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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 June 30, 1999

[ ] 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 1-14087

U S WEST, Inc.
(Exact name of registrant as specified in its charter)

A Delaware Corporation 84-0953188
(State or other jurisdiction of incorporation (I.R.S. Employer Identification No.)
of organization)

1801 California Street, Denver, Colorado 80202
Telephone Number (303) 672-2700

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 __

At July 23, 1999, 504,646,139 shares of common stock were outstanding.

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U S WEST, Inc.
Form 10-Q

TABLE OF CONTENTS

Item Page
PART I - FINANCIAL INFORMATION

1. Financial Statements

Consolidated Statements of Income -
Three months and six months ended June 30, 1999 and 1998............... 3

Consolidated Balance Sheets -
June 30, 1999 and December 31, 1998................................... 4

Consolidated Statements of Cash Flows -
Six months ended June 30, 1999 and 1998................................ 5

Notes to Consolidated Financial Statements...................................... 6

2. Management's Discussion and Analysis of Financial
Condition and Results of Operations.............................................. 15

3. Quantitative and Qualitative Disclosures
About Market Risk................................................................ 24

PART II - OTHER INFORMATION

1. Legal Proceedings....................................................................... 31

2. Changes in Securities and Use of Proceeds............................................... 31

4. Submission of Matters to a Vote of Security Holders..................................... 32

5. Recent Developments..................................................................... 33

6. Exhibits and Reports on Form 8-K........................................................ 33

U S WEST, INC.
CONSOLIDATED STATEMENTS OF INCOME
(dollars in millions, except per share amounts)
(unaudited)

Three Months Ended Six Months Ended
June 30, June 30,
1999 1998 1999 1998
---- ---- ---- ----

Operating revenues:
Local services....................................... $1,933 $1,756 $3,800 $3,486
Access services...................................... 688 671 1,369 1,336
Long-distance services............................... 156 200 330 404
Directory services................................... 333 310 659 616
Other services....................................... 148 116 282 220
------------- ------------ ------------- ------------
Total operating revenues.......................... 3,258 3,053 6,440 6,062
Operating expenses:
Employee-related expenses............................ 1,153 1,069 2,278 2,075
Other operating expenses............................. 677 765 1,339 1,421
Depreciation and amortization........................ 573 535 1,175 1,067
------------- ------------ ------------- ------------
Total operating expenses.......................... 2,403 2,369 4,792 4,563
------------- ------------ ------------- ------------

Operating income........................................... 855 684 1,648 1,499
Other expense:
Interest expense..................................... 163 109 316 206
Other expense-net.................................... 13 33 14 58
------------- ------------ ------------- ------------

Total other expense-net........................... 176 142 330 264
------------- ------------ ------------- ------------

Income before income taxes................................. 679 542 1,318 1,235
Provision for income taxes................................. 258 215 500 474
------------- ------------ ------------- ------------

Net income................................................. $421 $327 $818 $761
============= ============ ============= ============

Basic earnings per share.................................. $0.84 $0.67 $1.62 $1.56
============= =========== ============== ============

Basic average shares outstanding (in 000's)............... 503,934 487,869 503,622 486,424
============= =========== ============== ============

Diluted earnings per share................................ $0.83 $0.67 $1.61 $1.55
============= =========== ============== ============

Diluted average shares outstanding (in 000's)............. 508,200 491,944 508,255 490,521
============= =========== ============== ============

Dividends per share....................................... $0.75 $0.535 $1.285 $1.07
============= =========== ============== ============

The accompanying notes are an integral part of the consolidated financial
statements.

U S WEST, INC.
CONSOLIDATED BALANCE SHEETS
(dollars in millions, except share amounts)

June 30, December 31,
1999 1998
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents............................................................... $122 $49
Accounts receivable, less allowance for uncollectibles of
$77 and $69, respectively............................................................. 1,730 1,743
Inventories and supplies................................................................ 264 197
Deferred directory costs................................................................ 272 274
Deferred tax assets..................................................................... 153 151
Prepaid and other.............................................................. 129 78
-------------- -------------

Total current assets....................................................................... 2,670 2,492
Property, plant and equipment-net.......................................................... 15,480 14,908
Other assets-net........................................................................... 3,741 1,007
-------------- -------------

Total assets............................................................................... $21,891 $18,407
============== =============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Short-term debt......................................................................... $4,218 $1,277
Accounts payable........................................................................ 1,352 1,347
Accrued expenses........................................................................ 1,951 1,702
Advance billings and customer deposits.................................................. 381 370
-------------- -------------

Total current liabilities.................................................................. 7,902 4,696
Long-term debt............................................................................. 8,458 8,642
Postretirement and other postemployment benefit obligations................................ 2,634 2,643
Deferred income taxes...................................................................... 910 786
Unamortized investment tax credits......................................................... 159 159
Deferred credits and other................................................................. 762 726

Commitments and Contingencies

Stockholders' equity:
Preferred stock - $1.00 par value, 190,000,000 shares authorized, none issued and
outstanding.......................................................................... - -
Series A junior preferred stock-$1.00 par value, 10,000,000 shares authorized, none
issued and outstanding............................................................... - -
Common stock-$0.01 par value, 2,000,000,000 shares authorized, 504,652,058 and
503,207,058 issued, 504,348,055 and 502,903,055 outstanding......................... 589 532
Retained earnings....................................................................... 394 223
Accumulated other comprehensive income.................................................. 83 -
-------------- -------------

Total stockholders' equity................................................................. 1,066 755
-------------- -------------

Total liabilities and stockholders' equity................................................. $21,891 $18,407
============== =============

The accompanying notes are an integral part of the consolidated financial
statements.

U S WEST, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(dollars in millions)
(unaudited)

Six Months Ended
June 30,
1999 1998
---- ----
OPERATING ACTIVITIES
Net income................................................................................ $818 $761
Adjustments to net income:
Depreciation and amortization....................................................... 1,175 1,067
Deferred income taxes and amortization of investment tax credits.................... 74 89
Changes in operating assets and liabilities:
Accounts receivable................................................................. 13 11
Inventories, supplies and other current assets...................................... (120) (88)
Accounts payable, accrued expenses and advance billings............................. 159 (76)
Other............................................................................... (50) 55
-------------- --------------
Cash provided by operating activities............................................... 2,069 1,819
-------------- --------------

INVESTING ACTIVITIES
Expenditures for property, plant and equipment......................................... (1,681) (1,283)
Proceeds from (payments on) disposals of property, plant and equipment................. (18) 34
Investment in Global Crossing Ltd. common stock........................................ (2,464) -
Other.................................................................................. (14) (52)
-------------- --------------
Cash used for investing activities..................................................... (4,177) (1,301)
-------------- --------------

FINANCING ACTIVITIES
Net proceeds from short-term debt...................................................... 2,940 2,060
Proceeds from issuance of long-term debt............................................... 17 3,066
Repayments of long-term debt........................................................... (280) (83)
Repayments of Old U S WEST debt in connection with the Dex Alignment................... - (3,829)
Net repayments of Old U S WEST debt.................................................... - (198)
Proceeds from issuance of common stock................................................. 42 44
Dividends paid on common stock......................................................... (538) (519)
Dividends paid to Old U S WEST......................................................... - (183)
Payment to Old U S WEST for debt refinancing costs..................................... - (140)
Return of capital from Old U S WEST.................................................... - 13
Purchases of treasury stock............................................................ - (46)
-------------- --------------

Cash provided by financing activities.................................................. 2,181 185
-------------- --------------

CASH AND CASH EQUIVALENTS
Increase............................................................................... 73 703
Beginning balance...................................................................... 49 27
-------------- --------------

Ending balance......................................................................... $122 $730
============== ==============

The accompanying notes are an integral part of the consolidated financial
statements.

U S WEST, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
For the six months ended June 30, 1999
(dollars in millions, except per share amounts)
(unaudited)

NOTE 1: U S WEST SEPARATION

On June 12, 1998, our former parent company, herein referred to as "Old
U S WEST," separated into two independent companies (the "Separation"). Old U S
WEST had conducted its businesses through two groups: (i) the U S WEST
Communications Group (the "Communications Group"), which included the
communications businesses of Old U S WEST, and (ii) the U S WEST Media Group
(the "Media Group"), which included the multimedia and directories businesses of
Old U S WEST. As part of the Separation, Old U S WEST contributed to us the
businesses of the Communications Group and the domestic directories business of
the Media Group known as U S WEST Dex, Inc. ("Dex"). The alignment of Dex with
our Company is referred to in this document as the "Dex Alignment." Old U S WEST
has continued as an independent public company comprised of the businesses of
Media Group other than Dex and has been renamed MediaOne Group, Inc.

In connection with the Dex Alignment, (i) Old U S WEST distributed to
holders of Media Group common stock, approximately 16,341,000 shares of our
common stock (net of the redemption of approximately 305,000 fractional shares)
with an aggregate of $850 in value (the "Dex Dividend") and (ii) we refinanced
$3,900 of Old U S WEST debt (the "Dex Indebtedness"), formerly allocated to
Media Group.

NOTE 2: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation. The consolidated financial statements include
the consolidated results of operations, financial position and cash flows of the
businesses that comprise the Communications Group and Dex, as if such businesses
operated as a separate entity for all periods and as of all dates presented.
However, certain financial effects of the Separation and the Dex Alignment,
including interest expense associated with refinancing the Dex Indebtedness and
the dilutive effect of the Dex Dividend, are not reflected in the accompanying
consolidated statements of income prior to the Separation.

For periods prior to the Separation, the consolidated financial
statements include an allocation of certain costs, expenses, assets and
liabilities from Old U S WEST. We believe the allocations were reasonable;
however the amount of costs allocated to us were not necessarily indicative of
the costs that would have been incurred if we had operated as a stand-alone
company. The consolidated financial statements may not necessarily reflect the
financial position, results of operations or cash flows in the future or what
they would have been had we been a separate, stand-alone company during such
periods.

The consolidated interim financial statements are unaudited. The
financial statements have been prepared in accordance with the instructions for
Form 10-Q and, therefore, do not necessarily include all information and
footnotes required by generally accepted accounting principles. In our opinion,
all adjustments (consisting only of normal recurring adjustments) necessary to
present fairly our consolidated financial position, results of operations and
cash flows as of June 30, 1999 and for all periods presented have been made. The
statements are subject to year-end audit adjustment. A description of our
accounting policies and other financial information are included in the audited
consolidated financial statements filed with the Securities and Exchange
Commission in our Form 10-K/A for the year ended December 31, 1998. The
consolidated results of operations for the three and six months ended June 30,
1999 are not necessarily indicative of the results expected for the full year.

Certain reclassifications of prior period revenue amounts have been
made to conform to the current year presentation. For a description of the
reclassifications, see the Form 8-K filed April 21, 1999.

On January 1, 1999, we adopted the accounting provisions required by
the American Institute of Certified Public Accountants' Statement of Position
("SOP") 98-1, "Accounting for the Costs of Computer Software Developed or
Obtained for Internal Use." SOP 98-1, among other things, requires that certain
costs of internal use software, whether purchased or developed internally, be
capitalized and amortized over the estimated useful life of the software.
Adoption of the SOP resulted in an increase in net income for the three months
ended June 30, 1999 of $61, or $0.12 per diluted share, and $99, or $0.20 per
diluted share for the six months ended June 30, 1999. We expect that the impact
for all of fiscal year 1999 will be to increase net income by approximately $150
to $180 or $0.30 to $0.35 per diluted share.

NOTE 3: EARNINGS PER SHARE

The following presents a reconciliation of basic weighted average
shares to diluted weighted average shares:

Three Months Six Months
Ended June 30, Ended June 30,
------------------------------- ------------------------------

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

Basic weighted average shares outstanding....... 503,934 487,869 503,622 486,424
Dilutive effect of stock options................ 4,266 4,075 4,633 4,097
-------------- ----------- ------------- -----------

Diluted weighted average shares outstanding..... 508,200 491,944 508,255 490,521
============== =========== ============= ===========

Certain of the financial effects of the Separation and the Dex
Alignment, including interest expense associated with the refinancing of the Dex
Indebtedness and the dilutive effects of the Dex Dividend, are not reflected in
the consolidated statements of income prior to the Separation. The following
presents earnings per share for the quarter and six months ended June 30, 1998
on a pro forma basis. The pro forma earnings per share amounts give effect to
the Dex Indebtedness and issuance of approximately 16,341,000 shares (net of the
redemption of 305,000 fractional shares) of common stock in connection with the
Dex Alignment as if such transactions had been consummated as of January 1, 1998
(shares in thousands).

Quarter Six Months
Ended Ended
June 30, 1998

Basic Earnings Per Share
Net income............................................................ $327 $761
Pro forma adjustment(1)............................................... (31) (72)
-------------- --------------

Pro forma net income.................................................. $296 $689
============== ==============

Basic weighted average shares(2)...................................... 487,869 486,424
Pro forma adjustment(3)............................................... 13,647 14,987
-------------- --------------

Pro forma basic weighted average shares............................... 501,516 501,411
============== ==============

Pro forma basic earnings per share.................................... $0.59 $1.37
============== ==============

Diluted Earnings Per Share
Net income............................................................ $327 $761

Pro forma adjustment(1)............................................... (31) (72)
-------------- --------------

Pro forma net income.................................................. $296 $689
============== ==============

Diluted weighted average shares(2).................................... 491,944 490,521
Pro forma adjustment(3)............................................... 13,647 14,987
-------------- --------------

Pro forma diluted weighted average shares............................. 505,591 505,508
============== ==============

Pro forma diluted earnings per share.................................. $0.59 $1.36
============== ==============

<FN>
<F1>
(1) Reflects incremental (after-tax) interest expense associated with the Dex
Indebtedness.
<F2>
(2) Historical average shares assume a one-for-one conversion of historical
Communications Group common stock outstanding into shares of U S WEST
as of the Separation.
<F3>
(3) Reflects the issuance of approximately 16,341,000 shares of common
stock (net of the redemption of approximately 305,000 fractional
shares) issued in connection with the Dex Alignment as if the shares
had been issued at the beginning of the period.
</FN>

NOTE 4: SEGMENT INFORMATION

We operate in four segments: retail services, wholesale services,
network services and directory services. The retail services segment provides
local telephone services, including wireless, data and long-distance services.
The wholesale services segment provides access services that connect customers
to the facilities of interexchange carriers and interconnection to our
telecommunications network to competitive local exchange carriers. Our network
services segment provides access to our telecommunications network, including
our information technologies, primarily to our retail services and wholesale
services segments. The directory services segment publishes White and Yellow
Pages telephone directories and provides electronic directory and other
information services. We provide our services to more than 25 million
residential and business customers in Arizona, Colorado, Idaho, Iowa, Minnesota,
Montana, Nebraska, New Mexico, North Dakota, Oregon, South Dakota, Utah,
Washington and Wyoming.

Following is a breakout of our segments. Because significant expenses
of operating the retail services and wholesale services segments are not
allocated to the segments for decision-making purposes, management does not
believe the segment margins are representative of the actual operating results
of the segments. The margin for the retail services and wholesale services
segments excludes network and corporate expenses. The margin for the network
services segment and directory services segment excludes corporate expense. The
"other" category includes our corporate expenses and intersegment eliminations.
The total communications and related services column represents a total of the
retail services, wholesale services and network services segments.

Total
Communica-
tions
and
Retail Wholesale Network Related Directory Reconciling Consolidated
Services Services Services Services Services Other Items Total
-------- -------- -------- -------- -------- ----- ----- -----
Three Months Ended
June 30, 1999
Operating
revenues......... $2,222 $719 $65 $3,006 $336 $- $(84)(1) $3,258
Margin........... 1,543 526 (699) 1,370 170 (3) (858) 679(2)
Assets........... -(3) -(3) -(3) -(3) 514 -(3) 21,377(3) 21,891
Capital
expenditures..... 93(4) 9 831 933 10 38 - 981
1998
Operating
revenues......... $2,113 $638 $53 $2,804 $313 $- $(64)(1) $3,053
Margin........... 1,544 449 (629) 1,364 155 (81) (896) 542(2)
Assets........... -(3) -(3) -(3) -(3) 504 -(3) 18,093(3) 18,597
Capital
expenditures..... 119(4) - 641 760 15 34 - 809

- -----------------------
<FN>
<F1>
(1) Represents primarily intersegment charges.
<F2>
(2) Represents income before income taxes. Adjustments that are made to the
total of the segments' margin to arrive at income before income taxes
include the following:
</FN>

Three Months Ended June 30,
------------------------------------------
1999 1998
------------------- -------------------
Costs and adjustments excluded from segment data but included
in the consolidated total:
Restructuring costs............................................. $- $129
Taxes other than income taxes................................... 109 90
Depreciation and amortization................................... 573 535
Interest expense................................................ 163 109
Other expense-net............................................... 13 33
------------------- -------------------
$858 $896
=================== ===================
<FN>
<F1>
(3) A breakout of assets for all segments is not provided to our chief
operating decision-maker. The reconciling items column represents the
amount to reconcile to the consolidated total.
<F2>
(4) Capital expenditures reported for the retail services segment include
only expenditures for wireless services and certain data services.
Additional capital expenditures relating to those services are included
in network services capital expenditures.
</FN>

Total
Communi-
cations
and
Retail Wholesale Network Related Directory Reconciling Consolidated
Services Services Services Services Services Other Items Total
-------- -------- -------- -------- -------- ----- ----- -----
Six Months Ended June 30,
1999
Operating
revenues......... $4,390 $1,409 $115 $5,914 $664 $- $(138)(1) $6,440
Margin........... 3,047 1,055 (1,384) 2,718 340 (36) (1,704) 1,318(2)
Assets........... -(3) -(3) -(3) -(3) 514 -(3) 21,377(3) 21,891
Capital
expenditures..... 204(4) 40 1,469 1,713 17 38 - 1,768
1998
Operating
revenues......... $4,180 $1,273 $99 $5,552 $620 $- $(110)(1) $6,062
Margin........... 3,108 959 (1,305) 2,762 312 (188) (1,651) 1,235(2)
Assets........... -(3) -(3) -(3) -(3) 504 -(3) 18,093(3) 18,597
Capital
expenditures..... 237(4) - 1,032 1,269 21 41 - 1,331

Six Months Ended June 30,
------------------------------------------
1999 1998
------------------- -------------------
Costs and adjustments excluded from segment data but included
in the consolidated total:
Restructuring costs............................................. $- $129
Taxes other than income taxes................................... 199 191
Depreciation and amortization................................... 1,175 1,067
Interest expense................................................ 316 206
Other expense-net............................................... 14 58
=================== ===================
$1,704 $1,651
=================== ===================
<FN>
<F1>
(3) A breakout of assets for all segments is not provided to our chief
operating decision-maker. The reconciling items column represents the
amount to reconcile to the consolidated total.
<F2>
(4) Capital expenditures reported for the retail services segment include
only expenditures for wireless services and certain data services.
Additional capital expenditures relating to those services are included
in network services capital expenditures.
</FN>

In addition to the operating revenues disclosed above, intersegment
operating revenues of the retail services segment, network services and
directory services segments were:

Three Months Ended June 30, Six Months Ended June 30,
------------------------------- ------------------------------

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

Retail services................................. $8 $7 $14 $13
Network services................................ 17 16 31 33

Directory services.............................. 3 3 5 4

NOTE 5: COMPREHENSIVE INCOME

Other comprehensive income at June 30, 1999 consists of $83 of
unrealized gains on available for sale marketable securities, which are net of
deferred taxes of $49.

Total comprehensive income for the three and six months ended June 30,
1999 is as follows:

June 30, 1999
Three months ended Six months ended
Net income..................................................... $421 $818
Other comprehensive income-
Unrealized gains on available for sale marketable
securities............................................ 68 83
------------------------ --------------------
Comprehensive income........................................... $489 $901
======================== ====================

NOTE 6: COMMITMENTS AND CONTINGENCIES

Commitments

We have entered into an agreement with Olympic Properties of the United
States to sponsor the 2002 Salt Lake City Winter Olympics and the U.S. Olympic
Teams through 2004. As of June 30, 1999, we have a remaining commitment of $49
to be paid in a combination of cash and services through 2004.

Contingencies

U S WEST Communications, Inc. ("USWC"), our wholly owned subsidiary,
has the following pending regulatory action in Oregon.

On May 1, 1996, the Oregon Public Utilities Commission ("OPUC")
approved a stipulation terminating prematurely USWC's alternative form of
regulation ("AFOR") plan and it then undertook a review of USWC's earnings. In
May 1997, the OPUC ordered USWC to reduce its annual revenues by $97, effective
May 1, 1997, and to issue a one-time refund, including interest, of
approximately $102 to reflect the revenue reduction for the period May 1, 1996
through April 30, 1997. This one-time refund for interim rates became subject to
refund when USWC's AFOR plan was terminated on May 1, 1996.

USWC filed an appeal of the order and asked for an immediate stay of
the refund with the Oregon Circuit Court which granted USWC's request for a
stay, pending a full review of the OPUC's order. On February 19, 1998, the
Oregon Circuit Court entered a judgment in USWC's favor on most of the appealed
issues. The OPUC appealed to the Oregon Court of Appeals on March 19, 1998, and
the appeal remains pending. USWC continues to charge interim rates, subject to
refund, during the pendency of that appeal. The potential exposure, including
interest, at June 30, 1999, is not expected to exceed $386. Management does not
believe there will be a material adverse impact to the financial statements as a
result of this matter.

Other Contingencies. In December 1998, we were informed of the
possibility of a claim by a purported class challenging the transfer of
approximately $54 from the U S WEST pension trust to the U S WEST health care
trust to pay retiree medical expenses pursuant to Section 420 of the Internal
Revenue Code of 1986, as amended. We believe that this transfer complied with
the applicable law and the associated plan documents. We plan to vigorously
defend any such claim if and when it is asserted.

Twelve complaints have been filed against U S WEST and the directors of
U S WEST in the following jurisdictions: California Superior Court, Los Angeles
County (1); New York Supreme Court, New York County (1); Colorado District
Court, City and County of Denver (2); Delaware Court of Chancery (8). These
actions are purported class actions brought on behalf of all persons, other than
the defendants, who own the common stock of U S WEST against U S WEST and the
directors of U S WEST. Each of the complaints makes substantially similar
allegations that the defendants breached their fiduciary duties to the class
members by refusing to seek all bona fide offers for the Company and refusing to
consider the Qwest Communications International Inc. ("Qwest") proposal,
resulting in the stockholders being prevented from maximizing the value of the
common stock. The complaints seek various injunctive and monetary relief,
including orders: a) requiring defendants to act in accordance with the
fiduciary duties by considering any bona fide proposal which would maximize
stockholder value; b) requiring the directors to undertake an evaluation of U S
WEST as a merger/acquisition candidate and take steps to enhance that value and
create an active auction for U S WEST; c) preventing defendants from using a
stockholder rights plan to impede any bona fide offer for U S WEST; d) enjoining
the consummation of the proposed Global Crossing Ltd. ("Global Crossing")-U S
WEST merger until all alternatives are explored; e) requiring defendants to
account for all damages suffered by plaintiffs as a result of defendants'
actions with respect to the tender offer for the shares of Global Crossing
common stock by U S WEST and the proposed Global Crossing-U S WEST merger; and
f) requiring defendants to pay damages to plaintiffs. The Company intends to
vigorously defend these actions.

We are subject to other legal proceedings and claims that arise in the
ordinary course of business. Although there can be no assurance of the ultimate
disposition of these matters, it is management's opinion, based upon the
information available at this time, that the expected outcome, individually or
in the aggregate, will not have a material adverse effect on our consolidated
results of operations or financial position.

NOTE 7: MERGER AGREEMENTS

In May 1999, we entered into an agreement to merge with Global
Crossing. In connection with the Global Crossing merger agreement, in June 1999,
we completed a cash tender offer for approximately 39 million shares of Global
Crossing common stock at a price of $62.75 per share. The transaction was
financed through the issuance of $1,000 of debt securities maturing June 2000,
with interest based on LIBOR and we issued commercial paper for approximately
$1,500. We entered into a line of credit for $1,500 as a backup facility in
issuing the commercial paper. The line of credit expires June 2000. Commitment
fees on the unused portion of the line of credit are .125%. As of June 30, 1999,
there was no outstanding balance on the line of credit.

In July 1999, we entered into an agreement to merge with Qwest. Under the
terms of the merger agreement, Qwest will issue shares of its common stock
having a value of $69.00 for each share of our common stock, subject to a
"collar" on Qwest's Average Price (as defined below) between $28.26 and $39.90
per share. The exchange ratio, and accordingly, the number of Qwest shares to be
issued for each U S WEST share will be determined by dividing $69.00 by the
average of the volume weighted averages of the trading prices of Qwest common
stock for the 15 trading days randomly selected by lot by the Company and Qwest
together from the 30 consecutive trading days ending on the third trading day
preceeding the closing of the transaction (the "Average Price"). If Qwest's
Average Price is less than $28.26, the exchange ratio will be 2.44161. If
Qwest's Average Price is greater than $39.90, the exchange ratio will be
1.72932.

The obligation, if necessary, under the "collar" may be satisfied in whole
or in part with cash if Qwest's Average Price is below $38.70 per share. In
determining the cash amount for the "collar", Qwest and U S WEST will consider
Qwest's desire to reduce dilution to its stockholders, U S WEST's desire to
provide a cash element to its stockholders and both companies' desire to
maintain the merged company's strong financial condition. U S WEST may terminate
the merger agreement if the closing price of Qwest's shares is below $22.00 for
20 consecutive trading days before the closing, or if the Average Price of Qwest
shares during the measurement period is less than $22.00. The Boards of
Directors of both Qwest and U S WEST have unanimously approved the proposed
merger. The merger is subject to approval by the stockholders of both companies,
federal and state regulatory approvals and other customary closing conditions.
Mr. Anschutz, who beneficially owns approximately 39% of the outstanding shares
of Qwest, has agreed to vote his shares in favor of the merger. Closing of the
merger is expected by mid-2000.

In connection with the merger, U S WEST and Global Crossing agreed to
terminate their merger agreement. In consideration for terminating the Global
Crossing/U S WEST merger agreement, U S WEST paid Global Crossing $140 in cash
and 2,231,076 shares of Global Crossing common stock. Qwest provided us a $140
loan to pay for the cash portion of the termination fee. The loan bears an
interest rate of LIBOR plus .15% and is due December 31, 2001. If we change our
recommendation for the merger, we will be obligated to repay $70 in cash to
Qwest and we will receive only 1,115,538 shares of Global Crossing common stock
or the market value in cash at the time of the termination. Otherwise, Qwest
will not receive reimbursement for its $140 loan and will have to deliver to us
the same number of shares of Global Crossing common stock delivered to Global
Crossing by us or pay us the market value in cash at the time of the
termination.

NOTE 8: SALE OF EXCHANGES

In June 1999, the Company entered into a series of definitive
agreements to sell local-exchange telephone properties serving approximately
530,000 access lines in nine states for approximately $1,650 in cash, subject to
adjustment. Approval of the sale is subject to review by federal and state
regulatory agencies. The transfer of ownership, which will occur on a
state-by-state basis, is expected to be completed in 2000.

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

Special Note Regarding Forward-Looking Statements

Some of the information presented in this Form 10-Q constitutes
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995 (the "Reform Act"). Although U S WEST, Inc. (the
"Company," which may also be referred to as "we," "us" or "our") believes that
its expectations are based on reasonable assumptions within the bounds of its
knowledge of its businesses and operations, there can be no assurance that
actual results will not differ materially from our expectations. Factors that
could cause actual results to differ from expectations include:

o greater than anticipated competition from new entrants into the local
exchange, intraLATA (local access transport area) toll, wireless, data and
directories markets, causing loss of customers and increased price
competition;

o changes in demand for our products and services, including optional custom
calling features;

o higher than anticipated employee levels, capital expenditures and operating
expenses (such as costs associated with interconnection and Year 2000
remediation);

o the loss of significant customers;

o pending and future state and federal regulatory changes affecting the
telecommunications industry, including changes that could have an impact on
the competitive environment in the local exchange market;

o a change in economic conditions in the various markets served by our
operations;

o higher than anticipated start-up costs associated with new business
opportunities;

o delays in our ability to begin offering interLATA long-distance services;

o consumer acceptance of broadband services, including telephony, data, video
and wireless services;

o delays in the development of anticipated technologies, or the failure of
such technologies to perform according to expectations; and

o the timing and completion of the recently announced merger with Qwest
Communications International Inc. ("Qwest") and the subsequent integration
of the businesses of the two companies.

These cautionary statements should not be construed as an exhaustive
list or as any admission by us regarding the adequacy of the disclosures. We
cannot always predict or determine after the fact what factors would cause
actual results to differ materially from those indicated by our forward-looking
statements or other statements. In addition, consider statements that include
the terms "believes," "belief," "expects," "plans," "objectives," "anticipates,"
"intends," or the like to be uncertain and forward-looking. All cautionary
statements should be read as being applicable to all forward-looking statements
wherever they appear.

We do not undertake any obligation to publicly update or revise any
forward-looking statements, whether as a result of new information, future
events or otherwise. In light of these risks, uncertainties and assumptions, the
forward-looking events discussed herein might not occur.

General

The consolidated financial statements include the consolidated results
of operations, financial position and cash flows of the businesses that comprise
the Communications Group and Dex, as if such businesses operated as a separate
entity for all periods and as of all dates presented. However, certain financial
effects of the Separation and the Dex Alignment, including interest expense
associated with the refinancing of the Dex Indebtedness and the dilutive effect
of the Dex Dividend, are not reflected in the consolidated statements of income
prior to the Separation.

Results of Operations

Three and Six Months Ended June 30, 1999 Compared with 1998

Net income for the quarter ended June 30, 1999, increased by $94, or
28.7% to $421, compared to net income of $327 for the quarter ended June 30,
1998. Net income for the six months ended June 30, 1999, increased $57, or 7.5%
to $818, compared to net income of $761 for the six months ended June 30, 1998.
We experienced a 6.7% and 6.2% increase in revenues for the three and six months
ended June 30, 1999, respectively, over the comparable 1998 periods. These
increases were partially offset by increases in expenses to support our growth
initiatives, enhanced customer service and greater network and interconnection
costs.

The following sections provide a more detailed discussion of the
changes in revenues and expenses.

Operating Revenues

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Local services revenues......... $1,933 $1,756 $177 10.1% $3,800 $3,486 $314 9.0%

Local services revenues. Local services revenues include basic monthly service
fees, fees for calling services such as voice messaging and caller
identification, wireless revenues, subscriber access line charges, MegaBit(TM)
data services, public phone revenues, and installation and connection charges.
State public service commissions regulate most local service rates.

Local services revenues increased primarily due to increased sales of
wireless and calling services. Wireless services accounted for $41 and $72 of
the revenue increases for the three and six months ended June 30, 1999,
respectively. Increased revenues from calling services contributed $36 for the
quarter ended June 30, 1999 and $67 for the six months ended June 30, 1999, over
comparable 1998 periods. Additionally, revenues from access line growth
contributed to the rise in revenues. Second line additions by residential and
small business customers contributed to access line growth due to continuing
demand for Internet access and data transport capabilities. As of the end of the
second quarter of 1999, we had added 510,000 access lines, an increase of 3.1%
over the second quarter of 1998. Of this increase, second line installations
accounted for 242,000 lines, an increase of 16.5% compared with the second
quarter of 1998. Also contributing to the revenue growth were increases in the
subscriber base of our Megabit(TM) data services and greater revenue from inside
wire maintenance plans. Partially offsetting these increases were net regulatory
rate adjustments and refunds of $4 for the three months ended June 30, 1999 and
$19 for the six months ended June 30, 1999, over the comparable 1998 periods.

While local services revenues increased in 1999, the growth rate has
declined from 1998. The decline in the growth rate was primarily attributable to
increased competition as well as our customer retention strategy of offering
bundles of services to customers at lower prices in return for entering into
longer-term contracts. Additionally, some business customers have opted to
migrate from multiple single lines to high capacity lines, which decreases local
services revenues but increases access services revenues. We believe we may
continue to experience declining growth rates as the level of customer demand
slows and competition increases. In June 1999, we entered into a series of
definitive agreements to sell 530,000 access lines in nine states for $1,650 in
cash, subject to adjustment. The access lines accounted for 3.8% of fiscal 1998
local services revenues. While the sale is expected to provide us with a
one-time gain in 2000, it will negatively impact future local services revenue
growth.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Access services revenues........ $688 $671 $17 2.5% $1,369 $1,336 $33 2.5%

Access services revenues. Access services revenues are derived primarily from
charging interexchange carriers, such as AT&T and MCI WorldCom, for use of our
local network to connect customers to their long-distance networks. These
revenues are generated from both interstate and intrastate services.

Access services revenues increased due to greater demand for both
interstate and intrastate access services. The volume of interstate and
intrastate access minutes billed both increased 5% for the three months ended
June 30, 1999, over the comparable periods in 1998. Interstate and intrastate
access minutes billed increased 6% and 5%, respectively, for the six months
ended June 30, 1999 over the comparable 1998 periods. Rate reductions of $17 and
$14 for interstate and intrastate access services, respectively, for the three
months ended June 30, 1999, and $31 and $30 for the six months ended June 30,
1999, offset increases in demand. The net impact of increased demand, offset by
rate reductions for the three months ended June 30, 1999, was to increase
interstate access services revenues by $42, or 9% and to decrease intrastate
access services revenues by $4, or 3% over the comparable 1998 periods. The net
impact of increased demand, offset by rate reductions for the six months ended
June 30, 1999, was to increase interstate access services revenues by $93, or
10% and to decrease intrastate access services revenues by $19, or 3% over the
comparable 1998 periods. While we anticipate increased demand for total access
services will continue, the effect of rate reductions is anticipated to continue
to cause a decline in intrastate access services revenues. Additionally,
revenues for the quarter and six months ended June 30, 1998 were favorably
impacted by regulatory rate adjustments of $20 and $40, respectively.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Decrease 1999 1998 Decrease

Long-distance services revenues.
$156 $200 ($44) (22.0%) $330 $404 ($74) (18.3%)

Long-distance services revenues. Long-distance services revenues are derived
from customer calls to locations outside of their local calling area but within
the same LATA. The decrease in long-distance services revenues for the three and
six months ended June 30, 1999 was primarily attributable to greater
competition, resulting in revenue declines of $31 and $51, respectively. Rate
reductions of $7 and $17 for the three and six months ended June 30, 1999,
respectively, also contributed to the revenue losses. As of June 30, 1999,
customers in 11 of the 14 states in which we operate were able to choose an
alternative provider for intraLATA calls without dialing a special access code
when placing the call.

We believe we will continue to experience further declines in
long-distance services revenues as regulatory actions provide for increased
levels of competition. We are responding to competition through competitive
pricing of intraLATA long-distance services and increased promotional efforts to
retain customers. See "Special Note Regarding Forward-Looking Statements" on
page 15.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Directory services revenues.....
$333 $310 $23 7.4% $659 $616 $43 7.0%

Directory services. Directory services revenues are primarily derived from
selling advertising in our published directories. The increases in directory
services revenues were primarily attributable to price increases and increased
sales of premium advertisements.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Other services revenues......... $148 $116 $32 27.6% $282 $220 $62 28.2%

Other services revenues. Other services revenues include billings and
collections for interexchange carriers, customer equipment sales and sales of
other unregulated products, such as U S WEST.net(R), our Internet service. Other
services revenues increased primarily as a result of increased sales of other
unregulated products, primarily customer equipment sales and increased
subscribers for U S WEST.net(R).

Operating Expenses

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Employee-related expenses.......
$1,153 $1,069 $84 7.9% $2,278 $2,075 $203 9.8%

Employee-related expenses. Employee-related expenses include salaries and wages,
benefits, payroll taxes and contract labor.

Employee-related expenses increased during the three and six month
periods ended June 30, 1999, because of increased commitments towards improving
customer service, including meeting requests for installation, repair services
and customer services, resulting in higher labor costs. Additionally, growth in
several sectors of the business, primarily wireless and data communications,
resulted in increased employee levels. Across-the-board wage increases also
contributed to the increase in employee-related expenses. Additionally, included
in employee-related expenses are the salary and benefit costs for employees who
were transferred from Old U S WEST as part of the Separation. Prior to the
Separation, these costs were allocated to us and included in other operating
expenses. Partially offsetting the higher expenses were net reductions in the
costs of employee benefits, including pension expense, of $16 for the three
months ended June 30,1999 and $30 for the six months ended June 30, 1999, over
the comparable 1998 periods. In addition, $24 for the quarter ended June 30,
1999 and $38 for the six months ended June 30, 1999, of employee-related
expenses associated with developing internal use software were capitalized in
1999 due to the adoption of Statement of Position ("SOP") 98-1, "Accounting for
the Costs of Computer Software Developed or Obtained for Internal Use,"
effective January 1, 1999.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Decrease 1999 1998 Decrease

Other operating expenses........ $677 $765 ($88) (11.5%) $1,339 $1,421 ($82) (5.8%)

Other operating expenses. Other operating expenses include access charges paid
to independent local exchange carriers ("LECs") for the routing of local and
long-distance traffic through their facilities, paper, printing, delivery and
distribution costs associated with publishing activities and other selling,
general and administrative costs. Included in the quarter and six months ended
June 30, 1998 were $129 of Separation costs and asset impairment charges.
Excluding these charges, other operating expenses increased $41, or 6.4%, for
the quarter ended June 30, 1999 and increased $47, or 3.6%, for the six months
ended June 30, 1999. These increases in other operating expenses for the quarter
and six months ended June 30, 1999, were primarily attributable to the
following:

o higher access charge expenses resulting from regulatory rulings that
require us to pay reciprocal compensation to other LECs for calls that
originate on our network and terminate on other LECs' networks,

o increased costs of product sales associated with growth initiatives,
including wireless handset costs and costs applicable to our data
communications services, and

o higher interconnection and Year 2000 remediation costs.

In addition, the increase in other operating expenses for the six
months ended June 30, 1999, was also due to the following:

o higher marketing and advertising costs for wireless, data communications
services and calling services, such as caller identification, and

o higher rent expense related to increased computer hardware leasing and
increases in leasing costs associated with telephone poles.

Offsetting the increases in other operating expenses were the effects
of capitalizing $85 for the quarter ended June 30, 1999 and $146 for the six
months ended June 30, 1999 of costs associated with developing internal use
software in accordance with SOP 98-1. Additionally, the transfer of employees
from Old U S WEST as part of the Separation has resulted in the reclassification
of this cost to employee-related expenses.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Depreciation and amortization
expense...................... $573 $535 $38 7.1% $1,175 $1,067 $108 10.1%

Depreciation and amortization expense. Depreciation and amortization expense
increased primarily due to higher overall property, plant and equipment balances
resulting from continued investment in our network. Additionally, the useful
lives of certain assets were reduced, reflecting changes in technology, causing
greater depreciation expense. Partially offsetting the second quarter increase
was the cessation of depreciation primarily associated with the 530,000 access
lines that are under definitive sales agreements entered into in the second
quarter of 1999.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Other expense-net............... $176 $142 $34 23.9% $330 $264 $66 25.0%

Other expense-net. Interest expense was $163 for the second quarter of 1999
compared to $109 for the second quarter of 1998. Interest expense was $316 for
the six months ended June 30, 1999, compared to $206 for the comparable prior
period. The increase in interest expense was primarily attributable to the
$3,900 of debt assumed in the Separation as part of the Dex Alignment.

Also included in other expense-net were other expenses of $13 for the
quarter ended June 30, 1999, compared to $33 for the quarter ended June 30, 1998
and $14 for the six months ended June 30, 1999, compared to $58 for the prior
comparable period. The decreases were due to a reduction in regulatory interest
expense from the prior year. Additionally, for the six months ended June 30,
1999, there was a reduction in interest expense attributable to an anticipated
settlement of federal income tax liabilities for tax years still under audit.

Three Months Ended Six Months
June 30, Increase Ended June 30, Increase
1999 1998 (Decrease) 1999 1998 (Decrease)

Segment margin results:
Retail segment.................. $1,543 $1,544 $(1) (0.1)% $3,047 $3,108 $(61) (2.0)%
Wholesale segment............... 526 449 77 17.1 1,055 959 96 10.0
Network segment................. (699) (629) (70) (11.1) (1,384) (1,305) (79) (6.1)
Directory segment............... 170 155 15 9.7 340 312 28 9.0

Segment results. For segment reporting purposes, segment margins exclude certain
costs and expenses, including depreciation and amortization, corporate expenses
and taxes other than income. See Note 4 to the consolidated financial
statements.

Margin from the retail services segment decreased for the six months
ended June 30, 1999 over the comparable prior period due to operating expenses
increasing at a greater rate than revenue growth. Revenue from the retail
services segment increased 5.0% for the six months ended June 30, 1999 over the
comparable 1998 period, primarily due to growth in local services revenue. The
revenue increase was more than offset by the higher operating expenses driven by
growth initiatives and increased customer service costs. For the quarter ended
June 30, 1999, the margin was flat compared to the prior comparable quarter.
This improvement, compared to the margin decline for the six months ended June
30, 1999, resulted from a reduction in advertising costs. Margins from the
wholesale services segment increased as a result of greater demand for access
services, partially offset by price reductions as mandated by both federal and
state regulatory authorities and higher operating costs relating to
interconnection costs and additional access charge expenses. Margins from the
network services segment decreased as a result of expenditures to support growth
in both the retail and wholesale services segments. Margins from the directory
services segment increased due to growth in directory services revenue partially
offset by increased printing, paper and sales support costs. Additionally, the
implementation of SOP 98-1 in 1999 contributed favorably to each segment's
margin results.

Three Months Ended Six Months
June 30, Ended June 30,
1999 1998 Increase 1999 1998 Increase

Provision for income
taxes......................... $258 $215 $43 20.0% $500 $474 $26 5.5%

Provision for income taxes. The effective tax rate for the three months ended
June 30, 1999 was 38.0% compared to 39.7% for the comparable quarter of 1998.
The effective tax rate was 37.9% for the six months ended June 30, 1999 compared
to 38.4% for the six months ended June 30, 1998. The reductions in the 1999
effective tax rates were due to lower permanent differences in the current year.

Liquidity and Capital Resources

Operating Activities. Cash provided by operations was $2,069 for the six months
ended June 30, 1999 compared to $1,819 for the prior comparable period. The
increase in operating cash flow in 1999 resulted from both an increase in net
income and less cash used for working capital needs.

Investing Activities. Total capital expenditures, on a cash basis, were $1,681
in 1999 and $1,283 in 1998. Capital expenditures have primarily been, and
continue to be, focused on expanding access line growth, modernization of the
telecommunications network and meeting the requirements of the
Telecommunications Act of 1996 ("the Act"), including interconnection and local
number portability ("LNP"). We are also continuing to expand our investment to
compete in the wireless, data communications and video markets.

For 1999, we anticipate total capital expenditures will approximate
$4,000, which includes software capitalization, the acceleration of the next
generation of the network, launch of personal communication services in
additional markets, expansion of the Internet data business and greater emphasis
on our e-commerce efforts. Additionally, we will continue our expenditures on
interconnection and LNP to enable competition in compliance with federal
regulations. See "Special Note Regarding Forward-Looking Statements"on page 15.

In connection with our proposed merger agreement with Global Crossing,
we invested $2,464 to purchase approximately 39 million shares of Global
Crossing common stock in a tender offer during the second quarter of 1999. As a
result of our subsequent merger agreement with Qwest in July 1999, we entered
into a termination agreement with Global Crossing under which we were required
to pay Global Crossing $140 and 2,231,076 shares of Global Crossing common stock
for which we paid $140. We obtained a $140 loan from Qwest to satisfy the cash
portion of the termination fee. As of July 30, 1999, the remaining Global
Crossing shares we held had a market value of $1,537. We are restricted from
disposing of these shares until the consummation or termination of Global
Crossing's merger with Frontier Corporation.

Financing Activities. Cash provided by financing activities was $2,181 in 1999
and $185 in 1998. In 1999, net proceeds from short-term debt were $2,940, of
which $2,464 was used to finance the Global Crossing tender offer. We paid
dividends on our common shares totaling $538 in 1999 and $519 in 1998.
Additionally, prior to the Separation, Dex paid dividends to Old U S WEST equal
to its net income, adjusted for the amortization of intangibles, totaling $183
in 1998.

We maintain commercial paper programs to finance short-term cash flow
requirements, as well as to maintain a presence in the short-term debt market.
As of June 30, 1999, we had lines of credit with a total borrowing capacity of
$4,050.

Future cash needs could increase with the pursuit of new business
opportunities and continued implementation of the requirements of the Act.
Interconnection, LNP, universal service and access charge reform will negatively
impact cash flows to the extent recovery mechanisms provided for by the Federal
Communications Commission ("FCC") and state commissions are inadequate. From
time to time, we may consider the acquisition or disposition of assets or
businesses that may be material to our financial condition, and therefore, our
cash needs. We expect that such cash needs will be funded through operations
and, when necessary, the issuance of debt securities.

Risk Management

Over time, we are exposed to market risks arising from changes in
interest rates. The objective of our interest rate risk management program is to
manage the level and volatility of our interest expense. We may employ
derivative financial instruments to manage our interest rate risk exposure. We
have also employed financial derivatives to hedge interest rate and foreign
currency exposures associated with particular debt issues to synthetically
obtain below market interest rates. We do not use derivative financial
instruments for trading purposes.

As of June 30, 1999 and December 31, 1998, approximately $3,924 and
$957, respectively, of floating-rate debt was exposed to changes in interest
rates. This exposure is primarily linked to commercial paper rates and changes
in 3-month LIBOR. A hypothetical increase of 1% in commercial paper rates and
3-month LIBOR would increase annual pre-tax interest expenses by $39. As of June
30, 1999 and December 31, 1998, we also had $222 and $228, respectively, of
long-term fixed rate debt obligations maturing in the following 12 months. Any
new debt obtained to refinance this debt would be exposed to changes in interest
rates. A hypothetical 10% change in the interest rates on this debt would not
have had a material effect on our earnings.

As of June 30, 1999, all outstanding interest rate swaps and the
associated debt instrument have matured. As of December 31, 1998, we had
interest rate swaps with notional amounts of $155. The swaps synthetically
transformed certain of the Company's floating rate issues into fixed rate
obligations. The swaps and associated debt issues were indexed to two and
10-year constant maturity U.S. Treasury rates. Any gains (losses) on the swaps
were offset by losses (gains) on the associated debt instruments.

As of June 30, 1999 and December 31, 1998, we had also entered into
cross-currency swaps with notional amounts of $133 and $204, respectively. The
cross-currency swaps synthetically transform $97 and $182 of Swiss Franc
borrowings at June 30, 1999 and December 31, 1998, respectively, into U.S.
dollar obligations. Any gains (losses) on the cross-currency swaps would be
offset by losses (gains) on the Swiss Franc debt obligations.

Other assets at June 30, 1999 included marketable equity securities
recorded at a fair value of $154 including unrealized gains of $132. Those
securities have exposure to price risk. The estimated potential loss in fair
value resulting from a hypothetical 10% decrease in prices quoted by stock
exchanges would not have had a material effect on our earnings.

Recent Regulatory Developments

Interconnection. The FCC issued an order (the "Order") in 1996 relating to the
Act that established interconnection costing and pricing rules which, from our
perspective, significantly impeded negotiations with new entrants to the local
exchange market, state regulatory commission interconnection rulemakings and
interconnection arbitration proceedings.

On January 25, 1999, the U.S. Supreme Court ("Supreme Court") issued a
ruling on our appeal of the Order. Although the decision stated that the Act was
ambiguous and self-contradictory, the Supreme Court ruled that:

o the FCC has authority to set pricing methodology;

o unbundled network elements ("UNEs") must be provided in cases where
necessary or the lack of availability would impair competition;

o Incumbent local exchange companies ("ILECs") must sell on a bundled
basis, at the competitive local exchange carriers' ("CLECs") request,
network elements the ILEC uses itself on a bundled basis; and

o CLECs may pick and choose pricing or other terms and conditions from
multiple contracts within certain bounds.

The impact of the Supreme Court ruling is unclear since state
regulatory commissions generally follow the FCC's pricing and unbundling
requirements in setting UNE prices. On April 16, 1999, the FCC issued a Further
Notice of Proposal Rulemaking ("FNPRM") to address how it should interpret the
"necessary and impair" standard and which specific network elements the FCC
should require ILECs to unbundle. We expect further review of the legality of
the FCC's pricing rules will occur at the Eighth Circuit Court of Appeals.

InterLATA Long-Distance Entry. Several regional Bell operating companies have
filed for entry into the interLATA long-distance business. Although many of
these applications have been approved by state regulatory commissions, the FCC
has rejected all applications to date.

We view entry into this business as important to our strategy of
providing an integrated bundle of services to our customers. In 1999, we
withdrew our applications to enter the interLATA long-distance business in
Wyoming and Montana but we filed an application in Arizona. In April 1999, the
Nebraska Public Service Commission indicated it needed additional information
before making a recommendation to the FCC. We expect our application to be
forwarded to the FCC for its review in late 1999 or early 2000. See "Special
Note Regarding Forward-Looking Statements " on page 15.

Access Reform. In its access reform order, the FCC mandated a substantial
restructuring of interstate access pricing. A significant portion of the
services that were charged using minutes-of-use pricing are now being charged
using a combination of minutes-of-use rates, flat-rate presubscribed
interexchange carrier charges ("PICCs") and subscriber line charges ("SLCs").
Although an increase in the SLC to multi-line business users occurred on July 1,
1997, the bulk of the mandated pricing changes occurred on January 1, 1998.
Additional mandated pricing changes occurred on January 1, 1999 and July 1, 1999
and more will be implemented on January 1, 2000 and 2001. The net effect of
these changes will be to decrease minutes-of-use charges and increase flat-rate
charges (i.e., PICCs and SLCs).

The access reform order also continued in place the current rules under
which ILECs may not assess interstate access charges on information service
providers and purchasers of UNEs.

In February 1999, the FCC issued an order declaring that Internet
traffic is interstate and opened a proceeding to determine the appropriate
regulatory structure. The FCC allowed no change in the current agreements for
reciprocal compensation with CLECs until it rules on this matter. A ruling is
expected in the summer of 1999.

Advanced Telecommunications Services. On March 31, 1999, the FCC issued an
order establishing expanded collocation requirements for both conventional voice
and advanced services. The FCC also issued a FNPRM on "line sharing." Line
sharing allows a CLEC to provide advanced services over the same loop that the
ILEC uses to provide analog voice service.

Long-Term Number Portability Tariffs. In July 1999, the FCC issued an order on
our LNP tariff that was originally effective in February 1999. The FCC's order
reduced our tariff from $0.54 per access line to $0.43 per access line. The FCC
also required that the difference between $0.54 and $0.43 be refunded to
customers. The Company does not expect the refund to have a material impact on
its financial statements.

Court Remand of 6.5% Productivity Factor. On May 21, 1999, the District of
Columbia U.S. Court of Appeals issued a ruling reversing and remanding back to
the FCC its order requiring ILECs to retroactively increase the productivity
offset to price caps to 6.5% in their annual price cap filings. The Court found
that the FCC's order did not justify the increase. The FCC must revise and
reissue its order by April 2000.

Shared Transport. In June 1999, the Supreme Court vacated and remanded to the
Eight Circuit Court of Appeals its decision on the FCC's shared transport rules.
Until the FCC issues new rules, there is no federal requirement to make shared
transport available as a UNE. The FCC has combined this issue with its FNPRM on
UNE pricing.

Contingencies

We have pending regulatory actions in local regulatory jurisdictions.
See Note 6 to the consolidated financial statements.

Other Items

From time to time, we engage in discussions regarding restructurings,
dispositions, acquisitions and other similar transactions. Any such transaction
could include, among other things, the transfer, sale or acquisition of
significant assets, businesses or interests, including joint ventures, or the
incurrence, assumption or refinancing of indebtedness, and could be material to
our financial condition and results of operations. There is no assurance that
any such discussions will result in the consummation of any such transaction.

Year 2000 Costs

Background. We have conducted a comprehensive review of our computer-based
systems and related software and are taking measures to ensure that such systems
will properly recognize the year 2000 and continue to process beyond December
31, 1999. The systems we evaluated include systems within (i) the Public
Switched Telephone Network (the "Network"), (ii) Information Technologies
("IT"), and (iii) individual Business Units (the "Business Units").

The Network, which processes voice and data information relating to our
core communications business, relies on remote switches, central office
equipment, interoffice equipment and loop transport equipment that is
predominantly provided to us by telecommunications network vendors. IT is
comprised of our internal business systems that employ hardware and software on
an enterprise-wide basis, including operational, financial and administrative
functions. The Business Units, which include internal organizations such as
finance, procurement, directory services, operator services, wireless, data
networks, real estate, etc., employ systems that support desktop and
departmental applications, as well as embedded computer chip technologies, which
relate specifically to each of our Business Unit's functions and generally are
not part of the Network or IT.

We have approached year 2000 remediation activities through five
general phases: (i) inventory/assessment, (ii) planning, (iii) conversion, (iv)
testing/certification and (v) implementation. Additionally, we are continuously
monitoring and improving our year 2000 related activities and progress,
communicating with our customers and vendors, participating in cooperative
testing with others and taking steps to assure that we have contingency plans in
place prior to the end of 1999. These activities will continue throughout 1999.

Network update. With regard to the Network, we are working with our
telecommunications network vendors to obtain and convert to compliant releases
of hardware and software. We also are testing, at our own initiative, in
cooperation with certain of our customers, vendors and other major wireline
telecommunications companies, network equipment over multiple configurations
involving a broad spectrum of services. Toward this end, we participate in the
Telco Year 2000 Forum (the "Forum"), an organization that addresses the year
2000 readiness of network elements and network interoperability. The Forum has
contracted with Telcordia (formerly known as Bellcore), a former affiliate
engaged in telecommunications industry research, development and maintenance
activities, to engage in inter-region interoperability testing. No significant
issues have been found to date. We also participate in (i) the FCC's Network
Reliability and Interoperability Council IV working group, which is tasked to
evaluate the year 2000 readiness of the public telecommunications network, and
(ii) the Alliance for Telecommunications Industry Solutions ("ATIS"), which is
testing inter-network interoperability, and which, in conjunction with the
Cellular Telecommunications Industry Association ("CTIA"), is testing network
interoperability with wireless networks. Our inventory/assessment, planning and
conversion phases for the Network are complete. The network
testing/certification phase was approximately 100% complete as of June 30, 1999.
Cooperative testing with certain customers, vendors and other telecommunications
companies is expected to continue during 1999. As of June 30, 1999,
approximately 99.6% of our Network remediation implementation was complete, with
the remainder anticipated to be finished by August 1999. Substantial progress
has been made with Network contingency planning activities. We anticipate that
the remainder of the Network contingency planning activities will be complete by
the end of the third quarter, 1999.

IT update. Within IT, we have identified approximately 570 applications that
support our critical business processes, such as billing and collections,
network monitoring, repair and ordering. The inventory/assessment and planning
phases for such IT applications are complete. As of June 30, 1999, approximately
99% of IT conversion activities, 96.8% of IT testing activities and 97% of IT
implementation had been completed. We anticipate that each of these phases for
IT will be complete by September 1999. Substantial progress has been made with
IT contingency planning activities. We anticipate that the remainder of the IT
contingency planning activities will be complete by the end of the third
quarter, 1999.

Business Units update. Within our Business Units, it is estimated that as of
June 30, 1999, approximately 100% of the inventory/assessment activity, 99.5% of
the planning activity, 99.5% of the conversion activity and 99% of the testing
and remediation implementation activities were complete. We anticipate that each
of these phases will be complete in the Business Units for major conversions and
upgrades by the end of the third quarter of 1999. We have recently initiated
Business Unit contingency planning activities and we anticipate those will be
complete by the end of the third quarter, 1999.

Costs relating to year 2000. We have spent approximately $200 from the
beginning of 1997 through the end of the second quarter of 1999 on year 2000
projects and activities. We estimate that additional costs for year 2000 related
projects and activities will be approximately $75. Virtually all year 2000
related expenditures are being funded through operations. Though year 2000 costs
will directly impact the reported level of future net income, we intend to
control our total cost structure, including deferral of non-critical projects to
future years, in an effort to mitigate the impact of year 2000 costs on our
historical rate of earnings growth. The estimates stated above are subject to
change. The timing of our expenses may vary and is not necessarily indicative of
readiness efforts or progress to date.

Contingency plan. We cannot provide assurance that the results of our year 2000
compliance efforts or the costs of such efforts will not differ materially from
estimates. Accordingly, we are developing year 2000 specific business continuity
and contingency plans to address high risk areas as they are identified. Our
year 2000 contingency planning activities will include training of crisis
managers on year 2000 issues and potential business impacts to their particular
process areas, reviewing and modifying existing business continuity plans to
address year 2000 issues and establishing rapid response teams and
communications procedures for each of the major critical operations and
facilities to handle potential post-implementation year 2000 failures. These
year 2000 specific contingency planning activities are to be in place by the
third quarter of 1999. In addition, we have in place our standard overall
business continuity, contingency and disaster recovery plans (such as diesel
generator back-up power supply sources for our Network, Network rerouting
capabilities, computer data and records safe-keeping and back-up and recovery
procedures) which will be verified, and as appropriate, augmented for specific
year 2000 contingencies.

Dependencies. Within Network, we are highly dependent upon our
telecommunications network vendors to provide year 2000 compliant hardware and
software in a timely manner, and on third parties that are assisting us in the
focused testing and implementation phases regarding the Network. Because of
these dependencies, we have developed and implemented a vendor compliance
process whereby we have obtained written assurances of timely year 2000
compliance from most of our critical vendors (not only for Network, but also for
IT and the Business Units). In addition, we monitor and actively participate in
coordinated Network testing activities, as discussed above, with respect to the
Forum, ATIS and Telcordia. Within IT, we depend on the development of software
by experts, both internal and external, and the availability of critical
resources with the requisite skill sets. Because of this dependency, we have
developed detailed timetables, resource plans and standardized year 2000 testing
requirements for identified critical applications (irrespective of whether these
applications are used primarily by IT, the Network or the Business Units).
Within the Business Units, we are dependent on vendor supplied goods and
services and operability of the Network and critical IT and Business Unit
specific applications. Because of these dependencies, we are implementing the
same type of vendor compliance processes and application planning and testing
processes at the Business Units, as discussed above with respect to the Network
and IT. Overall, we have sought compliance assurances from approximately 7,765
vendors concerning approximately 25,769 products and have received assurances
for 99.6% of those products as of June 30, 1999. During 1999, we will continue
to pursue assurances of timely year 2000 compliance for the remaining critical
vendors.

As with any large-scale computer-related project such as year 2000
remediation, the testing phase may require resources in excess of other project
phases and the other project phases may be affected by and dependent upon the
results of the testing phase.

Summary. In management's view, the most reasonably likely worse case scenario
for year 2000 failure prospects we face is that a limited number of important IT
and/or Business Unit specific applications may unexpectedly fail. In addition,
there may be unexpected problems with the Network relating to the year 2000. Our
failure or the failure by certain of our vendors to remediate year 2000
compliance issues in advance of the year 2000 and to execute appropriate
contingency plans in the event that a critical failure is experienced, could
result in disruption of our operations, possibly impacting the Network and
impairing our ability to bill or collect revenues. However, while no assurance
can be given, management believes that our efforts at remediation and testing,
year 2000 specific contingency planning, and overall business continuity,
contingency and disaster recovery planning will likely be successful, and that
the aforementioned "worse case scenario" is unlikely to develop or significantly
disrupt our financial operations.

The above discussion regarding year 2000 contains many statements that
are "forward-looking" within the meaning of the Reform Act. Although we believe
that our estimates are based on reasonable assumptions, we cannot assure that
actual results will not differ materially from these expectations or estimates.
See "Special Note Regarding Forward-Looking Statements" on page 15.

New Accounting Standards

On June 15, 1998, the Financial Accounting Standards Board issued
Statement of Financial Accounting Standards ("FAS") No. 133, "Accounting for
Derivative Instruments and Hedging Activities." This statement establishes
accounting and reporting standards for derivative instruments and for hedging
activities. FAS No. 133 requires, among other things, that all derivative
instruments be recognized at fair value as assets or liabilities on the balance
sheet and that changes in fair value generally be recognized currently in
earnings unless specific criteria are met. The standard is effective for fiscal
years beginning after June 15, 2000, though earlier adoption is permitted.
Financial statement impacts of adopting the new standard depend upon the amount
and nature of the future use of derivative instruments and their relative
changes in valuation over time. Had we adopted FAS No. 133 in 1999, its impact
on the consolidated financial statements would not have been material.

PART II - OTHER INFORMATION

Item 1. Legal Proceedings

Our Company and its subsidiaries are subject to claims and proceedings
arising in the ordinary course of business. For a discussion of these actions,
see "Note 6: Commitments and Contingencies" - to the consolidated financial
statements.

Item 2. Changes in Securities and Use of Proceeds

Recent Sales of Unregistered Securities

The following describes securities issued by the Company within the
past fiscal quarter which were privately placed and not registered under the
Securities Act of 1933, as amended (the "Securities Act"). The Company believes
that the following issuances of securities were exempt from the registration
requirements of the Securities Act, pursuant to the exemption set forth in
Section 4(2), Rule 144A, and Regulation S thereof.

(a) On June 3, 1999, and in reliance on Rule 144A and Regulation S of
the Securities Act, U S WEST Capital Funding, Inc. ("Capital Funding"), a wholly
owned subsidiary of the Company, issued Floating Rate Notes (the "Notes") in the
aggregate principal amount of $1,000,000,000. Payment of principal and interest
on the Notes is unconditionally guaranteed by the Company. The Notes will mature
and the principal amount, together with interest accrued and unpaid thereon,
will be payable on June 15, 2000. The Notes will bear interest from June 10,
1999. The per annum rate of interest is based on three-month LIBOR, reset
quarterly, plus 45 basis points (.45%). Interest will be computed on the basis
of a 360-day year and the actual number of days in the applicable interest
period. Capital Funding may, at its option, redeem the Notes on any interest
payment date, in whole but not in part, at 100% of the principal amount thereof
plus accrued and unpaid interest, if any, to the redemption date upon not less
than 15 nor more than 60 calendar days notice, subject to the rights of holders
of record on the relevant record date to receive interest due on the relevant
interest payment date. J.P. Morgan Securities, Inc., Banc of America Securities
LLC, Chase Securities Inc. and Salomon Smith Barney Inc. (collectively, the
"Initial Purchasers") purchased the Notes for resale to "qualified institutional
buyers" as defined under Rule 144A at 99.90% of their principal amount
($999,000,000 aggregate proceeds to Capital Funding before deducting expenses
payable by Capital Funding). Accordingly, the Initial Purchasers received a
commission in the amount of $1 million.

(b) From June 21, 1999 through June 25, 1999, and in reliance on Rule
144A of the Securities Act, the Company issued $1.5 billion in commercial paper.

The Company used the proceeds from the sale of the Notes and commercial
paper to finance the purchase of Global Crossing shares pursuant to the Tender
Offer (as defined hereinafter). See Item 5 of this Part II for further
information on the Tender Offer.

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

The Company held its annual meeting of stockholders (the "Annual
Meeting") on May 11, 1999. The number of common votes present at the Annual
Meeting voting and withholding authority to vote in the election of Directors
was 447,363,630 which represented 88.862% of the common votes outstanding, which
were 503,433,705 votes, on March 15, 1999, the record date for said Annual
Meeting. At the meeting, the following items relating to the Company were
submitted to a vote of stockholders of the Company:

(a) Election of Directors in Class I:

Votes For Votes Withheld
--------- --------------
Hank Brown 430,483,507 16,880,123
George J. Harad 430,820,266 16,543,364
Marilyn Carlson Nelson 430,373,971 16,989,659

(b) Ratification of appointment of Arthur Andersen LLP, Independent
Public Accountants, as independent auditors to audit the financial statements of
the Company for the calendar year 1999:

Votes For Votes Against Votes Abstained
--------- ------------- ---------------
438,745,633 5,113,426 3,504,571

Votes For Votes Against Votes Abstained Votes Delivered Not Voted
--------- ------------- --------------- -------------------------
196,476,249 192,163,951 8,304,450 50,418,980

(d) A stockholder proposal recommending that the stockholders amend the
bylaws of the Company to discontinue the Shareholder Rights Plan:

Votes For Votes Against
--------- -------------
208,906,459 238,457,171*

* Votes Against include abstentions (8,780,407) and votes delivered but
not voted (50,400,719).

(e) A stockholder proposal limiting future change of control
compensation:

Votes For Votes Against Votes Abstained Votes Delivered Not Voted
--------- ------------- --------------- -------------------------
148,036,814 235,328,187 13,592,516 50,406,113

(f) A stockholder proposal requiring the Public Policy/Nominating
Committee to nominate two candidates for each directorship to be filled by the
voting of stockholders at annual meetings:

Votes For Votes Against Votes Abstained Votes Delivered Not Voted
--------- ------------- --------------- -------------------------
31,891,636 355,802,297 9,264,986 50,504,711

Item 5. Recent Developments

Global Crossing Merger

On May 17, 1999, the Board of Directors of U S WEST announced that it
had entered into a definitive agreement to merge (the "Global Merger Agreement")
U S WEST and Global Crossing. As part of the merger, U S WEST commenced and
closed a cash tender offer for approximately 39 million shares of common stock
of Global Crossing or approximately 9.5% of Global Crossing's outstanding shares
at a price of $62.75 per share (the "Tender Offer"). The Tender Offer commenced
on May 21, 1999, expired on June 18, 1999 and settled on June 28, 1999. U S WEST
financed the purchase of Global Crossing shares pursuant to the Tender Offer
with proceeds from the sale the Notes and commercial paper. See Item 2 of Part
II of this form 10-Q.

Qwest Merger

On July 18, 1999, the Board of Directors of U S WEST announced that it
had entered into a definitive agreement to merge U S WEST with and into Qwest
Communications International Inc. ("Qwest"). See Note 7 to the consolidated
financial statements. The merger is subject to, among other things, the approval
of stockholders of both companies, the expiration of applicable waiting periods
under the Hart-Scott-Rodino Antitrust Improvements Act, the approval by the
Federal Communications Commission, and other regulatory reviews.

For current information regarding the Qwest merger, you are encouraged
to review the publicly filed reports of the respective companies.

Item 6. Exhibits and Reports on Form 8-K

(a) Exhibits filed for the Company through the filing of this Form 10-Q.

(2-A) Separation Agreement between U S WEST, Inc. (renamed "MediaOne Group,
Inc.") and U S WEST, Inc. (formerly USW-C, Inc.), dated June 5, 1998
(Exhibit 99.1 to Form 8-K/A dated June 26, 1998, File No. 1-14087).

(2-A.1) Amendment to the Separation Agreement between MediaOne Group, Inc.
(formerly U S WEST, Inc.) and U S WEST, Inc. (formerly USW-C, Inc.),
dated June 12, 1998 (Exhibit 10(p) to Form 10-K/A for the year ended
December 31, 1998, File No.
1-14087).

(2-A.2) Offer to Purchase; Letter of Transmittal relating to the Common
Stock; Letter to Brokers, Dealers, Commercial Banks, Trust Companies
and Other Nominees to Clients; Letter from Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees to Clients;
Notices of Guaranteed Delivery relating to the Common Stock; Press
Release issued by the Offeror and the Company on May 17, 1999; and
Guidelines for Certificate of Taxpayer Identification Number on
Substitute Form W-9 each dated May 21, 1999 (Exhibits (a)(1) through
(a)(5) to Schedule 14D-1 and Schedule 13D, dated May 21, 1999, as
amended).

(2-A.3) Agreement and Plan of Merger, dated as of May 16, 1999, between
Global Grossing Ltd. and U S WEST, Inc. (Exhibit 2 to Form 8-K, dated
May 21, 1999, File No, 1-14087).

(2-A.4) Tender Offer and Purchase Agreement, dated as of May 16, 1999,
between Global Crossing Ltd. and U S WEST, Inc. (Exhibit (c)(2) to
Schedule 14D-1 and Schedule 13D, dated May 21, 1999, as amended).

(2-A.5) Voting Agreement, dated as of May 16, 1999, between Global Crossing
Ltd. and U S WEST, Inc. (Exhibit (c)(3) to Schedule 14D-1 and
Schedule 13D, dated May 21, 1999, as amended).

(2-A.6) Standstill Agreement, dated as of May 16, 1999, between Global
Crossing Ltd. and U S WEST, Inc. (Exhibit (c)(4) to Schedule 14D-1
and Schedule 13D, dated May 21, 1999, as amended).

(2-A.7) Tender and Voting Agreement, dated as of May 16, 1999, between U S
WEST, Inc. and each of the parties listed on the signature page
thereto (Exhibit (c)(5) to Schedule 14D-1 and Schedule 13D, dated May
21, 1999, as amended).

(2-A.8) Agreement, dated as of May 16, 1999, between U S WEST, Inc., Global
Crossing Ltd. and each person whose name appears on the signature
page thereto (Exhibit (c)(6) to Schedule 14D-1 and Schedule 13D,
dated May 21, 1999, as amended).

(2-A.9) Letter Agreement, dated as of May 16, 1999, between U S WEST,
Inc. and Global Crossing Ltd. (Exhibit 99 to Form 8-K, dated May
21, 1999, File No. 1-14087).

(2-A.10) Transfer Agreement, dated as of May 16, 1999, between Global Crossing
Ltd. and each person whose name appears on the signature page thereto
(Exhibit (c)(8) to Schedule 14D-1 and Schedule 13D, dated May 21,
1999, as amended).

(2-A.11) Agreement and Plan of Merger between U S WEST, Inc. and Qwest
Communications International Inc., dated as of July 18, 1999,
(Exhibit 2 to Form 8-K dated July 20, 1999, File No. 1-14087).
(2-A.12) Voting Agreement among each of the stockholders listed on the
signature page thereto and U S WEST, Inc., dated as of July 18, 1999
(Exhibit 10.1 to Form 8-K, dated July 20, 1999, File No. 1-14087).

(2-A.13) Termination Agreement between U S WEST, Inc. and Global Crossing
Ltd., dated as of July 18, 1999 (Exhibit 10.2 to Form 8-K, dated July
20, 1999, File No. 1-14087).

2-A.14 Amendment No. 1 to Tender Offer and Purchase Agreement, dated as of
July 18, 1999.

(3-A) Restated Certificate of Incorporation of U S WEST, Inc. (Exhibit 3A)
to Form S-4 Registration Statement No. 333-45765, filed February 6,
1998, as amended).

(3-B) Bylaws of U S WEST, Inc. (formerly "USW-C, Inc."), effective as
of June 12, 1998 (Exhibit 3(ii) to Form 8-K/A dated June 26, 1998,
File No. 1-14087).

(4-A) Form of Rights Agreement between U S WEST, Inc. (formerly "USW-C,
Inc.") and State Street Bank and Trust Company, as Rights Agent,
dated as of June 1, 1998 (Exhibit 4-A to the Form S-4 Registration
Statement No. 333-45765, filed February 6, 1998, as amended).

(4-A.1) Amendment No. 1 to Rights Agreement between U S WEST, Inc. and State
Street Bank and Trust Company, dated as of May 16, 1999 (Exhibit 4
to Form 8-K, dated May 21, 1999, File No. 1-14087).

4-A.2 Amendment No. 2 to Rights Agreement between U S WEST, Inc. and State
Street Bank and Trust Company, dated as of July 18, 1999.

(4-B) Indenture among U S WEST Capital Funding, Inc., USW-C (renamed "U S
WEST, Inc.") and First National Bank of Chicago, as Trustee, dated
June 29, 1998 (Exhibit 4(a) to Form 8-K, filed November 18, 1998,
File No. 1-14087).

(10-A) Employee Matters Agreement between U S WEST, Inc. (renamed "MediaOne
Group, Inc.") and USW-C, Inc. (renamed "U S WEST, Inc."), dated
June 5, 1998 (Exhibit 99.2 to Form 8-K/A dated June 26, 1998, File
No. 1-14087).

(10-B) Tax Sharing Agreement between U S WEST, Inc. (renamed "MediaOne
Group, Inc.") and USW-C, Inc. (renamed "U S WEST, Inc."), dated
June 5, 1998 (Exhibit 99.3 to Form 8-K/A dated June 26, 1998, File
No. 1-14087).

(10-C) 364-Day Credit Agreement, dated May 8, 1998, with Morgan Guaranty
Trust Company of New York, as Administrative Agent (Exhibit 10A to
Form 10-Q for the quarter ended March 31, 1998, File No. 1-14087).

(10-D) Five-Year Credit Agreement, dated May 8, 1998, with Morgan Guaranty
Trust Company of New York, as Administrative Agent (Exhibit 10B to
Form 10-Q for the quarter ended March 31, 1998, File No. 1-14087).

(10-D.1) Amendment No. 1 to Credit Agreements dated as of June 30, 1998 to the
364-Day Credit Agreement and the Five-Year Credit Agreement, each
dated as of May 8, 1998, among U S WEST Capital Funding, Inc., U S
WEST, Inc., the banks listed on the signature pages thereto and
Morgan Guaranty Trust Company of New York (Exhibit 10(e)(1) to Form
10-Q for the quarter ended September 30, 1998, File No. 1-14087).

(10-D.2) Amended and Restated Credit Agreement, dated as of May 7, 1999, among
U S WEST Capital Funding, Inc., U S WEST, Inc. and the banks listed
on the signature pages thereof (Exhibit (b)(4) to Schedule 14D-1 and
Schedule 13D, dated May 21, 1999, as amended).

10-D.3 Amendment to Credit Agreements, dated as of June 11, 1999, which
further amends (i) the 364-Day Credit Agreement dated as of May 8,
1999, as amended and (ii) the Five-Year Credit Agreement dated as of
May 8, 1998, as amended, among U S WEST Capital Funding, Inc., U S
WEST, Inc., the banks listed on the signature pages thereto, and
Morgan Guaranty Trust Company of New York.

(10-D.4) 364-Day $1.5 billion Credit Agreement dated as of June 11, 1999,
among U S WEST Capital Funding, Inc., and U S WEST, Inc., the banks
listed therein and Morgan Guaranty Trust Company of New York, as
Administrative Agent (Exhibit (b)(6) to Amendment No. 3 to Schedule
14D-1 and Schedule 13D, dated June 11, 1999, filed on behalf of
Global Crossing Ltd. and U S WEST, Inc.).

10-D.5 Assignment and Assumption Agreement among each institution listed on
Schedule 1 thereto, U S WEST, Inc. and Morgan Guaranty Trust Company
of New York, dated as of July 6, 1999.

10-E 364-Day Million Credit Agreement, among the banks listed therein, U S
WEST Communications, Inc., and Morgan Guaranty Trust Company of New
York, as Administrative Agent, dated as of May 19, 1999.

10-F Amendment No. 1 to Credit Agreement to the 364-Day $800 Million
Credit Agreement, dated as of May 19, 1998, among U S WEST
Communications, Inc., U S WEST, Inc., the banks listed on the
signature pages thereto and Morgan Guaranty Trust Company of New
York, as Administrative Agent, dated as of June 11, 1999.

(10-G) Change of Control Agreement for the President and Chief Executive
Officer (Exhibit 10(f) to Form 10-Q for the quarter ended June 30,
1998, File No. 1-14087).

(10-H) Form of Change of Control Agreement for Tier II Executive (Exhibit
10(g) to Form 10-Q for the quarter ended June 30, 1998, File No.
1-14087).

(10-I) Form of Executive Severance Agreement (Exhibit 10(h) to Form 10-Q for
the quarter ended June 30, 1998, File No. 1-14087).

(10-J) 1998 U S WEST Stock Plan (Exhibit 10-A to the Form S-4 Registration
Statement No. 333-45765, filed February 6, 1998, as amended).

(10-K) U S WEST Long-Term Incentive Plan (Exhibit 10-D to the Form
S-4 Registration Statement No. 333-45765, filed February 6, 1998, as
amended).

(10-L) U S WEST Executive Short-Term Incentive Plan (Exhibit 10-E to
the Form S-4 Registration Statement No. 333-45765, filed February 6,
1998, as amended).

(10-M) U S WEST 1998 Broad Based Stock Option Plan dated June 12, 1998
(Exhibit 10(l) to Form 10-Q for the quarter ended September 30, 1998,
File No. 1-14087).

(10-N) U S WEST Deferred Compensation Plan, amended and restated effective
as of June 12, 1998 (Exhibit 10(m) to Form 10-Q for the quarter ended
September 30, 1998, File No. 1-14087).

(10-O) U S WEST 1998 Stock Plan, as amended June 22, 1998 (Exhibit 10(n) to
Form 10-Q for the quarter ended September 30, 1998, File No.
1-14087).

(10-P) Stockholder Investment Plan dated June 12, 1998 (Form S-3
Registration Statement No. 333-52781, filed May 15, 1998).

(10-Q) Form of Non-Qualified Stock Option Agreement (Exhibit 10-Q to Form
10-Q for the quarter ended March 31, 1999, File No. 1-14087).

(10-R) Form of Agreement for Purchase and Sale of Telephone Exchanges, dated
as of June 16, 1999, between Citizens Utilities Company and U S WEST
Communications, Inc. (Exhibit 99 to Form 8-K, dated June 17, 1999,
File No. 1-14087).

(13) U S WEST 1998 Summary Annual Report to Stockholders (Exhibit 13
to Form 8-K dated February 24, 1999, File No. 1-14087).

27 Financial Data Schedule

(99) Annual Report on Form 11-K for the U S WEST Savings Plan/ESOP for
the year ended December 31, 1998, (Exhibit 99 to Form 10-K/A filed
by amendment on Form SE, File No. 1-14087), Paper Copy (P).
- -------------------
<FN>
<F1>
( ) Previously filed.
</FN>

(b) Reports on Form 8-K filed during the Second Quarter of 1999 and through
the filing of this Form 10-Q:

(i) Form 8-K dated April 6, 1999 providing notification of a press release
announcing the election of Manny Fernandez to the U S WEST Board of
Directors.

(ii) Form 8-K dated April 21, 1999 providing notification of the release of
first quarter earnings of U S WEST, Inc.

(iii) Form 8-K dated May 12, 1999 providing notification of (i) a press
release announcing Solomon Trujillo's election as the Company's
Chairman and Richard McCormick's retirement from the Board of Directors
and (ii) a press release announcing the voting results from the
Company's annual stockholders' meeting.

(iv) Form 8-K dated May 18, 1999, (i) providing notification of a press
release announcing the proposed merger of U S WEST, Inc. and Global
Crossing Ltd.; and (ii) filing the joint analyst presentation of Global
Crossing Ltd. and U S WEST, Inc., dated May 17, 1999.

(v) Form 8-K dated May 21, 1999 filing (i) the Agreement and Plan of Merger
between Global Crossing Ltd. and U S WEST, Inc., dated as of May 16,
1999; (ii) Amendment No. 1 to Rights Agreement between U S WEST, Inc.
and State Street Bank and Trust Company, dated as of May 16, 1999; and
(iii) the Letter Agreement between U S WEST, Inc. and Global Crossing
Ltd., dated as of May 16, 1999.

(vi) Form 8-K dated May 26, 1999, filing the Q&A presentation, dated May 25,
1999, relating to the transactions contemplated by the proposed merger
of U S WEST, Inc. and Global Crossing Ltd.

(vii) Form 8-K dated June 17, 1999 providing notification of a press release
announcing the definitive agreement reached between Citizens Utilities
Company and U S WEST Communications, Inc. and filing the Form of
Agreement for Purchase and Sale of Telephone Exchanges, dated as of
June 16, 1999.

(viii) Form 8-K dated June 22, 1999 providing notification of a press release
announcing that the Company's Board of Directors met and reviewed the
unsolicited proposal made by Qwest Communications International, Inc.
on June 13, 1999.

(ix) Form 8-K dated July 7, 1999 providing notification of a press release
announcing that the Company's Board of Directors had authorized the
Company's management and advisors to discuss with Qwest Communications
International Inc. issues relating to its June 23, 1999 revised merger
proposal.

(x) Form 8-K dated July 20, 1999 providing notification of a press release
announcing that the Company had entered into an Agreement and Plan of
Merger, dated as of July 18, 1999, with Qwest Communications
International Inc., and filing (i) the Voting Agreement among each of
the stockholders listed on the signature page thereto and U S WEST,
Inc.; (ii) the Termination Agreement; and (iii) the joint analyst
presentation of Qwest and U S WEST, dated as of July 19, 1999.

(xi) Form 8-K dated July 23, 1999 providing notification of the release of
second quarter earnings of U S WEST, Inc.

(xii) Form 8-K/A dated July 26, 1999 amending the July 23, 1999 Form 8-K,
providing notification of the release of second quarter earnings of U S
WEST, Inc.

SIGNATURE

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.

U S WEST, Inc.

/s/ ALLAN R. SPIES
By:___________________________________
Allan R. Spies
Executive Vice President and
Chief Financial Officer

August 9, 1999