Under the terms of the deal being discussed, people familiar with the situation told the Wall Street Journal, AT&T would still have control over WorldNet under its pending $40.9 billion takeover of Tele-Communications Inc, expected to close in mid-February.

Currently, TCI holds about 28 per cent of AtHome's common shares, and if warrants and options are exercised, TCI will control 58 per cent of the AtHome's voting stock.

People familiar with the situation told the paper they expect AT&T would keep voting control of AtHome, a high-speed Internet, cable access service provider.

AT&T would continue to operate the communications network used by WorldNet, and would jointly market it with AtHome, people familiar with the situation told the journal. WorldNet is the No 2 online service, butlags well behind America Online Inc, which has 15 million customers.

AtHome, which agreed to buy Excite Inc for $6.7 billion earlier this week, would take over WorldNet's 1.3 million residential customers and nearly one million business customers. WorldNet acquired the business customers in AT&T's recent $5 billion acquisition of International Business Machines Corp's global network for $5 billion.

People familiar with the matter told the paper that the possibility of acquiring WorldNet was an important consideration in AtHome's deal for Excite.

In fact, AT&T's chairman C Michael Armstrong was consulted about AtHome's purchase of Excite throughout the negotiations, people familiar with the matter told the paper.

Those people, however, cautioned the journal that any deal was contingent on AT&T's acquisition of TCI. Any sale of WorldNet is not expected until after the TCI deal is complete, people familiar with the matter told the paper. Representatives at AT&T and AtHome declined to comment on thematter to the paper.