NEW YORK (CNN/Money) - America Online Inc. has agreed to purchase access to Covad Communications Group Inc.'s high-speed digital phone lines, positioning itself to expand into the broadband market, a newspaper reported Friday.

The deal comes on the heels of a similar agreement by AOL to offer high-speed service to as many as 19 million homes over AT&T Corp. and Comcast Corp.'s cable systems, the Washington Post reported.

AOL Time Warner (AOL: Research, Estimates) is the parent company of CNN and CNN/Money.com.

Covad's network can reach more than 40 million homes and businesses in the nation's largest cities. The new arrangement allows AOL to patch holes in its coverage area and reach more customers, AOL Broadband President Lisa Hook said.

America Online will pay Covad a set amount per subscriber, but both companies declined to say how much that will be.

Separately, the Post also reported that ex-Bertelsmann AG chief Thomas Middelhoff, booted by the board of directors in July, has met with top AOL executives over the past two days.

The company would not say if Middelhoff, who met this week with Chairman Stephen Case and CEO Richard Parsons, is interviewing for a job, or which job that might be, according to the report.

However, no top-level jobs appear to be available. The media conglomerate shook up top management in July after the resignation of Chief Operating Officer Robert Pittman, essentially eliminating his position. The company created an Entertainment & Networks Group reporting to Parsons and headed by former HBO chief Jeffrey Bewkes, and a Media & Communications Group, run by former Time Inc. head Don Logan, the paper reported.

Shares of AOL Time Warner (AOL: Research, Estimates) slipped 48 cents to $12.11 Thursday.