<PAGE>

================================================================================
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10 - Q
             [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OF 15(d) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

                       For the period ended June 30, 2000

                                       or

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

          For the transition period from ____________to ______________

                       Commission File Number - 000-23269

                         METROMEDIA FIBER NETWORK, INC.
             (Exact name of registrant as specified in its charter)

             Delaware                                 11-3168327
             --------                                 ----------
     (State or other jurisdiction of     (I.R.S. Employer Identification No.)
     incorporation or organization)

                   c/o Metromedia Fiber Network Services, Inc.
                              360 Hamilton Avenue
                             White Plains, NY 10601
                             ----------------------

               (Address of principal executive office) (Zip code)

                                 (914) 421-6700
                                 --------------
              (Registrant's telephone number, including area code)


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 outstanding of the registrant's common stock as of
August 8, 2000 was:

                 CLASS         NUMBER OF SHARES
                 -----         ----------------
                   A             481,898,311
                   B              67,538,544


================================================================================
<PAGE>

                  METROMEDIA FIBER NETWORK, INC. & SUBSIDIARIES
                         QUARTERLY REPORT ON FORM 10-Q
             FOR THE THREE AND SIX MONTH PERIODS ENDED JUNE 30, 2000


                                TABLE OF CONTENTS


 ITEM NO.   DESCRIPTION                                                  PAGE
 --------   -----------                                                  ----

                         PART I - FINANCIAL INFORMATION

  Item 1.   Financial Statements

            Consolidated Statements of Operations for the
            Three and Six Month Periods Ended June 30, 2000
            and 1999.............................................          1

            Consolidated Balance Sheets as of June 30, 2000
            and December 31, 1999................................          2

            Consolidated Statements of Cash Flows for the
            Six Month Periods Ended June 30, 2000 and 1999.......          3

            Notes to Consolidated Financial Statements...........          4

  Item 2.   Management's Discussion and Analysis of
            Financial Condition and Results of Operations........          11

  Item 3.   Quantitative and Qualitative Disclosures about
            Market Risk..........................................          15

                           PART II - OTHER INFORMATION

  Item 1.   Legal Proceedings....................................          16

  Item 2.   Changes in Securities and Use of Proceeds............          17

  Item 3.   Defaults Upon Senior Securities......................          17

  Item 4.   Submission of Matters to a Vote of Security Holders..          17

  Item 5.   Other Information....................................          17

  Item 6.   Exhibits and Reports on Form 8-K.....................          17
<PAGE>

                         PART 1 - FINANCIAL INFORMATION

ITEM 1.      FINANCIAL STATEMENTS

                 METROMEDIA FIBER NETWORK, INC. & SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
                      (IN 000'S, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                             THREE MONTHS ENDED        SIX MONTHS ENDED
                                                  JUNE 30,                JUNE 30,
                                             ------------------       ------------------
                                               2000      1999           2000      1999
                                             --------  --------       --------  --------
<S>                                          <C>       <C>            <C>       <C>
Revenue ...................................  $ 43,315  $ 20,294       $ 75,236  $ 38,673

Expenses:
    Cost of sales .........................    47,148     6,561         82,724    14,819
    Selling, general and administrative ...    27,968     7,713         55,628    13,786
    Depreciation and amortization .........    40,045     3,863         72,534     5,058
                                             --------  --------       --------  --------
Income (loss) from operations .............   (71,846)    2,157       (135,650)    5,010
Other income (expenses):
    Interest income .......................    36,831     6,075         61,888    13,512
    Interest expense ......................   (55,689)  (14,503)      (100,869)  (30,407)
    Loss from joint ventures ..............    (1,308)     (193)        (2,541)     (393)
                                             --------  --------       --------  --------
Net loss ..................................   (92,012)   (6,464)      (177,172)  (12,278)
                                             ========  ========       ========  ========

Net loss per share, basic .................  $  (0.17) $  (0.03)      $  (0.33) $  (0.06)
                                             ========  ========       ========  ========

Net loss per share, diluted ...............     N/A       N/A            N/A       N/A
                                             ========  ========       ========  ========

Weighted average number of shares
    outstanding, basic ....................   547,708   189,667        537,789   189,098
                                             ========  ========       ========  ========

Weighted average number of shares
    outstanding, diluted ..................     N/A       N/A            N/A       N/A
                                             ========  ========       ========  ========
</TABLE>

                             SEE ACCOMPANYING NOTES


                                       1
<PAGE>

                  METROMEDIA FIBER NETWORK, INC. & SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                        (IN 000'S, EXCEPT SHARE AMOUNTS)

<TABLE>
<CAPTION>
                                                                     JUNE 30,     DECEMBER 31,
                                                                      2000            1999
                                                                   -----------    -----------
                                                                   (UNAUDITED)
<S>                                                                <C>            <C>
                    ASSETS
Current assets:
    Cash and cash equivalents ..................................   $ 2,082,010    $ 1,262,391
    Marketable securities ......................................       176,859           --
    Pledged securities .........................................          --           31,960
    Accounts receivable ........................................        77,088         72,166
    Prepaid expenses and other current assets ..................        26,605         10,948
                                                                   -----------    -----------
        Total current assets ...................................     2,362,562      1,377,465
Fiber optic transmission network and related equipment, net ....     1,530,586        796,684
Property and equipment, net ....................................        25,271          9,215
Restricted cash ................................................        62,182         82,193
Marketable securities ..........................................          --           29,628
Investment in/advances to joint ventures .......................        21,608         23,130
Other assets ...................................................        99,131        102,573
Intangibles, net ...............................................     1,564,808      1,539,097
                                                                   -----------    -----------
        Total assets ...........................................   $ 5,666,148    $ 3,959,985
                                                                   ===========    ===========

     LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
    Accounts payable ...........................................   $    60,529    $    43,344
    Accrued expenses ...........................................       214,080        186,528
    Deferred revenue, current portion ..........................        17,329         12,867
    Capital lease obligations and notes payable, current portion         7,784          6,781
                                                                   -----------    -----------
        Total current liabilities ..............................       299,722        249,520

Senior notes payable ...........................................     1,660,900      1,660,900
Convertible subordinated notes payable .........................       975,281           --
Capital lease obligations and notes payable ....................        35,863         38,414
Deferred revenue ...............................................       219,269        175,405
Other long term liabilities ....................................        12,878          1,070

Commitments and contingencies (see notes)

Stockholders' equity:
    Class A common stock, $.01 par value; 4,808,062,482
      shares authorized; 480,436,326 and 411,116,800
      shares issued and outstanding, respectively ..............         4,803          4,111
    Class B common stock, $.01 par value; 1,044,509,564
      shares authorized; 67,538,544 shares
      issued and outstanding ...................................           676            676
  Additional paid-in capital ...................................     2,805,666      1,995,741
  Accumulated deficit ..........................................      (334,346)      (157,175)
  Cumulative comprehensive loss ................................       (14,564)        (8,677)
                                                                   -----------    -----------
        Total stockholders' equity .............................     2,462,235      1,834,676
                                                                   -----------    -----------
        Total liabilities and stockholders' equity .............   $ 5,666,148    $ 3,959,985
                                                                   ===========    ===========
</TABLE>

                             SEE ACCOMPANYING NOTES


                                       2
<PAGE>

                  METROMEDIA FIBER NETWORK, INC. & SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
                                   (IN 000'S)

<TABLE>
<CAPTION>
                                                              SIX MONTHS ENDED
                                                                   JUNE 30,
                                                          ------------------------
                                                             2000          1999
<S>                                                       <C>            <C>
CASH FLOWS (USED IN) PROVIDED BY OPERATING ACTIVITIES:
Net loss ..............................................   $  (177,172)   $ (12,278)
Adjustments to reconcile net loss to net cash
   provided by operating activities:
      Depreciation and amortization ...................        72,534        5,057
      Amortization of deferred financing costs ........         2,838        1,000
      Stocks, options and warrants issued for services           --            395
      Loss from joint ventures ........................         2,541          393
CHANGE IN OPERATING ASSETS AND LIABILITIES:
      Accounts receivable .............................        (4,855)     (48,985)
      Accounts payable and accrued expenses ...........        14,477       37,990
      Deferred revenue ................................        46,726       35,081
      Other ...........................................        (1,097)       2,391
                                                          -----------    ---------
   Net cash (used in) provided by operating activities        (44,008)      21,044
                                                          -----------    ---------
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of marketable securities ....................      (147,231)     (19,716)
Capital expenditures on fiber optic transmission
   network and related equipment ......................      (726,632)    (122,823)
Investment in / advances to joint ventures ............        (5,266)      (3,000)
Capital expenditures on property and equipment ........       (24,226)      (1,676)
Business acquisitions (net of cash acquired) ..........        (2,315)     (24,966)
                                                          -----------    ---------
   Net cash used in investing activities ..............      (905,670)    (172,181)
                                                          -----------    ---------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock ................       751,337        2,056
Purchases and sales of pledged securities, net ........        31,960         --
Restricted cash secured by letter of credit ...........        20,011      (63,313)
Repayment of notes payable ............................        (3,405)        --
Proceeds from issuance of notes payable ...............       975,281         --
Payments of business acquisition's pre-acquisition debt          --        (15,028)
                                                          -----------    ---------
   Net cash (used in) provided by financing activities      1,775,184      (76,285)
                                                          -----------    ---------
EFFECT OF EXCHANGE RATE CHANGES ON CASH ...............        (5,887)        --
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ..       819,619     (227,422)
CASH AND CASH EQUIVALENTS-BEGINNING OF PERIOD .........     1,262,391      569,319
                                                          -----------    ---------
CASH AND CASH EQUIVALENTS-END OF PERIOD ...............   $ 2,082,010    $ 341,897
                                                          ===========    =========
Supplemental information:
   Interest paid ......................................   $    90,361    $  31,152
                                                          ===========    =========
   Income taxes paid ..................................   $      --      $   2,736
                                                          ===========    =========
   Accrued capital expenditures .......................   $   156,010    $  30,092
                                                          ===========    =========
</TABLE>

In connection with the acquisitions in 2000 of MIBH and of 100% of the shares
owned by the joint venture partners of AboveNet UK Ltd., shares of class A
common stock were issued with a total value of $49,280 and $10,000,
respectively.

                             SEE ACCOMPANYING NOTES


                                       3
<PAGE>

1.   BASIS OF PRESENTATION, DESCRIPTION OF THE BUSINESS AND SIGNIFICANT
     ACCOUNTING POLICIES

BASIS OF PRESENTATION

The consolidated financial statements include the accounts of Metromedia Fiber
Network, Inc. and its wholly owned subsidiaries, (collectively, "MFN" or the
"Company"). All significant intercompany balances and transactions have been
eliminated in consolidation. Investments in joint ventures which are not
majority owned, or which the Company does not control but over which it
exercises significant influence, are accounted for using the equity method.
Certain reclassifications have been made to the consolidated financial
statements for prior periods to conform to the current presentation.

The interim unaudited consolidated financial statements in this Report have been
prepared in accordance with the rules and regulations of the United States
Securities and Exchange Commission's Regulation S-X and consequently do not
include all disclosures required under accounting principles generally accepted
in the United States. The interim unaudited consolidated financial statements
should be read in conjunction with the audited Consolidated Financial Statements
of the Company and accompanying Notes for the year ended December 31, 1999,
contained in the Company's Annual Report on Form 10-K. The Form 10-K includes
information with respect to the Company's significant accounting and financial
reporting policies and other pertinent information. The Company believes that
all adjustments of a normal recurring nature that are necessary for a fair
presentation of the results of the interim periods presented in this report have
been made.

DESCRIPTION OF BUSINESS

The Company provides dedicated fiber optic infrastructure and high-bandwidth
Internet connectivity for its communications intensive customers. The Company is
a facilities-based provider of technologically advanced, high-bandwidth, fiber
optic communications infrastructure to communications carriers and corporate and
government customers in the United States and Europe. Through its acquisition of
AboveNet Communications, Inc. ("AboveNet") on September 8, 1999, the Company
also provides "one-hop" connectivity that enables mission critical Internet
applications to thrive, as well as high-bandwidth infrastructure, including
managed co-location services. AboveNet's wholly-owned subsidiary, PAIX.net, Inc.
("PAIX"), serves as a packet switching center for ISPs and also offers secure,
fault-tolerant co-location services to ISPs.

The Company intends to expand its presence to include approximately 50 Tier I
and Tier II markets in the United States and 17 major international markets.

The Company's existing intra-city networks consist of approximately 784,000
fiber miles covering in excess of 1,400 route miles in the United States. Its
inter-city network consists of approximately 173,000 fiber miles primarily
covering its 255 route-mile network that the Company has built between New York
City and Washington D.C. The Company has also built or contracted to acquire a
nationwide dark fiber network linking its intra-city networks.

In February 1999, the Company entered into an agreement with Viatel, Inc. and
Carrier 1 Holdings, Ltd. to jointly build a dark fiber inter-city network among
selected cities throughout Germany. Once completed, our German network will
consist of approximately 320,000 fiber miles covering in excess of 1,450 route
miles connecting 14 major cities. The Company has also acquired fiber on the
Circe network, which connects a number of European markets. In addition to its
inter-city networks, the Company is constructing 16 intra-city networks
throughout Europe. Separately, the Company has also entered into a contract to
acquire rights to dark fiber network facilities in Toronto, Canada.

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

MANAGEMENT ESTIMATES

The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
and assumptions that affect the reported amounts of assets and liabilities and
disclosures of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the
reporting periods. Actual results may differ from those estimates.


                                       4
<PAGE>

1.   BASIS OF PRESENTATION, DESCRIPTION OF THE BUSINESS AND SIGNIFICANT
     ACCOUNTING POLICIES (CONTINUED)

FIBER OPTIC TRANSMISSION NETWORK AND RELATED EQUIPMENT

The fiber optic transmission network and related equipment are stated at cost.
Costs incurred in connection with the installation and expansion of the network
are capitalized. Depreciation is computed using the straight-line method through
the life of either the franchise agreement or right of way for the related
network.

RECAPITALIZATIONS

On March 2, 2000 the Company announced a two-for-one stock split of the
Company's class A and class B common stock in the form of a 100 percent stock
dividend to all shareholders of record on March 14, 2000. This split was
effective on April 17, 2000.

The accompanying financial statements give retroactive effect to the above
recapitalization.

RECOGNITION OF REVENUE

The Company recognizes revenue on telecommunications services ratably over the
term of the applicable lease agreements with customers. Amounts billed in
advance of the service provided are recorded as deferred revenue. Revenue on
bandwidth and space requirement charges is recognized in the period in which the
services are provided. In addition, the Company had occasionally entered into
sales-type leases for portions of its network. For those leases entered into
prior to completion of the portion of the network and under contracts entered
into before June 30, 1999, the Company recognizes revenue using the percentage
of completion method.

Under the percentage of completion method, progress is generally measured on
performance milestones relating to the contract where such milestones fairly
reflect the progress toward contract completion. Network construction costs
include all direct material and labor costs and those indirect costs related to
contract performance. General and administrative costs are charged to expense as
incurred. If necessary, the estimated loss on an uncompleted contract is
expensed in the period in which it is identified. Contract costs are estimated
using allocations of the total cost of constructing the specific phase of the
network. Revisions to estimated profits on contracts are recognized in the
period that they become known.

Most of the Company's contracts for the provision of dark fiber are accounted
as operating leases under which it recognizes recurring monthly revenues. For
certain other contracts the Company recognizes revenue under the percentage
of completion method for the provision of dark fiber. Effective June 30,
1999, the Financial Accounting Standards Board issued FASB Interpretation No.
43 "Real Estate Sales" ("FIN 43") which requires that sales or leases of
integral equipment be accounted for in accordance with real estate accounting
rules. The Company believes that the staff of the Securities and Exchange
Commission requires the classification of dark fiber cables in the ground as
integral equipment as defined in FIN 43. Accounting for dark fiber leases as
defined by FIN 43 does not change any of the economics of the contracts. It
requires the Company, however, to recognize the revenue from certain leases
as operating leases over the term of the contract as opposed to the prior
method of recognizing revenue when the Company delivers the fiber. As a
result, this change in accounting treatment reduces the revenue and income
that the Company recognizes in the earlier years of the contract and spreads
it out over the life of the contract regardless of when the cash was received
or the delivery of the fiber took place.

By way of example, if the Company entered into an agreement for a 25-year
lease for dark fiber with a customer who pays $100.0 million in cash when the
contract is signed, the Company previously recorded revenues of $20.0 million
per year over the 5 years during which the Company delivered the dark fiber.
By contrast, the real estate accounting rules of FIN 43 would require
recognition of revenue of $4.0 million per year over the 25 year term of the
contract, even though the Company would receive a cash payment of $100.0
million when the contract is signed.

                                       5
<PAGE>

1.   BASIS OF PRESENTATION, DESCRIPTION OF THE BUSINESS AND SIGNIFICANT
     ACCOUNTING POLICIES (CONTINUED)

The Company implemented FIN 43 real estate accounting for certain of its leases
entered into after June 30, 1999, and has not restated any amounts for contracts
executed prior to such date. Although there was no change to the economics of
the contracts or the timing of the cash to be received by the Company, the
impact of the change in accounting resulted in the Company recording
substantially less revenue after July 1, 1999 than would have been recorded if
this change had not been imposed. Revenue recognized for the three months ended
June 30, 2000 and 1999 related to the percentage of completion method was zero
and $16.8 million, respectively. Revenue recognized for the six months ended
June 30, 2000 and 1999 related to the percentage of completion method was
$325,000 and $33.6 million, respectively. The related cost of sales recorded was
zero and $3.4 million, respectively, for the three months ended June 30, 2000
and 1999, and $49,000 and $9.7 million for the six months ended
June 30, 2000 and 1999, respectively. In the future, similar revenues will be
recognized over the term of the related contracts, typically 20 to 25 years.

The Company also provides installation services for its customers, and as these
services typically are completed within a short time period, the Company records
the revenues and related costs for these services under the completed contract
method.

DEFERRED REVENUE

Deferred revenue represents prepayments received from customers for future use
of the Company's fiber optic network and co-location facilities as well as
prepayment for installation services, which have not yet been provided. Lease
payments are structured as either prepayments or monthly recurring charges.
Prepayments are accounted for as deferred revenues and recognized over the term
of the respective customer lease agreement.

COMPREHENSIVE LOSS

Statement of Financial Accounting Standards No. 130 ("SFAS 130") Reporting
Comprehensive Income establishes rules for the reporting of comprehensive income
and its components. Comprehensive loss consists of net loss and foreign currency
translation adjustments. The comprehensive loss for the three and six months
ended June 30, 2000 was approximately $93.1 million and $183.1 million,
respectively, compared to a loss of $8.5 million and $17.2 million for the three
and six months ended June 30, 1999, respectively.

SEGMENT INFORMATION

The Company discloses information regarding segments in accordance with SFAS No.
131, "Disclosures about Segments of an Enterprise and Related Information." SFAS
No. 131 establishes standards for reporting of financial information about
operating segments in annual financial statements and requires reporting
selected information about operating segments in interim financial reports. The
disclosure of segment information is not required as the Company operates in
only one business segment.

As of and for the three and six months ended June 30, 2000 and 1999,
substantially all of the Company's assets were located in the United States and
the Company derived substantially all of its revenue from businesses located in
the United States.

IMPACT OF RECENTLY ISSUED ACCOUNTING STANDARDS

In June 1998, the FASB issued SFAS No. 133, "Accounting for Derivatives and
Hedging Activities," which establishes accounting and reporting standards for
derivative instruments and hedging activities. This standard is effective for
all fiscal quarters of fiscal years beginning after June 15, 2000. The Company
does not expect the adoption of SFAS No. 133 to have an impact on its results of
operations, financial position or cash flows.


                                       6
<PAGE>

1.   BASIS OF PRESENTATION, DESCRIPTION OF THE BUSINESS AND SIGNIFICANT
     ACCOUNTING POLICIES (CONTINUED)

In March 2000, the FASB issued FASB Interpretation No. 44 "Accounting for
Certain Transactions involving Stock Compensation " ("FIN 44"), an
interpretation of APB Opinion No. 25 "Accounting for Stock Issued to Employees".
FIN 44 is effective July 1, 2000 and effects the way certain stock options
granted to non-employees will be accounted for. The Company does not believe
the adoption of FIN 44 will have a material impact on its results of operations.

In December 1999, the Securities and Exchange Commission issued SEC Staff
Accounting Bulleting No. 101 or SAB 101, "Revenue Recognition in Financial
Statements." SAB 101 summarizes certain of the SEC's views in applying
generally accepted accounting principles to revenue recognition in financial
statements. The Company does not believe the adoption of SAB 101 will have a
material impact on its results of operations.

2.  FIBER OPTIC TRANSMISSION NETWORK AND RELATED EQUIPMENT

Fiber optic transmission network and related equipment consist of the following
(in 000's):

<TABLE>
<CAPTION>
                                                      June 30,      December 31,
                                                       2000            1999
                                                    -----------      ---------
<S>                                                 <C>              <C>
Fiber optic network ..........................      $   719,386      $ 318,494
Data Centers .................................          152,641         97,400
Telecommunication equipment & other ..........           56,502         51,878
Construction in progress .....................          659,365        356,404
                                                    -----------      ---------
    Total Network ............................        1,587,894        824,176
Less: accumulated depreciation ...............          (57,308)       (27,492)
                                                    -----------      ---------
                                                    $ 1,530,586      $ 796,684
                                                    ===========      =========
</TABLE>

Construction in progress includes amounts incurred in the Company's expansion of
its network and data centers. These amounts include fiber optic cable and other
materials, engineering and other layout costs, fiber optic cable installation
costs and other network assets held under capital leases. Construction in
progress also includes payments for rights of way for the underlying sections of
the network build.

3.  INVESTMENT IN/ADVANCES TO JOINT VENTURES

During 1997 the Company formed a joint venture with Racal Telecommunications,
Inc. ("Racal") that provides broad-based transatlantic communication services
between New York and London. During 1999 and 1998, the Company made capital
contributions of $1.8 million and $4.3 million, respectively. The Company
accounts for its investment using the equity method. The Company records equity
losses based on its 50% interest in the joint venture.

As part of its international expansion strategy, AboveNet has entered into joint
ventures to provide managed co-location and Internet connectivity solutions for
mission critical Internet operations overseas. In March 1999, AboveNet entered
into agreements to form joint ventures in Austria, Germany, France and the
United Kingdom. (The Company purchased additional interests in the joint
ventures in Germany and the United Kingdom in June and February 2000,
respectively - see note 4). AboveNet invested a total of $30.7 million in these
ventures through June 30, 2000. These joint ventures are accounted for under the
equity method of accounting.

In December 1999, AboveNet entered into a joint venture agreement in Japan. The
Company invested a total of $4.0 million through June 30, 2000, and is required
to invest an additional $4.0 million for up to a 40% ownership interest in this
venture.


                                       7
<PAGE>

4. ACQUISITIONS

In June 2000, the company purchased an additional 37.5% interest in it's 50%
owned joint venture in Germany, AboveNet GMBH, for approximately $1.4 million.

On May 9, 2000 the Company finalized an agreement with Pacific Gateway Exchange
("PGE") to purchase PGE's ownership position in the cable consortia that owns
and operates the TAT-14 and Japan-U.S. Cable Networks, and two of PGE's Japanese
subsidiaries. Under the terms of the sale, the Company will have paid
approximately $52 million in net cash proceeds to PGE, primarily to reimburse it
for payment made to date to the consortia. MFN will assume PGE's future payment
obligations to the cable consortia. The acquisition of the two Japanese
subsidiaries has been accounted for under the purchase method of accounting. The
excess of purchase price over the fair value of net assets acquired of
approximately $1.6 million has been recorded as goodwill.

In February 2000, the Company purchased the remaining 60% of its 40% owned joint
venture in the United Kingdom, AboveNet UK Limited, for shares of the Company's
stock with a market value of $10 million. The excess of purchase price over the
fair values of net assets acquired was approximately $10 million and has been
recorded as goodwill.

On January 19, 2000, the Company completed the acquisition of MIBH Inc., a
network outsourcing provider offering full-service management of business
Internet connectivity solutions for approximately $52.3 million in cash and
stock. The excess of purchase price over the fair values of net assets acquired
was approximately $51 million and has been recorded as goodwill.

Under the terms of the agreement, MIBH became a wholly owned subsidiary of
Metromedia Fiber Network, Inc., and has subsequently merged into Metromedia
Fiber Network Services, Inc. The shareholders of MIBH, a privately held company,
received an aggregate of 1,884,418 shares of Metromedia Fiber Network class A
common stock having a fair market value of approximately $49.3 million and $3.0
million in cash.

On September 8, 1999, the Company acquired all of the outstanding common stock
of AboveNet for a total purchase price, paid in Company class A common stock, of
approximately $1.8 billion. The holders of AboveNet common stock, stock options
and warrants received, in exchange for those securities, 2.35 shares of the
Company's class A common stock, stock options and warrants, respectively. The
excess of the purchase price over the fair values of the net assets acquired was
approximately $1.6 billion and has been recorded as goodwill.

In addition, in connection with the acquisition, the Company issued a letter of
credit, secured by the Company's restricted cash in the amount of $25 million,
to further secure a credit facility of AboveNet.

On June 21, 1999, AboveNet acquired certain assets and assumed certain
liabilities of PAIX from Compaq Computer Corporation ("Compaq") for a total
purchase price of $76.4 million consisting of $70 million in cash, certain
future ongoing services to be provided by AboveNet to Compaq, with a value
estimated to be $5.0 million, and acquisition related costs of $1.4 million.

On March 11, 1999, the Company acquired all the outstanding common stock of
Communication Systems Development, Inc. ("CSD") for $25 million in cash. CSD has
its primary operations in Dallas, Texas and is engaged in the engineering and
construction of fiber optic networks. The excess of the purchase price over the
fair values of the net assets acquired was approximately $11.2 million and has
been recorded as goodwill.

All acquisitions have been accounted for under the purchase method. The results
of operations of the acquired businesses are included in the consolidated
financial statements from the dates of acquisition. Goodwill is amortized on a
straight-line basis over 10 to 20 years.

5.   GERMAN NETWORK BUILD

In February 1999, the Company entered into a joint venture with Viatel, Inc. and
Carrier 1 Holdings, Ltd. to jointly build a national fiber optic
telecommunications network in Germany. Upon completion of construction, the
joint venture will be dissolved and the Company will own its own separate German
broadband network. In connection with the terms of this agreement, the Company
made a deposit payment of $4.7 million, during the third quarter of 1998. Upon
signing a definitive agreement, the Company provided an irrevocable standby
letter of credit in the amount of $64 million as security for the construction
costs of the network, which, in addition to the deposit payment made, covers the
Company's portion of the estimated construction costs. During the first quarter


                                       8
<PAGE>

5.   GERMAN NETWORK BUILD (CONTINUED)

of 2000, the letter of credit amount was increased by $12.5 million. As of June
30, 2000, construction costs of approximately $58.9 million have been incurred
and are included in fiber optic transmission network.

6.    RELATED PARTY TRANSACTIONS

The Company is a party to a management agreement under which the Company's
controlling shareholder, Metromedia Company, provides consultation and advisory
services relating to legal matters, insurance, personnel and other corporate
policies, cash management, internal audit and finance, taxes, benefit plans and
other services as are reasonably requested. The management agreement terminates
on December 31, of each year, and is automatically renewed for successive
one-year terms unless either party terminates upon 60 days prior written notice.
The 2000 and 1999 management fee under the agreement is $1.0 million, payable
quarterly. The Company is also obligated to reimburse Metromedia Company for all
its out-of-pocket costs and expenses incurred and advances paid by Metromedia
Company in connection with the management agreement.

7.  NOTES PAYABLE

On March 6, 2000, the Company issued $975.3 million of 6.15% convertible
subordinated notes due March 6, 2010, to Bell Atlantic Investments, Inc. ("Bell
Atlantic"). The notes are convertible into shares of class A common stock at a
conversion price of $17.00 per share. Interest on the notes is payable
semi-annually in arrears on March 15 and September 15, commencing on September
15, 2000. Upon the occurrence of a change of control, each holder of convertible
subordinated notes will have the right to require the Company to purchase all or
any part of that holder's convertible subordinated notes at a price equal to
100% of the outstanding principal amount. The payment of all amounts due on the
convertible subordinated notes is subordinated to the prior payment of the
senior notes.

At June 30, 2000, AboveNet had $16.2 million outstanding under its credit
facility (the "Credit Facility"), with no additional borrowings available.
Borrowings outstanding under the Credit Facility are payable in 42 monthly
installments, bear interest at rates ranging from 13.3% to 15.1% and are
collateralized by the equipment and leasehold improvements purchased with the
proceeds of the borrowing. Additionally, in connection with the AboveNet
acquisition, the Company issued a letter of credit, secured by the Company's
restricted cash in the amount of $25.0 million, to further secure the Credit
Facility. At June 30, 2000, the outstanding borrowings on the Credit Facility
are due as follows: 2000 - $3.1 million, 2001 - $6.9 million, and 2002 - $6.2
million.

8. BELL ATLANTIC INVESTMENT

On October 7, 1999, the Company entered into a securities purchase agreement
with Bell Atlantic, under which Bell Atlantic purchased approximately 51.1
million newly issued shares of our class A common stock at a purchase price of
$14.00 per share and a convertible subordinated note of approximately $975.3
million, which is convertible into shares of our class A common stock at a
conversion price of $17.00 per share (see Note 7). After the issuance of the
51.1 million shares of class A common stock and assuming conversion of the
convertible subordinated notes, this investment represents 18.2% of our
outstanding shares. Bell Atlantic has also agreed to pay us $550 million over
the next three years in exchange for delivery of fiber optic facilities over the
next five years. The proceeds from these transactions will be used to fund the
expansion of our network.

9.  CONTINGENCIES

On or about June 12, 1998, Claudio E. Contardi commenced an action against Peter
Sahagen, Sahagen Consulting Group of Florida and the Company in the United
States District Court for the Southern District of New York, No. 98 CIV 4140
(the "Contardi Litigation"). Mr. Contardi alleges a cause of action for, among
other things, breach of a finder's fee agreement entered into between Mr.
Sahagen and Mr. Contardi on or about November 14, 1996 and breach of an implied
covenant of good faith and fair dealing contained in the finder's fee agreement.
Mr. Contardi is seeking, among other things, a number of our shares of class A
common stock which the Company cannot currently ascertain but believe to be
approximately 112,500 shares (calculated as of


                                       9
<PAGE>

9.  CONTINGENCIES (CONTINUED)

the date on which the complaint was filed without taking into account subsequent
stock splits) or damages in an amount which the Company cannot currently
ascertain but believe to be approximately $4.9 million (calculated as of the
date on which the complaint was filed) and all costs and expenses incurred by
him in this action. The Company has filed an answer to the complaint and has
raised affirmative defenses and moved for summary judgment on the complaint. On
or about June 5, 2000, the court denied the summary judgment motion. On or about
July 20, 2000, the court entered a stipulation and order dismissing this action
without prejudice on the grounds that the court lacks subject matter
jurisdiction.

In January 2000, Herman Goldsmith and Arnold S. Schickler commenced an action
against the Company, F. Garofalo Electric Co., Inc. and Stephen A. Garofalo in
the Supreme Court of the State of New York, County of New York (No. 600163/00)
(the "Goldsmith Litigation"). The complaint alleges a cause of action for breach
of contract in connection with an alleged "finders agreement" entered into in
1993 between Messrs. Goldsmith and Schickler, on the one hand, and F. Garofalo
Electric Co., Inc. and Stephen A. Garofalo, on the other. Plaintiffs seek
damages of approximately $861 million, plus interest from September 7, 1999, in
addition to their costs, expenses and reasonable attorneys' fees. On April 7,
2000, the Company filed a motion to dismiss the complaint.

The Company intends to vigorously defend both the Goldsmith Litigation and the
Contardi Litigation (if plaintiff pursues the action) because it believes that
it acted appropriately in connection with the matters at issue in these two
cases. However, there can be no assurance that the Company will not determine
that the advantages of entering into a settlement outweigh the risk and expense
of protracted litigation or that ultimately it will be successful in defending
against these allegations. If the Company is unsuccessful in defending against
these allegations, awards of the magnitude being sought in the Contardi
Litigation and the Goldsmith Litigation would have a material adverse effect on
its financial condition and results of operations.

On June 29, 1999, an alleged stockholder of AboveNet filed a lawsuit, captioned
Kaufman v. Tuan, et al, Del. Ch. C.A. No. 17259NC, in the Court of Chancery of
the State of Delaware in and for the New Castle County. The plaintiff, who
purports to represent a class of all AboveNet stockholders, challenges the terms
of the proposed merger between the Company and AboveNet. The complaint names, as
defendants, AboveNet, the directors of AboveNet, and the Company (as an aider
and abettor). The complaint alleges generally that AboveNet's directors breached
their fiduciary duty to stockholders of AboveNet, and seeks an injunction
against the merger, or, in the alternative, rescission and the recovery of
unspecified damages, fees and expenses. AboveNet, the Company and the individual
defendants believe the lawsuit is without merit and intend to defend against it
vigorously. AboveNet and the individual director defendants' responses were
filed on July 22, 1999. In connection with these responses, a motion to dismiss
the complaint in its entirety and a motion to stay discovery pending the outcome
of the motion to dismiss were filed by AboveNet and the individual directors of
AboveNet on July 22, 1999. Similar motions to dismiss the complaint and stay
discovery were filed by the Company on July 26, 1999. Upon stipulation of the
parties, this action was dismissed without prejudice in December 1999.

Four other complaints, which are virtually identical to the complaint in Kaufman
v. Tuan, have also been filed in the Delaware Court of the Chancery. None of
these four complaints have been served. The four actions are captioned Brosious
v. Tuan, et al, Del. Ch. C.A. No. 17271NC, Chong v. Tuan, et al, Del. Ch. C.A.
No. 17281NC, Ehlert v. Tuan, et al, Del. Ch. C.A. No. 17284NC, Horn v. Tuan, et
al, Del. Ch. C.A. No. 17300NC.

In addition, the Company is subject to various claims and proceedings in the
ordinary course of business. Based on information currently available, the
Company believes that none of such current claims, or proceedings, individually,
or in the aggregate, including the Contardi Litigation and the Goldsmith
Litigation, will have a material adverse effect on our financial condition or
results of operations, although the Company can make no assurances in this
regard.


                                       10
<PAGE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
        OF OPERATIONS.

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

Any statements in this Quarterly Report on Form 10-Q about our expectations,
beliefs, plans, objectives, assumptions or future events or performance are not
historical facts and are forward-looking statements. These statements are often,
but not always, made through the use of words or phrases such as "will," "will
likely result," "expect," "will continue," "anticipate," "estimate," "intend,"
"plan," "projection," "would," "should" and "outlook." Accordingly, these
statements involve estimates, assumptions and uncertainties which could cause
actual results to differ materially from those expressed in them. Any
forward-looking statements are qualified in their entirety by reference to the
factors discussed throughout this Report and our Annual Report on Form 10-K for
the year ended December 31, 1999. The following cautionary statements identify
important factors that could cause our actual results to differ materially from
those projected in the forward-looking statements made in this prospectus. Among
the key factors that have a direct bearing on our results of operations are:

         o        general economic and business conditions; the existence or
                  absence of adverse publicity; changes in, or failure to comply
                  with, government regulations; changes in marketing and
                  technology; changes in political, social and economic
                  conditions;

         o        increased competition in the telecommunications industry;
                  industry capacity; general risks of the telecommunications
                  industries;

         o        success of acquisitions and operating initiatives; changes in
                  business strategy or development plans; management of growth;

         o        availability, terms and deployment of capital;

         o        construction schedules; costs and other effects of legal and
                  administrative proceedings;

         o        dependence on senior management; business abilities and
                  judgment of personnel; availability of qualified personnel;
                  labor and employee benefit costs;

         o        development risks; risks relating to the availability of
                  financing; and

         o        other factors referenced in this Report and the Form 10-K.

Because the risk factors referred to above could cause actual results or
outcomes to differ materially from those expressed in any forward-looking
statements made by us, you should not place undue reliance on any such
forward-looking statements. Further, any forward-looking statement speaks only
as of the date on which it is made and we undertake no obligation to update any
forward-looking statement or statements to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time, and it is not
possible for us to predict which will arise. In addition, we cannot assess the
impact of each factor on our business or the extent to which any factor, or
combination of factors, may cause actual results to differ materially from those
contained in any forward-looking statements.

GENERAL

      We provide dedicated fiber optic infrastructure and high-bandwidth
Internet connectivity for our communications intensive customers. We are a
facilities-based provider of technologically advanced, high-bandwidth, fiber
optic communications infrastructure to communications carriers and corporate and
government customers in the United States and


                                       11
<PAGE>

Europe. Through our acquisition of AboveNet, we also provide "one-hop"
connectivity that enables mission-critical Internet applications to thrive, as
well as high-bandwidth infrastructure, including managed co-location services.

      We intend to expand our presence to include approximately 50 Tier I and
Tier II markets in the United States and 17 major international markets.

      Our existing intra-city networks consist of approximately 784,000 fiber
miles covering in excess of 1,400 route miles in the United States. We are
currently working to expand our existing local intra-city networks in these
metropolitan areas, and to construct additional intra-city networks in
approximately 40 additional Tier I and Tier II markets in the United States.

      Our inter-city network currently consists of approximately 173,000 fiber
miles primarily covering the 255 route-mile network that we have built between
New York City and Washington, D.C. We have also built or contracted to acquire a
nationwide dark fiber network linking our intra-city networks.

      In addition to our domestic networks, we intend to expand our
international presence to include approximately 17 major markets. In February
1999, we entered into an agreement with Viatel, Inc. and Carrier 1 Holdings,
Ltd. to jointly build a dark fiber inter-city network connecting selected cities
throughout Germany. Once completed, the German network will consist of
approximately 320,000 fiber miles covering in excess of 1,450 route miles
connecting 14 major cities. We have also acquired fiber on the Circe network,
which connects a number of European markets. In addition to our inter-city
networks, we are constructing 16 intra-city networks throughout Europe.
Separately, we have also entered into a contract to acquire rights to dark fiber
network facilities in Toronto, Canada.

      On September 8, 1999, we completed the acquisition of AboveNet. The
holders of AboveNet common stock received 2.35 shares of our class A common
stock for each share of AboveNet common stock. AboveNet is a leading provider of
facilities-based, managed services for customer-owned Web servers and related
equipment, known as co-location, and high performance Internet connectivity
solutions for electronic commerce and other business critical Internet
operations. PAIX, AboveNet's wholly owned subsidiary, serves as a packet
switching center for ISPs. PAIX also offers secure, fault-tolerant co-location
services to ISPs. The acquisition has been recorded under the purchase method of
accounting and AboveNet's results are included in the results of operations
subsequent to the acquisition date.

       On October 7, 1999, we entered into a securities purchase agreement with
Bell Atlantic, under which Bell Atlantic purchased approximately 51.1 million
newly issued shares of our class A common stock at a purchase price of $14.00
per share and a convertible subordinated note of approximately $975.3 million,
which is convertible into shares of our class A common stock at a conversion
price of $17.00 per share. This transaction closed on March 6, 2000. After the
issuance of the 51.1 million shares of class A common stock and assuming
conversion of the convertible subordinated note, this investment represents
18.2% of our outstanding shares. Bell Atlantic has also agreed to pay us $550
million over the next three years in exchange for delivery of fiber optic
facilities over the next five years. The proceeds from these two transactions
will be used to fund the expansion of our network.

      Most of our contracts for the provision of dark fiber are accounted for as
operating leases under which we recognize recurring monthly revenues. For
certain other contracts we recognize revenue under the percentage of completion
method for the provision of dark fiber. Effective June 30, 1999, the Financial
Accounting Standards Board issued FASB Interpretation No. 43,"Real Estate Sales"
("FIN 43"), which requires that sales or leases of integral equipment subsequent
to June 30, 1999, be accounted for in accordance with real estate accounting
rules. We believe that the staff of the Securities and Exchange Commission
requires the classification of dark fiber cables in the ground as integral
equipment as defined in FIN 43. Accounting for dark fiber leases as defined by
FIN 43 does not change any of the economics of the contracts. It requires us,
however, to recognize the revenue from certain leases as operating leases over
the term of the contract as opposed to the prior method of recognizing revenue
when we deliver the fiber. As a result, this change in accounting treatment
reduces the revenue and income that we recognize in the earlier years of the
contract and spreads it out over the life of the contract regardless of when the
cash was received or the delivery of the fiber took place.

      By way of example, if we entered into an agreement for a 25 year lease
for dark fiber with a customer who pays $100.0 million in cash when the
contract is signed, we previously recorded average revenues of $20.0 million
per year over the 5 years during which we delivered the dark fiber. By
contrast, the real estate accounting rules of FIN 43 would require us to
recognize revenue of $4.0 million per year over the 25 year term of the
contract, even though we would receive a cash payment of $100.0 million when
the contract is signed.

                                       12
<PAGE>

      We implemented this method of accounting for our contracts entered into
after June 30, 1999, as required. Although there was no change to the economics
of the contracts or the timing of the cash to be received by the Company, the
impact of the change in accounting resulted in the Company recording
substantially less revenue after the date of July 1, 1999 than would have been
recorded if this change had not been imposed.

      On March 2, 2000, the Company announced a two-for-one stock split of the
Company's class A and class B common stock in the form of a 100 percent stock
dividend to all shareholders of record on March 14, 2000. This stock split
became effective on April 17, 2000.

All share and per share amounts presented herein give retroactive effect to the
above stock split.

RESULTS OF OPERATIONS - THREE MONTHS ENDED JUNE 30, 2000 COMPARED TO THREE
MONTHS ENDED JUNE 30, 1999, AND SIX MONTHS ENDED JUNE 30, 2000 COMPARED TO SIX
MONTHS ENDED JUNE 30, 1999

REVENUES
Revenues for the second quarter of 2000 were $43.3 million or 113% greater than
revenues of $20.3 million for the second quarter of 1999. Revenues for the six
months ended June 30, 2000 were $75.2 million, or 94% greater than revenues of
$38.7 million for the same period in 1999. The increase for the three and six
months ended June 30, 2000, compared with the three and six months ended June
30, 1999 reflected higher revenues associated with commencement of service to an
increased total number of customers, and the inclusion of AboveNet's revenue in
2000. Revenue recognized for the three and six months ended June 30, 2000 using
the percentage of completion method was zero and $325,000, respectively,
compared to $16.8 million and $33.6 million for the three and six months ended
June 30, 1999, respectively. If not for the impact of the aforementioned
accounting change, effective June 30,1999, the increase in revenues would have
been greater.

COST OF SALES
Cost of sales was $47.1 million in the second quarter of 2000, a 614% increase
over cost of sales of $6.6 million for the second quarter of 1999. Cost of sales
for the six months ended June 30, 2000 was $82.7 million, or 459% greater than
cost of sales of $14.8 million for the same period in 1999. The increase for the
three and six months ended June 30, 2000, compared with the three and six months
ended June 30, 1999 is primarily due to the inclusion of AboveNet and costs
associated with an increased amount of customers and higher fixed costs
associated with the operation of our network in service. Cost of sales as
percentages of revenue for the second quarters of 2000 and 1999 was 109% and
33%, respectively, and 110% and 38% for the six months ended June 30, 2000 and
1999, respectively, increasing in 2000 as a result of the higher fixed costs
related to the operation and maintenance of the Company's network, as well as
the higher fixed costs of the internet connectivity services related to
AboveNet's operations. Cost of sales in the three and six months ended June 30,
2000 related to the percentage of completion method was zero and $48,000,
compared to $3.4 million and $9.7 million for the three and six months ended
June 30, 1999. Costs of sales was also impacted as a direct result of the
aforementioned accounting change, effective June 30, 1999.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES
Selling, general and administrative expenses increased to $28.0 million for
the second quarter of 2000, from $7.7 million during the second quarter of
1999, an increase of $20.3 million or 264%. Selling, general and
administrative expenses, for the six month period ended June 30, 2000 versus
the six month period ended June 30, 1999, increased 303% to $55.6 million
from $13.8 million. The increase in selling, general and administrative
expenses in the three and six month periods ended June 30, 2000 as compared
to the same periods in 1999 resulted primarily from the acquisition of
AboveNet and the increased headcount and other overhead to support our
network expansion. As a percentage of revenue, selling, general and
administrative expenses increased to 65% and 74%, of revenue for the three
and six months ended June 30, 2000, respectively, from 38% and 36%,
respectively, for the comparable periods in 1999. This is primarily a result
of the aforementioned accounting change.

EARNINGS BEFORE INTEREST, TAXES, DEPRECIATION AND AMORTIZATION (EBITDA) EBITDA
consists of earning (loss) before income taxes plus all net interest expense and
all depreciation and amortization expense and losses from joint ventures. We
have included EBITDA because it is a widely used financial measure of the
potential capacity of a company to incur and service debt. Our reported EBITDA
may not be comparable to similarly titled measures used by other companies.


                                       13
<PAGE>

For the three and six months ended June 30, 2000, we recognized an EBITDA loss
of $31.8 million and $63.1 million, respectively, compared with income before
interest, taxes, depreciation and amortization for the three and six months
ended June 30, 1999 of $6.0 million and $10.0 million, respectively. The change
in EBITDA is primarily due to the acquisition of AboveNet and the aforementioned
accounting change.

DEPRECIATION AND AMORTIZATION
Depreciation and amortization expense was $40.0 million and $72.5 million for
the three and six months ended June 30, 2000, respectively, versus $3.9 million
and $5.0 million for the three and six months ended June 30, 1999, respectively.
This represents increases of $36.1 million for the second quarter of 2000 as
compared to the second quarter of 1999 and $67.5 million for the six months
ended June 30, 2000 as compared to the same period in 1999. The increases in
depreciation and amortization expense resulted primarily from amortization of
the goodwill relating to the acquisition of AboveNet and increased investment in
our completed fiber optic network and additional property and equipment
acquired.

INCOME (LOSS) FROM OPERATIONS
For the three and six months ended June 30, 2000 we recognized losses from
operations of $71.8 million and $135.7 million, respectively. This represents an
increased loss of $74.0 million for the three months ended June 30, 2000 from
the $2.2 million income from operations reported for the three months ended June
30, 1999, and an increased loss of $140.7 million for the six months ended June
30, 2000 from the $5.0 million income from operations recognized at June 30,
1999 . The increased loss from operations was attributable to the acquisition of
AboveNet and the related goodwill and the aforementioned accounting change.

INTEREST INCOME
Interest income was $36.8 million during the three months ended June 30, 2000,
as compared to $6.1 million during the comparable 1999 period, an increase of
$30.7 million, or 503%. Interest income was $61.9 million during the six months
ended June 30, 2000, as compared to $13.5 million during the comparable 1999
period, an increase of $48.4 million, or 359%. Interest income increased in 2000
as a result of the investment of our excess cash received as proceeds from the
issuance and sale of our 10% senior notes in October 1999, as well as from the
convertible subordinated notes issued in March 2000.

INTEREST EXPENSE
Interest expense increased in the three and six months ended June 30, 2000 to
$55.7 million and $100.9 million, respectively, versus $14.5 million and $30.4
million for the three and six months ended June 30, 1999. The increase in
interest expense reflects the cost of additional debt acquired related to the
issuance and sale of 10% senior notes in October 1999, as well as the
convertible subordinated notes issued in March 2000.

NET LOSS
We had a net loss of $92.0 million and $177.2 million for the three and six
months ended June 30, 2000, versus net losses of $6.5 million and $12.3
million for the comparable periods of 1999. For the three and six months
ended June 30, 2000, basic net loss per share was $0.17 and $0.33 versus
basic net loss per share of $0.03 and $0.06 for the three and six months
ended June 30, 1999.

LIQUIDITY AND CAPITAL RESOURCES

On October 25, 1999, we issued and sold 10% Senior Notes due 2009 which
generated net proceeds of $974.2 million. On October 7, 1999, we entered into a
securities purchase agreement with Bell Atlantic, under which Bell Atlantic
would purchase shares of our class A common stock and a convertible subordinated
note. The agreement closed on March 6, 2000 and generated net proceeds of
approximately $1.7 billion. In addition, Bell Atlantic has agreed to purchase a
minimum of $550 million of fiber optic facilities payable over the next three
years.

Cash used in operating activities was $44.0 million for the six months ended
June 30, 2000, compared with $21.0 million provided by operations during the
comparable period in 1999. For the six months ended June 30, 2000 we used $905.7
million of cash for


                                       14
<PAGE>

investing activities as compared to $172.2 million for the same period in 1999.
This increase was due primarily to investments in the expansion of our networks
and related construction in progress. For the six months ended June 30, 2000,
$1.8 billion was provided by financing activities, primarily through the Bell
Atlantic investment, compared to the $76.3 million cash outflow in the six
months ended June 30, 1999. The primary use of cash in the first two quarters of
1999 related to financing activities was the restriction of cash as security for
a letter of credit in connection with our German network build.

On May 9, 2000, we finalized an agreement with Pacific Gateway Exchange ("PGE")
to purchase PGE's ownership position in two transoceanic fiber-optic consortia.
Under the terms of the sale, we will have paid approximately $52 million in net
cash proceeds to PGE, primarily to reimburse it for payment to the consortia to
date. We will assume PGE's future payment obligations to the cable consortia.

We anticipate that we will continue to incur net operating losses as we expand
and complete our existing networks, construct additional networks and market our
services to an expanding customer base. We anticipate spending approximately
$3.4 billion through the year ending December 31, 2001 on the build-out of our
fiber optic networks and Internet service exchanges in 50 major markets in the
United States and in 17 major international markets. We believe that the net
proceeds from the investment by Bell Atlantic, the net proceeds from the senior
notes, cash on hand, certain vendor financing and cash generated by operations
(including advance customer payments), will enable us to fully fund the planned
build-out of our networks and our other working capital needs through the year
ending December 31, 2001. The indentures governing our debt obligations permit
us to incur additional indebtedness to finance the engineering, construction,
installation, acquisition, lease, development or improvement of
telecommunications assets. As a result, we may also consider from time to time
private or public sales of additional equity or debt securities, entering into
other credit facilities and financings, depending upon market conditions, in
order to finance the continued build-out of our network. We cannot assure you
that we will be able to successfully consummate any such financing on acceptable
terms or at all.

We expect to experience negative cash flows for the foreseeable future. In
addition, as part of our acquisition of AboveNet, we recorded approximately $1.6
billion in goodwill and other intangible assets, which we are amortizing over
periods up to twenty years. Accordingly, we expect to report further net
operating losses for the foreseeable future.

ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

In the normal course of business, the financial position of the Company is
routinely subjected to a variety of risks. In addition to the market risk
associated with interest movements on the Company's outstanding debt, the
Company is subject to other types of risk such as the collectibility of its
accounts receivables. The Company's principal long term obligation are its $650
million 10% senior notes due 2008 and $1 billion 10% senior notes due 2009, and
the convertible subordinated note of approximately $975.3 million issued to Bell
Atlantic in March 2000. The fair value of the long-term debt at June 30, 2000
was $2.63 billion. A 10% decrease and a 10% increase in the level of interest
rates would result in an increase in the fair value of the Company's long term
obligation by $55 million and a decrease in the fair value of the Company's long
term obligation by $27 million respectively.


                                       15
<PAGE>

                           PART II - OTHER INFORMATION

ITEM 1.  LEGAL PROCEEDINGS

On or about June 12, 1998, Claudio E. Contardi commenced an action against Peter
Sahagen, Sahagen Consulting Group of Florida and the Company in the United
States District Court for the Southern District of New York, No. 98 CIV
4140(JGK) (the "Contardi Litigation"). Mr. Contardi alleges a cause of action
for, among other things, breach of a finder's fee agreement entered into between
Mr. Sahagen and Mr. Contardi on or about November 14, 1996 and breach of an
implied covenant of good faith and fair dealing contained in the finder's fee
agreement. Mr. Contardi is seeking, among other things, a number of our shares
which we cannot currently ascertain but believe to be approximately 112,500
(calculated as of the date on which the complaint was filed and does not take
into account subsequent stock splits) or damages in an amount which we cannot
currently ascertain but believe to be approximately $4.9 million (calculated as
of the date on which the complaint was filed) and all costs and expenses
incurred by him in this action. We have filed an answer to the complaint and
have raised affirmative defenses and moved for summary judgment on the
complaint. On or about June 5, 2000, the court denied the summary judgment
motion. On or about July 20, 2000, the court entered a stipulation and order
dismissing this action without prejudice on the grounds that the court lacks
subject matter jurisdiction.

In January 2000, Herman Goldsmith and Arnold S. Schickler commenced an action
against the Company, F. Garofalo Electric Co., Inc. and Stephen A. Garofalo in
the Supreme Court of the State of New York, County of New York (No. 600163/00)
(the "Goldsmith Litigation"). The complaint alleges a cause of action for breach
of contract in connection with an alleged "finders agreement" entered into in
1993 between Messrs. Goldsmith and Schickler, on the one hand, and F. Garofalo
Electric Co., Inc. and Stephen A. Garofalo, on the other. Plaintiffs seek
damages of approximately $861 million, plus interest from September 7, 1999, in
addition to their costs, expenses and reasonable attorneys' fees. On April 7,
2000, we filed a motion to dismiss the complaint.

We intend to vigorously defend both the Goldsmith Litigation and the Contardi
Litigation (if plaintiff pursues the action) because we believe that we acted
appropriately in connection with the matters at issue in these two cases.
However, we cannot assure you that we will not determine that the advantages of
entering into a settlement outweigh the risk and expense of protracted
litigation or that ultimately we will be successful in defending against these
allegations. If we are unsuccessful in defending against these allegations,
awards of the magnitude being sought in the Contardi Litigation and the
Goldsmith Litigation would have a material adverse effect on our financial
condition and results of operations.

On June 29, 1999, an alleged stockholder of AboveNet filed a lawsuit, captioned
Kaufman v. Tuan, et al, Del. Ch. C.A. No. 17259NC, in the Court of Chancery of
the State of Delaware in and for the New Castle County. The plaintiff, who
purports to represent a class of all AboveNet stockholders, challenges the terms
of the proposed merger between the Company and AboveNet. The complaint names, as
defendants, AboveNet, the directors of AboveNet, and the Comapny (as an aider
and abettor). The complaint alleges generally that AboveNet's directors breached
their fiduciary duty to stockholders of AboveNet, and seeks an injunction
against the merger, or, in the alternative, rescission and the recovery of
unspecified damages, fees and expenses. AboveNet, the Company and the individual
defendants believe the lawsuit is without merit and intend to defend against it
vigorously. AboveNet and the individual director defendants' responses were
filed on July 22, 1999. In connection with these responses, a motion to dismiss
the complaint in its entirety and a motion to stay discovery pending the outcome
of the motion to dismiss were filed by the AboveNet and the individual directors
of AboveNet on July 22, 1999. Similar motions to dismiss the complaint and stay
discovery were filed by us on July 26, 1999. Upon stipulation of the parties,
this action was dismissed without prejudice in December 1999.

Four other complaints, which are virtually identical to the complaint in Kaufman
v. Tuan, have also been filed in the Delaware Court of the Chancery. None of
these four complaints have been served. The four actions are captioned Brosious
v. Tuan, et al, Del. Ch. C.A. No. 17271NC, Chong v. Tuan, et al, Del. Ch. C.A.
No. 17281NC, Ehlert v. Tuan, et al, Del. Ch. C.A. No. 17284NC, Horn v. Tuan, et
al, Del. Ch. C.A. No. 17300NC.

In addition, we are subject to various claims and proceedings in the ordinary
course of business. Based on information currently available, we believe that
none of such current claims, or proceedings, individually, or in the aggregate,
including the Contardi Litigation and the Goldsmith Litigation, will have a
material adverse effect on our financial condition or results of operations,
although we can make no assurances in this regard.


                                       16
<PAGE>

ITEM 2.  CHANGES IN SECURITIES AND USE OF PROCEEDS

Not applicable

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES

Not applicable

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

We held our 2000 annual meeting of stockholders on May 16, 2000.

The stockholders elected the following class A directors at the 2000 annual
meeting of stockholders by the indicated votes of the shares of our class A
common stock:

<TABLE>
<CAPTION>
                      CLASS OF                   VOTES
        NAME          DIRECTOR     VOTES FOR    WITHHELD
        ----          --------     ---------    --------
<S>                    <C>        <C>           <C>
Stephen A. Garofalo    Class A    182,758,255   2,876,804
Nicholas M. Tanzi      Class A    182,756,765   2,878,294
Vincent A. Galluccio   Class A    177,445,122   8,189,937
</TABLE>

At the annual meeting, the stockholders voted to approve the amendment to the
Metromedia Fiber Network, Inc. 1998 Incentive Stock Plan increasing the number
of shares of class A common stock available for issuance under the plan by a
vote of 103,586,596 class A shares and all 33,769,272 class B shares
(337,692,720 votes) voting for the amendment; and 35,530,788 class A shares
voting against the amendment, 113,185 class A shares abstaining and 46,404,490
class A shares constituting broker non-votes.

At the annual meeting, the stockholders voted to ratify the retention of Ernst &
Young LLP as independent auditors for the 2000 fiscal year, by a vote of
185,511,016 class A shares and all 33,769,272 class B shares (337,692,720 votes)
voting for the proposal; and 70,378 class A shares voting against the amendment
and 53,665 class A shares abstaining.

ITEM 5.  OTHER INFORMATION

Not applicable

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

a)    Exhibits

      EXHIBIT #
      ---------

            27 Financial Data Schedule for the period ended June 30, 2000.

b)    Reports on Form 8-K

      None.


                                       17
<PAGE>

SIGNATURE

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

                                    METROMEDIA FIBER NETWORK, INC.
                                          (Registrant)


                                          By: /s/ GERARD BENEDETTO
                                              ----------------------------------
                                          Gerard Benedetto
                                          Senior Vice President and Chief
                                          Financial Officer
                                          (Principal Financial and Accounting
                                          Officer and Duly Authorized Officer)

                                          August 9, 2000


                                       18