LIBERTY MEDIA CORPORATION
(Exact name of Registrant as specified in its charter)

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 and (2) has been subject to such filing requirements for the past 90 days. Yes ý No o

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ý No o

Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Indicate by check mark whether the Registrant is a shell company as defined in Rule 12b-2 of the Exchange Act. Yes o No ý

The number of outstanding shares of Liberty Media Corporation's common stock as of July 30, 2010 was:

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(unaudited)

			June 30, 2010

			amounts in millions
Assets
Current assets:
	Cash and cash equivalents		$	4,106		4,835
	Trade and other receivables, net			1,327		1,518
	Inventory, net			956		985
	Program rights			508		469
	Financial instruments (note 8)			—		752
	Other current assets			560		168

		Total current assets		7,457		8,727

Investments in available-for-sale securities and other cost investments, including $904 million and $851 million pledged as collateral for share borrowing arrangements (note 6)				4,070		4,120
Investments in affiliates, accounted for using the equity method (note 7)				1,017		1,030
Property and equipment, at cost				2,165		2,163
Accumulated depreciation				(912	)	(858	)

				1,253		1,305

Intangible assets not subject to amortization (note 9):
	Goodwill			6,157		6,225
	Trademarks			2,494		2,508
	Other			153		153

				8,804		8,886

Intangible assets subject to amortization, net (note 9)				2,824		3,027
Other assets, at cost, net of accumulated amortization				1,422		1,536

		Total assets	$	26,847		28,631

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets, continued

(unaudited)

				June 30, 2010

				amounts in millions
Liabilities and Equity
Current liabilities:
	Accounts payable			$	467	598
	Accrued liabilities				910	1,037
	Financial instruments (note 8)				1,074	1,002
	Current portion of debt (note 10)				791	1,932
	Current deferred income tax liabilities				1,322	1,247
	Other current liabilities				601	360

		Total current liabilities			5,165	6,176

Long-term debt, including $2,235 million and $2,254 million measured at fair value (note 10)					7,364	7,842
Deferred income tax liabilities					2,583	2,675
Other liabilities					1,509	1,700

		Total liabilities			16,621	18,393

Equity
	Stockholders' equity (note 11):
		Preferred stock, $.01 par value. Authorized 50,000,000 shares; no shares issued			—	—
		Series A Liberty Capital common stock, $.01 par value. Authorized 2,000,000,000 shares; issued and outstanding 83,323,278 shares at June 30, 2010 and 89,814,862 shares at December 31, 2009			1	1
		Series B Liberty Capital common stock, $.01 par value. Authorized 75,000,000 shares; issued and outstanding 7,381,311 shares at June 30, 2010 and 7,405,151 shares at December 31, 2009			—	—
		Series A Liberty Starz common stock, $.01 par value. Authorized 4,000,000,000 shares; issued and outstanding 48,911,983 shares at June 30, 2010 and 49,673,954 shares at December 31, 2009			—	—
		Series B Liberty Starz common stock, $.01 par value. Authorized 150,000,000 shares; issued and outstanding 2,363,545 shares at June 30, 2010 and 2,365,545 shares at December 31, 2009			—	—
		Series A Liberty Interactive common stock, $.01 par value. Authorized 4,000,000,000 shares; issued and outstanding 568,839,391 shares at June 30, 2010 and 567,044,845 shares at December 31, 2009			6	6
		Series B Liberty Interactive common stock, $.01 par value. Authorized 150,000,000 shares; issued and outstanding 29,249,336 shares at June 30, 2010 and 29,276,689 shares at December 31, 2009			—	—
		Additional paid-in capital			8,686	8,900
		Accumulated other comprehensive earnings, net of taxes			140	352
		Retained earnings			1,276	850

			Total stockholders' equity		10,109	10,109
	Noncontrolling interests in equity of subsidiaries				117	129

			Total equity		10,226	10,238

Commitments and contingencies (note 13)
		Total liabilities and equity		$	26,847	28,631

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements Of Operations

(unaudited)

			Three months ended June 30,						Six months ended June 30,

			2010			2009			2010			2009
			amounts in millions, except per share amounts
Revenue:
	Net retail sales		$	2,053			1,936			4,078			3,767
	Communications and programming services			511			498			984			920

				2,564			2,434			5,062			4,687

Operating costs and expenses:
	Cost of sales			1,284			1,208			2,578			2,391
	Operating			558			477			1,014			904
	Selling, general and administrative, including stock-based compensation (note 3)			271			264			617			522
	Depreciation and amortization			164			163			326			336

				2,277			2,112			4,535			4,153

		Operating income		287			322			527			534
Other income (expense):
	Interest expense			(174	)		(143	)		(344	)		(280	)
	Share of earnings (losses) of affiliates, net (note 7)			39			14			48			(91	)
	Realized and unrealized gains (losses) on financial instruments, net (note 8)			(81	)		266			86			2
	Gains on dispositions, net (note 6)			25			113			388			111
	Other, net			2			81			—			92

				(189	)		331			178			(166	)

		Earnings from continuing operations before income taxes		98			653			705			368
Income tax expense				(57	)		(257	)		(265	)		(120	)

		Earnings from continuing operations		41			396			440			248
Earnings from discontinued operations, net of taxes (note 2)				—			90			—			111

		Net earnings		41			486			440			359
Less net earnings attributable to the noncontrolling interests				4			8			14			17

Net earnings attributable to Liberty Media Corporation shareholders			$	37			478			426			342

Net earnings (loss) attributable to Liberty Media Corporation shareholders:
	Liberty Capital common stock		$	(82	)		201			(60	)		41
	Liberty Starz common stock			61			149			118			230
	Liberty Interactive common stock			58			128			368			71

			$	37			478			426			342

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements Of Operations, continued

(unaudited)

		Three months ended June 30,					Six months ended June 30,

		2010			2009		2010			2009
		amounts in millions, except per share amounts
Basic earnings (loss) from continuing operations attributable to Liberty Media Corporation stockholders per common share (note 4):
	Series A and Series B Liberty Capital common stock	$	(.86	)		2.09		(.63	)		.43
	Series A and Series B Liberty Starz common stock	$	1.22			.11		2.36			.23
	Series A and Series B Liberty Interactive common stock	$	.10			.22		.62			.12
Diluted earnings (loss) from continuing operations attributable to Liberty Media Corporation stockholders per common share (note 4):
	Series A and Series B Liberty Capital common stock	$	(.86	)		2.07		(.63	)		.42
	Series A and Series B Liberty Starz common stock	$	1.20			.11		2.31			.23
	Series A and Series B Liberty Interactive common stock	$	.10			.21		.61			.12
Basic net earnings (loss) attributable to Liberty Media Corporation shareholders per common share (note 4):
	Series A and Series B Liberty Capital common stock	$	(.86	)		2.09		(.63	)		.43
	Series A and Series B Liberty Starz common stock	$	1.22			.29		2.36			.44
	Series A and Series B Liberty Interactive common stock	$	.10			.22		.62			.12
Diluted net earnings (loss) attributable to Liberty Media Corporation shareholders per common share (note 4):
	Series A and Series B Liberty Capital common stock	$	(.86	)		2.07		(.63	)		.42
	Series A and Series B Liberty Starz common stock	$	1.20			.29		2.31			.44
	Series A and Series B Liberty Interactive common stock	$	.10			.21		.61			.12

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements Of Comprehensive Earnings (Loss)

(unaudited)

			Three months ended June 30,						Six months ended June 30,

			2010			2009			2010			2009
			amounts in millions
Net earnings			$	41			486			440			359

Other comprehensive earnings (loss), net of taxes:
	Foreign currency translation adjustments			(50	)		74			(102	)		(13	)
	Unrealized holding gains (losses) arising during the period			(67	)		21			(2	)		19
	Recognition of previously unrealized losses (gains) on available-for-sale securities, net			(14	)		—			(126	)		2
	Share of other comprehensive earnings (loss) of equity affiliates			(6	)		5			(1	)		(10	)
	Other, net			12			20			25			37
	Other comprehensive loss from discontinued operations			—			(5	)		—			(6	)

		Other comprehensive earnings (loss)		(125	)		115			(206	)		29

Comprehensive earnings (loss)				(84	)		601			234			388
	Less comprehensive earnings attributable to the noncontrolling interests			11			11			20			7

	Comprehensive earnings (loss) attributable to Liberty Media Corporation shareholders		$	(95	)		590			214			381

Comprehensive earnings (loss) attributable to Liberty Media Corporation shareholders:
	Liberty Capital common stock		$	(170	)		212			(88	)		55
	Liberty Starz common stock			61			144			118			224
	Liberty Interactive common stock			14			234			184			102

			$	(95	)		590			214			381

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Condensed Consolidated Statements Of Cash Flows

(unaudited)

						Six months ended June 30,

						2010			2009
						amounts in millions
Cash flows from operating activities:
	Net earnings					$	440			359
	Adjustments to reconcile net earnings to net cash provided by operating activities:
		Earnings from discontinued operations					—			(111	)
		Depreciation and amortization					326			336
		Stock-based compensation					60			63
		Cash payments for stock-based compensation					(40	)		(11	)
		Noncash interest expense					50			74
		Share of (earnings) losses of affiliates, net					(48	)		91
		Cash receipts from returns on equity investments					10			—
		Realized and unrealized gains on financial instruments, net					(86	)		(2	)
		Gains on disposition of assets, net					(388	)		(111	)
		Deferred income tax (benefit) expense					106			(59	)
		Other noncash charges (credits), net					112			(16	)
		Changes in operating assets and liabilities
				Current and other assets			88			383
				Payables and other current liabilities			(99	)		(147	)

					Net cash provided by operating activities		531			849

Cash flows from investing activities:
	Cash proceeds from dispositions						518			420
	Proceeds from settlement of financial instruments, net						719			61
	Investments in and loans to cost and equity investees						(257	)		(609	)
	Repayment of loan by cost and equity investees						98			—
	Capital expended for property and equipment						(129	)		(93	)
	Net sales (purchases) short term investments						(307	)		59
	Net (increase) decrease in restricted cash						(30	)		24
	Other investing activities, net						(2	)		(40	)

			Net cash provided (used) by investing activities				610			(178	)

Cash flows from financing activities:
	Borrowings of debt						1,136			1,979
	Repayments of debt						(2,738	)		(1,735	)
	Repurchases of Liberty common stock						(326	)		(3	)
	Other financing activities, net						73			(66	)

			Net cash provided (used) by financing activities				(1,855	)		175

Effect of foreign currency exchange rates on cash							(15	)		(24	)

Net cash provided by discontinued operations:
	Cash used by operating activities						—			(3	)
	Cash used by investing activities						—			(17	)
	Cash provided by financing activities						—			—
	Change in available cash held by discontinued operations						—			45

			Net cash provided by discontinued operations				—			25

			Net increase (decrease) in cash and cash equivalents				(729	)		847
			Cash and cash equivalents at beginning of period				4,835			3,060

			Cash and cash equivalents at end of period			$	4,106			3,907

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES
Condensed Consolidated Statement Of Equity
(unaudited)
Six months ended June 30, 2010

		Stockholders' Equity

				Common stock
				Liberty Capital				Liberty Starz				Liberty Interactive							Accumulated other comprehensive earnings					Noncontrolling interest in equity of subsidiaries
		Preferred stock		Liberty Capital				Liberty Starz				Liberty Interactive				Additional paid-in capital						Retained earnings					Total equity
		Preferred stock		Series A		Series B		Series A		Series B		Series A		Series B		Additional paid-in capital						Retained earnings					Total equity
		amounts in millions
Balance at January 1, 2010		$	—		1		—		—		—		6		—		8,900			352			850		129			10,238
	Net earnings		—		—		—		—		—		—		—		—			—			426		14			440
	Other comprehensive loss		—		—		—		—		—		—		—		—			(212	)		—		6			(206	)
	Stock compensation		—		—		—		—		—		—		—		80			—			—		—			80
	Issuance of common stock upon exercise of stock options		—		—		—		—		—		—		—		9			—			—		—			9
	Series A Liberty Capital stock repurchases		—		—		—		—		—		—		—		(286	)		—			—		—			(286	)
	Series A Liberty Starz stock repurchases		—		—		—		—		—		—		—		(40	)		—			—		—			(40	)
	Issuance of subsidiary shares to noncontrolling interest		—		—		—		—		—		—		—		—			—			—		14			14
	Distribution to noncontrolling interest		—		—		—		—		—		—		—		—			—			—		(46	)		(46	)
	Other		—		—		—		—		—		—		—		23			—			—		—			23

Balance at June 30, 2010		$	—		1		—		—		—		6		—		8,686			140			1,276		117			10,226

LIBERTY MEDIA CORPORATION AND SUBSIDIARIES

Notes to Condensed Consolidated Financial Statements

The accompanying condensed consolidated financial statements include the accounts of Liberty Media Corporation and its controlled subsidiaries (collectively, "Liberty" or the "Company" unless the context otherwise requires). All significant intercompany accounts and transactions have been eliminated in consolidation.

Liberty, through its ownership of interests in subsidiaries and other companies, is primarily engaged in the video and on-line commerce, media, communications and entertainment industries in North America, Europe and Asia.

The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles ("GAAP") for interim financial information and the instructions to Form 10-Q and Article 10 of Regulation S-X as promulgated by the Securities and Exchange Commission. Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair presentation of the results for such periods have been included. The results of operations for any interim period are not necessarily indicative of results for the full year. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto contained in Liberty's Annual Report on Form 10-K for the year ended December 31, 2009.

The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Liberty considers (i) fair value measurement, (ii) accounting for income taxes, (iii) assessments of other-than-temporary declines in fair value of its investments and (iv) estimates of retail-related adjustments and allowances to be its most significant estimates.

Liberty holds investments that are accounted for using the equity method. Liberty does not control the decision making process or business management practices of these affiliates. Accordingly, Liberty relies on management of these affiliates to provide it with accurate financial information prepared in accordance with GAAP that Liberty uses in the application of the equity method. In addition, Liberty relies on audit reports that are provided by the affiliates' independent auditors on the financial statements of such affiliates. The Company is not aware, however, of any errors in or possible misstatements of the financial information provided by its equity affiliates that would have a material effect on Liberty's condensed consolidated financial statements.

assets, issue securities or enter into legally binding agreements. Holders of tracking stocks have no direct claim to the group's stock or assets and are not represented by separate boards of directors. Instead, holders of tracking stock are stockholders of the parent corporation, with a single board of directors and subject to all of the risks and liabilities of the parent corporation.

LEI held Liberty's 57% interest in DIRECTV (which had a carrying value of $13,475 million at the time of the DTV Split-Off), 100% interest in Liberty Sports Holdings, LLC, 65% interest in Game Show Network, LLC and approximately $120 million in cash and cash equivalents, and approximately $2 billion of indebtedness. All of the businesses, assets and liabilities that were attributed to the Entertainment Group and were not held by LEI have remained with Liberty and continue to be attributed to the Entertainment Group, which Liberty redesignated as the Starz Group. The businesses that were held by LEI are accounted for as discontinued operations for periods prior to the DTV Split-Off.

On February 25, 2010, Liberty announced that its board of directors had resolved to effect the following changes in attribution between the Capital Group and the Interactive Group, effective as of that date (the "Reattribution"):

Liberty reflected the Reattribution prospectively in the unaudited attributed financial information. This change in attribution had no effect on the assets and liabilities attributed to the Starz Group.

See Exhibit 99.1 to this Quarterly Report on Form 10-Q for unaudited attributed financial information for Liberty's tracking stock groups.

The term "Interactive Group" does not represent a separate legal entity, rather it represents those businesses, assets and liabilities which Liberty has attributed to that group. The assets and businesses Liberty has attributed to the Interactive Group are those engaged in video and on-line commerce, and include its subsidiaries QVC, Inc. ("QVC"), Provide Commerce, Inc. ("Provide"), Backcountry.com, Inc. ("Backcountry"), Bodybuilding.com, LLC ("Bodybuilding"), BuySeasons, Inc. ("BuySeasons") and Commerce Technologies, Inc. ("CommerceHub") and its noncontrolling interest in Expedia, Inc. ("Expedia"), HSN, Inc. ("HSN"), Interval Leisure Group, Inc. ("Interval"), Tree.com, Inc. ("Lending Tree") and IAC/InterActiveCorp ("IAC"). In addition, Liberty has attributed $3,127 million principal amount (as of June 30, 2010) of its public debt to the Interactive Group. The Interactive Group will also include such other businesses, assets and liabilities that Liberty's board of directors may in the future determine to attribute to the Interactive Group, including such other businesses and assets as Liberty may acquire for the Interactive Group.

Similarly, the term "Starz Group" does not represent a separate legal entity, rather it represents those businesses, assets and liabilities which Liberty has attributed to that group. The Starz Group focuses primarily on video programming and is comprised primarily of Starz Entertainment, LLC ("Starz Entertainment") and $583 million of corporate cash (as of June 30, 2010). The Starz Group will also include such other businesses, assets and liabilities that Liberty's board of directors may in the future determine to attribute to the Starz Group, including such other businesses as Liberty may acquire for the Starz Group.

The term "Capital Group" also does not represent a separate legal entity, rather it represents all of Liberty's businesses, assets and liabilities other than those which have been attributed to the Interactive Group or the Starz Group. The assets and businesses attributed to the Capital Group include Liberty's subsidiaries: Starz Media, LLC ("Starz Media"), Atlanta National League Baseball Club, Inc. ("ANLBC") and TruePosition, Inc. ("TruePosition"); and its interests in Sirius XM Radio Inc. ("SIRIUS XM"), Time Warner Inc. ("Time Warner"), Time Warner Cable Inc. ("Time Warner Cable"), Sprint Nextel Corporation ("Sprint") and Live Nation Entertainment, Inc. ("Live Nation"). In addition, Liberty has attributed $2,060 million of cash, including subsidiary cash, and $1,888 million principal amount (as of June 30, 2010) of its exchangeable senior debentures and other parent debt to the Capital Group. The Capital Group will also include such other businesses, assets and liabilities that Liberty's board of directors may in the future determine to attribute to the Capital Group, including such other businesses and assets as Liberty may acquire for the Capital Group.

During the second quarter of 2009, each of the Starz Group and the Capital Group made intergroup loans to the Interactive Group in the amount of $250 million. In the first quarter of 2010, the Interactive Group repaid the remaining balance of the intergroup loans by making payments of $158 million to each the Starz Group and Capital Group.

During the second quarter of 2010, Liberty announced that its board of directors has authorized its management to proceed with a plan to separate its Liberty Capital and Liberty Starz tracking stock groups from its Liberty Interactive tracking stock group.

currently attributed to the Liberty Capital group ("Splitco Capital") and the other tracking assets that are currently attributed to the Liberty Starz group ("Splitco Starz"). In the redemption, holders of Liberty Capital tracking stock will receive shares of Splitco Capital tracking stock and holders of Liberty Starz tracking stock will receive shares of Splitco Starz tracking stock. After the redemption, Splitco and Liberty will be separate public companies.

The proposed split-off is intended to be tax-free to stockholders of Liberty and its completion will be subject to various conditions including the receipt of IRS private letter rulings, the opinions of tax counsel and required governmental approvals. The redemption that is necessary to effect the proposed split-off will require the affirmative vote of a majority of the voting power of the outstanding shares of Liberty Capital tracking stock and Liberty Starz tracking stock at a meeting called to consider the redemption, each voting as a separate class.

On August 6, 2010, Liberty announced that it had filed suit in the Delaware Court of Chancery against the trustee under the indenture governing the public indebtedness issued by the Company's subsidiary, Liberty Media, LLC. The lawsuit was filed in response to allegations made by a law firm purporting to represent a holder with a large position in this public indebtedness. The lawsuit seeks a declaratory judgment by the court that the proposed split-off will not constitute a disposition of "all or substantially all" of the assets of Liberty Media, LLC, as those terms are used in the indenture, as well as related injunctive relief. Resolution of the subject matter of this lawsuit is a condition to Liberty completing the proposed split-off. Subject to the satisfaction of the conditions described above, Liberty intends to complete the proposed split-off in late 2010 or early 2011.

The Company has granted to certain of its directors, employees and employees of its subsidiaries options and stock appreciation rights ("SARs") to purchase shares of Liberty common stock (collectively, "Awards"). The Company measures the cost of employee services received in exchange for an Award of equity instruments (such as stock options and restricted stock) based on the grant-date fair value of the Award, and recognizes that cost over the period during which the employee is required to provide service (usually the vesting period of the Award). The company measures the cost of employee services received in exchange for an Award of liability instruments (such as stock appreciation rights that will be settled in cash) based on the current fair value of the Award, and remeasures the fair value of the Award at each reporting date.

Included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations are the following amounts of stock-based compensation (amounts in millions):

During the six months ended June 30, 2010, Liberty granted, primarily to QVC employees, 3.8 million options to purchase shares of Series A Liberty Interactive common stock. Such options had a weighted average grant-date fair value of $5.57 per share. These options vest semi-annually over the 4 year vesting period.

During the six months ended June 30, 2010, Liberty granted, primarily to Starz Entertainment employees, 224,000 options to purchase shares of Series A Liberty Starz common stock. Such options had a weighted average grant-date fair value of $16.70 per share. These options vest quarterly over the 4 year vesting period.

In addition, during the six months ended June 30, 2010 Liberty granted 6.2 million options to purchase shares of Series A Liberty Interactive common stock, 1.1 million options to purchase shares of Series A Liberty Capital common stock and 651,000 options to purchase shares of Series A Liberty Starz common stock, as a long-term incentive grant to Liberty officers. Such options had a weighted average grant-date fair value of $8.07, $19.38 and $22.94 per share, respectively. These options vest one third each on June 30, 2013, June 30, 2014 and December 31, 2015.

The Company has calculated the grant-date fair value for all of its equity classified awards and any subsequent remeasurement of its liability classified awards using the Black-Scholes Model. The Company estimates the expected term of the Awards based on historical exercise and forfeiture data. The volatility used in the calculation for Awards is based on the historical volatility of Liberty's stocks and the implied volatility of publicly traded Liberty options. The Company uses a zero dividend rate and the risk-free rate for Treasury Bonds with a term similar to that of the subject options.

The following table presents the number and weighted average exercise price ("WAEP") of options and SARs to purchase Liberty common stock granted to certain officers, employees and directors of the Company.

The following table provides additional information about outstanding options to purchase Liberty common stock at June 30, 2010.

As of June 30, 2010, the total unrecognized compensation cost related to unvested Liberty equity Awards was approximately $223 million. Such amount will be recognized in the Company's consolidated statements of operations over a weighted average period of approximately 3 years.

Basic earnings (loss) per common share ("EPS") is computed by dividing net earnings (loss) by the weighted average number of common shares outstanding for the period. Diluted EPS presents the dilutive effect on a per share basis of potential common shares as if they had been converted at the beginning of the periods presented.

The basic and diluted EPS calculation is based on the following weighted average outstanding shares. Excluded from diluted EPS for the six months ended June 30, 2010 are 1 million potential common shares because their inclusion would be antidilutive.

The basic and diluted EPS calculation is based on the following weighted average outstanding shares. Excluded from diluted EPS for the six months ended June 30, 2010 are less than a million potential common shares because their inclusion would be antidilutive.

The basic and diluted EPS calculation is based on the following weighted average outstanding shares. Excluded from diluted EPS for the six months ended June 30, 2010 are 27 million potential common shares because their inclusion would be antidilutive.

For assets and liabilities required to be reported at fair value, GAAP provides a hierarchy that prioritizes inputs to valuation techniques used to measure fair value into three broad levels. Level 1 inputs are quoted market prices in active markets for identical assets or liabilities that the reporting entity has the ability to access at the measurement date. Level 2 inputs are inputs, other than quoted market prices included within Level 1, that are observable for the asset or liability, either directly or indirectly. Level 3 inputs are unobservable inputs for the asset or liability.

The Company uses the Black-Scholes Model to estimate fair value for the majority of its Level 2 financial instrument assets and liabilities using observable inputs such as exchange-traded equity prices, risk-free interest rates, dividend yields and volatilities obtained from pricing services. For the Company's debt instruments reported at fair value, the Company gets quoted market prices from pricing services or from evidence of observable inputs, some of which may be obtained using third-party brokers. However, the Company does not believe such instruments are traded on "active markets," as defined in GAAP. Accordingly, the debt instruments are reported in the foregoing table as Level 2 fair value.

The Company incorporates a credit risk valuation adjustment in its fair value measurements to estimate the impact of both its own nonperformance risk and the nonperformance risk of its counterparties. The Company estimates credit risk associated with its and its counterparties nonperformance primarily by using observable credit default swap rates for terms similar to those of the remaining life of the instrument, adjusted for any master netting arrangements or other factors that provide an estimate of nonperformance risk. These are Level 3 inputs. However, as the credit risk

valuation adjustments were not significant, the Company continues to report its equity collars, interest rate swaps and put options as Level 2.

All marketable equity and debt securities held by the Company are classified as available-for-sale ("AFS") and are carried at fair value generally based on quoted market prices. GAAP permits entities to choose to measure many financial instruments, such as AFS securities, and certain other items at fair value and to recognize the changes in fair value of such instruments in the entity's statement of operations (the "fair value option"). Liberty has previously entered into economic hedges for certain of its non-strategic AFS securities (although such instruments are not accounted for as fair value hedges by the Company). Changes in the fair value of these economic hedges are reflected in Liberty's statement of operations as unrealized gains (losses). In order to better match the changes in fair value of the subject AFS securities and the changes in fair value of the corresponding economic hedges in the Company's financial statements, Liberty has elected the fair value option for those of its AFS securities which it considers to be non-strategic ("Non-strategic Securities"). Accordingly, changes in the fair value of Non-strategic Securities, as determined by quoted market prices, are reported in realized and unrealized gains (losses) on financial instruments in the accompanying condensed consolidated statements of operations. The total value of the Non-strategic Securities aggregated $3,097 million as of June 30, 2010.

Investments in AFS securities, including Non-strategic Securities, and other cost investments are summarized as follows:

			June 30, 2010

			amounts in millions
Capital Group
	Time Warner(1)		$	990	997
	Time Warner Cable(1)			447	356
	Sprint ("Sprint")(1)			301	260
	Motorola, Inc.(1)			339	403
	Viacom, Inc.			238	226
	Live Nation(2)			260	—
	CenturyLink, Inc.(1)			179	195
	Other AFS equity securities(1)			179	220
	SIRIUS XM debt securities(3)			399	300
	Other AFS debt securities			429	376
	Other cost investments and related receivables			7	22

		Total attributed Capital Group		3,768	3,355

Interactive Group
	IAC(4)			281	492
	Other(5)			—	242

		Total attributed Interactive Group		281	734

Starz Group
	Other AFS securities			21	31

		Total attributed Starz Group		21	31

	Consolidated Liberty		$	4,070	4,120

Unrealized holding gains and losses related to investments in AFS securities, not accounted for using the fair value option, are summarized below.

Liberty has various investments accounted for using the equity method. The following table includes Liberty's carrying amount and percentage ownership of the more significant investments in affiliates at June 30, 2010 and the carrying amount at December 31, 2009:

The following table presents Liberty's share of earnings (losses) of affiliates:

The market value of the Company's investment in Expedia was $1,300 million and $1,781 million at June 30, 2010 and December 31, 2009, respectively. Summarized unaudited financial information for Expedia is as follows:

		June 30, 2010

		amounts in millions
Current assets		$	1,816	1,225
Property and equipment			257	237
Goodwill			3,597	3,604
Intangible assets			801	823
Other assets			152	48

	Total assets	$	6,623	5,937

Current liabilities		$	2,587	1,835
Deferred income taxes			227	224
Long-term debt			895	895
Other liabilities			247	233
Noncontrolling interest			61	67
Equity			2,606	2,683

	Total liabilities and equity	$	6,623	5,937

		Six months ended June 30,

		2010			2009
		amounts in millions
Revenue		$	1,552			1,405
Cost of revenue			(327	)		(292	)

	Gross profit		1,225			1,113
Selling, general and administrative expenses			(902	)		(798	)
Amortization			(17	)		(18	)
Restructuring charges and other			—			(89	)

	Operating income		306			208
Interest expense			(41	)		(42	)
Other income (expense), net			3			(22	)
Income tax expense			(92	)		(62	)

	Net earnings		176			82
Net earnings attributable to noncontrolling interests			(2	)		(2	)

Net earnings attributable to Expedia, Inc.		$	174			80

During 2009, Liberty made equity investments and loans to SIRIUS XM and made open market purchases of SIRIUS XM public debt.

In the first quarter of 2009, Liberty and SIRIUS XM entered into a senior secured loan agreement (the "Senior Loan") whereby Liberty loaned SIRIUS XM $250 million and made a commitment to loan an additional $30 million to fund qualifying expenditures by SIRIUS XM (the "Purchase Money Commitment"). In exchange for making the Senior Loan, Liberty received a $30 million origination fee. Liberty accounted for the origination fee as a discount to the Senior Loan. On March 6, 2009, Liberty (i) purchased $100 million of a new senior loan facility of a subsidiary of SIRIUS XM ("Subsidiary Senior Loan"), (ii) purchased $61 million of bank debt of such subsidiary directly from the lending group and (iii) committed to make a loan of $150 million to such subsidiary in December 2009 ("Subsidiary Commitment"). Also on March 6, 2009 Liberty purchased voting preferred stock of SIRIUS XM (the "SIRIUS XM Preferred Stock"), which has substantially the same rights and preferences as common shareholders of SIRIUS XM, for a cash payment of $12,500. The SIRIUS XM Preferred Stock is convertible into common stock equal to 40% of the outstanding common shares after giving effect to such conversion.

Liberty allocated the total consideration paid for the Subsidiary Senior Loan, the Subsidiary Commitment and the SIRIUS XM Preferred Stock to each of the instruments based on their relative fair values.

During the first quarter of 2010, Liberty purchased an additional $150 million of SIRIUS XM 8.75% debt securities due April 15, 2015 at par. During the second quarter of 2010 SIRIUS XM repurchased and retired certain public bonds of which Liberty owned approximately $55 million of the principal amounts. As of June 30, 2010, Liberty owns $374 million principal amount of SIRIUS XM

public bonds, which are accounted for as AFS securities and have a fair market value of $399 million, and the SIRIUS XM Preferred Stock.

Based on Liberty's voting rights and its conclusion that the SIRIUS XM Preferred Stock is in-substance common stock, Liberty accounts for its investment in the SIRIUS XM Preferred Stock using the equity method of accounting. Liberty has elected to record its share of earnings/losses for SIRIUS XM on a three-month lag due to timeliness considerations. As of March 31, 2010 SIRIUS XM had total assets and liabilities of $7,740 million and $7,588 million, respectively. SIRIUS XM's net income attributable to common shareholders was $42 million for the three months ended March 31, 2010.

As of June 30, 2010, the SIRIUS XM Preferred Stock had a market value of $2,458 million based on the value of the common stock into which it is convertible.

The Company has entered into equity collars and other financial instruments to manage market risk associated with its investments in certain marketable securities. These instruments are recorded at fair value based on option pricing models. Equity collars provide the Company with a put option that gives the Company the right to require the counterparty to purchase a specified number of shares of the underlying security at a specified price at a specified date in the future. Equity collars also provide the counterparty with a call option that gives the counterparty the right to purchase the same securities at a specified price at a specified date in the future. The put option and the call option generally have equal fair values at the time of origination resulting in no cash receipts or payments. Currently the Company has no equity collars outstanding.

From time to time and in connection with certain of its derivative instruments, Liberty borrows shares of the underlying securities from a counterparty and delivers these borrowed shares in settlement of maturing derivative positions. In these transactions, a similar number of shares that are owned by Liberty have been posted as collateral with the counterparty. These share borrowing arrangements can be terminated at any time at Liberty's option by delivering shares to the counterparty. The counterparty can terminate these arrangements at any time. The liability under these share borrowing arrangements is marked to market each reporting period with changes in value recorded in unrealized gains or losses in the consolidated statement of operations. The shares posted as collateral under these arrangements are marked to market each reporting period with changes in value recorded as unrealized gains or losses in the consolidated statement of operations.

Realized and unrealized gains (losses) on financial instruments are comprised of changes in the fair value of the following:

Amortization expense for intangible assets with finite useful lives was $235 million and $250 million for the six months ended June 30, 2010 and 2009, respectively. Based on its amortizable intangible assets as of June 30, 2010, Liberty expects that amortization expense will be as follows for the next five years (amounts in millions):

						Carrying value

				Outstanding principal June 30, 2010		Carrying value
				Outstanding principal June 30, 2010		June 30, 2010			December 31, 2009
				amounts in millions
Capital Group
	Exchangeable senior debentures
		3.125% Exchangeable Senior Debentures due 2023		$	1,138		1,178			1,157
		4% Exchangeable Senior Debentures due 2029			—		—			243
		3.75% Exchangeable Senior Debentures due 2030			—		—			237
		3.5% Exchangeable Senior Debentures due 2031			—		—			297
	Liberty bank facility				750		750			750
	Liberty derivative loan				—		—			838
	Subsidiary debt				86		86			131

		Total attributed Capital Group debt			1,974		2,014			3,653

Interactive Group
	Senior notes and debentures
		5.7% Senior Notes due 2013			374		373			801
		8.5% Senior Debentures due 2029			287		284			284
		8.25% Senior Debentures due 2030			504		501			501
		4% Exchangeable Senior Debentures due 2029			469		243			—
		3.75% Exchangeable Senior Debentures due 2030			460		232			—
		3.5% Exchangeable Senior Debentures due 2031			492		261			—
		3.25% Exchangeable Senior Debentures due 2031			541		321			320
	QVC 7.125% Senior Secured Notes due 2017				500		500			—
	QVC 7.5% Senior Secured Notes due 2019				1,000		984			983
	QVC 7.375% Senior Secured Notes due 2020				500		500			—
	QVC Bank Credit Facilities				1,825		1,825			2,996
	Other subsidiary debt				71		71			188

		Total attributed Interactive Group debt			7,023		6,095			6,073

Starz Group
	Subsidiary debt				46		46			48

			Total attributed Starz Group debt		46		46			48

		Total consolidated Liberty debt		$	9,043		8,155			9,774

		Less current maturities					(791	)		(1,932	)

		Total long-term debt				$	7,364			7,842

During the second quarter of 2010, Liberty completed a cash tender offer for $410 million aggregate principal amount of the outstanding 5.7% senior notes due 2013. The total consideration payable under the tender offer was determined based on a modified "Dutch Auction" procedure and

resulted in a purchase price of 103% of par value. In addition Liberty made open market purchases to retire another $19 million during the quarter.

As discussed in Note 2, effective February 25, 2010 the Board of Directors of Liberty reattributed the 4%, 3.75% and 3.5% Exchangeable Senior Debentures from the Liberty Capital Group to the Liberty Interactive group which was reflected on a prospective basis.

During the first quarter of 2010, QVC issued $500 million principal amount of 7.125% Senior Secured Notes due 2017 at par. QVC used the proceeds from such offering to retire certain outstanding term loans under QVC's Bank Credit Facilities that were to mature on various dates between 2010 and 2014.

During the first quarter of 2010, QVC issued $500 million principal amount of 7.375% Senior Secured Notes due 2020 at par. QVC used the proceeds from such offering to retire certain outstanding term loans under QVC's Bank Credit Facilities that were to mature on various dates between 2010 and 2014.

As noted above, QVC retired outstanding term loans under its Amended Credit Agreements with proceeds from the issuance of the QVC Senior Secured Notes due 2017 and 2020, respectively. The remaining $1,825 million outstanding principal matures between March 2011 and March 2014 as follows: $452 million due in 2011; $400 million due in 2012; $400 million due in 2013; and $573 million due in 2014.

QVC is party to ten separate interest rate swap arrangements with an aggregate notional amount of $2,200 million to manage the cash flow risk associated with interest payments on its variable rate debt. These swap arrangements provide for QVC to make fixed payments at rates ranging from 4.96% to 5.29% and to receive variable payments at 3 month LIBOR. All of the swap arrangements expire in March 2011. Until December 2008, Liberty accounted for these swap arrangements as cash flow hedges with the effective portions of changes in the fair value reflected in other comprehensive earnings in the accompanying condensed consolidated balance sheet. In December 2008, QVC elected interest terms under its credit facilities that do not effectively match the terms of the swap arrangements. As a result, these swaps no longer qualify as cash flow hedges under GAAP and the unrecognized losses on the instruments accounted for in accumulated other comprehensive earnings are being amortized over the remaining contract period to interest expense. Accordingly, changes in the fair value of the swaps are now reflected in realized and unrealized gains or losses on financial instruments in the accompanying condensed consolidated statements of operations.

QVC is also party to two interest rate swap arrangements with an aggregate notional amount of $600 million. These swap arrangements, which expire in October 2010, provide for QVC to make fixed

payments at 3.07% and to receive variable payments at 3 month LIBOR. These swap arrangements do not qualify as cash flow hedges under GAAP.

During the third quarter of 2009, QVC entered into seven new forward interest rate swap arrangements with an aggregate notional amount of $1.75 billion. Such arrangements provide for payments beginning in March 2011 and extending to March 2013. QVC will make fixed payments at rates ranging from 2.98% to 3.67% and receive variable payments at 3 month LIBOR. These swap arrangements do not qualify as cash flow hedges under GAAP.

Other subsidiary debt at June 30, 2010 is comprised of capitalized satellite transponder lease obligations and bank debt of certain subsidiaries.

Liberty estimates the fair value of its debt based on the quoted market prices for the same or similar issues or on the current rate offered to Liberty for debt of the same remaining maturities. The fair value of Liberty's publicly traded debt securities that are not reported at fair value in the accompanying condensed consolidated balance sheet at June 30, 2010 is as follows (amounts in millions):

Due to its variable rate nature and the absence of significant change to Liberty's credit quality, Liberty believes that the carrying amount of its subsidiary debt and other parent debt approximated fair value at June 30, 2010.

As of June 30, 2010, Liberty reserved for issuance upon exercise of outstanding stock options the following:

In addition to the Series A and Series B Liberty Capital common stock, the Series A and Series B Liberty Interactive common stock and the Series A and Series B Liberty Starz common stock, there are 2.0 billion, 4.0 billion and 4.0 billion shares of Series C Liberty Capital, Series C Liberty Interactive and Series C Liberty Starz common stock, respectively, authorized for issuance. As of June 30, 2010, no shares of any Series C common stock were issued or outstanding.

As of June 30, 2010, put options with respect to 12.6 million shares of Series A Liberty Interactive common stock with a weighted average put price of $17.27 remained outstanding. Such put options expire before November 15, 2010.

The Company accounts for the foregoing put options as financial instrument liabilities due to their settlement provisions. Accordingly, the put options are recorded in financial instrument liabilities at fair value, and changes in the fair value are included in realized and unrealized gains (losses) on financial instruments in the accompanying condensed consolidated statements of operations.

As discussed in note 2, Liberty previously held an investment in DIRECTV. During the six months ended June 30, 2009, subsidiaries of Liberty recognized aggregate revenue of $168 million from DIRECTV for distribution of their programming. In addition, subsidiaries of Liberty made aggregate payments of $16 million to DIRECTV for carriage and marketing.

Starz Entertainment, a wholly-owned subsidiary of Liberty, provides premium video programming distributed by cable operators, direct-to-home satellite providers, telephone companies, other distributors and the Internet throughout the United States. Starz Entertainment has entered into agreements with a number of motion picture producers which obligate Starz Entertainment to pay fees ("Programming Fees") for the rights to exhibit certain films that are released by these producers. The unpaid balance of Programming Fees for films that were available for exhibition by Starz Entertainment at June 30, 2010 is reflected as a liability in the accompanying condensed consolidated balance sheet. The balance due as of June 30, 2010 is payable as follows: $133 million in 2010 $6 million in 2011 and $1 million thereafter.

Starz Entertainment has also contracted to pay Programming Fees for films that have been released theatrically, but are not available for exhibition by Starz Entertainment until some future date. These amounts have not been accrued at June 30, 2010. Starz Entertainment is obligated to pay Programming Fees for all qualifying films that are released theatrically in the United States by studios owned by The Walt Disney Company ("Disney") through 2015 and all qualifying films that are released theatrically in the United States by studios owned by Sony through 2016. Films are generally available to Starz Entertainment for exhibition 10-12 months after their theatrical release. The Programming Fees to be paid by Starz Entertainment are based on the quantity and the domestic theatrical exhibition receipts of qualifying films. As these films have not yet been released in theatres, Starz Entertainment is unable to estimate the amounts to be paid under these output agreements. However, such amounts are expected to be significant.

In addition, Starz Entertainment has agreed to pay Sony Pictures Entertainment ("Sony") a total of $190 million in four annual installments of $47.5 million beginning in 2011 for a contract extension. In December 2008, Starz Entertainment entered into a new agreement with Sony requiring $120 million in three equal annual installments beginning in 2015. Starz Entertainment's estimate of amounts payable for rights to future programming, including the Disney and Sony agreements, is as follows: $160 million in 2010; $375 million in 2011; $94 million in 2012; $84 million in 2013; $67 million in 2014 and $145 million thereafter.

Liberty guarantees Starz Entertainment's obligations under certain of its studio output agreements. At June 30, 2010, Liberty's guarantees for obligations for films released by such date aggregated $725 million. While the guarantee amount for films not yet released is not determinable, such amount

is expected to be significant. As noted above, Starz Entertainment has recognized the liability for a portion of its obligations under the output agreements. As this represents a direct commitment of Starz Entertainment, a consolidated subsidiary of Liberty, Liberty has not recorded a separate indirect liability for its guarantee of these obligations.

In connection with agreements for the sale of assets by Liberty or its subsidiaries, Liberty may retain liabilities that relate to events occurring prior to its sale, such as tax, environmental, litigation and employment matters. Liberty generally indemnifies the purchaser in the event that a third party asserts a claim against the purchaser that relates to a liability retained by Liberty. These types of indemnification obligations may extend for a number of years. Liberty is unable to estimate the maximum potential liability for these types of indemnification obligations as the sale agreements may not specify a maximum amount and the amounts are dependent upon the outcome of future contingent events, the nature and likelihood of which cannot be determined at this time. Historically, Liberty has not made any significant indemnification payments under such agreements and no amount has been accrued in the accompanying condensed consolidated financial statements with respect to these indemnification guarantees.

The Atlanta Braves and certain of their players and coaches have entered into long-term employment contracts whereby such individuals' compensation is guaranteed. Amounts due under guaranteed contracts as of June 30, 2010 aggregated $186 million, which is payable as follows: $67 million in 2010, $67 million in 2011 and $50 million in 2012 and $2 million thereafter. In addition to the foregoing amounts, certain players and coaches may earn incentive compensation under the terms of their employment contracts.

Liberty and its subsidiaries lease business offices, have entered into satellite transponder lease agreements and use certain equipment under lease arrangements.

Liberty has contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Although it is reasonably possible Liberty may incur losses upon conclusion of such matters, an estimate of any loss or range of loss cannot be made. In the opinion of management, it is expected that amounts, if any, which may be required to satisfy such contingencies will not be material in relation to the accompanying condensed consolidated financial statements.

Liberty, through its ownership interests in subsidiaries and other companies, is primarily engaged in the video and on-line commerce, media, communications and entertainment industries. Liberty has attributed each of its businesses to one of three groups: the Interactive Group, the Starz Group and the Capital Group. Each of the businesses in the tracking stock groups is separately managed. Liberty identifies its reportable segments as (A) those consolidated subsidiaries that represent 10% or more of its consolidated revenue, pre-tax earnings or total assets and (B) those equity method affiliates whose share of earnings represent 10% or more of Liberty's pre-tax earnings. The segment presentation for prior periods has been conformed to the current period segment presentation.

Liberty evaluates performance and makes decisions about allocating resources to its operating segments based on financial measures such as revenue, Adjusted OIBDA, gross margin, average sales price per unit, number of units shipped and revenue or sales per customer equivalent. In addition, Liberty reviews nonfinancial measures such as subscriber growth, penetration, website visitors, conversion rates and active customers, as appropriate.

Liberty defines Adjusted OIBDA as revenue less cost of sales, operating expenses, and selling, general and administrative expenses (excluding stock-based compensation). Liberty believes this measure is an important indicator of the operational strength and performance of its businesses, including each business's ability to service debt and fund capital expenditures. In addition, this measure allows management to view operating results and perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes depreciation and amortization, stock-based compensation, separately reported litigation settlements and restructuring and impairment charges that are included in the measurement of operating income pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with GAAP. Liberty generally accounts for intersegment sales and transfers as if the sales or transfers were to third parties, that is, at current prices.

For the six months ended June 30, 2010, Liberty has identified the following businesses as its reportable segments:

Liberty's reportable segments are strategic business units that offer different products and services. They are managed separately because each segment requires different technologies, distribution channels and marketing strategies. The accounting policies of the segments that are also consolidated subsidiaries are the same as those described in the Company's summary of significant policies.

		Six months ended June 30,

		2010					2009
		Revenue		Adjusted OIBDA			Revenue		Adjusted OIBDA
		amounts in millions
Interactive Group
	QVC	$	3,515		769			3,267		688
	Corporate and other		563		40			500		65

			4,078		809			3,767		753

Starz Group
	Starz Entertainment		613		213			592		213
	Corporate and other		5		(7	)		4		(5	)

			618		206			596		208

Capital Group
	Starz Media		228		(61	)		192		22
	Corporate and other		138		(41	)		132		(50	)

			366		(102	)		324		(28	)

	Consolidated Liberty	$	5,062		913			4,687		933

		Three months ended June 30,

		2010					2009
		Revenue		Adjusted OIBDA			Revenue		Adjusted OIBDA
		amounts in millions
Interactive Group
	QVC	$	1,758		403			1,679		371
	Corporate and other		295		25			257		41

			2,053		428			1,936		412

Starz Group
	Starz Entertainment		308		107			296		105
	Corporate and other		3		(4	)		3		(1	)

			311		103			299		104

Capital Group
	Starz Media		84		(54	)		90		17
	Corporate and other		116		(5	)		109		(13	)

			200		(59	)		199		4

	Consolidated Liberty	$	2,564		472			2,434		520

		June 30, 2010

		Total assets			Investments in affiliates		Capital expenditures
		amounts in millions
Interactive Group
	QVC	$	14,093			2		107
	Corporate and other		2,227			863		16

			16,320			865		123

Starz Group
	Starz Entertainment		1,757			—		1
	Corporate and other		740			—		—

			2,497			—		1

Capital Group
	Starz Media		586			—		1
	Corporate and other		7,600			152		4

			8,186			152		5

Inter-group eliminations			(156	)		—		—

	Consolidated Liberty	$	26,847			1,017		129

The following table provides a reconciliation of segment Adjusted OIBDA to earnings (loss) from continuing operations before income taxes:

		Three months ended June 30,						Six months ended June 30,

		2010			2009			2010			2009
		amounts in millions
Consolidated segment Adjusted OIBDA		$	472			520			913			933
Stock-based compensation			(21	)		(35	)		(60	)		(63	)
Depreciation and amortization			(164	)		(163	)		(326	)		(336	)
Interest expense			(174	)		(143	)		(344	)		(280	)
Share of earnings (losses) of affiliates, net			39			14			48			(91	)
Realized and unrealized gains (losses) on financial instruments, net			(81	)		266			86			2
Gains on dispositions, net			25			113			388			111
Other, net			2			81			—			92

	Earnings from continuing operations before income taxes	$	98			653			705			368

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

Certain statements in this Quarterly Report on Form 10-Q constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements regarding our business, product and marketing strategies; new service offerings; revenue growth and subscriber trends at QVC, Inc. and Starz Entertainment, LLC; the recoverability of our goodwill and other long-lived assets; counterparty performance under our derivative arrangements; our projected sources and uses of cash; the estimated value of our derivative instruments; and the anticipated non-material impact of certain contingent liabilities related to legal and tax proceedings and other matters arising in the ordinary course of business. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is expressed in good faith and believed to have a reasonable basis, but there can be no assurance that the expectation or belief will result or be achieved or accomplished. The following include some but not all of the factors that could cause actual results or events to differ materially from those anticipated:

For additional risk factors, please see Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2009. These forward-looking statements and such risks, uncertainties and other factors speak only as of the date of this Quarterly Report, and we expressly disclaim any obligation or undertaking to disseminate any updates or revisions to any forward-looking statement contained herein, to reflect any change in our expectations with regard thereto, or any other change in events, conditions or circumstances on which any such statement is based.

The following discussion and analysis provides information concerning our results of operations and financial condition. This discussion should be read in conjunction with our accompanying condensed consolidated financial statements and the notes thereto and our Annual Report on Form 10-K for the year ended December 31, 2009.

We own controlling and non-controlling interests in a broad range of video and on-line commerce, media, communications and entertainment companies. Our more significant operating subsidiaries, which are also our principal reportable segments, are QVC, Inc. and Starz Entertainment, LLC. QVC markets and sells a wide variety of consumer products in the United States and several foreign countries, primarily by means of televised shopping programs on the QVC networks and via the Internet through its domestic and international websites. Starz Entertainment provides premium programming distributed by cable operators, direct-to-home satellite providers, telephone companies, other distributors and the Internet throughout the United States.

Our "Corporate and Other" category includes our other consolidated subsidiaries and corporate expenses. Our other consolidated subsidiaries include Provide Commerce, Inc., Backcountry.com, Inc., Bodybuilding.com, LLC, BuySeasons, Inc., Starz Media, LLC, Atlanta National League Baseball Club, Inc. and TruePosition, Inc. Provide operates an e-commerce marketplace of websites for perishable goods, including flowers and fruits and desserts, as well as upscale personalized gifts. Backcountry operates websites offering outdoor and backcountry sports gear and clothing. Bodybuilding manages websites related to sports nutrition, body building and fitness. BuySeasons operates websites that offer costumes, accessories, décor and party supplies. Starz Media develops, acquires, produces and distributes live-action and animated films and television productions for the theatrical, home video, television and other ancillary markets in the United States and internationally. ANLBC owns the Atlanta Braves, a major league baseball club, as well as certain of the Atlanta Braves' minor league clubs. TruePosition provides equipment and technology that deliver location-based services to wireless users.

In addition to the foregoing businesses, we hold ownership interests in Expedia, Inc. and SIRIUS XM, which we account for as equity method investments; and we continue to maintain investments and related financial instruments in public companies such as Time Warner, Time Warner Cable, IAC, Sprint Nextel Corporation and Live Nation, which are accounted for at their respective fair market values and are included in corporate and other.

Tracking stock is a type of common stock that the issuing company intends to reflect or "track" the economic performance of a particular business or "group," rather than the economic performance of the company as a whole. Liberty has three tracking stocks—Liberty Interactive common stock, Liberty Starz common stock and Liberty Capital common stock, which are intended to track and reflect the economic performance of the Interactive Group, Starz Group and Capital Group, respectively. While the Interactive Group, the Starz Group and the Capital Group have separate collections of businesses, assets and liabilities attributed to them, no group is a separate legal entity and therefore cannot own assets, issue securities or enter into legally binding agreements. Holders of tracking stocks have no direct claim to the group's stock or assets and are not represented by separate boards of directors. Instead, holders of tracking stock are stockholders of the parent corporation, with a single board of directors and subject to all of the risks and liabilities of the parent corporation.

On November 19, 2009, Liberty completed its previously announced split-off (the "DTV Split-Off") of its wholly owned subsidiary, Liberty Entertainment, Inc. ("LEI"), and the business combination transaction among Liberty, LEI and The DIRECTV Group, Inc. ("DIRECTV") (the "DTV Business Combination"). The DTV Split-Off was accomplished by a redemption (the "Redemption") of 90% of the outstanding shares of Liberty Entertainment common stock in exchange for all of the outstanding shares of common stock of LEI, pursuant to which, 0.9 of each outstanding share of Liberty Entertainment common stock was redeemed for 0.9 of a share of the corresponding series of common stock of LEI, with payment of cash in lieu of any fractional shares. All of the businesses, assets and liabilities that were attributed to the Entertainment Group and were not held by LEI have remained with our company and continue to be attributed to the Entertainment Group, which we have redesignated as the Starz Group. The businesses that were held by LEI are accounted for as discontinued operations for the periods prior to the DTV Split-off.

See Exhibit 99.1 to this Quarterly Report on Form 10-Q for unaudited attributed financial information for our tracking stock groups.

The term "Interactive Group" does not represent a separate legal entity, rather it represents those businesses, assets and liabilities that we have attributed to it. The assets and businesses we have attributed to the Interactive Group are those engaged in video and on-line commerce, and include our subsidiaries QVC, Provide, Backcountry, Bodybuilding, BuySeasons and CommerceHub and our interests in Expedia, HSN, Interval, Lending Tree and IAC. In addition, we have attributed $3,127 million principal amount (as of June 30, 2010) of our public debt to the Interactive Group. The Interactive Group will also include such other businesses that our board of directors may in the future determine to attribute to the Interactive Group, including such other businesses as we may acquire for the Interactive Group.

Similarly, the term "Starz Group" does not represent a separate legal entity, rather it represents those businesses, assets and liabilities that we have attributed to it. The Starz Group consists primarily of our subsidiary Starz Entertainment and $583 million of corporate cash (as of June 30, 2010).

The term "Capital Group" also does not represent a separate legal entity, rather it represents all of our businesses, assets and liabilities that we have attributed to it. The Capital Group has attributed to it all of our businesses, assets and liabilities not attributed to the Interactive Group or the Starz Group, including our subsidiaries Starz Media, ANLBC, TruePosition and minority equity investments in SIRIUS XM, Live Nation, Time Warner Inc. and Sprint Nextel Corporation. In addition, as of June 30, 2010, we have attributed $2,060 million of cash, including subsidiary cash, and $1,888 million principal amount of our exchangeable senior debentures and other parent debt to the Capital Group. The Capital Group will also include such other businesses that our board of directors may in the future determine to attribute to the Capital Group, including such other businesses as we may acquire for the Capital Group.

The proposed split-off will be effected by the redemption of all the outstanding shares of Liberty Capital tracking stock and Liberty Starz tracking stock in exchange for shares in a newly formed company ("Splitco"). Splitco will hold substantially all the assets and be subject to substantially all the liabilities currently attributed to the Liberty Capital and Liberty Starz tracking stock groups. The common stock of Splitco will be divided into two tracking stock groups, one tracking assets that are currently attributed to the Liberty Capital group ("Splitco Capital") and the other tracking assets that are currently attributed to the Liberty Starz group ("Splitco Starz"). In the redemption, holders of Liberty Capital tracking stock will receive shares of Splitco Capital tracking stock and holders of Liberty Starz tracking stock will receive shares of Splitco Starz tracking stock. After the redemption, Splitco and Liberty will be separate public companies.

substantially all" of the assets of Liberty Media, LLC, as those terms are used in the indenture, as well as related injunctive relief. Resolution of the subject matter of this lawsuit is a condition to Liberty completing the proposed split-off. Subject to the satisfaction of the conditions described above, Liberty intends to complete the proposed split-off in late 2010 or early 2011.

General. We provide in the tables below information regarding our Consolidated Operating Results and Other Income and Expense, as well as information regarding the contribution to those items from our reportable segments categorized by tracking stock group. The "corporate and other" category for each tracking stock group consists of those assets or businesses which do not qualify as a separate reportable segment. For a more detailed discussion and analysis of the financial results of the principal reporting segments of each tracking stock group, see "Results of Operations—Tracking Stock Groups" below.

				Three months ended June 30,						Six months ended June 30,

				2010			2009			2010			2009
				amounts in millions
*Revenue*
	Interactive Group
		QVC		$	1,758			1,679			3,515			3,267
		Corporate and other			295			257			563			500

					2,053			1,936			4,078			3,767

	Starz Group
		Starz Entertainment			308			296			613			592
		Corporate and other			3			3			5			4

					311			299			618			596

	Capital Group
		Starz Media			84			90			228			192
		Corporate and other			116			109			138			132

					200			199			366			324

			Consolidated Liberty	$	2,564			2,434			5,062			4,687

*Adjusted OIBDA*
	Interactive Group
		QVC		$	403			371			769			688
		Corporate and other			25			41			40			65

					428			412			809			753

	Starz Group
		Starz Entertainment			107			105			213			213
		Corporate and other			(4	)		(1	)		(7	)		(5	)

					103			104			206			208

	Capital Group
		Starz Media			(54	)		17			(61	)		22
		Corporate and other			(5	)		(13	)		(41	)		(50	)

					(59	)		4			(102	)		(28	)

			Consolidated Liberty	$	472			520			913			933

*Operating Income (Loss)*
	Interactive Group
		QVC		$	270			241			502			418
		Corporate and other			4			25			(10	)		32

					274			266			492			450

	Starz Group
		Starz Entertainment			102			92			201			187
		Corporate and other			(6	)		(17	)		(13	)		(31	)

					96			75			188			156

	Capital Group
		Starz Media			(55	)		15			(64	)		17
		Corporate and other			(28	)		(34	)		(89	)		(89	)

					(83	)		(19	)		(153	)		(72	)

			Consolidated Liberty	$	287			322			527			534

Revenue. Our consolidated revenue increased 5.3% and 8.0% for the three and six month periods ended June 30, 2010, respectively, as compared to the corresponding prior year periods. The six month increase is due primarily to increases for QVC ($248 million) with additional increases from our e-commerce businesses ($63 million), Starz Media ($36 million) and Starz Entertainment ($21 million). See Management's Discussion and Analysis for each of our tracking stock groups below for a more complete discussion of the results of operations of certain of our subsidiaries.

Adjusted OIBDA. We define Adjusted OIBDA as revenue less cost of sales, operating expenses and selling, general and administrative ("SG&A") expenses (excluding stock compensation). Our chief

operating decision maker and management team use this measure of performance in conjunction with other measures to evaluate our businesses and make decisions about allocating resources among our businesses. We believe this is an important indicator of the operational strength and performance of our businesses, including each business's ability to service debt and fund capital expenditures. In addition, this measure allows us to view operating results, perform analytical comparisons and benchmarking between businesses and identify strategies to improve performance. This measure of performance excludes such costs as depreciation and amortization, stock-based compensation, separately reported litigation settlements and restructuring and impairment charges that are included in the measurement of operating income pursuant to GAAP. Accordingly, Adjusted OIBDA should be considered in addition to, but not as a substitute for, operating income, net income, cash flow provided by operating activities and other measures of financial performance prepared in accordance with GAAP. See note 14 to the accompanying condensed consolidated financial statements for a reconciliation of Adjusted OIBDA to Earnings (loss) from continuing operations before income taxes.

Consolidated Adjusted OIBDA decreased $48 million or 9.2% and $20 million or 2.1% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year periods. The three and six month decreases are primarily due to decreases at Starz Media ($71 million and $83 million, respectively) and the e-commerce businesses ($16 million and $25 million, respectively) offset by increases at QVC ($32 million and $81 million, respectively). See Management's Discussion and Analysis for each of our tracking stock groups below for a more complete discussion of the results of operations of certain of our subsidiaries.

Stock-based compensation. Stock-based compensation includes compensation related to (1) options and stock appreciation rights ("SARs") for shares of our common stock that are granted to certain of our officers and employees, (2) phantom stock appreciation rights ("PSARs") granted to officers and employees of certain of our subsidiaries pursuant to private equity plans and (3) amortization of restricted stock grants.

We recorded $60 million and $63 million of stock compensation expense for the six months ended June 30, 2010 and 2009, respectively. The decrease in stock compensation expense in 2010 relates to our liability classified awards due to a decrease in our stock prices partially offset by increased amortization of outstanding option awards. As of June 30, 2010, the total unrecognized compensation cost related to unvested Liberty equity awards was approximately $223 million. Such amount will be recognized in our consolidated statements of operations over a weighted average period of approximately 3 years.

Operating income. Our consolidated operating income decreased $35 million and $7 million for the three and six months ended June 30, 2010 as compared to the corresponding prior year periods. The decrease is primarily the net result of the increased losses for Starz Media ($70 million and $81 million, respectively) and the e-commerce businesses ($23 million and $32 million, respectively) with offsetting operating income growth from QVC ($29 million and $84 million, respectively), Starz Entertainment ($10 million and $14 million, respectively) and Corporate and other in the Starz group ($11 million and $18 million, respectively), due to decreases in stock compensation. See Management's Discussion and Analysis for each of our tracking stock groups below for a more complete discussion of the results of operations of certain of our subsidiaries.

			Three months ended June 30,						Six months ended June 30,

			2010			2009			2010			2009
			amounts in millions
Interest expense
	Interactive Group		$	(163	)		(110	)		(310	)		(206	)
	Starz Group			(1	)		—			(1	)		(1	)
	Capital Group			(10	)		(33	)		(33	)		(73	)

		Consolidated Liberty	$	(174	)		(143	)		(344	)		(280	)

Share of earnings (losses) of affiliates
	Interactive Group		$	36			12			59			(83	)
	Starz Group			—			(2	)		—			(4	)
	Capital Group			3			4			(11	)		(4	)

		Consolidated Liberty	$	39			14			48			(91	)

Realized and unrealized gains (losses) on financial instruments, net
	Interactive Group		$	7			25			32			(47	)
	Starz Group			—			2			(1	)		9
	Capital Group			(88	)		239			55			40

		Consolidated Liberty	$	(81	)		266			86			2

Gains (losses) on dispositions, net
	Interactive Group		$	—			(1	)		364			(3	)
	Starz Group			—			1			—			1
	Capital Group			25			113			24			113

		Consolidated Liberty	$	25			113			388			111

Other, net
	Interactive Group		$	(21	)		41			(43	)		33
	Starz Group			—			1			—			(6	)
	Capital Group			23			39			43			65

		Consolidated Liberty	$	2			81			—			92

Interest expense. Consolidated interest expense increased 21.7% and 22.9% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year period. The overall increases in interest expense related to higher interest rates on variable rate debt and additional borrowings at higher fixed rates due to the longer term nature which were used to pay down lower rate debt that was closer to maturity. These increases were offset slightly by lower interest expense related to borrowings against our derivative positions that were repaid during the year.

Share of earnings (losses) of affiliates. The following table presents our share of earnings (losses) of affiliates:

The share of losses attributed to the Interactive Group in 2009 include $44 million for Ticketmaster and $47 million for HSN. As we record our share of losses for these affiliates on a three month lag, the losses reflected in our six months ended June 30, 2009 results include our share of goodwill impairment charges recorded by Ticketmaster and HSN in the fourth quarter of 2008 that were in excess of other than temporary impairment charges that we recorded in the fourth quarter of 2008 related to those investments. No impairments were necessary in 2010.

Realized and unrealized gains (losses) on financial instruments. Realized and unrealized gains (losses) on financial instruments are comprised of changes in the fair value of the following:

Gains on dispositions. Gains on dispositions in 2010 include a $178 million gain related to the Ticketmaster and Live Nation merger, a gain related to the sale of our GSI Commerce, Inc. shares of $132 million and a gain of $53 million related to the disposition of IAC shares.

Income taxes. Our effective tax rate for the six months ended June 30, 2010 is 37.6% which is only slightly greater than the U.S. federal income tax rate of 35% due to the net impact of state taxes offset slightly by gains on put options sold on Liberty Interactive stock excluded from taxable income.

Net earnings. We had net earnings of $440 million and $359 million for the six months ended June 30, 2010 and 2009, respectively, and were the result of the above-described fluctuations in our revenue, expenses and other gains and losses.

While the Interactive Group, the Starz Group and the Capital Group are not separate legal entities and the assets and liabilities attributed to each group remain assets and liabilities of our consolidated company, we manage the liquidity and financial resources of each group separately. Keeping in mind that assets of one group may be used to satisfy liabilities of one of the other groups, the following discussion assumes, consistent with management expectations, that future liquidity needs of each group will be funded by the financial resources attributed to each respective group.

As of June 30, 2010 substantially all of our cash and cash equivalents are invested in U.S. Treasury securities, other government securities or government guaranteed funds, AAA rated money market funds and A1/P1 rated commercial paper.

The following are potential sources of liquidity for each group to the extent the identified asset or transaction has been attributed to such group: available cash balances, cash generated by the operating activities of our privately-owned subsidiaries (to the extent such cash exceeds the working capital needs of the subsidiaries and is not otherwise restricted), proceeds from asset sales, monetization of our public investment portfolio, debt and equity issuances, and dividend and interest receipts.

Standard & Poor's Ratings Services and Moody's Investors Services each lowered their rating on our corporate credit in previous periods. These rating services put our corporate ratings on credit watch with developing implications and possible downgrade, respectively, following the Company's proposed split-off announcement in June of 2010. In the event we need to obtain external debt financing at the corporate level, such possible downgrades could negatively impact our ability to obtain financing at the corporate level and could increase the cost of any financing we are able to obtain.

Interactive Group. During the six months ended June 30, 2010, the Interactive Group's primary uses of cash were $1,763 million of debt repayments, the repayment of $316 million in intergroup notes and $123 million of capital expenditures. These uses of cash were funded primarily with $1,000 million from the issuance of QVC bonds, $200 million of cash provided by operating activities, which is net of $190 million of intercompany tax payments to the Capital Group, $807 million of cash reattributed from the Capital Group and $459 million of cash proceeds from the disposition of certain investments. As of June 30, 2010, the Interactive Group had a cash balance of $1,100 million.

The projected uses of Interactive Group cash for the remainder of 2010 include approximately $250 million for interest payments on QVC and parent debt attributed to the Interactive Group, $146 million for capital expenditures, additional tax payments to the Capital Group and potential payments to settle outstanding put options on Liberty Interactive Group common stock. In addition, we may make repurchases of Liberty Interactive common stock and additional investments in existing or new businesses and attribute such investments to the Interactive Group. One of our subsidiaries, attributed to the Interactive Group, acquired an on-line personalized gift company, for approximately $35 million, in July of 2010. We do not have any other commitments to make new investments at this time.

Effective August 2, 2010, upon the expiration of the existing contract, QVC entered into a new agreement with GE Money Bank, who provides revolving credit directly to QVC customers solely for the purchase of merchandise from QVC. Under the new agreement QVC and GE Money Bank share the net revenue of the credit card program according to percentages that vary with the performance of the portfolio and 3 month LIBOR and are settled monthly. Net revenue includes finance charges and late fees, less write-offs of uncollectible accounts and other expenses. The new agreement, which will expire in August 2015, is substantially different than the expired agreement, under which we retained the rights to all of the net credit card revenue and paid a fee to GE Money Bank to service the revolving credit accounts. QVC estimates that operating income (and adjusted OIBDA) would have been negatively impacted by approximately $20-25 million per year over the previous 3 years based on the terms of the new contract as compared to the expired contract. QVC also recovered its noninterest

bearing deposit maintained as collateral under the old agreement with GE Money Bank in the amount of $501 million. This deposit had previously been recorded as a component of accounts receivable. QVC's liquidity and capital resources have been significantly strengthened due to this increase in cash. As a result, QVC expects that the overall net economics of the new agreement will not have a material negative impact to its cash flows as compared to the prior agreement based on the potential uses for the cash on hand. For example, although there is no requirement to do so, QVC could reduce its interest expense if it were to use the additional cash resources to retire a portion of its existing indebtedness.

We expect that the Interactive Group will fund its 2010 cash needs with cash on hand and cash provided by operating activities. In addition, at June 30, 2010, unused capacity under the QVC Amended Credit Agreements aggregated $423 million.

Starz Group. During the six months ended June 30, 2010, the Starz Group's primary uses of cash were the repurchases of Liberty Starz common stock for $40 million and stock based compensation payments of $29 million. The uses of cash were funded by a repayment of the outstanding intergroup loan of $158 million by the Interactive Group and cash from operations. As of June 30, 2010, the Starz Group had a cash balance of $946 million.

The projected uses of Starz Group cash in 2010 include an estimated payment for the settlement of stock appreciation rights exercised by the founder and former CEO of Starz with respect to which we have accrued a liability of $116 million and tax payments to the Capital Group. In addition, we may make additional repurchases of Liberty Starz common stock and additional investments in existing or new businesses and attribute such investments to the Starz Group. However, we do not have any significant commitments to make new investments at this time. We expect that we will be able to use a combination of cash on hand and cash from operations to fund Starz Group cash needs in 2010.

Capital Group. During the six months ended June 30, 2010, the Capital Group's primary uses of cash were $807 million cash reattributed to the Interactive Group and the repayment of $973 million in outstanding debt, primarily the derivative loans, $286 million in Liberty Capital tracking stock repurchases and $257 million of additional investments in cost to equity investees. The uses of cash were funded by cash on hand, cash proceeds of $750 million from the settlement of derivatives and the repayment of the outstanding intergroup loan of $158 million by the Interactive Group.

The projected uses of Capital Group cash for the remainder of 2010 include approximately $20 million for interest payments. We may also make additional repurchases of Liberty Capital common stock and additional investments in existing or new businesses and attribute such investments to the Capital Group.

We expect that the Capital Group's investing and financing activities will be funded with a combination of cash on hand, net tax payments from the Interactive Group and the Starz Group and dispositions of non-strategic assets. At June 30, 2010, the Capital Group's sources of liquidity include $2,060 million in cash and $2,097 million of non-strategic AFS securities. To the extent the Capital Group recognizes any taxable gains from the sale of assets or the expiration of derivative instruments, we may incur current tax expense and be required to make tax payments, thereby reducing any cash proceeds attributable to the Capital Group.

See note 13 to the accompanying condensed consolidated financial statements for further discussion of our commitments and contingencies.

The Interactive Group consists of our subsidiaries QVC, Provide, Backcountry, Bodybuilding, BuySeasons and CommerceHub our interests in IAC, Expedia, HSN, Interval, Lending Tree and $3,127 million principal amount (as of June 30, 2010) of our publicly-traded debt.

The following discussion and analysis provides information concerning the results of operations of the Interactive Group. This discussion should be read in conjunction with (1) our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (2) the Unaudited Attributed Financial Information for Tracking Stock Groups filed as Exhibit 99.1 to this Quarterly Report on Form 10-Q.

		Three months ended June 30,						Six months ended June 30,

		2010			2009			2010			2009
		amounts in millions
*Revenue*
	QVC	$	1,758			1,679			3,515			3,267
	E-commerce businesses		295			257			563			500
	Corporate and other		—			—			—			—

		$	2,053			1,936			4,078			3,767

*Adjusted OIBDA*
	QVC	$	403			371			769			688
	E-commerce businesses		28			44			46			71
	Corporate and other		(3	)		(3	)		(6	)		(6	)

		$	428			412			809			753

*Operating Income (Loss)*
	QVC	$	270			241			502			418
	E-commerce businesses		8			31			12			44
	Corporate and other		(4	)		(6	)		(22	)		(12	)

		$	274			266			492			450

QVC. QVC is a retailer of a wide range of consumer products, which are marketed and sold primarily by merchandise-focused televised shopping programs and via the Internet. In the United States, QVC's live programming is aired through its nationally televised shopping network 24 hours a day ("QVC-US"). Internationally, QVC's program services are based in the United Kingdom ("QVC-UK"), Germany ("QVC-Germany") and Japan ("QVC-Japan"). QVC-UK broadcasts 24 hours a day with 17 hours of live programming and QVC-Germany and QVC-Japan each broadcast live 24 hours a day. Additionally, QVC expects to launch its programming in Italy in the fourth quarter of 2010.

		Three months ended June 30,						Six months ended June 30,

		2010			2009			2010			2009
		amounts in millions
Net revenue		$	1,758			1,679			3,515			3,267
Cost of sales			(1,105	)		(1,061	)		(2,230	)		(2,092	)

	Gross profit		653			618			1,285			1,175
Operating expenses			(166	)		(160	)		(331	)		(318	)
SG&A expenses (excluding stock-based compensation			(84	)		(87	)		(185	)		(169	)

	Adjusted OIBDA		403			371			769			688
Stock-based compensation			(4	)		(3	)		(9	)		(7	)
Depreciation and amortization			(129	)		(127	)		(258	)		(263	)

	Operating income	$	270			241			502			418

Net Revenue. QVC's consolidated net revenue increased 4.7% and 7.6% during the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year period. The three month increase in net revenue is comprised of $80 million due to a 3.9% increase in units shipped, $28 million due to a 2% increase in the average sales price per unit ("ASP") and $11 million due to an increase in shipping and handling revenue. These increases were partially offset by a decrease of $35 million due to an increase in estimated product returns and a decrease of $5 million due to unfavorable foreign currency rates. Returns as a percent of gross product revenue increased to 19.1% from 18.4%. The six month increase in revenue is comprised of $246 million due to a 6.2% increase in units shipped, $41 million due to an increase in shipping and handling revenue, $25 million due to favorable foreign currency rates and $3 million due to a 1% increase in ASP. These increases were partially offset by $67 million due to an increase in estimated product returns. Returns as a percent of gross product revenue increased to 19.2% from 18.7%.

During the three and six months ended June 30, 2010 and 2009, the changes in revenue and expenses were impacted by changes in the exchange rates for the UK pound sterling, the euro and the Japanese yen. In the event the U.S. dollar strengthens against these foreign currencies in the future,

QVC's revenue and operating cash flow will be negatively impacted. The percentage increase in revenue for each of QVC's geographic areas in U.S. dollars and in local currency is as follows:

For the third consecutive quarter, QVC's net revenue increased in local currency in each geographical area compared to the corresponding prior year period. QVC-US growth in net revenue for the three and six month period ended June 30, 2010 is due primarily to an increase in gross shipped sales as well as higher shipping and handling revenue, partially offset by an increase in return rates. Shipped sales increased due to growth in sales in the home, accessories and apparel product areas offset by a lower jewelry sales. Shipping and handling revenue increased due to increased customer usage of prepaid return labels as well as less promotional offers. For the three and six months ended June 30, 2010, UK showed increased sales in the beauty and apparel product areas partially offset with decreased jewelry and electronics sales. QVC-Germany's sales increase in local currency for the three and six months ended June 30, 2010 is due primarily to increases in the beauty, accessories and electronics areas with a decline experienced in the jewelry product area. For both periods, QVC-Japan has shown sales growth in each product category partially offset with softness in the jewelry product area.

The QVC service is already received by substantially all of the cable television and direct broadcast satellite homes in the U.S., the UK and Germany. In addition, in Japan, analog customers are expected to be converted to a digital environment in July 2011. It is likely that such conversion will have a negative impact on the overall number of subscribers viewing the program. QVC is currently evaluating the possible impact on QVC-Japan's results as well as opportunities to acquire subscribers via other distribution channels that will aid in mitigating the impact of the conversion. QVC's future sales growth will primarily depend on expansions into new countries, sales growth from our e-commerce platforms, additions of new customers from homes already receiving the QVC service and growth in sales to existing customers. QVC's future sales may also be affected by (i) the willingness of cable and satellite distributors to continue carrying QVC's programming service, (ii) QVC's ability to maintain favorable channel positioning, which may become more difficult as distributors convert analog customers to digital, (iii) changes in television viewing habits because of personal video recorders, video-on-demand and IP television and (iv) general economic conditions.

Gross profit. QVC's gross profit percentage increased from 36.8% to 37.1% and from 36.0% to 36.6% during the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year period. These increases are due primarily to lower inventory obsolescence provisions. For the six months ended June 30, the increase is also due to higher initial product margins in the apparel and to a lesser extent, the jewelry product areas.

Operating expenses. QVC's operating expenses are principally comprised of commissions, order processing and customer service expenses, credit card processing fees, telecommunications expense and production costs. Operating expenses increased 3.8% and 4.1% for the three and six months ended June 30, 2010, as compared to the corresponding prior year period. The increase in 2010 operating expenses is due primarily to increased commissions and credit card fee expenses. As a percent of net revenue, operating expenses were 9.4% and 9.5% for the three months ended June 30, 2010 and 2009, respectively and 9.4% and 9.7% for the six months ended June 30, 2010 and 2009, respectively. The 2010 decrease in operating expenses as a percent of net revenue is due primarily to lower customer service expenses due to staff efficiencies as well as an increase in online and automated touch phone ordering.

SG&A expenses. QVC's SG&A expenses include personnel, information technology, provision for doubtful accounts, credit card income and marketing and advertising expenses. Such expenses decreased 3.4% and increased 9.5% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year period. Included in QVC's SG&A results are $3 million and $6 million of costs for the three and six months ended June 30, 2010, respectively, related to the expected launch of the QVC-Italy service. This is an increase over the prior year of $3 million for the three months ended June 30, 2010 and $5 million for the six months ended June 30, 2010. QVC expects that QVC-Italy will incur an Adjusted OIBDA loss in 2010 of $30-40 million. Excluding the impact of Italy, the decrease in the three months ended June 30, 2010 is due primarily to a $9 million increase in credit card income, a $5 million decrease in personnel expenses and a $3 million decrease in franchise tax expense. The decrease in personnel expenses primarily relate to management bonus compensation and benefits expense. These decreases are partially offset by a $7 million increase in bad debt expense and a $3 million increase in software expense and outside services. QVC continues to experience an increase in write-offs and reserves related to its installment receivables and private label credit card. Such increases in bad debt are due to an increase in customer use of the installment payment plan offered by QVC and to the more recent recessionary economic conditions. Excluding the impact of Italy, the increase in the six months ended June 30, 2010 is due primarily to a $15 million increase in bad debt expense, a $6 million increase in personnel expenses primarily related to increased management bonus compensation and a $3 million increase in marketing expenses primarily related to internet marketing initiatives. These increases were partially offset by a $15 million increase in credit card income.

As discussed in the Material Changes in Financial Condition section, QVC entered into a new agreement with GE Money Bank, who provides revolving credit directly to QVC customers solely for the purchase of merchandise from QVC. QVC estimates that the terms of the new agreement will negatively impact Adjusted OIBDA but believes the overall cash flow impact will not be material.

Depreciation and amortization. Depreciation and amortization consist of the following:

E-commerce businesses. Our e-commerce businesses are comprised primarily of Provide, Backcountry, Bodybuilding and BuySeasons. Revenue for the e-commerce businesses is seasonal due to certain holidays, which drive a significant portion of the e-commerce businesses' revenue. The third quarter is generally lower, as compared to the other three quarters, due to fewer holidays. Revenue increased $38 million or 14.8% and $63 million or 12.6% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year periods. Overall revenue growth was partially offset by lower commission revenue earned when customers sign-up for third-party on-line discount services. In the first quarter of 2010, a decision was made to change the way these promotions are offered which reduced the revenue earned in the three and six months by $11 million and $18 million, respectively. These changes are expected to continue adversely impacting commission revenue throughout 2010. For the year ended December 31, 2009, the revenue earned associated with

these commissions was approximately $32 million. Revenue earned from the commissions yielded significantly higher margins than product sales, and therefore, the reduction in this revenue more negatively impacted Adjusted OIBDA on a percentage basis. Additionally, during the period increased marketing spend helped grow revenue and new customer names but impacted the margin percentage negatively. Adjusted OIBDA for the e-commerce businesses decreased 35.2% for the six month period in 2010 and represented 8.2% of revenue in 2010, as compared to 14.2% in 2009. Additionally, for the three and six months ended June 30, 2010, approximately $4 million and $9 million, respectively, of adjusted OIBDA losses were incurred associated with two start-up operations. These negative impacts offset the growth in product related Adjusted OIBDA that was achieved by our other e-commerce businesses.

The Starz Group is primarily comprised of our subsidiary Starz Entertainment and $583 million of corporate cash.

The following discussion and analysis provides information concerning the attributed results of operations of the Starz Group. This discussion should be read in conjunction with (1) our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (2) the Unaudited Attributed Financial Information for Tracking Stock Groups filed as Exhibit 99.1 to this Quarterly Report on Form 10-Q.

		Three months ended June 30,						Six months ended June 30,

		2010			2009			2010			2009
		amounts in millions
*Revenue*
	Starz Entertainment	$	308			296			613			592
	Corporate and other		3			3			5			4

		$	311			299			618			596

*Adjusted OIBDA*
	Starz Entertainment	$	107			105			213			213
	Corporate and other		(4	)		(1	)		(7	)		(5	)

		$	103			104			206			208

*Operating Income (Loss)*
	Starz Entertainment	$	102			92			201			187
	Corporate and other		(6	)		(17	)		(13	)		(31	)

		$	96			75			188			156

Revenue. The Starz Group's revenue increased $12 million or 4.0% and $22 million or 3.7% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year periods.

Adjusted OIBDA. The Starz Group's Adjusted OIBDA remained relatively flat with a slight decrease of $1 million or 1.0% and $2 million or 1.0% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year periods.

Operating income. Operating income for the Starz Group increased $21 million or 28.0% and $32 million or 20.5% for the three and six months ended June 30, 2010, respectively, as compared to

the corresponding prior year periods. The reduced operating loss for the six months ended June 30, 2010 is primarily due to a decrease in stock compensation.

Starz Entertainment. Starz Entertainment provides premium programming distributed by cable operators, direct-to-home satellite providers, telephone companies, other distributors and the Internet throughout the United States. Substantially all of Starz Entertainment's revenue is derived from the delivery of movies and original programming to subscribers under affiliation agreements with television video programming distributors. Some of Starz Entertainment's affiliation agreements provide for payments to Starz Entertainment based on the number of subscribers that receive Starz Entertainment's services ("consignment agreements"). Starz Entertainment also has fixed-rate affiliation agreements with certain of its customers. Pursuant to these agreements, the customers pay an agreed-upon rate regardless of the number of subscribers. The agreed-upon rate may be increased annually to the extent the contract provides for an increase. The affiliation agreements expire in 2010 through 2017. During the six months ended June 30, 2010, 55.7% of Starz Entertainment's revenue was generated by its three largest customers, Comcast, DIRECTV and Dish Network, each of which individually generated more than 10% of Starz Entertainment's revenue for such period.

Starz Entertainment's revenue increased 4.1% and 3.5% for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year period. The six month increase is comprised of $6 million due to a higher effective rate for Starz Entertainment's services and $15 million due to growth in the number of subscriptions under consignment deals. The Starz movie service and Encore and the Encore thematic multiplex channels ("EMP") movie service are the primary drivers of Starz Entertainment's revenue. Starz average subscriptions decreased 3.4% and 3.8% and EMP average subscriptions decreased 1.0% and 1.8% for the three and six months ended June 30, 2010, respectively. Such average decreases are the net result of increases in subscriptions under consignment agreements and decreases in subscriptions under fixed-rate agreements which do not impact revenue. Approximately 33% of Starz Entertainment's revenue in 2010 was earned under its fixed-rate affiliation agreements.

Starz Entertainment's operating expenses increased $12 million or 7.6% and $14 million or 4.4% for the three and six months ended June 30, 2010 as compared to the corresponding prior year periods. Operating expenses for the three and six months ended June 30, 2010 increased due primarily to increased amortization and impairments on two original programs (Party Down and Gravity) which were cancelled during the quarter.

Starz Entertainment's SG&A expenses were relatively flat for the three months ended June 30, 2010 and increased $7 million or 11.5% for the six months ended June 30, 2010 as compared to the corresponding prior year period. The six month increase is due primarily to the promotion of a Starz original production Spartacus in the first quarter of 2010.

Starz Entertainment has outstanding phantom stock appreciation rights (PSARs) held by its founder and former chief executive officer which were exercised in the fourth quarter of 2009. No additional compensation was recorded in the current period related to those rights. The determination of the final amount owed for the PSARs will be made by independent third parties and the process for making that determination has been initiated.

The Capital Group is comprised of our subsidiaries, assets and liabilities not attributed to the Interactive Group or the Starz Group, including controlling interests in Starz Media, ANLBC and TruePosition as well as minority investments in Sirius, Time Warner Inc., Time Warner Cable Inc., Sprint, Live Nation and other public and private companies. In addition, we have attributed $2,060 million of cash, including subsidiary cash, and $1,888 million principal amount (as of June 30, 2010) of our exchangeable senior debentures and other parent debt to the Capital Group.

The following discussion and analysis provides information concerning the attributed results of operations of the Capital Group. This discussion should be read in conjunction with (1) our condensed consolidated financial statements and notes thereto included elsewhere in this Quarterly Report on Form 10-Q and (2) the Unaudited Attributed Financial Information for Tracking Stock Groups filed as Exhibit 99.1 to this Quarterly Report on Form 10-Q.

		Three months ended June 30,						Six months ended June 30,

		2010			2009			2010			2009
		amounts in millions
*Revenue*
	Starz Media	$	84			90			228			192
	Corporate and other		116			109			138			132

		$	200			199			366			324

*Adjusted OIBDA*
	Starz Media	$	(54	)		17			(61	)		22
	Corporate and other		(5	)		(13	)		(41	)		(50	)

		$	(59	)		4			(102	)		(28	)

*Operating Income (Loss)*
	Starz Media	$	(55	)		15			(64	)		17
	Corporate and other		(28	)		(34	)		(89	)		(89	)

		$	(83	)		(19	)		(153	)		(72	)

Revenue. The Capital Group's combined revenue increased 0.5% for the three months ended June 30, 2010 and increased 13.0% for the six months ended June 30, 2010 as compared to the corresponding prior year periods. The six month increase in revenue is due primarily to a $19 million increase in theatrical revenue and a $30 million increase in home video revenue. Theatrical revenue increased due to the wide release (in excess of 1900 screens) of two films, The Crazies and Brooklyn's Finest, as compared to one theatrical release, Sunshine Cleaning, on a limited basis (approximately 600 screens) in the prior year. Home video revenue increased as the result of five films (Law Abiding Citizen, The Men Who Stare at Goats, Pandorum, Capitalism:A Love Story and The Crazies) released on DVD in the first quarter of 2010 as compared to only three (Righteous Kill, Henry Poole is Here and Last Chance Harvey) in the same period last year. The revenue from Starz Media decreased for the

three months ended June 30, 2010, due to a $14 million decrease in television revenue resulting from pay television revenue recorded in the 2009 period related to Space Chimps, partially offset by an $8 million increase in home video revenue related to the DVD releases described above.

During the second quarter of 2010 TruePosition delivered the final specified upgrade in accordance with one of its agreements under which revenue and costs were being deferred. The delivery of this item allows TruePosition to recognize previously deferred revenue and costs ($641 million and $202 million, respectively) into operations over the remaining useful life of the equipment delivered. The estimated original life of the equipment was determined to be seven years and the weighted average amortization period, based on the remaining useful life, for revenue and costs is 3.5 years. In addition, any current revenue will be recognized as delivered and no longer deferred.

Included in Capital Group's corporate and other revenue are payments from CNBC related to a revenue sharing agreement between our company and CNBC. The agreement has no termination date, and payments aggregated $12 million for each of the six month periods ended June 30, 2010 and 2009.

Adjusted OIBDA. The Capital Group's Adjusted OIBDA decreased $63 million and $74 million for the three and six months ended June 30, 2010, respectively, as compared to the corresponding prior year periods. Starz Media's Adjusted OIBDA decreased $83 million for the six months ended June 30, 2010 due in part to the number and timing of films released theatrically and on home video and television by Starz Media and Overture Films and the corresponding fluctuations of theatrical, home video and television revenue and related expenses associated with these films. In addition, Starz Media determined that a number of its titles were impaired due to lower theatrical, home video and television revenue than previously anticipated, and recorded approximately $42 million of impairments during the second quarter of 2010. Theatrical print costs and advertising expenses related to the release of a film are recognized at the time the advertisements are run and generally exceed the theatrical revenue earned from the film. The wide release of two films in the six months ended June 30, 2010 as compared to one release on a limited basis in the prior year increased these costs by $32 million. In addition, amortization of film production costs begins when revenue recognition begins. Although there can be no assurance, the expectation when films are approved for production or acquisition is that the ultimate revenue to be earned from theatrical release, home video, premium television and other distribution, which revenue may be earned over several years, will exceed the costs associated with the film.

In July 2010, we announced that the marketing and distribution units of Overture were being transferred to Relativity Media, LLC ("Relativity"), effective July 27, 2010. As part of this arrangement, Relativity will handle the theatrical release of Overture's final three films. We will continue to exploit the films in Overture's library, as well as the three unreleased films, and the net margin earned on these films will be used to service the outstanding debt associated with these films. We are currently evaluating strategic alternatives for the remaining Starz Media businesses. While a final decision has not been made regarding the future of Starz Media, we do not expect it to incur annual operating losses in the future of the same magnitude that it has experienced in recent years given our decision with respect to Overture.

Operating loss. The Capital Group's operating loss increased in 2010 due to the aforementioned timing of films released by Starz Media in the theatrical and home video markets, impairments in the second quarter of 2010 offset slightly by decreased stock compensation as compared to the prior period.

We are exposed to market risk in the normal course of business due to our ongoing investing and financial activities and the conduct of operations by our subsidiaries in different foreign countries. Market risk refers to the risk of loss arising from adverse changes in stock prices, interest rates and

foreign currency exchange rates. The risk of loss can be assessed from the perspective of adverse changes in fair values, cash flows and future earnings. We have established policies, procedures and internal processes governing our management of market risks and the use of financial instruments to manage our exposure to such risks.

We are exposed to changes in interest rates primarily as a result of our borrowing and investment activities, which include investments in fixed and floating rate debt instruments and borrowings used to maintain liquidity and to fund business operations. The nature and amount of our long-term and short-term debt are expected to vary as a result of future requirements, market conditions and other factors. We manage our exposure to interest rates by maintaining what we believe is an appropriate mix of fixed and variable rate debt. We believe this best protects us from interest rate risk. We have achieved this mix by (i) issuing fixed rate debt that we believe has a low stated interest rate and significant term to maturity, (ii) issuing variable rate debt with appropriate maturities and interest rates and (iii) entering into interest rate swap arrangements when we deem appropriate. As of June 30, 2010, our debt is comprised of the following amounts.

In addition, QVC has entered into (i) interest rate swaps with an aggregate notional amount of $2,200 million pursuant to which it pays a fixed rate of 5.0-5.3% and receives variable payments at 3-month LIBOR which expire in March 2011 and (ii) interest rate swaps with an aggregate notional amount of $600 million pursuant to which it pays a fixed rate of 3.1% and receives variable payments at 3-month LIBOR which expire in October 2010.

The Interactive and Capital groups are exposed to changes in stock prices primarily as a result of our significant holdings in publicly traded securities. We continually monitor changes in stock markets, in general, and changes in the stock prices of our holdings, specifically. We believe that changes in stock prices can be expected to vary as a result of general market conditions, technological changes, specific industry changes and other factors.

At June 30, 2010, the fair value of our AFS equity securities attributed to the Capital Group was $3,761 million. Had the market price of such securities been 10% lower at June 30, 2010, the aggregate value of such securities would have been $376 million lower. Such decrease would be partially offset by an increase in the value of our borrowed shares. Our exchangeable senior debentures are also subject to market risk. Because we mark these instruments to fair value each reporting date, increases in the stock price of the respective underlying security generally result in higher liabilities and unrealized losses in our statement of operations.

The Interactive Group is exposed to foreign exchange rate fluctuations related primarily to the monetary assets and liabilities and the financial results of QVC's foreign subsidiaries. Assets and liabilities of foreign subsidiaries for which the functional currency is the local currency are translated into U.S. dollars at period-end exchange rates, and the statements of operations are generally translated at the average exchange rate for the period. Exchange rate fluctuations on translating foreign currency financial statements into U.S. dollars that result in unrealized gains or losses are referred to as translation adjustments. Cumulative translation adjustments are recorded in accumulated other comprehensive earnings (loss) as a separate component of stockholders' equity. Transactions denominated in currencies other than the functional currency are recorded based on exchange rates at the time such transactions arise. Subsequent changes in exchange rates result in transaction gains and

losses, which are reflected in income as unrealized (based on period-end translations) or realized upon settlement of the transactions. Cash flows from our operations in foreign countries are translated at the average rate for the period. Accordingly, the Interactive Group may experience economic loss and a negative impact on earnings and equity with respect to our holdings solely as a result of foreign currency exchange rate fluctuations.

In accordance with Exchange Act Rules 13a-15 and 15d-15, the Company carried out an evaluation, under the supervision and with the participation of management, including its chief executive officer, principal accounting officer and principal financial officer (the "Executives"), of the effectiveness of its disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, the Executives concluded that the Company's disclosure controls and procedures were effective as of June 30, 2010 to provide reasonable assurance that information required to be disclosed in its reports filed or submitted under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission's rules and forms.

There has been no change in the Company's internal control over financial reporting that occurred during the three months ended June 30, 2010 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

On several occasions our board of directors authorized share repurchase programs for our Series A and Series B Liberty Capital common stock, Series A and Series B Liberty Starz common stock and Series A and Series B Interactive common stock. On each of March 10, 2008 and August 13, 2008 our board authorized $300 million of share repurchases of Series A Liberty Capital common stock and an additional authorization of $500 million in share repurchases on May 6, 2010 for a total of $1,100 million. On November 9, 2009 our board authorized the repurchase of $500 million Series A and Series B Liberty Starz common stock. On each of May 5, 2006, November 3, 2006 and October 30, 2007 our board authorized the repurchase of $1 billion of Liberty Interactive Series A and Series B common stock for a total of $3 billion. Approximately $740 million may yet be purchased under such Liberty Interactive common stock repurchase programs.

A summary of the repurchase activity for the three months ended June 30, 2010 is as follows:

In addition to the shares listed in the table above, 5,207 shares of Series A Liberty Capital common stock, 16,708 shares of Series A Liberty Interactive common stock and 2,610 shares of Series A Liberty Starz common stock were surrendered by certain of our officers and employees to pay withholding taxes and other deductions in connection with the vesting of their restricted stock during the three months ended June 30, 2010.

Listed below are the exhibits which are filed as a part of this Report (according to the number assigned to them in Item 601 of Regulation S-K):

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.

Listed below are the exhibits which are filed as a part of this Report (according to the number assigned to them in Item 601 of Regulation S-K):


ý		QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended June 30, 2010
OR
o		TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from to


State of Delaware (State or other jurisdiction of incorporation or organization)		84-1288730 (I.R.S. Employer Identification No.)
12300 Liberty Boulevard Englewood, Colorado		80112
(Address of principal executive offices)		(Zip Code)


Large accelerated filer ý		Accelerated filer o		Non-accelerated filer o (do not check if smaller reporting company)		Smaller reporting company o



Liberty Capital common stock	80,096,717	7,379,094
Liberty Interactive common stock	568,838,611	29,247,036
Liberty Starz common stock	48,916,150	2,360,545

	Series A

	Liberty Capital			WAEP		Liberty Interactive			WAEP		Liberty Starz			WAEP
	numbers of options in thousands
Outstanding at January 1, 2010		5,069		$	14.45		40,832		$	11.30		2,595		$	43.13
Granted		1,116		$	34.57		10,016		$	14.03		875		$	51.23
Exercised		(307	)	$	14.05		(930	)	$	4.25		(41	)	$	31.21
Forfeited/Cancelled		(24	)	$	13.84		(338	)	$	6.56		(17	)	$	42.24

Outstanding at June 30, 2010		5,854		$	18.31		49,580		$	12.00		3,412		$	45.36

Exercisable at June 30, 2010		2,177		$	11.65		16,801		$	16.88		663		$	30.33


Three months ended:
	June 30, 2010	$	21
	June 30, 2009	$	35
Six months ended:
	June 30, 2010	$	60
	June 30, 2009	$	63

		WAEP of outstanding options		Weighted average remaining life	Aggregate intrinsic value (000's)			WAEP of exercisable options		Aggregate intrinsic value (000's)

Series A Capital	5,854	$	18.31	5.4 years	$	138,183	2,177	$	11.65	$	65,911
Series A Interactive	49,580	$	12.00	5.2 years	$	101,270	16,801	$	16.88	$	24,711
Series B Interactive	7,491	$	23.41	0.9 years	$	—	7,491	$	23.41	$	—
Series A Starz	3,412	$	45.36	6.0 years	$	29,867	663	$	30.33	$	14,349
Series B Starz	599	$	31.33	0.9 years	$	12,565	599	$	31.33	$	12,565

	Liberty Capital Common Stock

	Three months ended June 30, 2010		Six months ended June 30, 2010		Three months ended June 30, 2009		Six months ended June 30, 2009
	numbers of shares in millions
Basic EPS		95		95		96		96
Stock options		—		—		1		1

Diluted EPS		95		95		97		97

			Fair Value Measurements at June 30, 2010

Description	Total		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
			amounts in millions
Available-for-sale securities	$	4,063		3,659		404		—
Financial instrument liabilities	$	1,142		904		238		—
Debt	$	2,235		—		2,235		—

	June 30, 2010					December 31, 2009

	Equity securities		Debt securities			Equity securities		Debt securities
	amounts in millions
Gross unrealized holding gains	$	79		49			258		69
Gross unrealized holding losses	$	—		(3	)		—		—

		June 30, 2010					December 31, 2009

		Percentage ownership			Carrying amount		Carrying amount
					dollar amounts in millions
Interactive Group
	Expedia		24	%		650		631
	Other		various			215		264
Capital Group
	SIRIUS XM		40	%		50		33
	Other		various			102		102

					$	1,017		1,030

Type of financial instrument		June 30, 2010

		amounts in millions
Assets
	Equity collars(1)	$	—		752

Liabilities
	Borrowed shares(2)	$	904		851
	Other		238		283

			1,142		1,134
	Less current portion		(1,074	)	(1,002	)

		$	68		132

	June 30, 2010

	amounts in millions
Time Warner	$	87	88
Time Warner Cable		39	31
Sprint		222	125
Motorola		339	403
CenturyLink, Inc.		119	84
Other		98	120

	$	904	851

		QVC

		amounts in millions
Balance at January 1, 2010		$	5,395		132	698	6,225
	Foreign currency translation adjustments		(67	)	—	—	(67	)
	Other		(9	)	—	8	(1	)

Balance at June 30, 2010		$	5,319		132	706	6,157


Senior notes	$	379
Senior debentures	$	729
QVC senior secured notes	$	1,988

	Percentage increase in net revenue

	Three months ended June 30, 2010						Six months ended June 30, 2010
	U.S. dollars			Local currency			U.S. dollars			Local currency
QVC-US		3.6	%		3.6	%		6.8	%		6.8	%
QVC-UK		4.7	%		8.1	%		6.5	%		4.1	%
QVC-Germany		—	%		6.9	%		4.1	%		4.0	%
QVC-Japan		15.8	%		9.8	%		16.4	%		11.5	%

	Variable rate debt					Fixed rate debt

	Principal amount		Weighted avg interest rate			Principal amount		Weighted avg interest rate
	dollar amounts in millions
Interactive Group	$	1,847		4.68	%	$	4,248		5.95	%
Capital Group	$	835		0.70	%	$	1,180		3.13	%
Starz Group	$	—		N/A		$	46		5.5	%

		Series A Liberty Capital Common Stock

Period		(a) Total Number of Shares Purchased		(b) Average Price Paid per Share		(c) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs		(d) Maximum Number (or Approximate Dollar Value) of Shares that May Yet Be purchased Under the Plans or Programs
April 1-30, 2010			2,044,992	$	40.45		2,044,992	$	30 million
May 1-31, 2010			2,812,780	$	41.59		2,812,780	$	413 million
June 1-30, 2010			1,888,200	$	43.31		1,888,200	$	331 million

	Total		6,745,972				6,745,972


10.1		Executive Employment Agreement, dated December 19, 2009, between Gregory B. Maffei and Liberty Media Corporation*
10.2		Liberty Media Corporation 2010 Incentive Plan*
31.1		Rule 13a-14(a)/15d-14(a) Certification*
31.2		Rule 13a-14(a)/15d-14(a) Certification*
31.3		Rule 13a-14(a)/15d-14(a) Certification*
32		Section 1350 Certification**
99.1		Attributed Financial Information for Tracking Stock Groups*
99.2		Reconciliation of Liberty Media Corporation New Assets and Net Earnings to Liberty Media LLC Net Assets and Net Earnings**
101.INS		XBRL Instance Document**
101.SCH		XBRL Taxonomy Extension Schema Document**
101.CAL		XBRL Taxonomy Calculation Linkbase Document**
101.LAB		XBRL Taxonomy Label Linkbase Document**
101.PRE		XBRL Taxonomy Presentation Linkbase Document**
101.DEF		XBRL Taxonomy Definition Document**


	LIBERTY MEDIA CORPORATION
Date: August 9, 2010	By:	/s/ GREGORY B. MAFFEI Gregory B. Maffei President and Chief Executive Officer
Date: August 9, 2010	By:	/s/ DAVID J.A. FLOWERS David J.A. Flowers Senior Vice President and Treasurer (Principal Financial Officer)
Date: August 9, 2010	By:	/s/ CHRISTOPHER W. SHEAN Christopher W. Shean Senior Vice President and Controller (Principal Accounting Officer)


	10.1		Executive Employment Agreement, dated as of December 19, 2009, between Gregory B. Maffei and Liberty Media Corporation*
	10.2		Liberty Media Corporation 2010 Incentive Plan*
	31.1		Rule 13a-14(a)/15d-14(a) Certification*
	31.2		Rule 13a-14(a)/15d-14(a) Certification*
	31.3		Rule 13a-14(a)/15d-14(a) Certification*
	32		Section 1350 Certification**
	99.1		Attributed Financial Information for Tracking Stock Groups*
	99.2		Reconciliation of Liberty Media Corporation New Assets and Net Earnings to Liberty Media LLC Net Assets and Net Earnings**
	101.INS		XBRL Instance Document**
	101.SCH		XBRL Taxonomy Extension Schema Document**
	101.CAL		XBRL Taxonomy Calculation Linkbase Document**
	101.LAB		XBRL Taxonomy Label Linkbase Document**
	101.PRE		XBRL Taxonomy Presentation Linkbase Document**
	101.DEF		XBRL Taxonomy Definition Document**