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To: Skip Jack who wrote (1646)	4/10/1999 12:42:00 PM
From: Skip Jack	Respond to of 13157

All, I just found this article, not only is ACTV mentioned again, Liberty also talks about providing interactive video services to AT&T cable systems. Now that we know AT&T is making a big announcement next week in LA, I wonder if???????????????????????????????????????????? ***************************************** Date Posted: 4/9/1999 TCI Music gets the goods Liberty adds priceline.com, others to lackluster division to create new media contender In preparation for putting Liberty Media at full sail in digital seas, John Malone intends to transform the obscure and underperforming TCI Music into the figurehead for Liberty's Internet-interactive TV investments. The plan is for Liberty, a dominant force in the cable programming arena, to achieve racing trim by contributing its Internet and interactive television holdings to TCI Music; in return, Liberty gets even greater control of the company. "This is going to be Liberty Media's and John Malone's primary vehicle for investing in Internet, new media, and related technologies," says Lee Masters, chairman of TCI Music and CEO of Liberty Digital (currently not part of TCI Music). "This company is going to be for the Internet and new media what Liberty is for cable programming." Among the holdings Liberty would swap to TCI Music: priceline.com, iVillage, Sportsline USA, drugstore.com, iBeam, Interactive Pictures Corp., and ACTV. Perhaps as importantly, Liberty would contribute its rights to provide interactive video services to AT&T cable systems. Assuming TCI Music stockholders approve the proposal this month, the company would become Liberty Digital, with 94% of the equity owned by Liberty Media. That compares to Liberty's current 86% equity ownership of TCI Music. In an era where the standing joke is that you can double a stock's price just by adding ".com" to the name, it's not surprising that even the idea of a Malone-Internet pairing has enormous impact. For example, on the day Liberty made its proposal, TCI Music shares skyrocketed a stunning 253% to $29.5625, boosting TCI Music's market cap from $681.7 million to $2.4 billion in the space of a few hours. While the Internet-induced stock euphoria likely will ebb and flow, analysts are encouraged by what the proposed asset reorganization means for Liberty. "By contributing those assets (to TCI Music), people can see what they're worth and Liberty has a currency going forward to do Internet-related transactions," says Mark Greenberg, manager of mutual fund giant Invesco's Leisure Fund. "For those reasons, it makes sense."

To: Skip Jack who wrote (1646)	4/10/1999 12:50:00 PM
From: Skip Jack	Read Replies (3) \| Respond to of 13157

More interesting reading about John and Ruport ********* Date Posted: 4/9/1999 Getting out of the sports biz Liberty Media surprises observers by divesting its half of Fox Liberty Networks John Malone doesn't really need sports any more and is looking for investments with a better financial kick. That's the rationale behind the Liberty Media Corp. chairman's decision to sell his half of the Fox Liberty Networks to 50-50 partner News Corp. for $1.4 billion worth of News Corp. stock. Liberty's first major deal since Malone parted with Tele-Communications Inc. in February gives the first glimmer of how Liberty's massive portfolio might change now that its ties with TCI's systems have been diluted, if not necessarily severed. Malone sold TCI's systems to AT&T Corp. for $50 billion. He personally continues to hold a $3.5 billion stake in the long-distance carrier and Liberty is still technically a subsidiary of AT&T, with some close operating ties to the cable systems. But as a "tracking stock" with a completely different shareholder base from AT&T's, Liberty interests have diverged from TCI, industry and Wall Street executives said. "Liberty and TCI have always been managed for the mutual interests of both companies," said one Malone associate. "That's changed." Bear, Stearns & Co. media analyst Ray Katz agreed. "TCI is not what TCI was; it's a division of AT&T," Katz said. "Liberty is essentially a separate stock. They are more financial investors than strategic investors, and they see a better return in trading sports for News Corp. stock." Liberty President Dobb Bennett focused only on the second half of the equation: that operating problems at News Corp. over the past year have left the company undervalued. By exchanging the sports networks for News Corp. shares and buying even more stock, "We're acquiring a security that we think has substantial upside built into it." The deal will put the extensive network of regional sports channels firmly in the hands of sports-ambitious News Corp. Chairman Rupert Murdoch. His Fox Entertainment Group can now exploit the sports networks in new ways, such as cross-promoting and programming the local nets with his Fox Broadcasting operation. Fox President Chase Carey said Fox can also use subscribers' and operators' high demand for local sports to leverage greater carriage for other non-sports networks like Fox News Channel, Fox Movies, or channels launched later. "Sports is important as a locomotive to drive our entire business forward," said Carey. "The power of live sports, particularly local sports, is just going to get stronger." Carey said that he doesn't expect any further major sports-related acquisitions and is not seeking to restructure its sports network and team partnership with Cablevision Systems Corp.'s Rainbow unit. The deal calls for Liberty to shed its half of Fox Liberty Sports in exchange for 51.8 million News Corp. shares. In a second transaction, Liberty will pay $700 million for 28.1 million shares owned by MCI Worldcom Inc., which had invested in News Corp. in 1996 in anticipation of launching a now-derailed DBS venture. MCI's remaining 28.1 million News Corp. shares will be sold to Saudi Prince Al Waleed Bin Talal and News Corp. itself. That will leave Liberty the News Corp.'s second-largest shareholder, with 8% of the company's stock. The deal was not terribly shocking, since Murdoch's hunger for sports and professional teams has been clear and rumors of some sort of deal had been percolating for months. What surprised industry and Wall Street executives is that Malone's first post-TCI move would be a divestiture, rather than a substantial acquisition. Armed with cash from selling some Liberty assets to AT&T plus a huge slab of stock in AT&T and Sprint PCS from other operations, Malone has about $9 billion worth of liquid assets and the capacity to readily borrow several billion more, plenty to finance any number of major acquisitions. The president of another MSO contrasted Malone to USA Network Inc. Chairman Barry Diller, who is rushing to acquire all sorts of media and Internet properties, such as Lycos and October Films, which don't necessarily fit into his existing operations. "John doesn't need to build an empire. He already has one," the executive said. "What he's doing is portfolio management, trading assets for something that will get a superior return."