==============================================================================


                         UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION

                    Washington, D.C. 20549


                            FORM 10-Q


    [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

        For the Quarterly Period Ended September 30, 1999

                              OR

  [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

       For the transition period from _______ to _______

                  Commission File Number 1-8611

                       MediaOne Group, Inc.

A Delaware Corporation                          IRS Employer No. 84-0926774

            188 Inverness Drive West, Englewood, Colorado 80112

                   Telephone Number 303-858-3000

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such  shorter  period that the registrant  was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X_ No __

The number of shares of MediaOne Group, Inc. common stock  outstanding (net of
shares held in treasury), at October 29, 1999, was 611,980,629 shares.

===============================================================================

                                     MediaOne Group, Inc.
                                           Form 10-Q

                                      TABLE OF CONTENTS
<TABLE>
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Item                                                                                 Page
                                PART I - FINANCIAL INFORMATION


1.   MediaOne Group, Inc. Financial Information

             Consolidated Statements of Operations -
                Three and Nine Months Ended September 30, 1999 and 1998                3

             Consolidated Balance Sheets -
                September 30, 1999 and December 31, 1998                               5

             Consolidated Statements of Cash Flows -
                Nine Months Ended September 30, 1999 and 1998                          7

             Notes to Consolidated Financial Statements                                8

2.   MediaOne Group, Inc. Management's Discussion and Analysis of
             Financial Condition and Results of Operations

             Consolidated Results of Operations                                       22

             Liquidity and Capital Resources                                          34

             Risk Management                                                          38

             Selected Proportionate Data                                              44

3.   MediaOne Group, Inc. Quantitative and Qualitative Disclosures About              47
         Market Risk
</TABLE>

                          PART II - OTHER INFORMATION
<TABLE>
<CAPTION>
<S>                                                                                   <C>

1.   Legal Proceedings                                                                48

6.   Exhibits and Reports on Form 8-K                                                 48
</TABLE>

                                        2

Form 10-Q - Part I
                               MediaOne Group, Inc.
                      Consolidated Statements of Operations
                                  (Unaudited)
<TABLE>
<CAPTION>
<S>                                                                       <C>                        <C>

------------------------------------------------------------------------- -------------------------- --------------------------
                                                                             Three Months Ended          Nine Months Ended
                                                                                September 30,              September 30,
                                                                          -------------------------- --------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                                       <C>          <C>           <C>          <C>

Dollars in millions                                                          1999          1998         1999          1998
------------------------------------------------------------------------- ------------ ------------- ------------ -------------
Sales and other revenues:
    Cable and broadband                                                         $ 674        $  620       $2,000     $   1,857
    Corporate and other                                                             1             6            2            21
    Wireless communications                                                         -             -            -           361
                                                                          ------------ ------------- ------------ -------------
     Total sales and other revenues                                               675           626        2,002         2,239
                                                                          ------------ ------------- ------------ -------------

Operating expenses:
    Cost of sales and other revenues                                              270           225          804           783
    Selling, general and administrative expenses                                  185           208          549           710
    Depreciation and amortization                                                 306           288          884           894
                                                                          ------------ ------------- ------------ -------------
      Total operating expenses                                                    761           721        2,237         2,387
                                                                          ------------ ------------- ------------ -------------

Loss from operations                                                              (86)          (95)        (235)         (148)

Interest expense                                                                 (114)          (86)        (313)         (379)
Equity losses in unconsolidated ventures                                          (89)          (68)        (291)         (273)
Gains (losses) on investments:
   Sales and redemption of domestic investments                                   418             3          510            42
   Sales and exit costs of international investments - net                        163             -          295             -
   Exchange of AirTouch investment                                                  -             -        2,482             -
   Sale of domestic wireless investment                                             -             -            -         3,869
   PrimeStar investment                                                             -             -          (65)            -
Minority interest expense in Centaur Funding                                      (26)            -          (97)            -
Guaranteed minority interest expense                                              (24)          (11)         (71)          (53)
Merger costs                                                                      (15)            -       (1,537)            -
Other income - net                                                                 48            13          116            86
                                                                          ------------ ------------- ------------ -------------
Income (loss) from continuing operations before income taxes                      275          (244)         794         3,144
(Provision) benefit for income taxes                                             (127)           60         (933)       (1,376)
                                                                          ------------ ------------- ------------ -------------
Income (loss) from continuing operations                                          148          (184)        (139)        1,768
Income from discontinued operations - net of tax
     Results of operations (Note 12)                                                -             -            -           747
     Gain on separation                                                             -             -            -        24,461
                                                                          ------------ ------------- ------------ -------------
Income (loss) before extraordinary item                                           148          (184)        (139)       26,976
Extraordinary item:
     Gain (loss) on extinguishment of debt - net of tax                             -             -           17          (333)
                                                                          ============ ============= ============ =============
NET INCOME (LOSS)                                                               $ 148        $ (184)      $ (122)    $  26,643
                                                                          ============ ============= ============ =============

Preferred stock dividends and accretion                                          (14)           (13)         (42)         (39)
Loss on redemption of Series C Preferred Stock                                   (28)             -          (28)           -
Loss on redemption of Preferred Securities                                          -             -            -          (53)
                                                                          ------------ ------------- ------------ -------------
EARNINGS (LOSS) AVAILABLE FOR COMMON STOCK                                      $ 106        $ (197)      $ (192)    $ 26,551
------------------------------------------------------------------------- ============ ============= ============ =============
</TABLE>

See Notes to Consolidated Financial Statements.

                                        3

Form 10-Q - Part I
                              MediaOne Group, Inc.
                        Consolidated Statements of Operations
                                   (Continued)
                                   (Unaudited)
<TABLE>
<CAPTION>
<S>                                                                    <C>                             <C>

---------------------------------------------------------------------- ------------------------------- ----------------------------
                                                                             Three Months Ended              Nine Months Ended
                                                                               September 30,                   September 30,
                                                                       ------------------------------- ----------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                                    <C>              <C>            <C>             <C>

In thousands, except per share amounts                                      1999            1998          1999 (1)        1998(1)
---------------------------------------------------------------------- ---------------- -------------- --------------- ------------

MEDIAONE GROUP STOCK (2)
BASIC EARNINGS (LOSS) PER COMMON SHARE:
    Income (loss) from continuing operations                                  $ 0.18       $ (0.32)        $ (0.34)        $  2.75
    Income from discontinued operations (3)                                        -             -               -            0.26
    Gain on separation                                                             -             -               -           40.18
    Extraordinary item - early extinguishment of debt                              -             -            0.03           (0.55)
                                                                       ================ ============== =============== ============
Basic earnings (loss) per common share                                        $ 0.18       $ (0.32)        $ (0.32)        $ 42.65
                                                                       ================ ============== =============== ============

BASIC AVERAGE COMMON SHARES OUTSTANDING
                                                                             606,664       608,793         605,412         608,730
                                                                       ================ ============== =============== ============

DILUTED EARNINGS (LOSS) PER COMMON SHARE:
    Income (loss) from continuing operations                                  $ 0.18       $ (0.32)        $ (0.34)        $  2.62
    Income from discontinued operations (3)                                        -             -               -            0.24
    Gain on separation                                                             -             -               -           37.42
    Extraordinary item - early extinguishment of debt                              -             -            0.03           (0.51)
                                                                       ================ ============== =============== ============
Diluted earnings (loss) per common share                                      $ 0.18       $ (0.32)        $ (0.32)        $ 39.77
                                                                       ================ ============== =============== ============

DILUTED AVERAGE COMMON SHARES OUTSTANDING
                                                                             654,481       608,793         605,412         653,751
---------------------------------------------------------------------- ================ ============== =============== ============
</TABLE>

(1)      Column does not add due to rounding of individual components.
(2)      For 1998 earnings per share information of Communications Stock see
         Note 10 - Earnings Per Share - to the Consolidated Financial State-
         ments.
(3)      Amounts represent the operations of U S WEST Dex, Inc., the domestic
         directory business, which were discontinued as of June 12, 1998.


See Notes to Consolidated Financial Statements.

                                        4

Form 10-Q - Part I
                             MediaOne Group, Inc.
                          Consolidated Balance Sheets
<TABLE>
<CAPTION>
<S>                                                                              <C>                 <C>

-------------------------------------------------------------------------------- ------------------- ---------------------
                                                                                   September 30,         December 31,
Dollars in millions                                                                     1999                 1998
-------------------------------------------------------------------------------- ------------------- ---------------------
                                                                                   (Unaudited)

ASSETS

Current assets:
    Cash and cash equivalents                                                          $ 1,122                 $ 415
    Accounts and notes receivable  - net                                                   411                   255
    Income tax receivable                                                                  594                   375
    Current portion of deferred tax asset                                                   67                    74
    Prepaid and other                                                                      119                    33
    Marketable securities                                                                   60                    48
                                                                                 ------------------- ---------------------
Total current assets                                                                     2,373                 1,200
                                                                                 ------------------- ---------------------

Property, plant and equipment - net                                                      4,790                 4,069
Investment in Vodafone Group /AirTouch Communications                                    8,490                 5,919
Investment in Time Warner Entertainment                                                  2,517                 2,442
Net investment in international ventures held for sale                                     465                     -
Net investment in international ventures                                                     -                 1,344
Intangible assets - net                                                                 11,684                11,647
Other assets                                                                             2,105                 1,571
                                                                                 ------------------- ---------------------
Total assets                                                                          $ 32,424              $ 28,192
-------------------------------------------------------------------------------- =================== =====================
</TABLE>

See Notes to Consolidated Financial Statements.

                                        5

Form 10-Q - Part I
                               MediaOne Group, Inc.
                           Consolidated Balance Sheets
                                  (Continued)
<TABLE>
<CAPTION>
<S>                                                                              <C>                 <C>

-------------------------------------------------------------------------------- ------------------- --------------------
                                                                                   September 30,        December 31,
Dollars in millions                                                                     1999                1998
-------------------------------------------------------------------------------- ------------------- --------------------
                                                                                    (Unaudited)
LIABILITIES AND SHAREOWNERS' EQUITY

Current liabilities:
    Short-term debt                                                                   $  1,529              $   569
    Accounts payable                                                                       325                  332
    Employee compensation                                                                   95                   80
    Deferred revenues and customer deposits                                                171                   87
    Other                                                                                  645                  546

                                                                                 ------------------- --------------------
Total current liabilities                                                                2,765                1,614
                                                                                 ------------------- --------------------

Long-term debt                                                                           7,441                4,853
Deferred income taxes                                                                    7,311                6,035
Deferred credits and other                                                                 144                  641

Commitments and contingencies

Minority interest in Centaur Funding                                                     1,110                1,099
Company-obligated mandatorily redeemable preferred securities of subsidiary
   trust holding solely Company-guaranteed debentures
                                                                                         1,060                1,061
Preferred stock subject to mandatory redemption                                             50                  100

Shareowners' equity:
    Preferred stock                                                                        930                  927
    Common shares                                                                       10,465               10,324
    Retained earnings                                                                      478                  669
    Accumulated other comprehensive income                                                 670                  869
                                                                                 ------------------- --------------------
Total shareowners' equity                                                               12,543               12,789
                                                                                 ------------------- --------------------

Total liabilities and shareowners' equity                                             $ 32,424             $ 28,192
-------------------------------------------------------------------------------- =================== ====================
</TABLE>

See Notes to Consolidated Financial Statements.

                                        6

Form 10-Q - Part I
                               MediaOne Group, Inc.
                      Consolidated Statements of Cash Flows
                                  (Unaudited)
<TABLE>
<CAPTION>
<S>                                                                                   <C>             <C>

------------------------------------------------------------------------------------- --------------- ---------------
Nine Months Ended September 30,                                                            1999            1998
------------------------------------------------------------------------------------- --------------- ---------------

OPERATING ACTIVITIES                                                                       Dollars in millions
</TABLE>

<TABLE>
<CAPTION>
<S>                                                                                       <C>            <C>

   Net income (loss)                                                                      $ (122)        $ 26,643
   Adjustments to net income (loss):
     Discontinued operations                                                                   -             (747)
     Gain on Separation                                                                        -          (24,461)
     Extraordinary (gain) loss on debt extinguishment                                        (17)             333
     Depreciation and amortization                                                           884              894
     Equity losses in unconsolidated ventures                                                291              273
     Merger costs                                                                          1,537                -
     Gains on investments - net                                                           (3,222)          (3,911)
     Deferred income taxes                                                                 1,473            1,515
  Distribution from unconsolidated ventures                                                    -               42
  Separation costs paid                                                                        -             (115)
  Changes in operating assets and liabilities:
     Accounts and notes receivable                                                          (177)              87
     Prepaid and other current assets                                                        (23)             (20)
     Accounts payable and accrued liabilities                                                 62             (182)
  Other - net                                                                               (175)              40
                                                                                      --------------- ---------------
  Cash provided by operating activities                                                      511              391
                                                                                      --------------- ---------------

INVESTING ACTIVITIES
  Expenditures for property, plant and equipment                                          (1,436)          (1,157)
  Investment in international ventures                                                       (96)            (157)
  Investment in domestic ventures                                                            (97)             (84)
  Purchase of miscellaneous assets                                                             -              (35)
  Proceeds from sales of investments                                                         656              201
  Proceeds on exchange of investment in AirTouch                                             534                -
   Cash from net investment in assets held for sale                                            -               47
   Other - net                                                                                28               77
                                                                                      --------------- ---------------
   Cash used for investing activities                                                       (411)          (1,108)
                                                                                      --------------- ---------------

FINANCING ACTIVITIES
   Net (repayments of) proceeds from short-term debt                                        (287)             679
  Net proceeds from issuance of long-term debt                                             1,232            1,642
   Repayments of long-term debt                                                             (333)          (5,447)
  Repayments of Preferred Securities                                                           -             (582)
  Proceeds from issuance of common stock                                                      79              138
   Dividends paid on common stock                                                              -             (519)
   Dividends paid on preferred stock                                                         (38)             (39)
   Purchases of treasury stock                                                               (46)            (240)
                                                                                      --------------- ---------------
   Cash provided by (used for) financing activities                                          607           (4,368)
                                                                                      --------------- ---------------

  Cash provided by discontinued operations                                                     -            4,953
                                                                                      --------------- ---------------

CASH AND CASH EQUIVALENTS
   Increase (decrease)                                                                       707             (132)
   Beginning balance                                                                         415              184
                                                                                      =============== ===============
   Ending balance                                                                        $ 1,122             $ 52
------------------------------------------------------------------------------------- =============== ===============
</TABLE>

See Notes to Consolidated Financial Statements.

                                             7

Form 10-Q - Part I
                                    MediaOne Group, Inc.
                          Notes to Consolidated Financial Statements
                     For the Three and Nine Months Ended September 30, 1999
                                    (Dollars in Millions)
                                        (Unaudited)

NOTE 1:  AT&T MERGER

On May 6, 1999, MediaOne Group, Inc. ("MediaOne Group" or the "Company") entered
into an agreement with AT&T Corp. ("AT&T") to merge its operations with those of
AT&T. The merger was approved by MediaOne Group's shareowners on October 21,
1999. The transaction is expected to close in the first quarter of 2000, subject
to legal and regulatory approvals.

As a result of the merger approval, certain change of control provisions have
been triggered which require the recognition of compensation benefits payable to
select employees. Such benefits will be accounted for as merger costs in the
fourth quarter of 1999.

Under the terms of the AT&T definitive merger agreement, MediaOne Group
shareowners will have the right to receive, for each share of MediaOne Group
common stock ("MediaOne Group Stock"), (i) 1.4912 shares of AT&T common stock,
(ii) $85.00 in cash, or (iii) .95 of a share of AT&T common stock and cash of
$30.85. Since AT&T has agreed to pay a set amount of AT&T common stock in the
merger, MediaOne Group shareowners who elect to receive all AT&T common stock or
all cash may be subject to proration in the event that the common stock to be
issued is over or under subscribed. With respect to MediaOne Group shareowners
who receive AT&T common stock, if the volume-weighted average sale price of the
AT&T common stock for the 20 trading days ending three trading days prior to the
effective date of the merger (the "AT&T Price") is between $51.30 and $57.00 per
share, an additional amount in cash will be paid so that the total value of the
AT&T common stock (based on the AT&T Price) and cash received per share of
MediaOne Group Stock will be $85.00. If the AT&T Price is less than $51.30 per
share, the additional cash payment will be made based on an assumed AT&T Price
of $51.30 per share, and the total value of cash and AT&T common stock (based on
the AT&T Price) received per share of MediaOne Group Stock will be less than
$85.00. If the AT&T Price is above $57.00 per share, the total value of cash and
AT&T common stock (based on the AT&T Price) received per share of MediaOne Group
Stock will be more than $85.00. If a shareowner chooses the AT&T stock plus cash
election, the maximum additional cash payment would be $5.42 per share of
MediaOne Group Stock. If a shareowner chooses the AT&T stock election, the
maximum additional cash payment would be $8.50 per share of MediaOne Group
Stock.

MediaOne Group currently holds a 25.51 percent interest in Time Warner
Entertainment Company, L.P. ("TWE"). The remaining interest in TWE is owned by
Time Warner, Inc. ("Time Warner"). In order to avoid disputes as to whether the
AT&T merger would violate the non-competition provisions of the TWE partnership
agreement, on August 3, 1999, MediaOne Group sent a notice of termination to TWE
which will terminate these non-competition

                                        8

Form 10-Q - Part I
                               MediaOne Group, Inc.
                    Notes to Consolidated Financial Statements
                              (Dollars in Millions)
                                   (Unaudited)

provisions as to MediaOne Group. The non-competition provisions will continue to
apply to Time Warner. Delivery of the notice of termination permitted TWE to
terminate most of MediaOne Group's management rights in TWE, which it did on
August 4, 1999. Most of these rights would have terminated in any event upon the
change of control of MediaOne Group in the merger. The delivery of the
termination notice and the resulting termination of management rights is
irrevocable, however, even if the merger does not occur. The loss of these
management rights may have a material adverse effect on the value of MediaOne
Group's interest in TWE. Notwithstanding the notice of termination, MediaOne
Group retains certain rights under the partnership agreement, including the
right to approve such matters as the merger of TWE, TWE's entrance into new
lines of business and the issuance of new partnership interests.

In addition, Time Warner has expressed its view that, absent Time Warner's
consent, completion of the AT&T merger will violate the TWE partnership
agreement unless AT&T and MediaOne Group delay completion of the merger at least
until August 3, 2000, one year following delivery of the termination notice.
While AT&T and MediaOne Group disagree with this view, if Time Warner's view
prevails and if Time Warner does not consent to an earlier closing, AT&T and
MediaOne Group may have to delay completing the merger to August 3, 2000. Any
such delay could delay our ability to realize the expected financial and
operating benefits of the merger.

NOTE 2:  SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation. The Consolidated Financial Statements have been prepared
by the Company pursuant to the interim reporting rules and regulations of the
Securities and Exchange Commission ("SEC") and include the accounts of MediaOne
Group and its consolidated subsidiaries. Certain information and footnote
disclosures normally accompanying financial statements prepared in accordance
with generally accepted accounting principles ("GAAP") have been condensed or
omitted pursuant to such SEC rules and regulations.

In the opinion of MediaOne Group's management, the Consolidated Financial
Statements include all adjustments, consisting of normal recurring adjustments,
necessary to present fairly the financial information set forth therein. These
Consolidated Financial Statements should be read in conjunction with the 1998
MediaOne Group Consolidated Financial Statements and notes thereto included in
MediaOne Group's proxy statement mailed to all shareowners on April 5, 1999, and
MediaOne Group's Form 10-Q's for the three and six month periods ended March 31,
1999 and June 30, 1999 filed with the SEC.

Certain reclassifications within the Consolidated Financial Statements have been
made to conform to the current year presentation.

                                        9

Form 10-Q - Part I
                                MediaOne Group, Inc.
                      Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                   (Unaudited)

NOTE 3:  DOMESTIC ACQUISITIONS, DISPOSITIONS AND OTHER

Cable System Trades.  During third quarter of 1999, MediaOne Group, Time Warner
Cable, a division of Time Warner and TWE, and Cox Communications, Inc., ("Cox")
completed the exchange of certain cable systems previously announced. Effective
July 31, 1999, MediaOne Group exchanged cable systems in Ohio and Maine, serving
approximately 280,000  subscribers, for Time  Warner Cable cable systems in
Massachusetts and New Hampshire, serving approximately 240,000 subscribers, and
$40 in cash.  Effective August 31, 1999, MediaOne Group exchanged cable systems
in California, serving approximately 67,000 subscribers, and $39 in cash for
Time Warner Cable cable systems in  Georgia, serving approximately 72,000
subscribers; and MediaOne Group cable systems in Connecticut and Rhode Island,
serving approximately 51,000 subscribers, and cash of $10 for Cox cable systems
in Massachusetts, serving approximately 54,000 subscribers.

As a result of the cable system trades with Time Warner Cable and Cox, MediaOne
Group recognized a pretax gain of $368 ($226 after tax). The pretax gain is net
of a $26 deferred gain  related to a cable system traded with TWE, of which
MediaOne Group owns a 25.51 percent interest.  The deferred gain will be
amortized to earnings over 15 years.

MediaOne Group accounted for the cable systems acquired in the trades under the
purchase method of accounting.  The excess of the purchase price over the fair
market value of net tangible assets acquired  totaled $436 and will be amortized
over 25 years. The purchase price allocation is based on preliminary information
and may be modified upon the receipt of final asset appraisals.

NOTE 4: OPERATING SEGMENTS

In accordance with Statement of Financial Accounting Standards ("SFAS") No. 131,
"Disclosures about Segments of an Enterprise and Related  Information,"  the
following table presents selected  information for MediaOne  Group's operating
segments for the three and nine month periods ended September 30, 1999 and 1998.
"Sales and Other Revenues" and earnings before interest, taxes, depreciation,
amortization  and other ("EBITDA") for each segment are presented on  a
proportionate basis.  Proportionate results reflect the relative weight of
MediaOne Group's ownership in each of its respective  domestic and international
equity ventures together with the consolidated results of its subsidiaries. The
computation of EBITDA also excludes gains on asset sales, equity losses,
guaranteed minority interest expense and minority interest expense in Centaur
Funding. Adjustments  made to Sales and Other  Revenues and EBITDA to arrive at
proportionate  results are  reversed  in the column  labeled  "Eliminations  and
Adjustments," in conformity with SFAS No. 131, so that in total, Sales and Other
Revenues and EBITDA reflect consolidated results.

                                        10

Form 10-Q - Part I
                                MediaOne Group, Inc.
                      Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                    (Unaudited)

Operating Results:

                                                    ---------------------------
                                                    Domestic Cable & Broadband

                                                    ---------------------------
<TABLE>
<CAPTION>
<S>                                             <C>               <C>           <C>             <C>     <C>            <C>

                                                MediaOne of       Multimedia                            Eliminations
                                                of Delaware (1)   Ventures (2)  International   Other   & Adjustments  Consolidated

 ---------------------------------------------  ---------------   ------------- -------------   ------  -------------  ------------

                          Three months ended September 30, 1999

                          Sales and other revenues  $   674         $   886       $   528       $  -     $  (1,413)     $   675

                          EBITDA (3)                    242             232            81        (13)         (322)         220

                          Net income (loss)             122              40             8        (22)            -          148
----------------------------------------------  -------------- --------------  ------  ------------   ------------     ------------

                     Three months ended September 30, 1998
                     Sales and other revenues       $   614         $   822       $   363      $  15    $   (1,188)     $   626

                     EBITDA (3)                         227             210            79        (22)         (301)         193

                     Net income (loss)                 (103)              5           (56)       (30)            -         (184)
----------------------------------------------  -------------- --------------  -------  -------------  -----------     ------------

                          Nine months ended September  30, 1999
                          Sales and other revenues  $ 1,993         $ 2,415      $  1,424      $   7    $   (3,837)     $ 2,002

                          EBITDA (3)                    731             868           280        (51)       (1,179)         649

                          Net income (loss) (4)         (30)             60          (110)       (42)            -         (122)
-----------------------------------------------  -------------- --------------  -------  --------------  ----------    ------------

                     Nine months ended September 30, 1998
                     Sales and other revenues (5)   $ 1,840         $ 2,292      $  1,022      $ 411    $   (3,326)     $ 2,239

                     EBITDA (3, 5)                      706             604           147         62          (773)         746

                     Net income (loss) (5)             (339)             (3)         (205)    27,190             -       26,643
------------------------------------------------  -------------- -------------  --------  --------------  ----------   ------------
</TABLE>

(1)      MediaOne of Delaware represents the operations of the Company's
         domestic cable and broadband subsidiary.
(2)      Multimedia Ventures includes MediaOne Group's 25.51 percent equity
         interest in TWE, as well as related overheads. The reported TWE results
         are prepared in accordance with GAAP and have not been adjusted to
         report TWE's investments accounted for under the equity method on a
         proportionate basis.
(3)      The Company believes EBITDA is an important indicator of the operating
         performance of its businesses, however, should not be considered an
         alternative to operating or net income as an indicator of the
         performance of MediaOne Group's businesses, or as an alternative to
         cash flows from operating activities as a measure of liquidity, in
         each case determined in accordance with GAAP.
(4)      MediaOne of Delaware's  net income during the nine months ended
         September 30, 1999 includes an extraordinary gain of $17 on the early
         extinguishment of debt.
(5)      Other includes  proportionate revenue of $354, proportionate EBITDA of
         $114, and net income of $20 for the nine months ended September 30,
         1998 related to the domestic wireless operations which were sold in
         April 1998.  Other net income during the nine month period of 1998
         includes a gain of $24,461 on the separation of the telecommunications
         businesses and the domestic directory business from the Company, a
         gain of $2,257 on the sale of the domestic wireless businesses, $747
         related to discontinued operations, and an extraordinary loss of $333
         on the early extinguishment of debt in conjunction with the separation
         discussed above.

                                        11

Form 10-Q - Part I
                                MediaOne Group, Inc.
                     Notes to Consolidated Financial Statements
                                (Dollars in Millions)
                                     (Unaudited)

The following table presents a geographic breakout for proportionate revenues
and EBITDA and a reconciliation to consolidated amounts:


<TABLE>
<CAPTION>
<S>                                                       <C>                                     <C>

                                                          Three Months Ended                      Nine Months Ended
                                                             September 30,                          September 30,

                                                   ----------------------------                  ------------------------
                                                   ----------------------------                  ------------------------
</TABLE>

<TABLE>
<CAPTION>
<S>   <C>                                             <C>              <C>                    <C>            <C>

                                                         1999                1998                 1999           1998
      --------------------------------------------    ------------     --------------         -------------   ----------

      Proportionate Revenue:
         United States (1)                              $ 1,560           $ 1,441               $ 4,404        $ 4,502
         United Kingdom                                     336               206                   893            591
         Central Europe                                     167               136                   462            363
         Asia and other                                      25                31                    80            109
                                                      ------------     --------------          ------------   -----------
      Proportionate revenue                               2,088             1,814                 5,839          5,565
      Less: Proportionate adjustment                     (1,413)           (1,188)               (3,837)        (3,326)
                                                     =============     ==============          ============   ===========
          Consolidated revenues                           $ 675             $ 626               $ 2,002        $ 2,239
                                                     =============     ==============          ============   ===========

     Proportionate EBITDA:
        United States (1)                                 $ 461             $ 416               $ 1,550        $ 1,368
        United Kingdom                                       37                40                   160             71
        Central Europe                                       55                54                   144            122
        Asia and other                                      (11)              (16)                  (26)           (42)
                                                 ----------------------------------        ------------------------------
     Proportionate EBITDA                                   542               494                 1,828          1,519
     Less: Proportionate adjustment                        (322)             (301)               (1,179)          (773)
                                                 ==================================        ==============================
         Consolidated EBITDA                              $ 220             $ 193                 $ 649          $ 746
     --------------------------------------------==================================--------==============================
</TABLE>

(1)      Amounts include proportionate revenue of $354, and proportionate
         EBITDA of $114 for the domestic wireless operations during the nine
         months ended September 30, 1998.  These operations were sold in April
         1998.

Total Assets:

Total assets are those assets and  investments that are used in, or pertain to,
each segment's operations, as follows:


<TABLE>
<CAPTION>
<S>                                         <C>

                                            Domestic Cable & Broadband
                                           ------------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                         <C>            <C>             <C>                <C>         <C>

                                            MediaOne of    Multimedia
                                            Delaware (1)   Ventures (2)    International      Other       Consolidated


   ---------------------------------------  -------------  -------------   -------------      -------     ------------
        <C>           <C>

        Total assets as of:
        September 30, 1999                  $ 17,102        $ 2,916        $ 1,351            $ 11,055      $ 32,424
        December 31, 1998                     16,003          2,551          2,308               7,330        28,192

------------------------------------------  -------------   ------------   -------------      -------     ------------
</TABLE>

(1)      MediaOne of Delaware represents the operations of the Company's
         domestic cable and broadband subsidiary.
(2)      Multimedia Ventures includes MediaOne Group's 25.51 percent equity
         interest in TWE.

                                        12

Form 10-Q - Part I
                                MediaOne Group, Inc.
                   Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                    (Unaudited)

International assets decreased $957, or 41.5 percent, during 1999 due primarily
to the reclassification of international investments, including investments
classified as liabilities, to a net investment in international assets held for
sale, and to the sale of the Company's investments in shares of Cable & Wireless
Optus Limited  ("Optus"). The "Other" column includes  primarily cash; debt and
equity securities; investments in domestic interactive services; and other
corporate assets. The increase in Other total assets of $3,725, or 50.8 percent,
during 1999 is due primarily to the marking to market of the Company's
investments in marketable equity securities, including AirTouch Communications,
Inc. ("AirTouch") common stock which was exchanged in June 1999 into Vodafone
Group Public Limited Company ("Vodafone") American Depository Receipts ("ADRs")
and $9.00 per share cash proceeds.

NOTE 5:  INVESTMENT IN VODAFONE GROUP

During September 1999, the Company contributed 3,600,000 shares of its
investment in Vodafone ADRs to MediaOne SPC VI ("SPC  VI"), a wholly-owned
subsidiary of MediaOne Group. SPC VI subsequently  entered  into a series of
purchased and written options (the  "Collar") on its Vodafone  ADRs and issued
$717 in debt. See Note 7 - Debt - to the Consolidated Financial Statements.

The Collar has been designated and is effective as a hedge of the market risk
associated with the Company's investment in the Vodafone ADRs. The Collar is
therefore carried at market value with gains or losses recorded in equity as a
component of other comprehensive income together with any change in the fair
value of the Vodafone ADRs. No gain or loss was recognized on the Collar as of
September 30, 1999.

At expiration of the Collar, the Company will receive cash if the market value
of a Vodafone  ADR is less than  approximately $199.00 per share, effectively
eliminating downside risk on the stock below $199.00. Conversely, if the market
value of a Vodafone ADR is greater than approximately $288.00 per share, the
Company  will be required to pay cash which will be offset by the corresponding
increase in the value of the Vodafone ADRs. MediaOne Group intends to use
proceeds from the sale of the Vodafone ADRs to fund any cash obligations related
to the Collar. The Collar expires quarterly, in equal installments, starting in
the second quarter of 2003 and ending in the fourth quarter of 2005.

The number of Vodafone ADRs and per share values indicated above are prior to a
five for one stock split executed by Vodafone in October 1999.

                                        13

Form 10-Q - Part I
                                 MediaOne Group, Inc.
                     Notes to Consolidated Financial Statements
                                (Dollars in Millions)
                                    (Unaudited)

NOTE 6:  INVESTMENT IN INTERNATIONAL VENTURES

Investment Sales.  On July 16, 1999, MediaOne Group sold WatchMark, a wholly
owned wireless network management software operation, to Lucent Technologies for
net proceeds of $5, resulting in a pretax loss of $1.

On August 6, 1999, MediaOne Group agreed to sell its 50 percent ownership in
Mercury Personal Communications ("One 2 One"), a wireless operation in the
United Kingdom, to Deutsche Telekom for $5.7 billion, including approximately
$190 for the repayment of shareholder loans owed to the Company.  The sale was
consummated on October 1, 1999. In connection with the sale of One 2 One, the
Company entered into put options to minimize its exposure to declines in the
exchange rate on the British Pound, for a cost of approximately $75.  In
September 1999, the Company unwound certain of the put options and entered into
forward contracts related to the British Pound.  The put options and forward
contracts expired in October 1999.  The cost of the put options and the
settlement value on the forward contract will be included in the calculation of
the gain on the sale of One 2 One.

On September 3, 1999, United Pan-Europe Communications  N.V. ("UPC") purchased
MediaOne Group's interests in A2000, a cable operator located in the
Netherlands, for proceeds of $229, including $14 for the repayment of
shareholder loans and receivables owed to the Company.  The sale resulted in a
pretax gain of $154 ($94 after tax).

On September 8, 1999, the Company sold its interest in Lyonnaise Communications,
a cable operator in France, for proceeds of $22, which resulted in a pretax gain
of $10 ($6 after tax).

NOTE 7:  DEBT

In August 1999, MediaOne SPC IV ("SPC  IV"), a wholly-owned subsidiary of
MediaOne Group, redeemed approximately $105 of its floating rate debt issued in
June 1999 for face value.  The debt was redeemed with cash proceeds received in
June 1999 on the exchange of the Company's investment in AirTouch common stock
for Vodafone ADRs and $9.00 per share cash  proceeds. In addition, the Company
received proceeds of $30 upon the termination of the corresponding portion of an
interest rate swap agreement entered into to fix and pre-fund interest payments
on the debt issued by SPC IV. The terminated portion of the interest rate swap
agreement had a carrying value of approximately $29. As a result of the partial
redemption of SPC IV's floating rate debt and the corresponding reduction in the
interest rate swap agreement,  the fixed effective  interest rate on the debt is
approximately 5.91 percent.

                                        14

Form 10-Q - Part I
                                MediaOne Group, Inc.
                    Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                   (Unaudited)

On September 23, 1999, SPC VI issued approximately $717 of floating rate debt at
3-month LIBOR plus 0.5 percent and paid $216 to fix and pre-fund interest
payments on approximately $717 notional amount of the debt through an interest
rate swap agreement (the "Zero Coupon Swap"). The debt and Zero Coupon Swap
mature in equal quarterly installments starting in the second quarter of 2003
and ending in the fourth quarter of 2005. The index, maturity and notional
amount of the Zero Coupon Swap match the terms of the floating rate debt issued
by SPC VI. The Company has deferred the $216 cost of the Zero Coupon Swap and
will amortize the cost as an adjustment of interest expense associated with the
floating rate debt. As a result of the amortization and payments received under
the Zero Coupon Swap, the Company expects the floating rate debt of SPC VI to
have a fixed effective interest rate of approximately 6.02 percent.

The assets of SPC VI, which are primarily the 3,600,000 Vodafone ADRs, are not
available to pay the creditors of any member of the Company except the creditors
of SPC VI. The number of Vodafone ADRs held by SPC VI is prior to a five for one
stock split executed by Vodafone in October 1999.

NOTE 8:  PREFERRED STOCK SUBJECT TO MANDATORY REDEMPTION

Beginning on September 2, 1999, MediaOne Group had the option to redeem the
Company's Series C Cumulative  Redeemable  Preferred  Stock  (the "Series C
Preferred Stock") for one thousand dollars per share plus unpaid dividends and a
redemption  premium. On September 2, 1999, holders of the Series C Preferred
Stock exercised options to receive common shares of Financial Security Assurance
Holdings Ltd. ("FSA") held by the Company with a fair market value of $96. As a
result of the exercise of the FSA options, the Series C Preferred Stock was
effectively redeemed, resulting in an after tax charge to equity of $28 (net of
tax  benefits of $18). The Company also recognized a pretax gain of $50 ($31
after tax) based upon the difference of the fair market value and carrying value
of the FSA shares surrendered.  In addition, since the Series C Preferred Stock
holders exercised the option to receive FSA shares, the Company did not have to
pay a redemption premium.

                                        15

Form 10-Q - Part I
                                MediaOne Group, Inc.
                     Notes to Consolidated Financial Statements
                                (Dollars in Millions)
                                    (Unaudited)

NOTE 9: SHAREOWNERS' EQUITY

Following is a rollforward of shareowners' equity since the end of 1998:
<TABLE>
<CAPTION>
<S>                                                       <C>          <C>           <C>          <C>

--------------------------------------------------------- ------------ ------------- ------------ -------------------
                                                                                                     Accum. Other
                                                           Preferred      Common      Retained      Comprehensive
                                                             Stock        Shares      Earnings          Income
--------------------------------------------------------- ------------ ------------- ------------ -------------------
Balance at December 31, 1998                                $ 927       $ 10,324       $ 669            $ 869

Net loss                                                                                (122)
Issuance of MediaOne Group common stock                                       79
Purchase of treasury stock                                                   (46)
Preferred stock dividends and accretion                                                  (42)
Market value adjustments for debt and
  equity securities, and Exchangeable Notes,
  net of income taxes                                                                                    (188)
Foreign currency translation, net of income taxes                                                         (11)
Loss on redemption of Series C Preferred Stock                                           (28)
Other                                                           3            108           1
                                                          ============ ============= ============ ===================
Balance at September 30, 1999                               $ 930       $ 10,465       $ 478            $ 670
--------------------------------------------------------- ============ ============= ============ ===================
</TABLE>

Other common shares activity during 1999 represents $77 of tax benefits on stock
option exercises, $11 of gains on the exercise of a call option on MediaOne
Group Stock, and other costs of $20.

                                        16

Form 10-Q - Part I
                                 MediaOne Group, Inc.
                      Notes to Consolidated Financial Statements
                                (Dollars in Millions)
                                   (Unaudited)

Comprehensive Income. Total comprehensive income and the components of
comprehensive income follow:
<TABLE>
<CAPTION>
<S>                                                                <C>                           <C>

------------------------------------------------------------------ ----------------------------- ---------------------------
                                                                        Three Months Ended           Nine Months Ended
                                                                          September 30,                September 30,
                                                                   ----------------------------- ---------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                                <C>            <C>            <C>           <C>

                                                                       1999           1998          1999            1998
------------------------------------------------------------------ -------------- -------------- ------------- -------------

Net income (loss)                                                     $ 148         $ (184)       $ (122)       $ 26,643
Other comprehensive income (loss), before tax:
  Foreign currency translation adjustment                                (5)            19           (39)             27
  Unrealized gains (losses) on debt and equity securities, and
      Exchangeable Notes                                                606           (107)        1,951             583
  Reclassification for gains realized in net income (loss)               20              -        (2,232)            (11)

  Income tax (provision) benefit related to items of other
    comprehensive income (loss)                                        (242)            44           121            (227)
                                                                   -------------- -------------- ------------- -------------

Total other comprehensive income (loss), net of tax                     379            (44)         (199)            372
                                                                   ============== ============== ============= =============
Total comprehensive income (loss)                                     $ 527         $ (228)       $ (321)       $ 27,015
------------------------------------------------------------------ ============== ============== ============= =============
</TABLE>

The majority of the unrealized gains on debt and equity securities during the
three and nine month periods of 1999 relate to the Company's investment in
AirTouch common and preferred stock, which were exchanged for Vodafone ADRs and
preferred stock in June 1999. In addition, for the nine month period of 1999,
the Company also recorded unrealized gains on its investment in Time Warner
Telecom, Inc., a competitive local exchange business, which offered its shares
in an initial public offering in May 1999. The reclassification in the three
month period of 1999 relates to foreign currency translation adjustments on the
sale of an international investment during the period. The reclassification in
the nine month period of 1999 for gains realized in net loss is due primarily to
gains realized upon the exchange and modification of AirTouch common and
preferred stock for Vodafone ADRs and preferred stock. For the nine month period
of 1998, MediaOne Group recorded an unrealized gain of $147 related to its
investment in AirTouch preferred stock. This unrealized gain was fully offset by
a loss on an interest rate swap agreement which was designed to minimize the
Company's exposure to fluctuations in the fair value of the AirTouch preferred
stock as a result of interest rate changes.

                                        17

Form 10-Q - Part I

                                MediaOne Group, Inc.
                     Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                    (Unaudited)

NOTE 10: EARNINGS PER SHARE

The following table reflects the computation of basic and diluted  earnings
(loss) per share in accordance with SFAS No.  128, "Earnings  Per Share." The
diluted loss per share and related share amounts for the three month period of
1998 and the nine month period of 1999 do not include  potential share issuances
associated with MediaOne Group stock options and the Company's 4.5 percent
Series D Convertible Preferred Stock (the "Series D Preferred Stock") since the
effect would have been antidilutive on the loss from continuing operations.
Dilutive securities for the three month period of 1999 and the nine month period
of 1998 represent the incremental weighted average shares from potential share
issuances associated with stock options of MediaOne Group Stock and the
conversion of the Series D Preferred Stock into MediaOne Group Stock, as well as
the potential share issuances associated with stock options of Communications
Stock in 1998.
<TABLE>
<CAPTION>
<S>                                                              <C>                           <C>
---------------------------------------------------------------- ----------------------------- -----------------------------
                                                                      Three Months Ended            Nine Months Ended
                                                                        September 30,                 September 30,
                                                                 ----------------------------- -----------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                              <C>             <C>           <C>           <C>

                                                                      1999            1998           1999            1998
---------------------------------------------------------------- --------------- ------------- ------------- ---------------

MEDIAONE GROUP STOCK :
Income (loss) from continuing operations                              $ 148         $ (184)        $ (139)        $ 1,768
Preferred stock dividends and accretion                                 (14)           (13)           (42)            (39)
Loss on redemption of Series C Preferred Stock                          (28)             -            (28)              -
Loss on redemption of Preferred Securities                                -              -              -             (53)
                                                                 --------------- ------------- ------------- ---------------
Income (loss) from continuing operations available to MediaOne
   Group Stock shareowners used for basic earnings (loss) per
   share                                                              $ 106         $ (197)        $ (209)        $ 1,676
Preferred stock dividends and accretion on assumed conversion
                                                                         13              -              -              35
                                                                 =============== ============= ============= ===============
Income (loss) from continuing operations available to MediaOne
   Group Stock shareowners used for diluted earnings (loss)
   per share                                                          $ 119         $ (197)        $ (209)        $ 1,711
                                                                 =============== ============= ============= ===============

Income from discontinued operations (1)
   Results of operations                                                  -              -              -           $ 158
                                                                 =============== ============= ============= ===============
   Gain on separation                                                     -              -              -         $24,461
                                                                 =============== ============= ============= ===============
Extraordinary item - early extinguishment of debt                         -              -           $ 17         $  (333)
---------------------------------------------------------------- =============== ============= ============= ===============
</TABLE>

(1)      Represents the operations of the domestic directory business, which
         were discontinued effective June 12, 1998.

                                        18

Form 10-Q - Part I
                                 MediaOne Group, Inc.
                       Notes to Consolidated Financial Statements
                     (Dollars in Millions, Except Per Share Amounts)
                                     (Unaudited)
<TABLE>
<S>                                                                <C>                           <C>

------------------------------------------------------------------ ----------------------------- ----------------------------
                                                                        Three Months Ended            Nine Months Ended
                                                                          September 30,                 September 30,
                                                                   ----------------------------- ----------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                                <C>             <C>           <C>           <C>

                                                                          1999          1998          1999           1998
------------------------------------------------------------------ --------------- ------------- ------------- --------------
MEDIAONE GROUP STOCK :
Weighted average number of shares used for basic earnings (loss)
   per share (in thousands)                                            606,664       608,793       605,412        608,730
   Effect of dilutive securities:
    Stock options                                                        8,228             -             -          6,312
    Series D Preferred Stock                                            39,589             -             -         38,709
                                                                   =============== ============= ============= ==============
Weighted average number of shares used for diluted earnings
   (loss) per share                                                    654,481       608,793       605,412        653,751
                                                                   =============== ============= ============= ==============

BASIC EARNINGS (LOSS) PER COMMON SHARE:
    Income (loss) from continuing operations                          $   0.18      $  (0.32)     $  (0.34)      $   2.75
                                                                   =============== ============= ============= ==============
                                                                   =============== ============= ============= ==============
    Income from discontinued operations (1)                                  -             -             -       $   0.26
                                                                   =============== ============= ============= ==============
                                                                   =============== ============= ============= ==============
    Gain on separation                                                       -             -             -       $  40.18
                                                                   =============== ============= ============= ==============
                                                                   =============== ============= ============= ==============
    Extraordinary item - early extinguishment of debt                        -             -      $   0.03       $  (0.55)
                                                                   =============== ============= ============= ==============

DILUTED EARNINGS (LOSS) PER COMMON SHARE:
    Income (loss) from continuing operations                          $   0.18      $  (0.32)     $  (0.34)      $   2.62
                                                                   =============== ============= ============= ==============
    Income from discontinued operations (1)                                  -             -             -       $   0.24
                                                                   =============== ============= ============= ==============
    Gain on separation                                                       -             -             -       $  37.42
                                                                   =============== ============= ============= ==============
    Extraordinary item - early extinguishment of debt                        -             -      $   0.03       $  (0.51)
                                                                   =============== ============= ============= ==============

COMMUNICATIONS STOCK: (2)
Income from discontinued operations used for basic and diluted
     earnings per share (3)                                                  -             -             -       $    589
                                                                   =============== ============= ============= ==============
Weighted average number of shares used for basic earnings per
     share (in thousands)                                                    -             -             -        484,972
Effect of dilutive securities - stock options                                -             -             -          4,097
                                                                   --------------- ------------- ------------- --------------
Weighted average number of shares used for diluted earnings per
     share                                                                   -             -             -        489,069
                                                                   =============== ============= ============= ==============

BASIC AND DILUTED EARNINGS PER SHARE:
Basic earnings per share from discontinued oper. (3)                         -             -             -       $   1.21
                                                                     ============= ============= ============= ==============
Diluted earnings per share from discontinued oper.(3)                        -             -             -       $   1.20
-------------------------------------------------------------------- ============= ============= ============= ==============
</TABLE>

(1)      Represents the operations of the domestic directory business, which
         were discontinued effective June 12, 1998.
(2)      The Communications Stock was cancelled on June 12, 1998, effective with
         the separation of the telecommunications businesses from the Company.
(3)      Represents the operations of the telecommunications businesses which
         were discontinued effective June 12, 1998.

                                        19
Form 10-Q - Part I
                                 MediaOne Group, Inc.
                   Notes to Consolidated Financial Statements
                                (Dollars in Millions)
                                     (Unaudited)

NOTE 11:  SUBSEQUENT EVENTS

International Investment Sales. On  October 4, 1999, the Company signed an
agreement to sell its interest in Telewest Communications plc ("Telewest") to
Microsoft Corporation ("Microsoft") for approximately 30 million shares of
Microsoft common stock with a value of approximately $3 billion. The terms and
conditions of the sale will be subject to certain approvals. This transaction is
expected to close by year end.

On October 22, 1999, MediaOne Group agreed to sell its interests in most of its
Central European wireless ventures to Deutsche Telekom for $2 billion. These
ventures include Polska Telefonia Cyfrowa, a wireless operator in Central Europe
located in Poland, Westel 900 and Westel Radiotelefon, wireless operators
located in Hungary, and Russian Telecommunications Development Corporation
("RTDC"), a Russian venture which holds various wireless investments. This
transaction is expected to close early next year.

On October 27, 1999, the Company sold its interest in Cable Plus a.s. ("Cable
Plus"), a cable operator in the Czech Republic, to UPC for proceeds of $150.

Series D Preferred Stock. On October 1, 1999, MediaOne Group issued redemption
notices to its Series D Preferred Stock holders, with a conversion effective
date of November 15, 1999. The number of shares of MediaOne  Group Stock to be
received for the Series D Preferred Stock will be based on the Series D
Preferred Stock liquidation value of $50.00 per share, divided by 95 percent of
the average of the daily closing price of MediaOne Group Stock for the ten
consecutive trading  days ending on November 10, 1999. Prior to November 15,
1999, the Series D Preferred Stock is convertible at the option of the holder
into 1.98052 shares of MediaOne Group Stock per share of Series D Preferred
Stock. As of September 30, 1999, MediaOne Group had outstanding  19,989,175
shares of Series D Preferred Stock.

Debt Offering. On November 2, 1999, MediaOne Group sold 26 million Premium
Income Exchangeable Securities(SM) (the "Exchangeable Notes") for gross proceeds
of approximately $1.1 billion. The Exchangeable Notes mature on November 15,
2002, and are mandatorily redeemable into Vodafone ADRs, the cash equivalent, or
a combination of cash and Vodafone ADRs, based upon a predetermined formula. In
October 1999, Vodafone executed a five for one stock split of its Vodafone ADRs.
The PIES offering was based on post-split shares.

                                        20

Form 10-Q - Part I
                                MediaOne Group, Inc.
                    Notes to Consolidated Financial Statements
                               (Dollars in Millions)
                                    (Unaudited)

NOTE 12:  DISCONTINUED OPERATIONS

In accordance with Accounting Principles Board Opinion No. 30, "Reporting the
Results of Operations - Reporting the Effects of Disposal of a Segment of a
Business and Extraordinary, Unusual and Infrequently Occurring Events and
Transactions," the Consolidated Financial Statements reflect the
telecommunications businesses and the domestic directory business as
discontinued operations since these businesses were separated from the Company
effective on June 12, 1998. The revenues and expenses, and the cash flows of the
discontinued operations have been separately classified in the Consolidated
Statements of Operations and Cash Flows. Summarized operating results for the
discontinued operations for the nine month period of 1998 were as follows:
Revenues were $5,454; operating income was $1,412; income before income taxes
was $1,187; income tax expense was $(440); and net income from  discontinued
operations was $747.
                                        21
Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Some of the information presented in or in connection with this report
constitutes "forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995. Although the Company believes that its
expectations are based on reasonable assumptions within the bounds of its
knowledge of its business and operations, there can be no assurance that actual
results will not differ materially from its expectations. Factors that could
cause actual results to differ from  expectations include: (i) greater than
anticipated competition from new entrants into the cable, and wireless
communications markets, and from direct broadcast satellite systems,
(ii) changes in demand for the Company's products and services, (iii) regulatory
changes affecting the cable and telecommunications  industries,  iv) changes in
economic conditions in the various markets served by MediaOne Group operations,
including international markets, that could adversely affect the level of demand
for cable, wireless, or other services offered by the Company, (v) greater than
anticipated competitive activity requiring new pricing for services, (vi) higher
than anticipated start-up costs associated with new business opportunities,
(vii) higher than anticipated employee levels, capital expenditures,  and
operating expenses (such as costs associated with Year 2000 remediation),
(viii) consumer acceptance of broadband services, including telephony and data
services, and wireless services, (ix) increases in fraudulent activity with
respect to broadband and wireless services, or (x) delays in the development of
anticipated technologies, or the failure of such technologies to perform
according to expectations.

Results of Operations - Continuing Operations - Three and Nine Months Ended
          September 30, 1999 Compared with 1998

MediaOne Group Income (Loss) from Continuing Operations


Normalized Income (Loss) from Continuing Operations:

<TABLE>
<CAPTION>
<S>                                 <C>                   <C>                 <C>                   <C>

                                     Three Months Ended                        Nine Months Ended
                                       September 30,            Change           September 30,             Change
                                    --------------------- ------------------- --------------------- ---------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                 <C>        <C>        <C>        <C>      <C>        <C>        <C>        <C>

                                      1999       1998         $         %       1999       1998         $          %
----------------------------------- ---------- ---------- ---------- -------- ---------- ---------- ---------- ----------
Income (loss) from continuing
  operations                         $ 148      $ (184)     $ 332        -     $ (139)    $ 1,768    $ (1,907)       -
Adjustments to reported income (loss)
   from continuing operations:
   (Gain) loss on investments:
    Domestic                          (257)         (2)      (255)       -       (314)        (26)       (288)       -
    International - net               (102)          -       (102)       -       (175)          -        (175)       -
    Exchange of AirTouch                 -           -          -        -     (1,530)          -      (1,530)       -
    PrimeStar                            -           -          -        -         40           -          40        -
    Domestic wireless (1)                -           -          -        -          -      (2,257)      2,257        -
   Merger costs                          9           -          9        -      1,521           -       1,521        -
   Minority interest - Centaur           -           -          -        -         13           -          13        -
   Domestic wireless operations(1)       -           -          -        -          -         (20)         20        -
                                    ========== ========== ========== ======== ========== ========== ========== ==========
Normalized loss from continuing
  operations                        $ (202)     $ (186)     $ (16)     8.6     $ (584)     $ (535)      $ (49)     9.2
----------------------------------- ========== ========== ========== ======== ========== ========== ========== ==========
</TABLE>

(1)     The domestic wireless businesses were sold to AirTouch effective 4/6/98.

                                        22
Form 10-Q - Part I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (Dollars in millions, except per share amounts)


Basic Earnings (Loss) Per Share From Continuing Operations Available for
MediaOne Group Stock:

<TABLE>
<CAPTION>
<S>                                      <C>                    <C>               <C>                   <C>

                                          Three Months Ended                       Nine Months Ended
                                            September 30,           Change           September 30,          Change
                                         --------------------- ------------------ --------------------- ----------------
</TABLE>
<TABLE>
<S>                                       <C>       <C>        <C>       <C>      <C>        <C>        <C>        <C>

                                            1999        1998        $         %       1999       1998         $       %
---------------------------------------- ---------- ---------- --------- -------- ---------- ---------- ---------- -----
Earnings (loss) from continuing
  operations available for common stock  $  0.18     $ (0.32)   $ 0.50        -    $ (0.34)   $  2.75     $ (3.09)    -
Adjustments to reported earnings
   (loss) from continuing operations:
   (Gain) loss on investments:
    Domestic                               (0.42)          -     (0.42)       -      (0.51)     (0.04)      (0.47)    -
    International - net                    (0.17)          -     (0.17)       -      (0.30)         -       (0.30)    -
    Exchange of AirTouch                       -           -         -        -      (2.52)         -       (2.52)    -
    PrimeStar                                  -           -         -        -       0.07          -        0.07     -
    Domestic wireless (1)                      -           -         -        -          -      (3.71)       3.71     -
   Merger costs                             0.01           -      0.01        -       2.51          -        2.51     -
   Minority interest - Centaur                 -           -         -        -       0.02          -        0.02     -
   Domestic wireless operations (1)            -           -         -        -          -      (0.04)       0.04     -
   Loss on redemption of Series C
    Preferred Stock                         0.04           -      0.04        -       0.04          -        0.04     -
   Loss on redemption of Preferred
    Securities                                 -           -         -        -          -       0.09       (0.09)    -
   Other                                       -           -         -        -          -       0.01       (0.01)    -
                                         ---------- ---------- --------- -------- ---------- ---------- ---------- -----
Normalized loss from continuing
  operations available for common
  stock                                  $ (0.36)    $ (0.32)   $(0.04)    12.5   $  (1.03)   $ (0.94)    $ (0.09)  9.6
---------------------------------------- ========== ========== ========= ======== ========== ========== ========== =====
</TABLE>

(1)    The domestic wireless businesses were sold to AirTouch effective 4/6/98.

The table above normalizes for significant one-time items and aids in the
comparability of the Company's  performance period over period.  Routine
acquisitions and dispositions are normalized within the discussion of revenues
and operating loss which follows.

The increase in normalized loss from continuing operations during the three
month period ended September 30, 1999 was primarily a result of increased
interest expense, equity losses in unconsolidated ventures, minority interest
expense in Centaur Funding and guaranteed minority interest expense. The
increase was partially offset by a loss recognized in the third quarter of 1998
related to an interest rate swap on the Company's investment in AirTouch
preferred stock.

The increase in normalized loss from continuing operations during the nine month
period of 1999 was primarily a result of increased depreciation and amortization
expense, and minority  interest expense in Centaur Funding. The increase was
partially offset by decreased interest expense from lower debt levels at the
beginning of 1999, and by the loss recognized in 1998 related to an interest
rate swap discussed above.
                                        23

Form 10-Q - Part I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (Dollars in millions)

Sales and Other Revenues
<TABLE>
<CAPTION>
<S>                           <C>                     <C>                  <C>                       <C>

----------------------------- ----------------------- -------------------- ------------------------- --------------------
                                Three Months Ended                            Nine Months Ended
                                  September 30,             Change              September 30,              Change
                              ----------------------- -------------------- ------------------------- --------------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C>                       <C>          <C>        <C>       <C>        <C>          <C>          <C>       <C>

                                 1999        1998          $          %         1999         1998         $          %
----------------------------- ----------- ----------- --------- ---------- ------------ ------------ --------- ----------

Cable and broadband:
   Domestic                     $ 674       $ 614      $  60        9.8      $ 1,993      $ 1,840     $  153        8.3
   International                    -           6         (6)         -            7           17        (10)     (58.8)
                             --------------------------------------------------------------------------------------------
                                  674         620         54        8.7        2,000        1,857        143        7.7

Corporate                           1           6         (5)     (83.3)           2           20        (18)     (90.0)
Other                               -           -          -          -            -            1         (1)         -
                             --------------------------------------------------------------------------------------------

   Current operations             675         626         49        7.8        2,002        1,878        124        6.6

Domestic wireless(1)                -           -          -          -            -          361       (361)         -

                             ============================================================================================
Total                           $ 675       $ 626      $  49        7.8      $ 2,002      $ 2,239    $  (237)     (10.6)
-----------------------------============================================================================================
</TABLE>

(1)    The domestic wireless businesses were sold to AirTouch effective 4/6/98.

MediaOne Group sales and other revenues increased during the three month period
ended September 30, 1999, primarily as a result of growth in domestic cable and
broadband revenues. Sales and other revenues decreased during the nine month
period ended September 30, 1999 primarily as a result of the sale of the
domestic wireless businesses in April 1998, partially offset by growth in
domestic cable and broadband revenues. Normalized for acquisitions and
dispositions, total revenues for the three and nine month periods of 1999
increased $59, or 9.6 percent, and $175, or 9.6 percent, respectively, compared
with total revenues of $616 and  $1,827, for the same periods in 1998,
respectively. The normalized increases were due primarily to growth in domestic
cable and broadband revenues.

                                        24


Form 10-Q - Part I

Item   2.    Management's Discussion and Analysis of  Financial Condition and
             Results of Operations (Dollars in millions)

Domestic cable and broadband revenues increased during the three month period
ended September 30, 1999 due primarily to greater basic cable, advertising
and new products revenues. The increase during the nine month period of 1999
was due primarily to greater basic cable, pay-per-view, advertising and new
products revenue, partially offset by the lack of PrimeStar, Inc. ("PrimeStar")
direct broadcast services ("DBS") revenues in 1999. Normalized for the one-time
effects of cable system acquisitions and dispositions, total domestic cable and
broadband revenues for the three and nine month periods of  1999 increased 10.5
percent and 10.7 percent, respectively.

Basic Cable.   Basic cable services revenues increased during the three  and
nine month periods of 1999 due primarily to an approximate five percent
increase in revenue per average cable subscriber and increased basic
subscribers. At September 30, 1999, basic cable subscribers were 4,983,000, an
increase of 1.7 percent compared with the same period in 1998, normalized for
the effects of cable system acquisitions and dispositions. The increase in
revenue per average cable subscriber is  primarily  the result of increased
rates.

Premium.  Premium service revenues increased during 1999 due primarily to
improved premium service customer growth as a result of the launch of "NexTV" in
late 1998. NexTV is a repackaging of the Company's premium services into related
premium channels. At September 30, 1999, premium units were 4,325,000, an
increase of 6.9 percent compared with the same period in 1998, normalized for
the effects of cable system acquisitions and dispositions.

During the third quarter of 1999, the Company launched digital service in
Pompano, Florida, bringing the Company to five digital  markets launched. At
September 30, 1999, digital subscribers were 23,600 and digital  market-ready
homes were 832,000. Advanced analog subscribers totaled 1,354,000 at September
30, 1999, with 5,091,000 advanced analog market-ready homes.

Pay-per-view.  Pay-per-view revenues increased during the three and nine month
periods ended September 30, 1999 due primarily to the offering of various major
sporting events in 1999 compared with one major sporting event in 1998. In
addition, growth in advanced analog and digital subscribers during 1999, as well
as higher impulse pay-per-view capability, has resulted in greater movie and
other product purchases. During 1999,  purchases of pay-per-view services have
increased 11 percent on a normalized basis.

Advertising. Advertising revenues increased during 1999 primarily as a result of
growth in local and national advertising sales as compared with the same period
in 1998.

Equipment and Installation.  Equipment and installation revenues increased in
1999 due primarily to subscribers upgrading converter boxes, slightly offset by
free installation programs offered during the second quarter of 1999.

                                        25

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
        of Operations (Dollars in millions)

Other.  Other revenues include revenues received for guides and miscellaneous
revenues, offset by franchise fee payments.

Video.  Video revenue per average cable subscriber was $43.26 per month for the
three month period ended September 30, 1999, an increase of 6.2 percent compared
with $40.73 for the same  period  in 1998. For the nine  month  period  ended
September 30, 1999, video revenue per average cable subscriber was $42.85 per
month, an increase of 7.0 percent compared with $40.05 for the same period in
1998. Adjusted for the one-time effects of cable system acquisitions  and
dispositions, video revenue per average cable subscriber  increased 5.9 percent
and 6.8 percent during the three and nine month periods of 1999, respectively.
Video revenue per average cable subscriber has increased as a result of
increased rates and expanded channel offerings, as well as growth in advertising
and pay-per-view revenues.

Video revenues increased 7.3 percent and 8.1 percent during the three and nine
month periods of 1999, respectively, normalized for the one-time effects of
cable system acquisitions and dispositions.

New Products.  New products revenues increased during 1999 due  primarily to
customer growth in high speed Internet access services, as well as the launch of
residential telephone services during 1998 and 1999.  Normalized for
dispositions, new products revenues increased $20, or 222.2 percent, and $48, or
177.8  percent, during the three and nine month periods of 1999, respectively,
compared with new products revenues of $9 and $27 for the same periods in 1998.

At September 30, 1999, MediaOne Group had approximately 41,800 residential
telephone customers with 56,400 telephone lines.  Residential telephone services
were available to 1,331,400 market-ready homes as of September 30, 1999,
compared with 256,400 as of the same period in 1998.

At September 30, 1999, MediaOne Group had approximately 173,200 high speed
Internet customers compared with 53,400 high speed Internet customers for the
same period in 1998.  High speed  Internet access services were available to
4,794,100 market-ready homes at September 30, 1999, compared with 3,166,300 as
of the same period in 1998.

PrimeStar.  Subsequent to April 1, 1998, MediaOne Group no longer reflects
PrimeStar DBS services revenues as it contributed its PrimeStar subscribers and
certain related assets (the "PrimeStar Contribution") to PrimeStar.

Cable and Broadband - International.  International cable and broadband revenues
represent the consolidated  operations of Cable Plus.  Effective April 1, 1999,
MediaOne Group no longer consolidates the operations of Cable Plus as the entity
was sold in October 1999.

                                        26
Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
       of Operations (Dollars in millions)

Corporate.  Corporate revenues during the three and nine month periods of 1999
decreased due to adjustments associated with the discontinuance of insurance
policies on cellular phones.

Domestic Wireless.  On April 6, 1998, MediaOne Group sold its domestic wireless
businesses to AirTouch.

Operating Loss
<TABLE>
<CAPTION>
<S>                           <C>                     <C>                  <C>                       <C>

----------------------------- ----------------------- -------------------- ------------------------- --------------------
                                Three Months Ended                            Nine Months Ended
                                  September 30,             Change              September 30,              Change
                              ----------------------- -------------------- ------------------------- --------------------
</TABLE>
<TABLE>
<CAPTION>
<S> <C>                       <C>          <C>        <C>       <C>        <C>          <C>          <C>       <C>

                                 1999        1998          $          %         1999         1998         $          %
----------------------------- ----------- ----------- --------- ---------- ------------ ------------ --------- ----------

Cable and broadband:
   Domestic                    $  (61)     $  (56)     $  (5)        8.9    $   (141)    $   (114)    $  (27)       23.7
   International                    -          (1)         1           -          (1)          (5)         4       (80.0)
                             --------------------------------------------------------------------------------------------
                                  (61)        (57)        (4)        7.0        (142)        (119)       (23)       19.3

International wireless              -          (2)         2           -          (2)          (7)         5       (71.4)
Corporate                         (24)        (36)        12       (33.3)        (89)        (109)        20       (18.3)
Other                              (1)          -         (1)          -          (2)          (6)         4       (66.7)
                             --------------------------------------------------------------------------------------------

   Current operations             (86)        (95)         9        (9.5)       (235)        (241)         6        (2.5)

Domestic wireless(1)                -           -          -           -           -           93        (93)          -

                             ============================================================================================
Total                          $  (86)     $  (95)     $   9        (9.5)   $   (235)    $   (148)    $  (87)       58.8
-----------------------------============================================================================================
</TABLE>

(1)     The domestic wireless businesses were sold to AirTouch effective 4/6/98.

During the three month period ended September 30, 1999, MediaOne Group's
operating loss decreased due primarily to a reduction in corporate costs. During
the nine month period ended September 30, 1999, MediaOne Group's operating loss
increased due primarily to the sale of its domestic wireless businesses in April
1998. Also contributing were increased depreciation and amortization charges on
the continuing upgrade of the Company's cable network, partially offset by
decreased corporate costs during 1999.

MediaOne Group's EBITDA was $220 and $193 for the three month  periods in 1999
and 1998, respectively, and $649 and $746 for the nine month periods in 1999 and
1998, respectively. Excluding the effect of the domestic wireless  operations,
EBITDA would have been $598 for the nine month period in 1998.  MediaOne  Group
considers EBITDA an important indicator of the operational strength and
performance of its businesses. EBITDA, however, should not be considered an
alternative to operating or net income as an  indicator of the performance of
MediaOne Group's businesses, or as an alternative to cash flows from operating
activities as a measure of liquidity, in each case determined in accordance with
GAAP.

                                        27

Form 10-Q - Part I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (Dollars in millions)

Cable and Broadband - Domestic.  Domestic cable and broadband  operating  losses
increased during the three month period ended  September 30, 1999 due primarily
to increased depreciation expense on the continuing  upgrade of the Company's
cable network, partially offset by the suspension of $18 in depreciation and
amortization expense related to cable systems held for sale in the first half of
1999. The cable systems were traded for Time Warner Cable and Cox cable systems
during the third quarter of 1999.

Domestic cable and broadband operating losses increased during the nine month
period ended September 30, 1999 due primarily to increased depreciation expense
on the continuing upgrade of the Company's cable networks, as well as a one-time
$25 depreciation and amortization charge related to the deferral of a cable
system trade with Tele-Communications, Inc. (the {"TCI trade") until such time
as the merger of MediaOne Group with AT&T is completed. Depreciation and
amortization expense on the TCI trade properties had been suspended during 1998
pending the trade of these properties. Partially offsetting the increase in
operating losses was the suspension of $48 in depreciation and amortization
expense related to cable systems held for sale in 1999, and a one-time charge of
$28 in the first quarter of 1998 for depreciation and amortization expense
related to the termination of the sale of cable systems in Minnesota.
Depreciation and amortization expense had been suspended on the Minnesota
systems in 1997 while they were held for sale.

During the three month period of 1999, EBITDA for domestic cable and broadband
operations was $242, an increase of $15, or 6.6 percent, compared with $227 for
the same period in 1998. Revenue increases of $60, or 9.8  percent, were
partially offset by increased programming costs of $25, or 17.7 percent,  and
increased operating, general and administrative costs of $20, or 8.1 percent.
Normalized for the one-time effects of cable system acquisitions and
dispositions, domestic cable and broadband EBITDA increased $17, or 7.6 percent.

During the nine month period of 1999, EBITDA for domestic cable and broadband
operations was $731, an increase of $25, or 3.5 percent, compared with $706 for
the same period in 1998. Revenue increases of $153, or 8.3 percent, were
partially offset by increased programming costs of $55, or 12.8 percent, and
increased operating, general and administrative costs of $73, or 10.4 percent.
Of those amounts, the PrimeStar Contribution provided revenue decreases of $34
and cost decreases of $30, including $14 of programming costs, to total domestic
cable and broadband  EBITDA for the period.  Normalized for the one-time effects
of cable system  acquisitions and dispositions, domestic cable and broadband
EBITDA increased $30, or 4.3 percent.

                                        28

Form 10-Q - Part I

Item 2. Management's Discussion and Analysis of Financial Condition and Results
        of Operations (Dollars in millions)

Video EBITDA was $253, an increase of $11, or 4.5 percent, for the three month
period of 1999, compared  with $242 for the same  period in 1998. For the nine
month period of 1999, video EBITDA was $772, an increase of $31, or 4.2 percent,
compared with $741 for the same period in 1998. Normalizing for acquisitions and
dispositions, video EBITDA increased $12, or 5.0 percent, for the three month
period of 1999, compared with video EBITDA of $241 for the same period in 1998,
and increased  $30, or 4.0 percent, for the nine month period of 1999 compared
with video EBITDA of $742 for the same period in 1998.

New products EBITDA was a loss of $(11) for the three month  period of 1999, a
decrease in losses of $4, or 26.7 percent, compared with EBITDA losses of $(15)
in the same period of 1998. New  products revenue increases of $16, or 123.1
percent, were partially offset by new products cost increases of $12, or 42.9
percent, during the period, primarily for the offering of residential telephone
services. For the nine month period of 1999, new products EBITDA was a loss of
$(41), an increase in losses of $(2), or 5.1 percent. New products revenue
increases of $41, or 120.6 percent, were offset by new products cost increases
of $43, or 58.9 percent, during the nine month period, primarily for the
offering of residential telephone services. Normalizing for dispositions, new
products  EBITDA loss for the three month period of 1999 decreased $5, or 31.3
percent, compared with new products EBITDA loss of $(16) for the same period in
1998. Normalizing for dispositions, new products EBITDA was a loss of $(41) for
both of the nine month periods in 1999 and 1998.

Programming costs were $166 for the three month period in 1999, an increase of
$25, or 17.7 percent, over the same period in 1998. For the nine month period of
1999, programming costs were $486, an increase of $55, or 12.8 percent, over the
same period in 1998. Excluding programming costs related to PrimeStar DBS
services, programming costs during the nine month period of 1999 increased $69,
or 16.5 percent. The normalized increase was primarily a result of programmer
rate increases, expanded channel offerings and growth in subscribers, as well as
fees paid in 1999 to the Road Runner joint venture to provide high speed
Internet services to MediaOne Group's customers.

Operating, general and administrative costs were $266 during the three month
period of 1999, an increase of $20, or 8.1 percent, over the same period in
1998. During the nine month period of 1999, operating, general and
administrative costs were $776, an increase of $73, or 10.4 percent, over the
same period in 1998, partially offset by decreased costs of $16 related to the
PrimeStar Contribution. Increases in operating, general and administrative costs
were primarily a function of adding customer service employees; spending on
marketing and advertising to deploy new products, such as high speed Internet
and residential telephone services, and to drive subscriber growth; and spending
on specific initiatives to improve the operations of the Company.

                                        29

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

During the three and nine month periods of 1999, MediaOne Group incurred
initiatives costs of $15 and $38, respectively, to improve reporting and billing
systems and to create customer databases to serve customers more effectively,
and incurred incremental costs of $4 and $16, respectively, for Year 2000
remediation, for a total of $19 and $54, respectively. Initiatives spending and
incremental Year 2000 costs in the three and nine month periods of 1999 have
increased a total of $9 and $36, respectively, compared with the same periods in
1998.

International Wireless. International wireless operating losses represent the
consolidated operations of RTDC. Effective April 1, 1999, MediaOne Group no
longer consolidates RTDC's results as the entity is held for sale.

Corporate. Corporate costs for the three and nine month periods of 1999 have
decreased.

Other. Costs incurred for the development of domestic Internet content services
have decreased during the nine month period of 1999 primarily as a result of
aligning certain of these operations within the domestic cable and broadband
operations.

Interest Expense and Other
<TABLE>
<CAPTION>
<S>                            <C>                     <C>                <C>                       <C>

------------------------------ ----------------------- ------------------ ------------------------- ------------------
                                 Three Months Ended                          Nine Months Ended
                                   September 30,            Change             September 30,             Change
                               ----------------------- ------------------ ------------------------- ------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                            <C>         <C>         <C>       <C>       <C>         <C>          <C>       <C>

                                   1999        1998          $       %         1999         1998         $         %
------------------------------ ----------- ----------- --------- -------- ------------ ------------ --------- --------

Interest expense                $  (114)    $   (86)   $   (28)    32.6    $   (313)    $   (379)    $    66    (17.4)
Equity losses in
  unconsolidated ventures           (89)        (68)       (21)    30.9        (291)        (273)        (18)     6.6
Gains (losses) on investments:
  Domestic sales and
   redemption                       418           3        415        -         510           42         468        -
  International sales and
   exit costs - net                 163           -        163        -         295            -         295        -
  Exchange of AirTouch                -           -          -        -       2,482            -       2,482        -
  Domestic wireless sale              -           -          -        -           -        3,869      (3,869)       -
  PrimeStar                           -           -          -        -         (65)           -         (65)       -
Minority interest expense in
  Centaur Funding                   (26)          -        (26)       -         (97)           -         (97)       -
Guaranteed minority interest
  expense                           (24)        (11)       (13)       -         (71)         (53)        (18)    34.0
Merger costs                        (15)          -        (15)       -      (1,537)           -      (1,537)       -
Other income - net                   48          13         35        -         116           86          30     34.9
----------------------------------------------------------------------------------------------------------------------
</TABLE>

                                        30

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Interest Expense. Interest expense during the three month period of 1999
increased due primarily to the issuance of: (a) $1.7 billion of debt in June and
September 1999 associated with the monetization of Vodafone ADRs, (b) a $1.5
billion note payable to AT&T in May 1999 for the termination fee paid to Comcast
Corporation ("Comcast") on behalf of MediaOne Group, and (c) $1.7 billion of
Exchangeable Notes during the later part of 1998. Interest expense for the nine
month period of 1999 decreased due primarily to the refinancing of debt in
connection with the June 12, 1998 separation of the Company's businesses into
two separate companies, as well as the assumption of $1.35 billion in debt by
AirTouch as a result of the sale of the Company's domestic wireless operations,
partially offset by the issuance of the Exchangeable Notes during the latter
part of 1998.

Equity Losses in Unconsolidated Ventures. Equity losses during the three month
period of 1999 increased due primarily to greater losses of $(67) from
international ventures, partially offset by increased earnings of $46 from
domestic ventures. For the nine month period of 1999, equity losses from
international ventures have increased $(123), partially offset by increased
earnings from domestic ventures of $105. Effective April 1, 1999, equity losses
from international ventures include the results of operations of Cable Plus and
RTDC as these investments are no longer consolidated with the Company's results
of operations.

Equity losses from international ventures during the three month period of 1999
increased due primarily to greater losses from the Company's investments in
international wireless ventures and higher ownership in the equity losses of
Telewest and other international cable and broadband ventures. MediaOne Group
has a higher ownership in the equity losses of Telewest as a result of the
Company's participation in a Telewest rights offering in 1998. During the nine
month period of 1999, equity losses from international ventures increased due
primarily to a higher ownership in the equity losses of Telewest and other
international cable and broadband ventures, partially offset by improved results
from the international wireless ventures. Equity earnings from domestic ventures
have increased due to one-time gains recognized by TWE during the three and nine
month periods of 1999, and the absence of losses from the investment in PrimeCo
Personal Communications, L.P. ("PrimeCo") during the nine month period of 1999
as it was sold to AirTouch in April 1998. In addition, as of April 1, 1999, the
Company suspended recording equity losses for its high speed data joint venture
with Time Warner, TWE and Time Warner Entertainment/Newhouse Partnership as its
investment was reduced to zero and the Company had no future funding commitments
to the joint venture.

                                        31

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Gains (Losses) on Investments

Sales and Redemption of Domestic Investments. During the three month period of
1999, MediaOne Group finalized certain cable system trades with Time Warner
Cable and Cox which resulted in pretax gains of $330 ($202 after tax) and $38
($24 after tax), respectively. The Company also recognized a gain of $50 ($31
after tax) on the exercise of an option for FSA shares held by the Company which
was exercised in conjunction with the redemption of the Series C Preferred
Stock. In addition, during the nine month period of 1999, debt exchangeable into
common stock ("DECS") matured and was redeemed for shares of FSA resulting in a
pretax gain of $21 ($14 after tax), and MediaOne Group sold: (a) investments in
two providers of business telephony services resulting in a pretax gain of $44
($27 after tax), (b) various cable systems resulting in a pretax gain of $15 ($9
after tax), and (c) miscellaneous assets from its capital assets group resulting
in a pretax gain of $12 ($7 after tax). During the three month period of 1998,
MediaOne Group sold various investments, resulting in a pretax gain of $3.
During the nine month period of 1998, MediaOne Group sold a cable programming
investment and various other investments resulting in a pretax gain of $42 ($26
after tax).

Sales and Exit Costs of International Investments - net. During the three month
period of 1999, MediaOne Group sold its investment in A2000 for a pretax gain of
$154 ($94 after tax), and various other international investments for a pretax
gain of $9 ($8 after tax, including a correction to the tax provision on the
sale of Listel). During the nine month period of 1999, MediaOne Group sold its
investment in A2000 described above, as well as Optus shares resulting in a
pretax gain of $155 ($95 after tax), its investment in Listel resulting in a
pretax gain of $20 ($9 after tax), and various other international investments
for a pretax gain of $9 ($5 after tax). In addition, during the nine month
period of 1999, the Company recorded a charge of $43 ($28 after tax) related to
its international exit plan.

Exchange of AirTouch Investment. Effective on June 30, 1999, MediaOne Group
exchanged and modified its investment in AirTouch common and preferred stock for
Vodafone ADRs and preferred stock and $9.00 per share cash proceeds, resulting
in a net pretax gain of $2,482 ($1,530 after tax).

Sale of Domestic Wireless Investment. On April 6, 1998, MediaOne Group sold its
domestic wireless businesses to AirTouch resulting in a pretax gain of $3,869
($2,257 after tax).

PrimeStar Investment. During the first quarter of 1999, MediaOne Group recorded
a pretax loss of $65 ($40 after tax) for probable obligations related to its
investment in PrimeStar, of which a total of $55 was funded in April, June and
September 1999.

                                        32

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Minority Interest Expense in Centaur Funding. Minority interest expense in
Centaur Funding for the three and nine month periods of 1999 represents
dividends and accretion on the $1.1 billion of preferred shares (the "Preference
Shares") issued in December 1998 by Centaur Funding Corporation ("Centaur"), a
special purpose entity consolidated by MediaOne Group. In addition, since the
Preference Shares were referenced to the AirTouch preferred shares, Centaur
recorded a $21 extraordinary dividend in June 1999 payable to the Preference
Shares Series B and Series C holders to mirror the extraordinary dividend paid
by AirTouch in August 1999 as a result of the Vodafone merger. This dividend
amount is reflected as minority interest expense in Centaur Funding for the nine
month period of 1999.

Guaranteed Minority Interest Expense. Guaranteed minority interest expense has
increased during the three and nine month periods of 1999, due primarily to the
exchange of MediaOne Group's 7.96 and 8.25 percent Company-obligated mandatorily
redeemable preferred securities of subsidiary trust holding soley
Company-guaranteed debentures (the "Preferred Securities") for 9.30 and 9.50
percent Preferred Securities in mid-June 1998, and the issuance in October 1998
of 9.04 percent Preferred Securities. The exchange of the Preferred Securities
was a result of the separation of the Company's businesses into two separate
companies effective on June 12, 1998.

Merger Costs. Merger costs during the three month period of 1999 include
severance costs, and miscellaneous legal and advisory fees of $15 ($9 after
tax), related to merger activity of the Company. Merger costs for the nine month
period of 1999 include a charge of $1,500 to terminate the Company's merger
agreement with Comcast, as well as severance costs and miscellaneous legal and
advisory fees of $37 related to merger activity of the Company, resulting in
total pretax merger costs of $1,537 ($1,521 after tax).

Other Income - Net. During the three and nine month periods of 1999, other
income increased due primarily to the recognition in 1998 of a $40 loss related
to an interest rate swap associated with the Company's investment in AirTouch
preferred stock. For the nine month period of 1999, other income also increased
as a result of dividend income from the Company's investment in AirTouch
preferred stock, partially offset by increased foreign exchange transactions
losses associated with loans to international ventures. The Company also
recorded $15 of income in 1999 for a fee paid by Optus to the Company as a
result of having met certain performance measures.

                                        33

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

(Provision) Benefit for Income Taxes for Continuing Operations
<TABLE>
<CAPTION>
<S>                            <C>                     <C>               <C>                      <C>

------------------------------ ----------------------- ----------------- ------------------------ ------------------
                                 Three Months Ended                         Nine Months Ended
                                   September 30,            Change            September 30,            Change
                               ----------------------- ----------------- ------------------------ ------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                             <C>        <C>         <C>      <C>      <C>           <C>        <C>       <C>

                                    1999        1998        $        %         1999         1998        $         %
------------------------------ ----------- ----------- -------- -------- ------------- ---------- --------- --------

(Provision) benefit for
  income taxes                  $   (127)    $    60    $  (187)     -     $   (933)    $ (1,376)  $   443    (32.2)
Effective tax rate                  46.2%       24.6%                         117.5%        43.8%
--------------------------------------------------------------------------------------------------------------------
</TABLE>

The increase in the 1999 effective tax rate is primarily a result of merger
costs, gains on the sales of investments and the loss on the PrimeStar
investment. Excluding these unusual transactions, the effective tax rate would
have been 31.6 percent and 32.2 percent for the three and nine month periods of
1999, respectively. The increase in the 1998 effective tax rate is primarily a
result of the gain on the sale of the domestic wireless businesses. Excluding
the gain on the sale of the domestic wireless businesses, the domestic wireless
operations and gains on the sales of investments, the effective tax rate would
have been 26.5 percent and 29.7 percent during the three and nine month periods
of 1998, respectively.

Liquidity and Capital Resources

Operating Activities

Cash provided by operating activities during the nine month period ended
September 30, 1999 increased $120 to $511 as compared with the same period in
1998. The increase was due to the receipt of $377 of net income tax benefits,
due primarily to the carryback of the 1998 taxable loss to the 1996 consolidated
tax return, partly offset by the lack of operating cash from the domestic
wireless operations which were sold in April 1998. Cash provided during 1998
from operating activities of the domestic wireless operations was offset during
the period by increased interest payments on long-term debt outstanding during
the period, as well as costs paid for the separation. The Company also received
$42 in dividends during 1998, primarily from Westel 450 and Westel 900, the
Company's European wireless investments in Hungary.

In August 1999, MediaOne Group received $21 from AirTouch as an extraordinary
dividend related to the exchange of AirTouch preferred shares for Vodafone
preferred shares. Since the Centaur Preference Shares were referenced to the
AirTouch preferred shares, Series B Preference Shares holders received an $18
interest payment from Centaur in August 1999. The Series C Preference Shares
holders will receive their share of the extraordinary dividend upon redemption
of the Series C Preference Shares.

MediaOne Group expects that cash from operations will not be adequate to fund
future expected cash requirements. Additional funding will come from cash on
hand, asset sales and new debt financing, including the monetization of Vodafone
ADRs.

                                        34

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Investing Activities

Capital expenditures at MediaOne Group, on a cash basis, were $1,436 and $1,157
during the nine month periods ended September 30, 1999 and 1998, respectively.
The majority of the capital expenditures were devoted to upgrading the domestic
cable network and continuing the provision of new and enhanced services.

For the nine months ended September 30, 1999 and 1998, MediaOne Group invested
$96 and $157, respectively, in international ventures, net of $19 and $45
repayments in 1999 and 1998, respectively, from a wireless investment in the
United Kingdom. The investments made in 1999 were primarily capital
contributions and shareholder loans to cable investments in Belgium, the
Netherlands, Poland, Japan, and Singapore, as well as wireless ventures in India
and Indonesia. During 1998, MediaOne Group invested $131 in Telewest as a result
of the Company's participation in a rights offering by Telewest. Telewest
offered the rights in connection with its acquisition of General Cable in
September 1998. The remaining investments made in 1998 were capital
contributions to cable investments in Belgium, Japan and Singapore, as well as
to wireless ventures in the Slovak Republic, India and Indonesia. Domestically,
MediaOne Group invested $97 and $84 during the nine month periods ended
September 30, 1999 and 1998, respectively, including $55 funded in 1999 related
to the Company's funding obligations of PrimeStar. The remaining investments in
1999 primarily represent ventures for the development of Internet content
services. During 1998, the Company funded $64 related to its investment in
PrimeCo which was sold to AirTouch in April 1998.

During 1999, MediaOne Group sold various investments resulting in net proceeds
of $656, comprised of the following:
<TABLE>
<CAPTION>
<S>  <C>                                                                                <C>

     ---------------------------------------------------------------------------------- --------------------
     Investment Description                                                                Cash Proceeds
     ---------------------------------------------------------------------------------- --------------------

     International investments:
         A2000                                                                                        $ 229
         Listel                                                                                          55
         Lyonnaise                                                                                       22
         Optus shares                                                                                   164
     Two business telephony providers                                                                    82
     Miscellaneous assets of capital assets group                                                        64
     Various cable television systems                                                                    32
     Other assets                                                                                         8

                                                                                        ====================
     TOTAL                                                                                            $ 656
     ---------------------------------------------------------------------------------- ====================
</TABLE>

                                        35

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

In addition, MediaOne Group received cash proceeds of $534 upon the exchange of
its investment in AirTouch common stock for Vodafone ADRs and $9.00 per share
cash proceeds. During the nine month period ended September 30, 1998, the
Company sold various investments resulting in net proceeds of $201, comprised of
the following: (a) an equity investment in PrimeStar Partners, L.P. for $77, (b)
a cable programming investment for $38, (c) various cable systems for $42, and
(d) miscellaneous assets for $44.

In addition, during 1999, MediaOne Group received net proceeds of $28 from
various asset transactions, including a payment to Cox on the swap of cable
systems totaling $10, a receipt of $16 on the maturity of an option for FSA
shares held by the Company, a receipt of $10 on the maturity of an investment,
and the receipt of $12 for miscellaneous transactions. During 1998, MediaOne
Group received proceeds of $71 on the sale of a note receivable and $6 for
miscellaneous asset sales. The Company also purchased various cable television
systems during 1998 totaling $35.

Financing Activities

Debt Activity. Total debt at September 30, 1999 was $8,970, an increase of
$3,548 compared with December 31, 1998. The increase in debt outstanding was due
primarily to the issuance in June and September 1999 of $1.7 billion of debt
associated with the monetization of Vodafone ADRs, the issuance of a $1.5
billion note payable to AT&T for the funding of the Comcast merger termination
fee, and increases in the fair value of the Exchangeable Notes since the
redemption value of the Exchangeable Notes is derived from the fair market value
of Vodafone ADRs. Debt increases during the period were partially offset by the
DECS maturity in May 1999, the early extinguishment of long-term debt, and the
de-consolidation of debt related to Cable Plus and RTDC. The remaining change in
debt outstanding was due primarily to the repayment of commercial paper using
the income tax refund received and proceeds generated by asset sales.

On September 2, 1999, holders of the Series C Preferred Stock exercised options
to receive common shares of FSA held by the Company, resulting in the effective
redemption of the Series C Preferred Stock. The Company did not have to pay a
redemption premium since the Series C Preferred Stock holders exercised the
option to receive FSA shares rather than redeeming their Series C Preferred
Stock shares.

On September 23, 1999, SPC VI issued $717 of floating rate debt a 3-month LIBOR
plus 0.5 percent and paid $216 for a Zero Coupon Swap to fix and pre-fund
interest payments on the debt. Net proceeds from the debt offering were invested
in short term instruments, to be used for general corporate purposes.

                                        36

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

On June 3, 1999, MediaOne SPC IV ("SPC IV"), a wholly-owned subsidiary of
MediaOne Group, issued $1,128 of floating rate debt at 3-month LIBOR plus 0.5
percent and paid $321 for a Zero Coupon Swap to fix and pre-fund interest
payments on the debt. Net proceeds from the debt offering were used for general
corporate purposes. As a result of the Vodafone merger, $105 of the debt issued
by SPC IV was repaid in August using the cash proceeds from the exchange of
AirTouch common stock into Vodafone ADRs and $9.00 per share cash proceeds.

On June 1, 1999, MediaOne Group redeemed 11.0 percent senior subordinated
debentures with a carrying value of $345, including a debt premium of $45. The
debt extinguishment resulted in a net gain of $17 (net of income tax expense of
$11). In addition, the Company redeemed a third-party note for its carrying
value of $12. MediaOne Group financed the redemptions with cash on hand.

On May 15, 1999, DECS originally issued in 1996 matured and were redeemed for
FSA shares held by the Company. The redemption resulted in a pretax gain of $21
($14 after tax).

During August and September 1998, MediaOne Group issued approximately $1,686 of
6.25 percent Exchangeable Notes for net proceeds of $1,642.

On June 12, 1998, MediaOne Group tendered $4.9 billion notional amount of
long-term debt. Also on June 12, 1998, MediaOne Group tendered for cash $301
face value of the 7.96 percent Preferred Securities and $237 face value of the
8.25 percent Preferred Securities originally issued in 1995 and 1996,
respectively. The cash redemption amount of $5.5 billion for the long-term debt
and $582 for the Preferred Securities was financed with floating-rate commercial
paper with a weighted average interest rate of 5.85 percent. In addition, in
accordance with the terms of the separation agreement, the newly created entity
upon the distribution of the telecommunications businesses of the Company funded
to MediaOne Group $3.9 billion related to the transfer of U S WEST Dex, the
domestic directory business previously owned by MediaOne Group. Such funds were
used to repay a portion of the commercial paper issued to tender the debt
discussed above.

Dividends. During 1998, the Company paid $519 of common dividends on the
Communications Stock. Effective June 12, 1998, MediaOne Group no longer pays
dividends on the Communications Stock.

                                        37

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Cash from Discontinued Operations. Cash from discontinued operations during 1998
consisted primarily of fundings to MediaOne Group for common dividends paid to
Communications Stock shareowners, dividends paid by the domestic directory
business to MediaOne Group, proceeds from the issuance of Communications Stock,
and debt fundings and repayments between MediaOne Group and the discontinued
operations of the telecommunications businesses and the domestic directory
business.

Other Financing Activities

Commitments. During April 1999, the sale of PrimeStar's medium-powered business
was closed. As a result, MediaOne Group was released as guarantor on a $75
letter of credit for PrimeStar. The Company remains a guarantor for PrimeStar on
a $25 letter of credit.

MediaOne Group increased its ownership in Titus Communications Corporation, a
broadband network operation in Japan, during the second and third quarters of
1999, and its ownership in Chofu Cable Television, a cable operation in Japan,
during the second quarter of 1999. As part of the acquisitions, MediaOne Group
assumed outstanding debt guarantees of approximately $75.

Debt Ratings. On October 20, 1999, Moody's Investor Service raised MediaOne
Group's senior unsecured debt rating to Baa1 from Baa2, and the Preferred
Securities rating to ba2 from ba3. In addition, the senior debt rating at
MediaOne of Delaware, Inc. ("MediaOne"), the domestic cable and broadband
subsidiary of the Company, was raised to Baa2 from Baa3. The credit ratings are
investment grade and remain on credit watch with positive implications. MediaOne
Group does not guarantee the outstanding senior debt of MediaOne.

Shelf Registration. Under a registration statement filed with the SEC as of
October 8, 1999, MediaOne Group is permitted to issue up to $3.9 billion of new
debt securities.

Risk Management

MediaOne Group is exposed to market risks arising from changes in interest
rates, foreign exchange rates and equity prices. Derivative financial
instruments are used to selectively manage these risks. MediaOne Group does not
use derivative financial instruments for trading purposes.

Equity-Price Risk Management. MediaOne Group is exposed to market risks
associated with equity security prices related to its investments in marketable
equity securities and associated options to purchase marketable equity
securities. In 1999, the Company's exposure to equity price risk has changed due
to initial public offerings by various companies in which MediaOne Group has an
investment, the AirTouch/Vodafone merger and the Collars established on some
Vodafone shares.

                                        38

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

The table below presents the impact of hypothetical movements in the equity
security prices related to MediaOne Group's combined position in marketable
equity securities and derivative contracts:
<TABLE>
<CAPTION>
<S>                                                <C>                            <C>                 <C>

-------------------------------------------------- ------------------------------ ------------------- ----------------
                                                      Hypothetical Change in
                                                        9/30/99 Stock Price
                                                   ------------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                <C>            <C>             <C>                 <C>

                                                                                  Increase in         Decrease in
                                                                                  Fair Market         Fair Market
Investment                                           Increase        Decrease        Value               Value
-------------------------------------------------- -------------- --------------- ------------------- ----------------

Vodafone common stock, including Exchangeable
   Notes                                                30%            30%                 $ 825          $ 1,145
Internet related investments                            50%            50%                    94               93
All other investments                                   10%            10%                    53               49
                                                                                  =================== ================
Total                                                                                      $ 972          $ 1,287
-------------------------------------------------- -------------- --------------- =================== ================
</TABLE>

The changes in the equity security prices are based on hypothetical movements in
future market rates and are not necessarily indicative of actual results that
may occur.

Competitive and Regulatory Environment

Cable and Broadband - Domestic. On October 8, 1999, the Federal Communications
Commission (the "FCC") revised its rules on the number of cable subscribers that
a company may reach and the method to identify cable ownership interests that
would be attributable to a company. The revised rules maintained the original
ruling that a cable operator may not own systems that reach more than 30 percent
of United States homes. The calculation of the number of United States homes
reached was modified, however, to include those households that subscribe to
broadcast satellite and other multi-channel video programming distributors,
effectively increasing the number of subscribers that a cable operator may
serve. The FCC has voluntarily stayed the ownership rules pending the outcome of
a court challenge to the original ownership rules. The Company believes that
these new rules will allow the AT&T merger to close.

                                        39
Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Year 2000 Readiness

The statements made herein relating to the Year 2000 are designated as Year 2000
Readiness Disclosures for purposes of the Year 2000 Information and Readiness
Act. MediaOne Group uses software and related technologies throughout its
business that may be affected by the date change in the year 2000. MediaOne
Group established a corporate-wide Year 2000 program in 1997, which in relation
to other business projects and objectives has been assigned a high priority. The
inability of systems to appropriately recognize the year 2000 could result in a
disruption of Company operations. More specifically, such a failure could result
in material operational impacts on various of the Company's business operations,
as identified in more detail in the chart below.

MediaOne Group continues its progress through a comprehensive program to
evaluate, monitor and address the impact of the Year 2000 on its operations.
MediaOne Group is utilizing both internal and external resources in implementing
the program. The program consists of the following phases:

Phase
(I)  Assessment  -  Structured   evaluation,   including  a  detailed  inventory
     outlining the impact that the Year 2000 may have on current operations.
(II) Detailed Plan - Establishment of priorities, development of specific action
     steps and  allocation  of  resources  to address  the issues as outlined in
     Phase I.
(III)Conversion  -  Implementation  of the  necessary  changes,  (i.e.,  repair,
     replacement or retirement) as outlined in Phase II.
(IV) Testing - Verification  that the conversions  implemented in Phase III will
     be successful in resolving  the Year 2000 problem so that  inventory  items
     used by the critical business processes will function properly.
(V)  Implementation  - The final  roll-out of selected  and  verified  Year 2000
     solutions into an operational unit.

MediaOne Group identified three primary risk assessment levels for various
inventory items relative to its Year 2000 program. These levels are high, medium
and low, with high risk items being those that may have such an impact on the
business, that if the risk is not appropriately managed and/or mitigated, the
occurrence of the risk could have an adverse impact on the operations of the
business, its customers and its employees. Medium risks are those that if they
are not appropriately managed and/or mitigated, the occurrence of the risk may
cause major difficulties in managing the day-to-day operations of the business,
and/or have a significant impact on the ability to deliver acceptable service to
customers. Low risks are those that if they are not appropriately managed and/or
mitigated, the occurrence of the risk may cause difficulties in managing the
business, however, should not severely impact service delivery, cash flow, or
critical management activities.

                                        40

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

MediaOne Group has identified and prioritized four critical business functions
across its business operations in order to manage its Year 2000 program. The
critical business functions are (i) customer service, which includes service
delivery, service disruption, network management and workforce management; (ii)
customer care and billing, which includes bill issuance and access to
functioning call centers; (iii) cash flow, which includes payment processing,
general ledger, accounts payable and accounts receivable; and (iv) employees,
health and safety, which includes payroll processing, pension fund issues, and
building operations and security.

MediaOne Group has identified two business areas that are subject to Year 2000
disclosures. These are Domestic Cable and Broadband, and Investments in
Unconsolidated Subsidiaries.

Domestic Cable and Broadband

The Company continues to progress through its program to address the Year 2000
issues related to its Domestic Cable and Broadband operations. As of September
30, 1999, all four critical business functions managed by the program were 98+
percent complete* relative to the high and medium priority projects.
<TABLE>
<S>                      <C>                           <C>                        <C>                 <C>

------------------------ ----------------------------- -------------------------- ------------------- ---------------

                                                                                                         Date of
Business Functions          Current Areas of Focus        Operational Impact        Current Status      Completion
------------------------ ----------------------------- -------------------------- ------------------- ---------------

Customer Service         Head End Controller           Inability to provide       Complete*           Q3 1999
                         Digital Transmission            video, telephony &
                           Equipment                     data service to
                         Switches                        customers
                         Ad Insertion
                         Network Surveillance

Customer Care & Billing  Subscriber Billings           Loss of revenues           Complete*           Q3  1999
                         Ad Sales Billings             Loss of customer
                         Call Center Operations          provisioning and
                         Data Communications             repair support
                         Desktop Computing

Cash Flow                Financial Systems             Interruption to cash       Complete*           Q3  1999
                                                         receipts &
                                                         disbursements cycle

Employees, Health &      Payroll & Benefit Systems     Loss of support systems    Complete*           Q2 1999
  Safety                 Facilities Functions            and employee disruption

------------------------ ----------------------------- -------------------------- ------------------- ---------------
</TABLE>

*    Indicates ongoing Year 2000 compliant operations,  which includes a process
     to identify  inventory  which will be  continually  updated  with new items
     throughout 1999.

                                        41

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Investment in Unconsolidated Subsidiaries

MediaOne Group has significant investments in both domestic and international
operations. The Company's Year 2000 program includes plans to monitor the
progress of these ventures in addressing the Year 2000 issues. The Company
believes, based upon information provided by the ventures, that these ventures
are progressing in their efforts to address the Year 2000 issues and continue to
be in the testing and/or implementation phase of their programs. The Company
continues to believe that the costs of addressing the Year 2000 issues by the
ventures will not have a material adverse impact on MediaOne Group's financial
position.

Third Party Relationships

MediaOne Group has significant relationships and dependencies with regard to
systems and technology provided and supported by third party vendors and service
providers. As part of its Year 2000 program, MediaOne Group established a vendor
compliance group to obtain formal Year 2000 compliance representation from
vendors who provide products and services to MediaOne Group. The scope of this
group's focus includes vendors who provide information technologies, network
switching and elements, infrastructure, electronic trading partners and other
third party suppliers. The vendor compliance process is being performed
concurrently with the regional/business unit Year 2000 remediation activities.
In addition, the MediaOne Group Year 2000 legal team has established in parallel
a vendor contract analysis program.

Business Continuity

Business continuity teams are now in place for the Year 2000 program and include
business contingency and response and recovery management. Operational response
and recovery plans are in place to quickly assess and repair service
interruptions which may occur during the millennium rollover.

Costs of Year 2000 Program

MediaOne Group has incurred approximately $48 of costs to implement its Year
2000 compliance program through the third quarter of 1999 and currently expects
to incur between $50 to $60 of costs in aggregate, of which $10 to $15 represent
capitalized expenditures. Of the total costs being incurred, approximately $45
to $55 are incremental to MediaOne Group. The funding of these costs will be
managed by the Company through its liquidity and capital resources plan.

                                        42

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

Risks Associated with Year 2000 Issues

Due to the complexity of the issues presented by the Year 2000 and the proposed
solutions, and the interdependence of MediaOne Group on a global list of third
party suppliers, it is impossible to assess with any degree of accuracy the
impact of a failure in any one aspect or combination of aspects of the Company's
Year 2000 program in relation to the Company's critical business function areas.
MediaOne Group cannot provide assurance that actual results will not differ from
management's estimates due to the complexity of correcting the systems and
related technologies surrounding the Year 2000 issue.

Failure by MediaOne Group to complete its Year 2000 project in a timely or
complete manner, within its estimate of projected costs, or failure by third
parties, such as financial institutions and related networks, software
providers, local telephone companies, long distance providers, power providers,
etc., to correct their systems, with which MediaOne Group's systems
interconnect, could have a material impact on future results of operations and
financial position. Other factors which might cause a material difference from
management's estimate would include, but not be limited to, the collateral
effects on MediaOne Group of the Year 2000 problem on the economy in general, or
on MediaOne Group's business partners and customers in particular. However,
MediaOne Group believes that the Year 2000 issue can be mitigated through its
planned repair, replacement, or retirement of the relevant systems and related
technologies, that are within MediaOne Group's reasonable control.






                      * * * * * * * * *





MediaOne Group from time to time engages in preliminary discussions regarding
restructurings, dispositions and other similar transactions. Any such
transaction may include, among other things, the transfer of certain assets,
businesses or interests, or the incurrence or assumption of indebtedness, and
could be material to the financial condition and results of operations of the
Company. There is no assurance that any such discussions will result in the
consummation of any such transaction.

                                        43
Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

SELECTED PROPORTIONATE DATA

Proportionate Results of Operations - Nine Months Ended September 30, 1999
Compared With 1998

The following table and discussion is not required by GAAP or intended to
replace the Consolidated Financial Statements prepared in accordance with GAAP.
It is presented supplementally because MediaOne Group believes that
proportionate financial and operating data facilitate the understanding and
assessment of its Consolidated Financial Statements. The financial information
included below departs materially from GAAP because it aggregates a portion of
the revenues and operating income of entities not controlled by MediaOne Group
with those of the consolidated operations of MediaOne Group.
<TABLE>
<CAPTION>
<S>                                                         <C>                      <C>

----------------------------------------------------------- ------------------------ ------------------------
                                                                                             Change
                                                                                     ------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                         <C>          <C>         <C>         <C>

Nine Months Ended September 30,                                   1999        1998         $            %
----------------------------------------------------------- ------------ ----------- ----------- ------------
Proportionate Revenues
Cable and broadband:
     Domestic (1)                                            $   4,408    $   4,132     $   276        6.7
     International                                                 377          230         147       63.9
                                                            ------------ ----------- ----------- ------------
                                                                 4,785        4,362         423        9.7

International wireless                                           1,047          792         255       32.2
Corporate                                                           (4)          15         (19)         -
Other (2)                                                           11           42         (31)     (73.8)

                                                            ============ =========== =========== ============
          Total proportionate revenues (3)                   $   5,839    $   5,211     $   628       12.1
=========================================================== ============ =========== =========== ============

Proportionate EBITDA (4)
Cable and broadband:
     Domestic (1)                                            $   1,599    $   1,310     $   289       22.1
     International                                                  56           10          46          -
                                                            ------------ ----------- ----------- ------------
                                                                 1,655        1,320         335       25.4

International wireless                                             224          137          87       63.5
Corporate                                                          (47)         (50)          3       (6.0)
Other (2)                                                           (4)          (2)         (2)         -
                                                            ------------ ----------- ----------- ------------

     Total proportionate EBITDA (3)                          $   1,828    $   1,405     $   423       30.1
=========================================================== ============ =========== =========== ============
</TABLE>

(1)  The proportionate results are based on MediaOne Group's 25.51 percent pro
     rata priority and residual equity interests in reported TWE results, less a
     $79 deferred gain in 1999 related to a cable system exchange between
     MediaOne Group and TWE. TWE's results are as reported and have not been
     adjusted to report TWE investments accounted for under the equity method on
     a proportionate basis.
(2)  Primarily includes international directories which were sold in June, 1999.
(3)  For the nine months ended September 30, 1998, amounts exclude proportionate
     revenues of $354 and proportionate EBITDA of $114 for the domestic wireless
     operations which were sold in April 1998.
(4)  Proportionate  EBITDA  represents  MediaOne  Group's equity interest in the
     entities multiplied by the entities' EBITDA. As such,  proportionate EBITDA
     does not represent cash available to MediaOne Group.

                                        44

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

SELECTED PROPORTIONATE DATA (Continued)

Proportionate Statistics (in thousands)
<TABLE>
<CAPTION>
<S>                                                         <C>                      <C>
----------------------------------------------------------- ------------------------ ------------------------
                                                                                             Change
                                                            ------------------------ ------------------------
</TABLE>
<TABLE>
<CAPTION>
<S>                                                         <C>          <C>         <C>         <C>

For the Nine Months Ended September 30,                           1999         1998       Amount         %
----------------------------------------------------------- ------------ ----------- ----------- ------------

Cable and broadband:
    Domestic video subscribers (1)                                4,983       4,926          57          1.2
    Domestic homes passed (1)                                     8,496       8,438          58          0.7
    Domestic high speed data subscribers (1, 2)                     173          53         120            -
    Domestic telephone lines                                         56           5          51            -

    International video subscribers                                 782         912        (130)       (14.3)
    International homes passed                                    2,629       2,202         427         19.4
    International telephone lines                                   532         330         202         61.2


International wireless:
    Subscribers                                                   2,749       1,424       1,325         93.0
    POPs                                                         76,254      72,754       3,500          4.8
=========================================================== ============ =========== =========== ============
</TABLE>

(1)  The  proportionate  statistics  exclude  MediaOne Group's 25.51 percent pro
     rata priority and residual equity interests in reported TWE statistics.
(2)  High speed data subscribers for 1998 have been restated to conform with the
     current year presentation.

Normalized for the one-time effects of acquisitions, dispositions and other
asset transactions, proportionate revenues increased $672, or 13.0 percent, and
EBITDA increased $196, or 14.3 percent.

Cable and Broadband - Domestic. Normalized for the one-time effects of cable
system acquisitions and dispositions, proportionate revenues related to MediaOne
increased $192, or 10.7 percent during 1999. This is a result of increases in
subscribers and revenue per subscriber mainly due to expanded channel offerings,
repackaging of services and increased rates. Normalized for the one-time effects
of cable system acquisitions and dispositions, proportionate EBITDA for MediaOne
increased $30, or 4.3 percent. This increase is primarily a result of higher
revenues, partially offset by higher programming fees, increased personnel costs
related to customer service initiatives and costs associated with the deployment
of high speed data and residential telephone services. Proportionate EBITDA
related to TWE operations increased 56.8 percent. TWE's results benefited from
improved cable, programming and filmed entertainment operations; one-time gains
in 1999 on cable system sales and swaps and the early termination of a
distribution agreement with a third party. Proportionate EBITDA for domestic
cable and broadband also includes a $79 deferred gain related to the 1999 cable
system swap between MediaOne and TWE.

                                        45

Form 10-Q - Part I

Item 2. Management's  Discussion and Analysis of Financial Condition and Results
     of Operations (Dollars in millions)

SELECTED PROPORTIONATE DATA (Continued)

Cable and Broadband - International. Normalized for the one-time effects of
acquisitions, international cable and broadband proportionate revenues increased
$60, or 18.9 percent, during 1999 due primarily to customer growth at Telewest.
During the same period, normalized proportionate EBITDA increased $27, or 93.1
percent, due primarily to reduced MediaOne Group international staff costs and
improved EBITDA results from Telewest.

Proportionate international cable subscribers totaled 782,000 at September 30,
1999, a 7.4 percent increase over last year on a comparable basis. Telewest's
cable television subscribers increased 13.6 percent over last year on a
comparable basis.

International Wireless. During 1999, proportionate revenues and EBITDA for the
international wireless operations increased due to the 93.0 percent increase in
the proportionate international wireless subscriber base to 2,749,000, on a
comparable basis. One 2 One added 886,000 proportionate customers, a 119.6
percent increase from a year ago.

Corporate. During 1999, proportionate revenues for corporate operations
decreased $19, to $(4), primarily due to adjustments associated with the
discontinuance of insurance policies on cellular phones. EBITDA losses decreased
$3, to $(47), primarily due to a decrease in corporate costs.

Other. Other reflects the results of the international directories operations
located in South America and costs related to development activities of Internet
content services. During 1999, proportionate revenues decreased $31, to $11, and
proportionate EBITDA losses increased $2, to $(4), primarily due to the sale of
the international directories operations in June 1999. As a result of this sale,
the Company no longer reflects international directories operations in the
proportionate results.

                                        46

Form 10-Q - Part I

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Reference is made to the information set forth on page 38.

                                        47



                           PART II - OTHER INFORMATION

Item 1.  Legal Proceedings

MediaOne Group, Inc. and its subsidiaries are subject to claims and proceedings
arising in the ordinary course of business. While complete assurance cannot be
given as to the outcome of any contingent liabilities, in the opinion of
MediaOne Group, any financial impact to which MediaOne Group and its
subsidiaries are subject is not expected to be material in amount to MediaOne
Group's operating results or its financial position.

Item 6.  Exhibits and Reports on Form 8-K

(a)  Exhibits  Exhibits identified in  parentheses below are on file with the
     Securities and Exchange Commission and are incorporated herein by
     reference. All other exhibits are provided as part of this  electronic
     submission.

Exhibit
Number

12   Statement regarding computation of earnings to fixed charges ratio of
     MediaOne Group, Inc.


(b)  Reports on Form 8-K filed during the Third Quarter of 1999

(i)  Form 8-K Current Report dated July 27, 1999, concerning a Press Release by
     the Company announcing its second quarter 1999 earnings results.


                                        48

                                    SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                /s/   Richard A. Post
                               -----------------------------------------------
                               MediaOne Group, Inc.
November 12, 1999              Richard A. Post
                               Executive Vice President and
                               Chief Financial Officer


                                        49