to all 21 million of AT&T Comcast's combined customers.