1355096--2/27/2009--LIBERTY_MEDIA

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Risks Relating to the Ownership of Our Common Stock due to our Tracking Stock Capitalization Holders of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock are common stockholders of our company and are, therefore, subject to risks associated with an investment in our company as a whole, even if a holder does not own shares of common stock of all three of our groups. We could be required to use assets attributed to one group to pay liabilities attributed to another group or groups. The market price of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock may not reflect the performance of the Interactive Group, the Entertainment Group and the Capital Group, respectively, as we intend. The market price of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock may be volatile, could fluctuate substantially and could be affected by factors that do not affect traditional common stock. The market value of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock could be adversely affected by events involving the assets and businesses attributed to only one of such groups. We may not pay dividends equally or at all on Liberty Interactive common stock, Liberty Capital common stock or Liberty Entertainment common stock. Our tracking stock capital structure could create conflicts of interest, and our board of directors may make decisions that could adversely affect only some holders of our common stock. Other than pursuant to our stated management and allocation policies, we have not adopted any specific procedures for consideration of matters involving a divergence of interests among holders of shares of stock relating to our different groups, or among holders of different series of stock relating to a specific group. Our board of directors may change the management and allocation policies to the detriment of any group without stockholder approval. Holders of shares of stock relating to a particular group may not have any remedies if any action by our directors or officers has an adverse effect on only that stock, or on a particular series of that stock. Stockholders will not vote on how to attribute consideration received in connection with a merger involving our company among holders of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock. We may dispose of assets of the Interactive Group, the Capital Group or the Entertainment Group without your approval. Holders of Liberty Interactive common stock, Liberty Capital common stock or Liberty Entertainment common stock may receive less consideration upon a sale of the assets attributed to that group than if that group were a separate company. Our board of directors may in its sole discretion elect to convert the common stock relating to one group into common stock relating to one of our other groups, thereby changing the nature of your investment and possibly diluting your economic interest in our company, which could result in a loss in value to you. Holders of Liberty Interactive common stock, Liberty Entertainment common stock and Liberty Capital common stock vote together and have limited separate voting rights. Our capital structure as well as the fact that the Interactive Group, the Capital Group and the Entertainment Group are not independent companies may inhibit or prevent acquisition bids for the Interactive Group, the Capital Group or the Entertainment Group. Changes in the tax law or in the interpretation of current tax law may result in the cessation of the future issuance of shares of Liberty Entertainment common stock, Liberty Capital common stock and/or Liberty Interactive common stock or our conversion of stock intended to track the performance of one group into stock intended to track the performance of another group. It may be difficult for a third party to acquire us, even if doing so may be beneficial to our stockholders. Factors Relating to our Company, the Interactive Group, the Entertainment Group and the Capital Group The historical financial information of the Interactive Group, the Entertainment Group and the Capital Group may not necessarily reflect their results as separate companies. We do not have the right to manage our business affiliates, which means we are not able to cause those affiliates to operate in a manner that is favorable to us. The liquidity and value of our interests in our business affiliates may be affected by market conditions beyond our control that could cause us to record losses for declines in the market value of our available for sale securities. A substantial portion of the consolidated debt attributed to each group is held above the operating subsidiary level, and we could be unable in the future to obtain cash in amounts sufficient to service that debt and our other financial obligations. Certain of our subsidiaries and business affiliates depend on a limited number of potential customers for carriage of their programming. Rapid technological advances could render the products and services offered by our groups' subsidiaries and business affiliates obsolete or non-competitive. Certain of our subsidiaries and business affiliates depend on their relationships with third party distribution channels, suppliers and advertisers and any adverse changes in these relationships could adversely affect our results of operations and those attributed to any of our groups. Adverse events or trends in the industries in which the subsidiaries and business affiliates attributed to our groups operate could harm that group. The subsidiaries and business affiliates attributable to each group are subject to risks of adverse government regulation. The success of certain of the groups' subsidiaries and business affiliates whose businesses involve the Internet depends on maintaining the integrity of their systems and infrastructure. The success of certain of the subsidiaries and business affiliates attributed to each group depends on audience acceptance of its programs and programming services which is difficult to predict. Increased programming and content costs may adversely affect profits. Weakening economic conditions may reduce consumer demand for our products and services. Disruptions in the worldwide credit and equity markets have increased the risk of default by the counterparties to our financial instruments and cash investments. Sales of our common stock by our insiders could depress the market price of our common stock. Factors Relating to the Interactive Group's Subsidiary QVC QVC conducts its merchandising businesses under highly competitive conditions. QVC's sales and operating results depend on its ability to predict or respond to consumer preferences. QVC depends on the cable and satellite distributors that carry its network, and no assurance can be given that QVC will be able to renew its affiliation agreements on favorable terms or at all. Consumer retail spending can decline significantly during periods of general economic uncertainty or during recessionary periods when disposable incomes decline. QVC's success depends in large part on its ability to recruit and retain key employees capable of executing its unique business model. QVC has operations outside of the United States that are subject to numerous operational and financial risks. DIRECTV competes with other MVPDs, some of whom have greater resources than DIRECTV does and levels of competition are increasing. Emerging digital media competition could materially adversely affect DIRECTV. DIRECTV depends on others to produce programming and programming costs are increasing. DIRECTV's subscriber acquisition costs could materially increase. Increased subscriber churn or subscriber upgrade and retention costs could materially adversely affect DIRECTV's financial performance. Results are impacted by the effect of, and changes in, United States and Latin America economic conditions and weakening economic conditions may reduce subscriber spending and DIRECTV's rate of growth of subscriber additions and may increase subscriber churn. DTVLA is subject to various additional risks associated with doing business internationally, which include political instability, economic instability, and foreign currency exchange rate volatility. DIRECTV's ability to keep pace with technological developments is uncertain. DIRECTV's business relies on intellectual property, some of which is owned by third parties, and DIRECTV may inadvertently infringe patents and proprietary rights of others. DIRECTV relies on key personnel. Construction or launch delays on satellites could materially adversely affect DIRECTV's revenue and earnings. DIRECTV's satellites are subject to significant launch and operational risks. The cost of commercial insurance coverage on its satellites or the loss of a satellite that is not insured could materially adversely affect DIRECTV's earnings. DIRECTV depends on the Communications Act for access to cable-affiliated programming and changes impacting that access could materially adversely affect DIRECTV. Carriage requirements may negatively affect DIRECTV's ability to deliver local broadcast stations, as well as other aspects of its business. Satellite programming signals have been stolen and may be stolen in the future, which could result in lost revenue and would cause DIRECTV to incur incremental operating costs that do not result in subscriber acquisition. The ability to maintain FCC licenses and other regulatory approvals is critical to DIRECTV's business. DIRECTV controls a substantial portion of interaction with its customers and it may not be as efficient or effective as its outsourced providers resulting in higher costs. DIRECTV may not be able to obtain or retain certain foreign regulatory approvals.

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1355096--2/27/2009--LIBERTY_MEDIA_CORP