AOL discusses deal with cheap PC maker

AOL discusses deal with cheap PC maker has confirmed that it has talked with America Online about forming a "cross-marketing" arrangement for its new $US199 computer, but said there are no plans to be acquired by AOL.

News reports speculated AOL might acquire Microworkz to allow the online giant access to the computer market. Rick Latman, Microworkz president and chief executive officer, denied that and said his company had discussed with AOL making the iToaster computer an "AOL-branded box", MSNBC's Web site reported.

A Microworkz spokeswoman said that the company is pursuing a marketing deal with AOL and other online companies to provide online service for iToaster users.

"We are not in acquisition talks with AOL," said Luanne Brown. "We are looking at all sorts of possibilities. The phrase we are using is cross-marketing -- working together to help each other out."

Microworkz is also discussing possible deals with other companies that could deliver Internet content with the iToaster, Brown said, declining to name the companies.

AOL could not be reached for comment.

The iToaster, launched at the recent PC Expo in New York, does not use a Windows-based operating system, relying instead on a mix of Linux and BeOS systems. The iToaster, which requires the purchase of a separate monitor, is scheduled to ship in the US on July 15.

The arrangement would allow computer users to access AOL's Internet service without connecting to Windows, the operating system of AOL's arch-rival Microsoft.

In defending itself against an antitrust lawsuit filed by the US Government, Microsoft introduced in court the MSNBC story about the potential AOL-Microworkz deal as evidence of the competition Windows faces from new entrants into the operating system market. http://www.microworkz.com

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