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Action Audits, LLC <br />August 30, 2000 <br />Geoffery Gledhilll <br />County Attorney <br />Orange County <br />PO Box 8181 <br />Hillsborough, NC 27278 <br />RE: AOL-TW Transfer Resolution and Memorandum of Understanding <br />Dear Mr. Gledhill: <br />The Memorandum of Understanding, ("MOU") sets out voluntary commitments AOL Time <br />Warner made to provide open access (i.e., to make a choice of multiple Internet Service <br />Providers ("ISPs") available to consumers) on its broadband cable systems as a condition of <br />merger approval by the Federal government. AOL Time Warner consumers will not be required <br />to purchase service from an ISP that is affiliated with AOL Time Warner to enjoy broadband <br />Internet service over AOL Time Warner's cable system. <br />On August 1st, Juno Online Services became the first unaffiliated Internet Service Provider (ISP) <br />to enter into an agreement with the parties to offer a competing high-speed Internet service to <br />Time Warner cable customers in direct competition with Time Warner's Road Runner Internet <br />service. The agreement with Juno and AOL Time Warner indicates that AOL Time Warner is <br />serious about fulfilling the terms of the MOU. <br />Although AOL Time Warner will not place any fixed limit on the number of ISPs it will enter <br />into commercial arrangements to p;ovide broadband service to consumers. AOL Tirne Warner <br />has assured the FCC it will offer its consumers a wide choice among ISPs, consistent with <br />providing a quality consumer experience and any technological restrictions which might limit the <br />number of multiple ISPs carried on its broadband cable systems. The true extent of any such <br />limitation is not yet known; however, it is conceivable that a dozen or so ISPs could be <br />accommodated. <br />The Transfer Resolution represents the initial step by government in the process of articulating <br />the terms, conditions and pazameters under which a combined AOL Time Warner will offer <br />consumers access to multiple ISPs on its broadband cable systems. The Federal <br />Communications Commission is in the process of rule promulgation which, when released, will <br />Action Audits, LLC: Franchise Fee U-Tax Auditing & Telecommunication Administration <br />101 Pocono Lane, Cary, North Carolina 27513-5316 Voice # 919.467.5392 Fax # 919.460.6868 <br />