MediaOne, Cox and Comcast in talks with AT&T
NEW YORK, Feb 9 (Reuters) - MediaOne Group Inc. (NYSE:UMG -news), Comcast Corp. (Nasdaq:CMCSA - news) and Cox Communications Inc. (NYSE:COX - news) have joined forces to negotiate potential telephone joint ventures with AT&T Corp. (NYSE:T - news), a MediaOne spokesman said Tuesday.
AT&T wants to provide local phone service using cable systems
rather than traditional phone lines.
''We're open to exploring a relationship with AT&T,'' said Steve Lang, a MediaOne spokesman said. ''It's fair to say the three of us are working together.''
Lang declined to comment on the status of the discussions. AT&T, Cox and Comcast could not be reached immediately for comment.
AT&T, the No. 1 U.S. telecommunications company, plans to buy Tele-Communications Inc. (Nasdaq:TCOMA - news) for $48 billion and last week said it would form a joint venture with Time Warner Inc. (NYSE:TWX - news). Time Warner is the largest cable operator in the U.S., and TCI the second biggest.
Analysts said MediaOne, Comcast and Cox will likely try to model their joint venture after the Time Warner deal.
Since the break-up of AT&T in 1984, the company lost control of the local telephone lines that connect directly into customers' homes and businesses. Using cable TV wires, AT&T can bypass the Baby Bells'
phone lines, and the costly access charges, to reach customers.
AT&T's deal with TCI and Time Warner will give it access to more than 40 percent of U.S. households.
AT&T has said it aims to complete additional deals with other cable companies by mid- to late-spring to help it reach two-thirds of the nation.
In addition to potential deals with MediaOne, Cox and Comcast, AT&T may also forge a pact with other cable companies such as Cablevision Systems Corp. (AMEX:CVC - news), analysts said.
Earlier this month, AT&T announced it would offer local telephone service over Time Warner's cable television wires in 33 states.
AT&T and Time Warner expect to begin a pilot project in one or two cities by the end of 1999 and to begin broader commercial operations in the year 2000.
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