Joan Marsh 1120 20th Street NW Director, Federal Government Affairs Suite 1000 Washington DC 20036 202/457-3120 FAX 202/263-2716 January 13, 2000 Ms. To-Quyen Truong Associate Chief Cable Services Bureau Federal Communications Commission 445 12th Street, SW Washington, DC 20554 Re: In the Matter of Applications for Transfer of Control to AT&T Corp. ("AT&T") of Licenses and Authorizations Held by MediaOne Group, Inc. (MediaOne"), CS Docket No. 99-251 Dear Ms. Truong: This letter sets forth AT&T Corp.'s and MediaOne Group, Inc.'s response to your December 22, 1999 request for information: Question 1: The November 22, 1999 response to Question 7 states that the Yankee Group survey and the MediaOne research cited in the McGee affidavit would be provided under separate cover. Please provide all other documents that are responsive to Question 7 or confirm that no such documents exist. Response to Question 1: As part of its response to Question 7, AT&T provided to the Commission on November 24, 1999, a 1997 local services brand preference report (AT&T 000915) that showed the relative strength of the AT&T and MediaOne brands for local service. The results of that survey also were set forth in AT&T's November 24th response to Question 12 (p. 8). MediaOne's brand research was provided to the Commission on November 24, 1999 (AT&T 000782-840), as was the Yankee Group survey (Bates No. AT&T 000210). In response to the Commission's supplemental request, AT&T requested that its consumer services organization responsible for brand issues identify additional brand survey information. AT&T is providing separately under the protective order the brand survey identified by that organization (Bates Nos. AT&T 002476-543). Question 2: The November 24, 1999 response to Question 11 states that "AT&T will provide. . . documents that show the advantages of the merger with MediaOne." Please provide the other requested documents or confirm that no such documents exist. Response to Question 2: On December 2, 1999, AT&T provided to the Commission contemporaneous documents that specifically discussed the advantages of the MediaOne merger (AT&T 000943-960; AT&T 000961-999; AT&T 000995-2018; AT&T 002019-2045). In addition, AT&T's filings with the Commission in connection with this application have demonstrated the advantages of the merger. See, e.g., Public Interest Statement, filed July 7, 1999; AT&T Reply Comments, filed September 17, 1999; AT&T Ex Parte Reply Comments, filed December 14, 1999. In response to the Commission's supplemental request, AT&T has searched the files of a number of AT&T persons who have been involved with the MediaOne merger. Other than the documents previously produced to the Commission, no other responsive documents were discovered. Question 3: The November 24, 1999 response to Question 14 states that "[b]ecause the merger has not been consummated, AT&T and MediaOne have not completed any formal planning regarding post-merger activity in MediaOne's service areas." No documents were provided in response to this request. Question 14 was not limited to AT&T's and MediaOne's formal planning. Accordingly, please provide all information and documents that are responsive to Question 14 or confirm that no such documents exist. Response to Question 3: As part of their November 24th response to Question 13, AT&T and MediaOne provided under confidential seal their schedules for the upgrades of their systems and deployment of cable telephony. After the merger, MediaOne will continue to upgrade its systems and deploy cable telephony in accordance with that schedule. However, the addition of the AT&T brand, consumer marketing expertise, and customer care infrastructure and experience, plus efficiencies created by the merger, is expected to increase significantly both consumer acceptance of MediaOne's telephony offer and the volume of customer orders that can be provisioned in a given period. AT&T and MediaOne have had increasing discussions to plan how cable telephony will be offered over the MediaOne and AT&T cable systems post-merger. These discussions have ranged from how people and organizations will be integrated after the merger to what integrated systems and processes will be used in the future. We are producing separately under the protective order recent documents that reflect such discussions and planning (Bates Nos. AT&T 002462-75). These documents further demonstrate that the cable telephony efforts of both companies will benefit from the merger as the combined entity integrates the best processes, systems, and assets of each party to enhance the ability to provide competitive local telephone services. AT&T would welcome the opportunity to brief the Commission further on these planning efforts. Question 4: The November 22, 1999 response to Question 16 states that "[d]ue to its position as a passive investor in Time Warner Entertainment Company, L.P., MediaOne does not have access to information that would be necessary to respond to this question regarding the holdings of TWE, TWE Advance/Newhouse or TWI Cable." Please provide the requested information as it pertains to TWE, TWE Advance/Newhouse, and TWI Cable. MediaOne's status as an investor in TWE, whether active or passive, does not affect MediaOne's obligation to provide information necessary for Commission staff to process its application. The requested information is necessary to enable staff to determine whether the proposed license transfers would violate the Commission's cross- ownership rules. Response to Question 4: Neither TWE, TWE Advance/Newhouse, nor TWI Cable holds any interest in any MDS licensees or television broadcast stations. Several Time Warner cable systems have from time to time acquired SMATV systems in their cable service territories, but these SMATV systems are integrated into the particular Time Warner cable system and offer service in accordance with the terms and conditions of the operator's franchise agreement. Accordingly, ownership of these SMATVs does not violate the Commission's cross-ownership rules. See 47 C.F.R.  76.501(e)(2). Question 5: The November 24, 1999 response to Question 19 indicates that MediaOne owns interests in competitive local exchange carriers that provide service in AT&T cable franchise areas. The response includes a chart showing areas of overlap between MediaOne cable franchise areas and areas where AT is or will be providing local telephone service using its own switching facilities. Using a similar chart and/or other descriptive means, please: (a) identify AT&T cable franchise areas in which MediaOne owns an interest in any local exchange carrier; (b) identify the local exchange carrier and the level of MediaOne's ownership interest; (c) describe the nature of the service being provided by the local exchange carrier; (d) state when the local exchange carrier first provided service in each area, how many customers are now served, and how many customers could be served using existing facilities (assuming the addition of drop lines or other facilities that normally would be installed upon initial customer hook-up); (e) state the market share held by MediaOne or its affiliates in each overlap area; and (f) identify all other entities that provide residential local exchange service in each area. Response to Question 5: In addition to providing local telephone service in several of its cable franchise areas, MediaOne owns an interest in only one competitive local exchange carrier, Time Warner Telecom, which serves only business customers. We are providing separately under the protective order a chart (Bates Nos. AT&T 002544-47) which contains the requested information about Time Warner Telecom's service in AT&T cable franchise areas, insofar as such information is available. Because Time Warner Telecom has only recently begun to provide service in these areas, information about subscribers is limited. Question 6: In the Transfer of Control Applications Public Interest Statement dated July 7, 1999 ("Public Interest Statement"), at 41 n.93, AT&T and MediaOne state, "MediaOne has entered into definitive agreements for transfers to Time Warner that will eliminate [franchise] overlaps with AT&T in Riverside-San Bernardino, with the exception of franchise territories in which there is no overbuilding." After the Time Warner-MediaOne transfer agreements are consummated, will AT&T and MediaOne hold cable franchises with overlapping territories in Riverside-San Bernardino? If so, identify any such overlapping territories. Response to Question 6: AT&T's predecessor, Inland Valley Cablevision, was authorized to operate in the City of Murrieta, California under its Riverside County franchise until that franchise expired. AT&T also held franchises to serve the City of Beaumont and several communities in Riverside County, California. In December 1999, AT&T contributed all of these systems to a partnership that is currently managed by Adelphia. AT&T retains a 25 percent interest in that partnership. MediaOne had franchises to serve Murrieta, Beaumont, and Riverside County, California. There was an overbuild between MediaOne and AT&T in the City of Beaumont of less than 100 customers. MediaOne transferred the Beaumont system and one of the Riverside County systems to Time Warner in a deal that closed August 31, 1999. MediaOne retains its Murrieta system and three other Riverside County systems (Riverside County, Riverside County/Corona, and Riverside County/Lake Elsinore/The Farm). Now that the transaction between MediaOne and Time Warner has closed, MediaOne has an authorization to serve Murrieta that overlaps with the authorization held by the Adelphia partnership, in which AT&T has a 25 percent interest. There are no overbuilds in Murrieta. Question 7: Identify all AT&T and MediaOne cable franchises that have overlapping service areas, including franchises that were transferred after July 7, 1999, or for which transfer of ownership agreements are now pending. For each cable franchise identified, state: (a) the service area (including city and county) of the franchise; (b) the franchise's community unit identification number(s) ("CUID"); (c) the acquiring party; (d) the date the transfer agreement was entered into; and (e) if applicable, the date on which the agreement was consummated. Response to Question 7: We are providing separately under the protective order a chart (Bates Nos. ATT 002548-51) which contains the requested information for all communities where AT&T and MediaOne have overlapping franchise authorizations. As the chart demonstrates, the extent of the overlaps is small and the only actual overbuilds occur in four communities in Atlanta. Question 8: At the November 17, 1999 meeting between MediaOne and Commission staff, staff requested and MediaOne agreed to provide maps and charts showing the projected timeline for systems upgrades and provision of new broadband and telephony services in MediaOne's franchise areas, and the average income levels and racial and ethnic composition of households in the covered areas. Please provide the requested maps and charts. Response to Question 8: The maps and charts are being provided separately under the protective order (Bates Nos. AT&T 002407-461). Sincerely, Joan Marsh AT&T Corp. Susan Eid MediaOne Group, Inc. cc: Sunil Daluvoy Royce Dickens Page 6