Interestingly, Oneness Pentecostalism does not fail to see a distinction between Father and Son as many suppose. It is common to hear among them this quote in explaining the distinction of Father, Son and Holy Spirit: "Father in creation, Son in redemption, and Holy Spirit in sanctification." Note however, that the distinction is in what God is doing and how he is doing it, not in person-hood.
The doctrine of Oneness denotes that there is only one God who manifests/reveals/expresses Himself at various times in various ways. This is in contrast to Trinitarian doctrine which sees God as always having existed as three separate and distinct persons, though one God.
Oneness adherent, David Bernard, in his book, the Oneness of God, points out that Scripture uses the term Son when referring to Jesus' humanity, never His divinity. Thus, they see a distinction between Father and Son in terms of humanity. Jesus the Son says He is one with the Father, in the Father and the Father is in Him. They therefore see one God existing simultaneously on Earth in the Son and in heaven as the Father.
Having established that background, in Matthew 3:16-17, God is in the Son, who is getting baptized. God speaks from heaven as Father, addressing His Son. God also alights upon the Son, in the likeness of a dove. But He is only one God simultaneously in three places, doing three things, in three different ways.
I have commonly heard said, in reference to this passage, and in reaction to Oneness belief, "Was God talking to Himself?" However, it is clear they see in this account one God, as Father relating to His Son and anointing His Son.
See also my answer to a related question:
How do United Pentecostals and other Oneness groups interpret Hebrews 2:9?