MS offers deal to AT&T to steal AOL bid
ZDNet | at | by Mike
Microsoft Corp., in a highly unusual move, is offering to financially back two rival bidders for AT&T Corp.'s cable-television business as it tries to thwart a third bidder, AOL Time Warner Inc. Microsoft is backing both Cox Communications Inc. and Comcast Corp., two cable concerns that made separate, competing offers to acquire AT&T Broadband, AT&T's cable unit, according to people familiar with the situation. The software company's interest in backing the competing bids stems in large part from its interest in blocking AOL.
A fierce competitor of AOL, Microsoft is concerned about the media company's ability to get its hands on AT&T Broadband, the nation's largest cable-TV business, according to people familiar with the situation. If AOL were to win, it would catapult the company to the No. 1 spot with more than 25 million cable subscribers. With $36 billion in cash at its disposal, Microsoft is trying to keep AT&T's 13.7 million cable subscribers in the hands of a friendly ally.