December 18, 2000 James W. Cicconi General Counsel AT&T Corp. 1120 20th Street, N.W. Suite 1000 Washington, D.C. 20036 Re: In the Matter of Applications for Consent to the Transfer of Control of Licenses and Section 214 Authorizations from MediaOne Group, Inc. to AT&T Corp., CS Docket No. 99-251 Dear Mr. Cicconi: I am in receipt of your December 15, 2000 letter filed pursuant to Paragraph 71 and Appendix B, Section 18(f)(1) of the Commission's Order in this proceeding. After reviewing your letter, we find that it is not clear whether the letter is in compliance with Ordering Clause paragraph 187 and Appendix B, Section 18(f)(1) of the Order. The purpose of my letter is to seek further clarification from AT&T regarding its election pursuant to these provisions of the Order. Ordering Clause paragraph 187 required AT&T to file with the Cable Services Bureau a written document within six months after the merger's closure "stating which one of the compliance options specified in the Video Condition it has elected." This ordering clause further provides that "AT&T shall complete its divestiture of the elected assets by May 19, 2001." The December 15, 2000 letter does not appear to make a single election, as Ordering Clause paragraph 187 requires. Although the letter states that "AT&T intends to comply with the Commission's Order by spinning off Liberty Media Group and making non-attributable its interests in other entities from which Time Warner Entertainment, L.P. ("TWE") purchases video programming, by May 19, 2001," the letter then states that, under certain circumstances, AT&T may decline to divest Liberty. Because this is not an irrevocable commitment to divest Liberty, this statement does not comply with paragraph 187's requirement that AT&T divest the assets it has elected in its six month letter. The letter's clearest commitment appears to be its certification that AT&T will comply with the Order by divesting TWE or placing its TWE interest in an irrevocable trust for purposes of sale in the event that it declines to divest Liberty. Thus, it appears that your December 15, 2000 letter means that AT&T has elected to divest TWE as the means for its compliance with the Order. If our understanding of your election is correct, and by March 20, 2001, AT&T believes that it will not have divested TWE by May 19, 2001, then AT&T must, pursuant to paragraph 189 of the Order, file a document describing the irrevocable trust arrangement that it will establish for the sale of its TWE interest. Please advise immediately if this comports with your understanding of AT&T's election. Please clarify AT&T's election immediately. Sincerely, Deborah A. Lathen Chief Cable Services Bureau In the Matter of Applications for Consent to the Transfer of Control of Licenses and Section 214 Authorizations from MediaOne Group, Inc., Transferor, To AT&T Corp., Transferee, CS Docket No. 99- 251, Memorandum Opinion and Order ("Order"), 15 FCC Rcd. 9816 (2000). The Order requires AT&T, by May 19,2001, to either (a) divest its interests in TWE, (b) terminate its involvement in TWE's video programming activities (pursuant to the limited partnership exemption and the officers/directors attribution waiver provisions of the cable ownership attribution rules, 47 C.F.R.  76.503 n.2), or (c) divest its interests in other cable systems, such that it will have attributable ownership interests in cable systems serving no more than 30% of MVPD subscribers nationwide. See Ordering Clause paragraph 186. After AT&T makes its December 15 election, Ordering Clause paragraph 189 requires that, by March 19, 2001, AT&T file another written document with the Cable Services Bureau stating whether AT&T would be in compliance by the divestiture deadline and, if not, describing an irrevocable trust arrangement for the sale of the assets that AT&T had elected on December 15. James W. Cicconi December 18, 2000 Page 2