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Technology Stocks : AUTOHOME, Inc -- Ignore unavailable to you. Want to Upgrade?

To: John Carragher who wrote (8599)	4/25/1999 8:38:00 AM
From: Richie	Respond to of 29970

Article about T and broadband: Apologies if this has been posted, RichieH Behind AT&T's $58B bet on broadband By Louis Trager, ZDNet AT&T Chairman C. Michael Armstrong is more than doubling his shareholders' enormous bet on cable broadband for consumers with an unsolicited $58 billion bid to seize MediaOne Group from the acquiring clutches of fellow cable giant Comcast Corp. (Nasdaq:CMCSA - news) The megamerger, announced late Thursday, would add a crucial building block in AT&T's (NYSE:T - news) strategy to re-establish the end-to-end scope of the old Bell monopoly. The carrier would add high-speed Internet and digital video weapons in its role as dominant national competitor in the residential market to the consolidating Bells. "We are counting on the broadband cable infrastructure to be the heart of our strategy," Armstrong said Friday. Specifically, success in the MediaOne (NYSE:UMG - news) bid would expand AT&T's newly asserted leadership of the U.S. cable industry and give the carrier a massive stake in the RoadRunner cable modem operation and @Home (Nasdaq:ATHM - news) counterpart. Time Warner deal coming? In addition, it could grease the skids for a partnership with No. 1 cable operator Time Warner (NYSE:TWX - news) -- a deal reportedly hung up by MediaOne, a big Time Warner shareholder. But the proposed deal would burden AT&T with huge immediate costs in exchange for finite gains, mostly some years out. Issuance of 626 million new shares as partial payment would slash earnings per share 30 cents this year. Even with the acquisition, AT&T would have direct cable access to only one-quarter of U.S. homes. To circumvent the Bells' high fees and entrenched incumbency, AT&T would have to continue slogging through negotiations for cable, wireless and competitive-carrier partnerships. AT&T promises long-term growth as payoff. Meanwhile, it plans to divest $18 billion to $20 billion in "nonstrategic" assets, probably including some programming. AT&T expects its net price to be trimmed by up to $200 million in Tele-Communications Inc. (Nasdaq:TCOMP - news)-MediaOne "synergies" and $2 billion in additional AT&T cost savings before 2001 - including $850 million in network and operations expenses, $400 million in access and interconnection charge reductions and $250 million in bureaucratic belt-tightening. Bells howl Still, the net price of $4,700 per subscriber is about two-thirds more than the rich price AT&T paid in its $48 billion acquisition of the larger TCI (Nasdaq:TCOMA - news) last year. AT&T acknowledged that deal helped lift market prices and make Comcast bid almost $50 billion. MediaOne, however, is a quality property. "This is better stuff than TCI," said AT&T Broadband and Internet chief Leo Hindery, who ran TCI and would get authority for the MediaOne assets. MediaOne promises to have 70 percent of its network upgraded to two-way capability by year's end vs. TCI's 51 percent. It wasn't clear at press time whether Comcast, the fourth largest cable operator, would up the ante. The AT&T offer would reimburse MediaOne shareholders for any AT&T stock price drop up to 10 percent. "Comcast may not have the cash" to wage a bidding war, Kinetic Strategies' Michael Harris said, and may become takeover fodder itself. Bells howled at the AT&T offer. "AT&T is creating Ma Cable, going back to the bygone days of a [phone] monopoly that happily increased rates 5 [percent] to 15 percent" annually and at will, Bell Atlantic President Jim Cullen said. He accused AT&T of hypocrisy in insisting Bell networks be thrown open to competitors while AT&T assembles its own massive "closed, proprietary system." Antitrust objections low But even with the nation's largest telecom trying to consolidate cable, analysts didn't expect staunch antitrust resistance. In the nature of local cable monopolies, No. 3 operator MediaOne doesn't compete significantly with AT&T's ex-TCI properties, which rank second nationally. And policy-makers, who liked the TCI deal as the first big battering ram against the Bells' residential monopoly, may love the MediaOne bid for the same reason. One hang-up could be that besides owning 70 percent of @Home, AT&T would inherit MediaOne's 40 percent stake in RoadRunner. AT&T raised a conciliatory flag, offering to do whatever necessary to gain regulatory approvals to close the deal this year. The Federal Communications Commission was closed Friday for a federal holiday and unavailable for comment. Karen J. Bannan, Dennis Mendyk, William Rodger and Kimberly Weisul contributed to this report

To: John Carragher who wrote (8599)	4/25/1999 12:31:00 PM
From: Jing Qian	Respond to of 29970

Philadelphia Sunday Inquirer's opinion probably coincides with Ahhaha's comments. Ahhaha probably knows more than us. But so far his explanation of it was lame, such as autonomy and freedom, or FCC's denial. I don't see UMG will necessarily get more autonomy or freedom from Comcast. I also don't see FCC will go out of its way to crush an unproven competition based on perception. Ahhaha does have some reason, but not compelling enough. I wish Ahhaha can come out and explain more, not simply repeat what he has already told us.