Google, Comcast talks on AOL progressing: sources

HONG KONG/NEW YORK (Reuters) - Talks for Google and Comcast to buy a minority stake in Time Warner's America Online are progressing, sources close to the matter said on Thursday, even as a top Time Warner executive declined to confirm the negotiations.

At a luncheon in Hong Kong, Time Warner chief executive Richard Parsons declined to comment, saying, "It's market rumours, and I can't curb market rumours."

Google initiated discussions shortly after press reports first emerged about Microsoft rekindling discussions on buying a stake in AOL, the sources have said.

Three sources told Reuters that web search engine Google and cable company Comcast Corp were in talks to buy a stake in AOL in a deal worth up to US$5 billion for just the free programming and features such as instant messaging and its website.

Questions remain over what specific properties Google and Comcast would buy and what they are worth, one source said.

Meanwhile, sources have also said discussions are continuing with Microsoft.

Microsoft's technology and AOL's service would be complementary, Parsons said, although he declined comment on any talks.

Time Warner and Microsoft discussed an alliance earlier this year, but negotiations stalled over a range of issues including technical obstacles and questions about control.

Time Warner is interested in expanding operations in China and India, Parsons said, with India's market more inviting.

"India, I think, offers more current potential for us as it has a stronger rule-of-law culture," he said.

The obstacles in India are largely technical due to a lack of infrastructure, but there are fewer regulatory and cultural hurdles to overcome than in China, he said.

"I think gradually, gradually, they'll open up in their way," he said, referring to the Chinese market.