--------------------------------------------------------------------------------
                                  UNITED STATES

                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                   -----------

                                    FORM 10-Q

    (MARK ONE)     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
       |X|         SECURITIES AND EXCHANGE ACT OF 1934

                       FOR THE PERIOD ENDING JUNE 30, 2003

                                       OR

       |_|         TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                   SECURITIES AND EXCHANGE ACT OF 1934
                   FOR THE TRANSITION PERIOD FROM         TO
                                                  --------  --------
                         COMMISSION FILE NUMBER 0 - 1325

                               VICOM, INCORPORATED

             (Exact name of registrant as specified in its charter)

                                    MINNESOTA

         (State or other jurisdiction of incorporation or organization)

                                  41 - 1255001

                        (IRS Employer Identification No.)

              9449 SCIENCE CENTER DRIVE, NEW HOPE, MINNESOTA 55428

                    (Address of principal executive offices)

                   TELEPHONE (763) 504-3000 FAX (763) 504-3060

                            www.vicominc.net Internet

     (Registrant's telephone number, facsimile number, and Internet address)

         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  and Exchange Act
of 1934  during the  preceding  12 months (or for such  shorter  period that the
registrant was required to file such reports),  and (2) has been subject to such
filing requirements for the past 90 days.

                                Yes |X|      No |_|
         Indicate by check mark whether the registrant is an  accelerated  filer
(as defined in Rule 12b-2 of the Exchange Act).

                                Yes |_|      No |X|

         On August 7, 2003  there  were  16,846,563  shares  outstanding  of the
registrant's  common stock,  par value $.01 per share,  and 246,181  outstanding
shares of the registrant's convertible preferred stock.

--------------------------------------------------------------------------------

<PAGE>



PART I.  FINANCIAL INFORMATION

ITEM 1.  CONSOLIDATED FINANCIAL STATEMENTS

                      VICOM, INCORPORATED AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

<TABLE>
<CAPTION>
                                                                     Three Months Ended                   Six Months Ended
                                                              June 30, 2003     June 30, 2002      June 30, 2003       June 30, 2002
                                                               (unaudited)       (unaudited)        (unaudited)         (unaudited)
                                                              ------------       ------------       ------------       ------------
<S>                                                           <C>                <C>                <C>                <C>
REVENUES ...............................................      $  5,688,381       $  5,944,424       $ 11,560,143       $ 12,206,612
COSTS AND EXPENSES
     Cost of products and services .....................         3,914,420          4,354,714          8,225,122          9,143,928
     Selling, general and administrative ...............         2,502,741          2,240,223          4,738,737          4,496,761
                                                              ------------       ------------       ------------       ------------
     Total Costs and Expenses ..........................      $  6,417,161          6,594,937         12,963,859         13,640,689
LOSS FROM OPERATIONS ...................................          (728,780)          (650,513)        (1,403,716)        (1,434,077)
OTHER EXPENSE
     Interest expense ..................................          (219,723)          (426,869)          (445,410)          (772,904)
    Other Income (expense) .............................            15,232             25,281            (50,264)            44,957
                                                              ------------       ------------       ------------       ------------
     Total Other Expense ...............................          (204,491)          (401,588)          (495,674)          (727,947)
MINORITY INTEREST IN JOINT VENTURE .....................            (1,393)                 0             (1,393)                 0
LOSS BEFORE INCOME TAXES ...............................          (934,664)        (1,052,101)        (1,900,783)        (2,162,024)
PROVISION FOR INCOME TAXES .............................                 0                  0                  0                  0
                                                              ------------       ------------       ------------       ------------
NET LOSS ...............................................          (934,664)      $ (1,052,101)        (1,900,783)      $ (2,162,024)
      Preferred Stock Dividends ........................           (38,580)            (8,427)           (95,051)           (60,153)
LOSS ATTRIBUTABLE TO COMMON STOCKHOLDERS
                                                              $   (973,244)      $ (1,060,528)      $ (1,995,834)      $ (2,222,177)
                                                              ============       ============       ============       ============
LOSS PER SHARE - BASIC AND DILUTED .....................      $       (.06)      $       (.09)      $       (.13)      $       (.20)
WEIGHTED AVERAGE SHARES OUTSTANDING - BASIC AND
DILUTED ................................................        15,068,424         11,505,838         14,247,937         11,078,284
</TABLE>

            See notes to condensed consolidated financial statements


                                       2
<PAGE>

                      VICOM, INCORPORATED AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEETS

<TABLE>
<CAPTION>
                                                                                              June 30, 2003     December 31, 2002
                                                                                              -------------     -----------------
                                                                                               (unaudited)          (audited)
                                                          ASSETS
<S>                                                                                           <C>                <C>
CURRENT ASSETS
   Cash and cash equivalents ...........................................................      $    971,513       $    540,375
   Accounts receivable .................................................................         2,187,324          1,948,004
   Inventories, net of reserve of $364,500 and $341,000 ................................         2,005,636          1,463,658
   Other Current Assets ................................................................           318,306            226,774
                                                                                              ------------       ------------
      TOTAL CURRENT ASSETS .............................................................         5,482,779          4,178,811
                                                                                              ------------       ------------
PROPERTY AND EQUIPMENT, NET ............................................................         3,626,112          3,248,973
                                                                                              ------------       ------------
OTHER ASSETS
   Goodwill ............................................................................         2,966,241          2,748,879
   Other ...............................................................................           219,744            170,653
                                                                                              ------------       ------------
       TOTAL OTHER ASSETS ..............................................................         3,185,985          2,919,532
                                                                                              ------------       ------------
TOTAL ASSETS ...........................................................................      $ 12,294,876       $ 10,347,316
                                                                                              ============       ============
                                            LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
   Wholesale line of credit ............................................................      $  1,259,301       $  1,290,383
   Current portion of note payable - stockholder .......................................            59,579                  0
   Current portion of long term debt ...................................................           550,830            321,589
   Current portion of capital lease obligations ........................................            50,988             59,570
   Accounts payable ....................................................................         2,110,870          1,735,931
   Accrued liabilities .................................................................         1,051,501            714,479
   Deferred service obligations and revenue ............................................           298,377            309,729
                                                                                              ------------       ------------
      TOTAL CURRENT LIABILITIES ........................................................         5,381,446          4,431,681
LONG TERM DEBT, NET ....................................................................         2,256,047          3,114,006
NOTE PAYABLE - STOCKHOLDER, NET OF CURRENT PORTION .....................................            64,421                  0
CAPITAL LEASE OBLIGATIONS, NET OF CURRENT PORTION ......................................           186,409            159,344
                                                                                              ------------       ------------
TOTAL LIABILITIES ......................................................................         7,888,323          7,705,031
                                                                                              ------------       ------------
STOCKHOLDERS' EQUITY
Cumulative convertible preferred stock, no par value:
   8% Class A (27,831 shares issued and outstanding) ...................................           418,252            418,252
  10% Class B (6,200 shares issued and outstanding) ....................................            62,000             62,000
  10% Class C (134,500 and 131,510 shares issued and outstanding) ......................         1,720,493          1,699,407
  15% Class E (77,650 and 70,000 shares issued and outstanding) ........................           438,964            395,778
  Common stock, no par value (16,738,194 and 13,110,477 shares issued;
  16,711,189 and 13,065,410 shares outstanding) ........................................         7,272,629          4,465,832
  Stock subscriptions receivable .......................................................          (620,615)          (633,195)
   Options and warrants ................................................................        27,195,980         26,632,299
   Unamortized compensation ............................................................          (430,710)          (682,089)
   Minority Interest ...................................................................            61,393                  0
   Accumulated deficit .................................................................       (31,711,833)       (29,715,999)
                                                                                              ------------       ------------
TOTAL STOCKHOLDERS' EQUITY .............................................................         4,406,553          2,642,285
                                                                                              ------------       ------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY .............................................      $ 12,294,876       $ 10,347,316
                                                                                              ============       ============
</TABLE>

            See notes to condensed consolidated financial statements.


                                       3
<PAGE>

                      VICOM, INCORPORATED AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                                SIX MONTHS ENDED
                                                                                              JUNE 30, (UNAUDITED)
                                                                                              2003             2002
                                                                                              ----             ----
<S>                                                                                       <C>            <C>
OPERATING ACTIVITIES
   Net loss ...........................................................................   $(1,900,783)   $(2,162,024)
   Adjustments to reconcile net loss to net cash flows from operating activities
      Depreciation and amortization ...................................................       449,729        510,438
      Amortization of deferred compensation ...........................................       240,381        261,030
      Amortization of original issue discount .........................................       199,980        471,757
      Common stock issued for services ................................................       321,920         14,700
      Warrants issued for services
      Loss on sales of property and equipment .........................................        76,269         (7,359)
      Interest receivable on stock subscription receivable ............................       (10,272)             0
      Discount on preferred stock related to warrants .................................             0              0
      Minority interest in joint venture ..............................................         1,393              0
      Changes in operating assets and
liabilities:
        Accounts receivable, net ......................................................      (241,014)        57,437
        Inventories, net ..............................................................      (541,581)        53,057
        Other current assets ..........................................................      (107,742)        31,424
        Other assets ..................................................................          (801)        14,598
        Wholesale line of credit ......................................................       (31,082)      (142,661)
        Accounts payable and accrued liabilities ......................................       283,974         91,461
        Deferred service obligations and revenue ......................................       (11,352)       (39,294)
                                                                                          -----------    -----------
           Net cash flows from operating activities ...................................    (1,270,981)      (897,977)
                                                                                          -----------    -----------
INVESTING ACTIVITIES
   Purchases of property and equipment ................................................      (307,982)      (255,261)
   Proceeds from sale of property and equipment .......................................         6,145         10,277
   Payment for investment in joint venture ............................................       (64,878)             0
   Collections on notes receivable ....................................................         5,000         28,572
                                                                                          -----------    -----------
           Net cash flows from investing activities ...................................      (361,715)      (216,412)
                                                                                          -----------    -----------
FINANCING ACTIVITIES
   Proceeds from long-term debt and warrants issued with long term debt ...............             0        750,000
   Payments on long term debt .........................................................       (97,896)       (53,110)
   Payments on capital lease obligations ..............................................       (47,344)      (151,139)
   Proceeds from issuance of long term debt ...........................................       133,726              0
   Proceeds from issuance of stock and warrants .......................................     1,917,998        687,779
   Exercise of warrants ...............................................................       199,530              0
   Redemption of preferred stock ......................................................        (2,100)       (93,000)
   Preferred stock dividends ..........................................................       (40,080)       (50,736)
                                                                                          -----------    -----------
           Net cash flows from financing activities ...................................     2,063,834      1,089,794
                                                                                          -----------    -----------
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS ......................................       431,138        (24,595)
CASH AND CASH EQUIVALENTS
   Beginning of period ................................................................       540,375        624,845
                                                                                          -----------    -----------
   End of period ......................................................................   $   971,513    $   600,250
                                                                                          ===========    ===========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
   Cash paid for interest, net of amortization of original issue discount .............       259,391        291,995
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES
   Stock options issued below fair market value .......................................             0            400
   Issuance of preferred stock for acquisition of assets ..............................        76,500         18,590
   Warrants issued with debt ..........................................................       208,447          8,529
   Conversion of preferred stock into common stock ....................................        40,000        150,000
   Conversion of current liabilities into stock .......................................       173,148          7,255
   Conversion of notes payable into common stock ......................................       522,000              0
   Conversion of dividend into common stock ...........................................        54,971              0
   Reduction of preferred stock to note payable .......................................             0        290,000
   Stock subscription receivable for issuance of common stock .........................        40,000              0
   Conversion of notes payable to preferred stock .....................................             0        227,868
   Reduction of  stock subscription receivable ........................................        17,852         32,688
</TABLE>

            See notes to condensed consolidated financial statements


                                       4
<PAGE>

                      VICOM, INCORPORATED AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Unaudited)
                             JUNE 30, 2003 and 2002

NOTE 1 - UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS

The  information  furnished  in  this  report  is  unaudited  and  reflects  all
adjustments which are normal recurring  adjustments and, which in the opinion of
management,  are  necessary  to fairly  present  the  operating  results for the
interim periods. The operating results for the interim periods presented are not
necessarily  indicative  of the  operating  results to be expected  for the full
fiscal year.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Revenues and Cost Recognition

Vicom, Inc. and subsidiaries (the Company) earns revenues from five sources:  1)
Video and computer  technology  products  which are sold but not  installed,  2)
Voice,  video and data communication  products which are sold and installed,  3)
Service  revenues  related  to  communication  products  which are sold and both
installed  and not  installed,  4) MultiBand  user charges to multiple  dwelling
units, 5) Multiband USA user charges to timeshares.

Revenues  from video and computer  technology  products,  which are sold but not
installed, are recognized when delivered and the customer has accepted the terms
and has the ability to fulfill the terms.

Customers  contract  for both the  purchase and  installation  of voice and data
networking  technology  products and certain video technologies  products on one
sales   agreement,   as   installation  of  the  product  is  essential  to  the
functionality  of the product.  Revenues and costs on the sale of products where
installation  is involved are  recognized  under the  percentage  of  completion
method. Costs are expensed as incurred.  The amount of revenue recognized is the
portion that the cost expended to date bears to the  anticipated  total contract
cost, based on current  estimates to complete.  Contract costs include all labor
and  materials  unique to or installed in the  project,  as well as  subcontract
costs.  Costs and  estimated  earnings in excess of billings are  classified  as
current  assets;  billings  in  excess  of  costs  and  estimated  earnings  are
classified as current liabilities.

Service revenues related to technology products including  consulting,  training
and support are recognized when the services are provided.  The Company,  if the
customer elects, enters into equipment maintenance  agreements for products sold
once  the  original  manufacturer's  warranty  has  expired.  Revenues  from all
equipment  maintenance  agreements are recognized on a straight-line  basis over
the terms of each contract. Costs for services are expensed as incurred.

MultiBand  user  charges  are  recognized  as revenues in the period the related
services are provided.

Warranty costs incurred on new product sales are substantially reimbursed by the
equipment suppliers.

Goodwill

Goodwill  represents  the  excess of  acquisition  costs  over the fair value of
identifiable  net assets  acquired  and was  amortized  using the  straight-line
method over ten years.  The carrying  value of goodwill is reviewed if the facts
and circumstances  suggest that it may be impaired. If the review indicates that
goodwill will not be recoverable,  as determined based on the undiscounted  cash
flows  of the  assets  acquired  over the  remaining  amortization  period,  the


                                       5
<PAGE>

Company's  carrying  value of goodwill is reduced by the estimated  shortfall of
cash  flows.  The  Company  did not record  any  impairment  charges  related to
goodwill during the three or six months ended June 30, 2003 and 2002.

The changes in the carrying  value of goodwill for the six months ended June 30,
2003 are as follows:

Balance of goodwill as of December 31, 2002                     $2,748,879

Goodwill recorded related to the investments into MB
USA joint venture (see Note 8)                                     217,362
                                                                ----------

Balance as of June 30, 2003                                      2,966,241
                                                                ==========

Stock-Based Compensation

In accordance with Accounting  Principles Board (APB) Opinion No. 25 and related
interpretations, the Company uses the intrinsic value-based method for measuring
stock-based compensation cost which measures compensation cost as the excess, if
any, of the quoted market price of the Company's  common stock at the grant date
over the  amount the  employee  must pay for the stock.  The  Company's  general
policy is to grant stock options at fair value at the date of grant.

Pursuant to APB No. 25 and related  interpretations,  $120,191  and  $130,602 of
compensation   cost  has  been  recognized  in  the  accompanying   consolidated
statements  of  operations  for the three  months  ended June 30, 2003 and 2002,
respectively.  For the six months  ended June 30,  2003 and 2002,  $240,381  and
$261,030 of compensation  cost has been recognized.  Had compensation  cost been
recognized  based on the fair  values of options at the grant  dates  consistent
with the provisions of Statements of Financial  Accounting  Standards (SFAS) No.
123 "Accounting for Stock-Based  Compensation",  the Company's net loss and loss
attributable to common  stockholders and basic and diluted loss per common share
would have been increased to the additional pro forma amounts:

<TABLE>
<CAPTION>
                                                                    Three Months Ended                     Six Months Ended
                                                                          June 30                               June 30
                                                                          -------                               -------
                                                                   2003               2002              2003                2002
                                                               ------------       ------------       ------------       ------------
<S>                                                            <C>                <C>                <C>                <C>
Loss attributable to common stockholders                       $  (973,244)       $(1,060,528)       $(1,995,834)       $(2,222,177)
Pro forma loss attributable to common shares                   $(1,138,822)       $(1,111,690)       $(2,572,409)       $(2,321,545)

Basic and diluted net loss per share:
   As reported                                                 $     (0.06)       $     (0.09)       $     (0.14)       $     (0.20)
   Pro forma loss attributable to common shares                $     (0.08)       $     (0.10)       $     (0.18)       $     (0.21)

Stock-based compensation:
   As reported                                                 $   120,191        $   130,602        $   240,381        $   261,030
   Proforma                                                    $   165,578        $    51,162        $   576,575        $    99,368
</TABLE>

In determining the compensation cost of the options granted during the three and
six months ended June 30, 2003 and 2002,  as specified by SFAS No. 123, the fair
value of each  option  grant has been  estimated  on the date of grant using the
Black-Scholes  option pricing model and the weighted average assumptions used in
these calculations are summarized as follows for June 30:

<TABLE>
<CAPTION>
                                                                    Three Months Ended                     Six Months Ended
                                                                          June 30                               June 30
                                                                          -------                               -------
                                                                   2003               2002              2003                2002
                                                               ------------       ------------       ------------       ------------
<S>                                                            <C>                <C>                <C>                 <C>
Risk-free interest rate                                           3.62%              4.40%              3.31%               4.40%
Expected life of options granted                               10 years           10 years           10 years            10 years
Expected volatility range                                          170%               170%               170%                170%
Expected dividend yield                                              0%                 0%                 0%                  0%
</TABLE>

Net Loss per Share

Basic net loss per common share is computed by dividing the loss attributable to
common  stockholders by the weighted average number of common shares outstanding
for the  reporting  period.  Diluted  net loss per common  share is  computed by
dividing loss  attributable  to common  stockholders  by the sum of the weighted
average number of common shares  outstanding  plus all  additional  common stock
that would have been  outstanding if potentially  dilutive common shares related
to  common  share  equivalents  (stock  options,  stock  warrants,   convertible
preferred  shares,  and issued but not  outstanding  restricted  stock) had been
issued. All options, warrants,  convertible preferred shares, and


                                       6
<PAGE>

issued but not outstanding  restricted  stock during the three months ended June
30, 2003 and 2002 were anti-dilutive.

NOTE 3 - LIQUIDITY

The accompanying  consolidated  financial statements have been prepared assuming
the Company will continue as a going concern that  contemplates  the realization
of assets and satisfaction of liabilities in the normal course of business.  For
the six months ended June 30, 2003 and 2002, the Company  incurred net losses of
$1,900,783 and  $2,162,024,  respectively.  At June 30, 2003, the Company had an
accumulated deficit of $31,711,833. The Company's ability to continue as a going
concern is dependent on it ultimately  achieving  profitability  and/or  raising
additional  capital.  Management  intends  to obtain  additional  debt or equity
capital to meet all of its existing cash  obligations  and fund  commitments  on
planned MultiBand projects,  however, there can be no assurance that the sources
will be available or  available  on terms  favorable to the Company.  Management
anticipates  that  the  impact  of  the  actions  listed  below,  will  generate
sufficient  cash flows to pay current  liabilities,  long-term  debt and capital
lease obligations and fund the Company's future operations:

1.  Continued   reduction  of  operating   expenses  by   controlling   payroll,
professional fees and other general and administrative expenses.

2.  Solicit  additional  equity  investment  in the  Company  by either  issuing
preferred or common stock.

3. Continue to market MultiBand services and acquire  additional  multi-dwelling
unit customers.

4. Control capital expenditures by contracting  MultiBand services and equipment
through a landlord-owned equipment program.

NOTE 4 - NOTES PAYABLE

During the three months ended June 30, 2003, the Company borrowed $124,000 on an
unsecured  basis from a  shareholder  under a two year note  payable  with 7.85%
interest, payable monthly.

A note payable was also issued to Western  State Bank for $9,726 for a period of
four years, with 5.25% interest, payable monthly, secured by certain property.

NOTE 5 - RELATED PARTY

Commissions  of $4,729 were paid to  Rangecap,  LLC for the three and six months
ended June 30, 2003 for profits  recorded to  Multiband  equipment  purchased by
Rangecap.  David Weiss, Rangecap's principal, is a Vicom director. There were no
payments during fiscal year 2002.

NOTE 6 - STOCK WARRANTS

Stock warrants activity is as follows for the six months ended June 30, 2003:

                                                                Weighted Average
                                         Number of Warrants      Exercise Price
                                         ------------------      --------------
Warrants outstanding - December 31, 2002    4,327,396                2.05
  Granted                                   2,425,173                1.26
  Canceled or expired                               0                   0
  Exercised                                  (346,290)               1.79
                                           ----------                ----
Warrants outstanding - JUNE 30, 2003        6,406,279                1.77
                                           ==========                ====

The warrants  granted during the six months ended June 30, 2003 were awarded for
common stock,  preferred  stock, for services  rendered,  and in connection with
notes payable.


                                       7
<PAGE>


NOTE 7 - BUSINESS SEGMENTS

Following is Company  business  segment  information  for the three months ended
June 30, 2003 and 2002:

<TABLE>
<CAPTION>
                                                          Vicom            CTU         MultiBand          Total
                                                        ---------       ---------       ---------      ----------
<S>                                                  <C>             <C>             <C>             <C>
Three months ended June 30, 2003
         Revenues                                    $          0    $  5,330,420    $    357,961    $  5,688,381
         Income (Loss) from operations                   (502,859)         28,463        (254,384)       (728,780)
         Identifiable assets                            3,627,690       5,711,347       2,955,839      12,294,876
         Depreciation and amortization                     11,726         111,722         112,149         235,597
         Capital expenditures                                   0         194,123          21,574         215,697
Three months ended June 30, 2002
         Revenues                                    $          0    $  5,815,531    $    128,893    $  5,944,424
         Income (Loss) from operations                   (424,970)         30,832        (256,375)       (650,513)
         Identifiable assets                            3,081,046       5,509,679       3,171,368      11,762,093
         Depreciation and amortization                    136,795         112,823         137,310         368,928
         Capital expenditures                                   0          44,619         105,109         149,728
</TABLE>

Following is Company business segment  information for the six months ended June
30, 2003 and 2002:

<TABLE>
<CAPTION>
                                                          Vicom            CTU         MultiBand          Total
                                                        ---------       ---------       ---------      ----------
<S>                                                  <C>             <C>             <C>             <C>
Six Months ended June 30, 2003
         Revenues                                    $          0    $ 10,967,062    $    593,081    $ 11,560,143
         Loss from operations                            (909,280)        (26,431)       (468,005)     (1,403,716)
         Identifiable assets                            3,627,690       5,711,347       2,955,839      12,294,876
         Depreciation and amortization                     23,451         218,666         207,612         449,729
         Capital expenditures                                   0         230,768          77,214         307,982
Six Months ended June 30, 2002
         Revenues                                    $          0    $ 11,977,112    $    229,500    $ 12,206,612
         Loss from operations                            (869,252)        (56,443)       (508,382)     (1,434,077)
         Identifiable assets                            3,081,046       5,509,679       3,171,368      11,762,093
         Depreciation and amortization                    265,454         232,740         273,276         771,470
         Capital expenditures                                   0          84,439         170,822         255,261
</TABLE>

NOTE 8- MULTIBAND USA JOINT VENTURE

         During  February  2003,  the  Company  incorporated  a new  subsidiary,
Multiband USA,  Incorporated  (MB USA).  This subsidiary was set up as part of a
50% owned joint venture  agreement  with PACE  Electronics,  Inc (PACE) with the
Company  having the right to elect two of the three board of directors.  As part
of the joint venture agreement,  the Company, at its sole option and discretion,
shall have the right,  but not the  obligation to convert one Vicom common share
for every ten shares of MB USA issued to PACE.

         On April 25, 2003, the Company, through MB USA, purchased certain video
equipment assets from Suncoast  Automation,  Inc for $450,000.  The Company also
purchased related rights to video subscribers and rights of access agreements.


                                       8
<PAGE>


FORWARD-LOOKING STATEMENTS

         From time to time, the Company may publish  forward-looking  statements
relating  to  such  matters  as  anticipated  financial  performance,   business
prospects,  product pricing, management for growth, integration of acquisitions,
technological  developments,  new  products,  and similar  matters.  The Private
Securities   Litigation   Reform  Act  of  1995   provides  a  safe  harbor  for
forward-looking  statements including those made in this statement.  In order to
comply  with the terms of the Private  Securities  Litigation  Reform  Act,  the
Company notes that a variety of factors could cause the Company's actual results
and experience to differ  materially from the  anticipated  results or Company's
forward-looking statements.

         The  risks  and   uncertainties   that  may  affect   the   operations,
performance,  developments  and results of the  Company's  business  include the
following:  national  and  regional  economic  conditions;  pending  and  future
legislation affecting IT and telecommunications industries; market acceptance of
the Company's products and services;  the Company's  products and services;  the
Company's  continued ability to provide integrated  communication  solutions for
customers in a dynamic industry; and other competitive factors.

         Because these and other  factors  could affect the Company's  operating
results,  past financial  performance  should not necessarily be considered as a
reliable indicator of future performance and anticipated future period results.

                                     ITEM 2.
                     MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                  FINANCIAL CONDITION AND RESULTS OF OPERATION

GENERAL

         Vicom,  Incorporated  (Vicom)  is a  Minnesota  corporation  formed  in
September   1975.   Vicom  is  the  parent   corporation  of  two   wholly-owned
subsidiaries,  Corporate  Technologies,  USA, Inc.  (CTU),  and MultiBand,  Inc.
(MultiBand).

         Vicom  completed an initial  public  offering in June 1984. In November
1992, Vicom became a non-reporting  company under the Securities Exchange Act of
1934. In July 2000,  Vicom regained its reporting  company status.  In December,
2000,  Vicom stock began trading on the NASDAQ stock  exchange  under the symbol
VICM.

         Vicom's website is located at: www.vicominc.net .
                                        ----------------

         Vicom  recently  expanded  its efforts to establish  itself  within the
rapidly evolving telecommunications and computer industries.  Effective December
31, 1998,  Vicom acquired the assets of the Midwest region of Enstar  Networking
Corporation (ENC), a data cabling and networking  company.  In late 1999, in the
context of a forward triangular  merger,  Vicom, to expand its range of computer
products  and  related  services,  purchased  the  stock of  Ekman,  Inc.  d/b/a
Corporate  Technologies,  and merged Ekman, Inc. into the newly formed surviving
corporation,  Corporate Technologies,  USA, Inc. (CTU). CTU provides voice, data
and video systems and services to business and government.  MultiBand,  Inc. was
incorporated in February 2000.  MultiBand,  Inc provides  voice,  data and video
services to multiple  dwelling units (MDU's).  Multiband USA, Inc. was formed in
February,  2003 in partnership with Pace Electronics,  a video  wholesaler,  and
provides the same services as Multiband, Inc.

         As of June 30, 2003, CTU was providing  telephone equipment and service
to approximately 800 customers, with approximately 10,000 telephones in service.
In addition,  CTU provides computer products and services to approximately 2,100
customers.  MultiBand,  as of June 30, 2003, had approximately  4,100 customers.
Telecommunications  systems  distributed  by Vicom are intended to provide users
with flexible, cost-effective alternatives as compared to systems available from

                                       9
<PAGE>

major telephone  companies,  including those formerly comprising the Bell System
and from other interconnect telephone companies.

         CTU provides a full range voice, data and video communications  systems
and service,  system integration,  training and related  communication sales and
support  activities for commercial,  professional and  institutional  customers,
most of which are located in Minnesota and North Dakota.  CTU purchases products
and  equipment  from  NEC  America,  Inc.  (NEC),  Siemens  Enterprise  Networks
(Siemens),  Cisco Systems, Inc. (Cisco), Nortel Networks Corp. (Nortel), Tadiran
Telecommunications,  Inc.  (Tadiran),  and other manufacturers of communications
and  electronic  products  and  equipment.  CTU uses  these  products  to design
telecommunications systems to fit its customers' specific needs and demands.


                                       10
<PAGE>

SELECTED CONSOLIDATED FINANCIAL DATA

<TABLE>
<CAPTION>
                                                 DOLLAR AMOUNTS AS A PERCENTAGE OF       DOLAR AMOUNTS AS A PERCENTAGE OF
                                                              REVENUES                               REVENUES
                                                         THREE MONTHS ENDED                      SIX MONTHS ENDED
                                                 June 30, 2003      June 30, 2002       June 30, 2003       June 30, 2002
                                                  (unaudited)        (unaudited)         (unaudited)          (unaudited)

<S>                                                  <C>               <C>                 <C>                 <C>
REVENUES                                              100%               100%                100%                100%

COST OF PRODUCTS & SERVICES                          68.8%              73.3%               71.2%               74.9%

GROSS MARGIN                                         31.2%              26.7%               28.8%               25.1%

SELLING, GENERAL & ADMINISTRATIVE                    44.0%              37.7%               41.0%               36.8%

OPERATING LOSS                                      -12.8%             -11.0%              -12.1%              -11.7%
  INTEREST EXPENSE & OTHER, NET                      -3.6%              -6.7%               -4.3%               -6.0%
LOSS BEFORE TAXES                                   -16.4%             -17.7%              -16.4%              -17.7%
MINORITY INTEREST IN JOINT VENTURE                      0%                 0                   0%                  0
INCOME TAX                                              0                  0                   0                   0
NET LOSS                                            -16.4%             -17.7%              -16.4%              -17.7%
</TABLE>

The  following  table sets forth,  for the period  indicated,  the gross  margin
percentages for Corporate Technologies USA, Inc., MultiBand,  Inc. and Multiband
USA, Inc.

<TABLE>
<CAPTION>
                                                        THREE MONTHS ENDED                         SIX MONTHS ENDED
                                                JUNE 30, 2003        JUNE 30, 2002        JUNE 30, 2003        JUNE 30, 2002
<S>                                                 <C>                  <C>                  <C>                  <C>
GROSS MARGIN PERCENTAGES:
  CORPORATE TECHNOLOGIES USA, INC.                  30.4%                26.7%                28.2%                25.0%
  MULTIBAND, INC.                                   43.6%                34.1%                55.6%                35.5%
</TABLE>

RESULTS OF OPERATIONS

Revenues

         Revenues  decreased  4.3% to  $5,688,381  in the quarter ended June 30,
2003, as compared to $5,944,424 for the quarter ended June 30, 2002.

         Revenues for (CTU)  decreased 8.3% in the second quarter of fiscal 2002
to $5,330,420  as compared to  $5,815,531 in the second  quarter of fiscal 2002.
This decrease in CTU's revenues resulted primarily from CTU's desire to increase
gross margins versus maintaining top line revenues.

         Revenues for MultiBand,  Inc.  increased 117.7% to $357,961 as compared
to  $128,893  in the second  quarter of fiscal  2002.  This  increase  is due to
continued expansion of MultiBand services to additional properties.

         Revenues for the six month period ended June 30, 2003 decreased 5.3% to
$11,560,143 from $12,206,612 for the same period in 2002. For the second half of
fiscal year 2003,  the  Company  anticipates  revenues to remain  stable as both
subscriber revenues and Multiband project installation  revenues are expected to
increase.


                                       11
<PAGE>

Gross Margin

         The Company's  gross margin  increased  11.6% or $184,251 to $1,773,961
for the quarter ended June 30, 2003,  as compared to $1,589,710  for the similar
quarter  last year.  This  increase  in gross  margin is due to an  increase  in
service sales and recurring  subscriber  revenues which have better margins than
product  sales.  For the  quarter  ended  June 30,  2003,  as a percent of total
revenues,  gross  margin was 31.2% as compared  to 26.7% for the similar  period
last year.  This  increase in gross margin  percentage  is  primarily  due to an
increase in service sales and recurring  subscriber  revenues  which have better
margins than equipment sales.

         Gross margin for Corporate  Technologies USA, Inc. increased by 4.3% to
$1,618,065 for the quarter ended June 30, 2003, as compared to $1,551,763 in the
second  quarter of fiscal  2002.  This  increase  is due to the above  mentioned
service and subscriber sales.

         Gross margin for  MultiBand,  Inc. for the quarter  ended June 30, 2003
increased  354.7% to $155,896  as  compared to $43,947 in the second  quarter of
fiscal 2002 reflecting on the increase of revenue being billed.

         For the six month  period  ended June 30,  2003,  as a percent of total
revenues,  gross  margin was 28.8% as  compared  to 25.1% for the same period in
2002.  For the second half of fiscal year 2003,  gross  margin  percentages  are
expected to remain higher than gross margin percentages in the prior year as the
Company  continues  to shift its  emphasis to consumer  oriented  services  from
business related equipment sales.

Selling, General and Administrative Expenses

         Selling,   general  and  administrative  expenses  increased  11.7%  to
$2,502,741  in the quarter  ended June 30, 2003,  compared to  $2,240,223 in the
prior year quarter.  Selling,  general and  administrative  expenses  were, as a
percentage of revenues,  44.0% for the quarter ended June 30, 2003 and 37.7% for
the similar period a year ago. This increase is primarily attributable to higher
payroll and occupancy costs and the start-up of Multiband USA.

         For the six month period ended June 30, 2003 these  expenses  increased
5.4% to $4,738,737  as compared to $4,496,761  for the six months ended June 30,
2002. As a percentage of revenues,  selling, general and administrative expenses
are 41.0% for the period  ended June 30,  2003 as compared to 36.8% for the same
period 2002.

Interest Expense

         Interest  expense was  $219,723  for the quarter  ended June 30,  2003,
versus $426,869 for the similar period a year ago,  reflecting a decrease in the
Company's  long  term debt  that  resulted  in a  considerable  decrease  in the
amortization  of original  discount  expense.  Amortization  of  original  issue
discount  was $85,364 and  $260,774 for the three months ended June 30, 2003 and
2002.

         Interest  expense was  $445,410  for the six months ended June 30, 2003
and  $772,904  for the same period last year.  For the six months ended June 30,
2003  amortization of original discount was $199,980 and $471,757 in same period
as last year.


                                       12
<PAGE>

Net Loss

         In the second quarter of fiscal 2003,  the Company  incurred a net loss
of $934,664  compared to a net loss of $1,052,101  for the second fiscal quarter
of 2002. A decline in operating losses for the second quarter of 2003 versus the
similar period a year ago was primarily due to the above  mentioned  increase in
gross margin.

         For the six months ended June 30, 2003, the Company recorded a net loss
of $1,900,783, as compared to $2,162,024 for the six months ended June 30, 2002.

Liquidity and Capital Resources

         Available  working  capital at June 30, 2003 increased over the similar
period last year primarily due to a significant  decrease in the current portion
of long term debt and capital lease obligations.

         Inventories  decreased over last year's prior period inventories due to
the aforementioned revenue decreases. Net borrowings under notes and installment
obligations payable decreased for the period ended June 30, 2003 compared to the
prior year's period due to the reduction in capital leases.

         Management of Vicom believes that, for the near future,  cash generated
by sales of stock, and existing credit facilities, in aggregate, are adequate to
meet  the  anticipated  liquidity  and  capital  resource  requirements  of  its
Corporate  Technologies  USA, Inc.  business for the next twelve months provided
Company operating losses continue to decrease.  Significant  continuation of the
Company's MultiBand, Inc.'s build-out is highly dependent on securing additional
financing for future projects.  Management  believes that while future build-out
financing  is  available,  there is no  guarantee  that said  financing  will be
obtained.

Capital Expenditures

         The  Company  used  $307,982  for capital  expenditures  during the six
months ended June 30, 2003,  as compared to $255,261 in the similar  period last
year. Capital expenditures  consisted of equipment acquired for internal use and
for completion of a Multiband build out.

CRITICAL ACCOUNTING POLICIES AND ESTIMATES

Impairment of Long-Lived Assets

The  Company's  long-lived  assets  include  property,  equipment  and leasehold
improvements.  The  estimated  fair value of these  assets is  dependent  on the
Company's future  performance.  In assessing for potential  impairment for these
assets,  the Company  considers future  performance.  If these forecasts are not
met,  the  Company  may have to  record  an  impairment  charge  not  previously
recognized, which may be material. During the six months ended June 30, 2003 and
2002,  the Company did not record any  impairment  losses  related to long-lived
assets.

Impairment of Goodwill

We  periodically   evaluate   acquired   businesses  for  potential   impairment
indicators.  Our judgements regarding the existence of impairment indicators are
based on legal factors,  market  conditions and  operational  performance of our
acquired  businesses.  Future events could cause us to conclude that  impairment
indicators  exist and that goodwill  associated with our acquired  businesses is
impaired.  Any resulting impairment loss could have a material adverse impact on
our financial  condition and results of operations.  During the six months ended
June 30, 2003 and 2002, the Company did not record any impairment losses related
to goodwill.


                                       13
<PAGE>

Inventories

We value our inventory at the lower of the actual cost or the current  estimated
market value of the inventory.  We regularly review inventory quantities on hand
and record a provision for excess and obsolete  inventory.  Rapid  technological
change,  frequent new product  development,  and rapid product obsolescence that
could result in an increase in the amount of obsolete  inventory  quantities  on
hand characterize our industry.

RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS

In April 2003, the Financial  Accounting Standards Board (FASB) issued Statement
of Financial Accounting Standards (SFAS) No. 149, "Amendment of Statement 133 on
Derivative  Instruments and Hedging Activities," effective for contracts entered
into or modified after June 30, 2003.  This amendment  clarifies when a contract
meets the characteristics of a derivative,  clarifies when a derivate contains a
financing  component  and amends  certain  other  existing  pronouncements.  The
Company believes the adoption of SFAS No. 149 will not have a material effect on
the Company's consolidated statements.


In May 2003,  the FASB issued SFAS No. 150,  "Accounting  for Certain  Financial
Instruments with  Characteristics  of both Liabilities and Equity." SFAS No. 150
is effective for financial  instruments  entered into or modified  after May 31,
2003,  and otherwise is effective at the  beginning of the first interim  period
beginning  after June 15, 2003.  SFAS No. 150 requires the  classification  as a
liability of any financial  instruments with a mandatory  redemption feature, an
obligation to repurchase equity shares, or a conditional obligation based on the
issuance of a variable  number of its equity  shares.  The Company does not have
any financial  instruments as defined by SFAS No. 150. The Company  believes the
adoption  of SFAS  No.  150 will not have a  material  effect  on the  Company's
consolidated statements.


In  November  2002,  the FASB issued FASB  Interpretation  No. 45,  "Guarantor's
Accounting  and  Disclosure  Requirements  for  Guarantees,  Including  Indirect
Guarantees  of   Indebtedness   of  Others"  (FIN  45).  FIN  45  clarifies  the
requirements  for  a  guarantor's  accounting  for  and  disclosure  of  certain
guarantees  issued  and  outstanding.   The  initial   recognition  and  initial
measurement provisions of FIN 45 are applicable to guarantees issued or modified
after December 31, 2002. The disclosure requirements of FIN 45 are effective for
financial statements for periods ending after December 15, 2002. The adoption of
FIN 45 did not impact the Company's consolidated financial statements.

In January 2003, the FASB issued FASB  Interpretation No. 46,  "Consolidation of
Variable  Interest  Entities"  (FIN 46). FIN 46 states that  companies that have
exposure to the economic  risks and  potential  rewards  from  another  entity's
assets  and  activities  have a  controlling  financial  interest  in a variable
interest entity and should consolidate the entity,  despite the absence of clear
control through a voting equity interest.  The consolidation  requirements apply
to all variable  interest  entities created after January 31, 2003. For variable
interest  entities  that existed  prior to February 1, 2003,  the  consolidation
requirements  are effective for annual or interim  periods  beginning after June
15, 2003.  Disclosure of significant  variable  interest entities is required in
all financial  statements issued after January 31, 2003,  regardless of when the
variable  interest was created.  The Company does not expect the adoption of FIN
46 to have a material impact the Company's consolidated financial statements.



                                       14
<PAGE>

ITEM 3.  QUANTITIVE AND QUALITIVE DISCLOSURE ABOUT MARKET RISK

         Vicom is not subject to any material  interest rate risk as any current
lending agreements are at a fixed rate of interest.

ITEM 4.  CONTROLS AND PROCEDURES

The Company has carried out an evaluation,  with the  participation of its chief
executive/chief  financial officer,  of the effectiveness,  as of the end of the
most recent fiscal quarter, of the Company's  disclosure controls and procedures
(as defined in Rule  13a-15(e) and 15d-15(e) of the  Securities  Exchange Act of
1934), and the Company's  internal control over financial  reporting (as defined
in Rules 13a-15(f) and 13a-15(f) of the Securities  Exchange Act of 1934). Based
upon that evaluation, the chief executive/chief financial officer concluded that
the Company's  disclosure controls and procedures are effective in alerting him,
on a timely  basis,  to material  information  required to be  disclosed  in the
Company's  periodic  reports to the Securities and Exchange  Commission and that
there has been no  significant  change in the  Company's  internal  control over
financial  reporting that occurred over the most recently ended fiscal  quarter,
that has materially affected,  or is reasonably likely to materially affect, the
Company's internal control over financial reporting.

PART II.  OTHER INFORMATION

During the second quarter of fiscal year 2003, the Company raised  approximately
$1,917,998  due to sales of common stock via private  placements  to  accredited
investors   and  investor   exercises  of  warrants.   The  proceeds   from  the
aforementioned were used primarily for working capital and to retire debt.


ITEM 5.  LEGAL PROCEEDINGS

         As of June 30,  2003,  Vicom was not  engaged in any legal  proceedings
whose anticipated results would have a material adverse impact on the Company.

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         (a)      Exhibits

                     10.16
                     31.1
                     31.2
                     32

         (b)      Reports on Form 8-K.
                     None


                                       15
<PAGE>

                                   SIGNATURES

         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.

                                   VICOM, INC.
                                   Registrant

Date: August 14, 2003              By:

                                               /s/ James L. Mandel
                                             Chief Executive Officer

Date: August 14, 2003              By:

                                              /s/ Steven M. Bell
                                           Chief Financial Officer
                                 (Principal Financial and Accounting Officer)


                                       16