APPARENTLY ENTANGLED IN determining exactly what restrictions to impose on the blockbuster merger between Time Warner and America Online (AOL), the U.S. Federal Trade Commission (FTC) has decided to delay action for up to three weeks.

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"The parties have committed in the last 24 hours to offer new proposals to address competitive issues in connection with the proposed merger," the FTC said in a statement issued Thursday.

For several weeks AOL and Time Warner have been embroiled in a heated back-and-forth with the FTC in trying to defend the merger, which was valued initially at $350 billion. In September the FTC voiced concern that the merger generally would harm competition in the market for Internet access.

The Federal Communications Commission will also weigh in on the government's ultimate merger decision.

At the heart of both the delay and the fresh proposals is the issue of "open access" by competing ISPs to Time Warner's broadband cable networks. Combined, AOL-Time Warner would dominate, at least initially, ownership of the nation's broadband cable backbone.

Advocates for competing ISPs earlier this week were preparing to heavily scrutinize any restrictions that the FTC put on the AOL-Time Warner merger decision. That decision was originally due to be announced on Thursday. ISPs large and small want an opportunity to offer services using Time Warner's broadband cable infrastructure. Many of them were heartened by recent published reports that claimed regulators might forbid AOL and Time Warner from marketing joint products until well after the merger.

"It is important that the combined company be restrained from being a first mover until the market has time to mature," said Jeffrey Chester, executive director of the Center for Media Education in Washington.

Chester predicted that the FTC will be far from silent on the issue of open access.

"The question is how well-defined and meaningful will the restrictions be?" he said.

Those questions, however, will continue to remain unanswered following the FTC's five-votes-to-zero decision to delay action. It is not the first delay: Several deadlines for deciding the matter have passed without resolution.

Dulles Va.-based AOL and New York-based Time Warner announced plans in January for a stock-swap merger. The combined company, to be called AOL Time Warner, will have revenue of about $40 billion and a global subscriber base of more than 100 million.