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To: Irv Dimont who wrote (1705)	5/24/1999 9:35:00 PM
From: hoffy	Read Replies (1) \| Respond to of 4337

Comments from Malone on Liberty Media and Interactive TV: Technology News Mon, 24 May 1999, 9:30pm EDT Liberty Media CEO John Malone on Investments: Company Comment By Kim Chipman New York, May 24 (Bloomberg) -- The following are comments by John Malone, chairman of Liberty Media Group Inc., the programming arm of AT&T Corp., on investment strategies, interactive television and other topics. He spoke at Liberty's investor conference Thursday in New York City. On Liberty Media's investment strategy: ''There's no need to place all your money on one horse when you can sort of bet the category in your investment strategy. Liberty intends to do that.'' ''If Liberty can carefully invest in promising prospects and then, as they develop, nurture them and find synergies between various units -- and find all that in a tax-efficient capital structure ... then (we've) improved (our) probability for success and gain a higher-than-expected long-term growth rate to the capital asset values. That's really what Liberty is about.'' ''We have a great portfolio right now, and we get to see most investment opportunities that come down the pike. We still have a long list of bits and pieces that are growing rapidly and are designed to go somewhere -- to either end up as more stock in Time Warner Inc. or more stock in News Corp. or perhaps stock in Walt Disney Co.'' On Liberty's cash position (about $5 billion): ''Our cash position is about 10 percent of our market capitalization. It's probably prudent to retain a pretty liquid, flexible cash position. It allows transactions to take place quickly without intervention and allows the company to be extremely opportunistic.'' On managing investments: ''When you are running a large portfolio ... you have to start thinking, 'What if air comes out of the market?' How do you hedge that, and how do you take advantage of the cycles? ... You want a 'win-win' strategy. When things are good and the portfolio is strong . . . you are winning. When things get soft, how can you position yourself advantageously to take advantage of that? Position in Sprint PCS, a wireless telephone joint venture: ''The (U.S.) Justice Department requires Liberty to dispose of (its stake in Sprint PCS) down to 10 percent within three years and completely out within five years. The market value of our position ... is about $5 billion. We believe it's a terrific business being very well run by competent management. As European- type wireless values are applied to U.S. marketplace and we start to see kind of penetrations in wireless as seen in Europe, the strength of the Sprint strategy will come forward.'' ''We think it's a good investment. We aren't anxious to get out of it. We would love to be able to transmogrify it into someone's equity securities that we would be allowed to own. We'd like the prospects of that. We have at least two years to study that situation and explore other structural changes before we would actually want to do a taxable transaction for the position. Now, between now and then, we may well do some sort of derivatives transaction in order to pull the capital out of some or all of the position. But we'd be anxious to avoid going to a taxable transaction until or unless we had exhausted all the structural opportunities to do it tax free way.'' On introducing interactive television: ''People will try to position themselves very early on. My guess is that an Amazon.com Inc. or America Online Inc. will want to put forth interactive TV components if there's one box out there capable of working. So there will be a real dogfight in terms of positioning, because people will assume that once it's on, it's going to be hard to get it off.'' ''I expect 35 percent to 50 percent penetration of advance interactive within five years. That would be plenty of capacity to attract plenty of investment capital to develop the services. You will see it start late this year in terms of demonstration projects.''