U.S. SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10-QSB

[X]  QUARTERLY  REPORT UNDER SECTION 12 OR 15(d) OF THE SECURITIES  EXCHANGE ACT
     OF 1934 FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2000.

[ ]  TRANSITION  REPORT UNDER SECTION 13 OR 15(d) OF THE  SECURITIES  EXCHANGE
     ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO ____.

                          Commission file number 21143

                        CONVERGENCE COMMUNICATIONS, INC.
        (Exact name of small business issuer as specified in its charter)


                            Nevada                           87-0545056
               (State or other jurisdiction of            (I.R.S. Employer
                incorporation or organization)          Identification No.)

                102 West 500 South, Suite 320
                     Salt Lake City, Utah                      84101
           (Address of Principal Executive Offices)          (Zip Code)

                                 (801) 328-5618
                           (Issuer's telephone number)

                                 Not Applicable
(Former  name,  former  address and former  fiscal year,  if changed  since last
report)


Check  whether the issuer (1) filed all reports  required to be filed by Section
13 or 15(d) of the  Exchange  Act during the past 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___

As of April 30, 2000,  11,717,701 shares of registrant's Common Stock, par value
$.001 per share,  101,374 shares of the  registrant's  Series B Preferred Stock,
par value $.001 per share,  and 9,728,909  shares of the  registrant's  Series C
Preferred Stock, par value $.001 per share, were outstanding.

<PAGE>

PART I:  FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS REQUIRED BY FORM 10-QSB

         The  accompanying   unaudited   consolidated  financial  statements  of
Convergence Communications, Inc. have been prepared in accordance with generally
accepted  accounting  principles for interim financial reporting and pursuant to
the rules and regulations of the Securities and Exchange Commission. They do not
include all of the  information  and  footnotes  required by generally  accepted
accounting  principles  for  complete  financial  statements.   These  financial
statements should be read in conjunction with Note 1 herein and the consolidated
financial  statements  and notes  thereto  included in our annual report on Form
10-KSB for the year ended December 31, 1999,  which are  incorporated  herein by
reference.  The  accompanying  financial  statements  have not been  examined by
independent   accountants  in  accordance  with  generally   accepted   auditing
standards,  but in the opinion of  management,  all  adjustments  (consisting of
normal recurring  entries) necessary for the fair presentation of our results of
operations,  financial  position and changes  therein for the periods  presented
have been  included.  The results of operations for the three months ended March
31, 2000 may not be  indicative of the results that may be expected for the year
ending December 31, 2000.

<PAGE>

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES
<TABLE>
<CAPTION>

CONSOLIDATED BALANCE SHEETS (UNAUDITED)
MARCH 31, 2000 AND DECEMBER 31, 1999
-------------------------------------------------------------------------------------------------------------------

                                                                                  March 31,          December 31,
                                                                                    2000                 1999
                                                                               ----------------     ---------------
<S>                                                                              <C>                 <C>
ASSETS
CURRENT ASSETS:
    Cash and cash equivalents                                                     $ 19,247,958        $ 26,303,296
    Accounts receivable - net                                                        3,757,357           3,180,748
    Inventory - net                                                                    367,715             262,177
    Other current assets                                                             3,491,746           1,225,490
                                                                               ----------------     ---------------
                 Total current assets                                               26,864,776          30,971,711
PROPERTY AND EQUIPMENT - net                                                        29,648,981          28,446,776
INTANGIBLE ASSETS - net                                                             35,241,003          36,660,025
OTHER ASSETS                                                                         1,535,948           1,126,011
                                                                               ----------------     ---------------
TOTAL ASSETS                                                                      $ 93,290,708        $ 97,204,523
                                                                               ================     ===============

LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES:
    Notes payable - current portion                                               $ 11,423,346        $ 11,190,987
    Accounts payable and accrued liabilities                                         9,500,360           6,851,249
    Due to affiliates                                                                  122,356             122,356
                                                                               ----------------     ---------------
                 Total current liabilities                                          21,046,062          18,164,592
LONG-TERM LIABILITIES:
    Notes payable - long-term portion                                               11,546,997          11,389,937
    Long-term debt (payable to related parties)                                      2,622,261           2,595,634
    Other long-term liabilities                                                        193,899             185,686
                                                                               ----------------     ---------------
                 Total long-term liabilities                                        14,363,157          14,171,257
MINORITY INTEREST IN SUBSIDIARIES                                                    4,835,652           5,493,394
                                                                               ----------------     ---------------
                 Total liabilities                                                  40,244,871          37,829,243
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS' EQUITY:
    Series "B" Preferred stock; $0.001 par value; 750,000 shares authorized:
       101,374 shares issued and outstanding in 2000 and 1999.                             101                 101
    Series "C" Preferred stock; $0.001 par value; 14,250,000 shares authorized:
       9,728,909 shares issued and outstanding in 2000 and 1999.                         9,729               9,729
    Common stock; $0.001 par value; 100,000,000 shares authorized:
       11,596,489 and 11,585,489 outstanding in 2000 and 1999, respectively             11,596              11,585
    Additional paid-in capital                                                      95,412,346          95,147,893
    Accumulated deficit                                                            (42,458,296)        (35,764,016)
    Accumulated other comprehensive income (loss)                                       70,361             (30,012)
                                                                               ----------------     ---------------
                 Total stockholders' equity                                         53,045,837          59,375,280
                                                                               ----------------     ---------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY                                        $ 93,290,708        $ 97,204,523
                                                                               ================     ===============


See notes to consolidated financial statements.

</TABLE>

<PAGE>

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2000, 1999 AND 1998
-----------------------------------------------------------------------------------------------------------------------

                                                                   Three Months       Three Months       Three Months
                                                                      Ended               Ended             Ended
                                                                     March 31           March 31           March 31
                                                                       2000               1999               1998
                                                                 -----------------   ----------------   ---------------

<S>                                                                   <C>               <C>                 <C>
NET REVENUES FROM SERVICES                                            $ 7,216,423        $ 2,042,488          $ 28,336
                                                                 -----------------   ----------------   ---------------
COSTS AND EXPENSES:
    Variable cost of services                                           4,100,160            980,352            91,800
    Salaries, wages and benefits                                        3,154,721            584,985            85,768
    Selling, general and administrative                                 3,680,208          1,930,687           856,150
    Depreciation and amortization                                       2,908,715          1,205,871           428,897
    Stock option compensation expense                                     264,223            317,005                 -
                                                                 -----------------   ----------------   ---------------
                  Total costs and expenses                             14,108,027          5,018,900         1,462,615
                                                                 -----------------   ----------------   ---------------
OPERATING LOSS                                                         (6,891,604)        (2,976,412)       (1,434,279)
OTHER INCOME AND (EXPENSES):
    Interest expense, net                                                (444,939)          (585,072)           54,049
    Net gain (loss) on foreign exchange                                    38,281                  -                 -
                                                                 -----------------   ----------------   ---------------
                  Total other expense                                    (406,658)          (585,072)           54,049
                                                                 -----------------   ----------------   ---------------
LOSS BEFORE INCOME TAXES AND MINORITY INTEREST                         (7,298,262)        (3,561,484)       (1,380,230)
PROVISION FOR INCOME TAXES                                                (53,759)           (34,774)                -
                                                                 -----------------   ----------------   ---------------
LOSS BEFORE MINORITY INTEREST                                          (7,352,021)        (3,596,258)       (1,380,230)
MINORITY INTEREST IN LOSS OF SUBSIDIARIES                                 657,741            355,260             4,096
                                                                 -----------------   ----------------   ---------------
NET LOSS ATTRIBUTABLE TO COMMON SHAREHOLDERS                         $ (6,694,280)      $ (3,240,998)     $ (1,376,134)
                                                                 =================   ================   ===============
Net loss per basic and diluted common share                               $ (0.49)           $ (0.27)          $ (0.13)
                                                                 =================   ================   ===============
Weighted-average number of common shares:
    Basic and diluted                                                  21,419,157         11,839,656        10,813,180
                                                                 =================   ================   ===============


See notes to consolidated financial statements.

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                Preferred Stock
                                                                    --------------------------------------------------------------
                                                                           Series "A"                             Series "B"
                                                                    -----------------------------    -----------------------------
                                                      Total             Shares          Amount           Shares           Amount
                                                   --------------   ------------    -------------    ---------------    ----------
<S>                                                  <C>              <C>              <C>               <C>              <C>
BALANCE, DECEMBER 31, 1996                            $ (661,018)
Reverse acquisition of TIC:
     Exchange of TIC common shares for CCI
     Series "A" Preferred shares                          14,571        685,063            $ 685
     Addition of CCI common stock                         86,990
Exchange of CVV common stock for CCI common
     shares and Series "B" Preferred shares            7,096,500                                            101,374         $ 101
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                    10,000,000        150,380              150
Issuance of warrants below fair value                    657,143
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                       300,000          4,083                4
Issuance of options for common shares and
     Series "A" Preferred shares below fair value      1,479,074
Net loss for the year ended December 31, 1997         (4,594,294)
                                                   --------------   ------------    -------------    ---------------    ----------
BALANCE, DECEMBER 31, 1997                            14,378,966        839,526              839            101,374           101
Comprehensive loss:
     Net loss for the year ended December 31, 1998   (10,230,796)
     Other comprehensive loss consisting of
          foreign currency translation adjustment        (20,515)
                                                   --------------   ------------    -------------    ---------------    ----------
          Total comprehensive loss                   (10,251,311)             -                -                  -             -
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                     4,956,626         91,180               91
Conversion of Series "A" Preferred shares into
     common shares                                             -       (930,706)            (930)
Exchange of Telecom common stock for CCI
     common shares                                       600,000
Issuance of options for common shares
     below fair value                                  1,000,245
                                                   --------------   ------------    -------------    ---------------    ----------
BALANCE, DECEMBER 31, 1998                            10,684,526              -                -            101,374           101
Comprehensive loss:
     Net loss for the year ended December 31, 1999   (20,277,479)
     Other comprehensive loss consisting of
          foreign currency translation adjustment         (9,497)
                                                   --------------   ------------    -------------    ---------------    ----------
          Total comprehensive loss                   (20,286,976)             -                -                  -             -

Issuance of Series "C" Preferred Stock, net           67,794,198
Issuance of warrants                                     750,677
Repurchases and retirements of common stock           (1,215,860)
Forgiveness of related party liability                   235,175
Issuance of warrants on debt                             162,191
Issuance of options for common shares
     below fair value                                  1,251,349
                                                   --------------   ------------    -------------    ---------------    ----------
BALANCE, DECEMBER 31, 1999                            59,375,280              -                -            101,374           101
Comprehensive income (loss):
     Net loss for three months ended March 31, 2000   (6,694,280)
     Other comprehensive income consisting of
          foreign currency translation adjustment        100,373
                                                   --------------   ------------    -------------    ---------------    ----------
          Total comprehensive loss                    (6,593,907)             -                -                  -             -

Exercise of stock options                                    241
Issuance of options for common shares
     below fair value                                    264,223
                                                   --------------   ------------    -------------    ---------------    ----------
BALANCE, MARCH 31, 2000                             $ 53,045,837              -                -            101,374         $ 101
                                                   ==============   ============    =============    ===============    ==========

See notes to consolidated financial statements.
</TABLE>
<PAGE>
CONTINUED

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES

<TABLE>
<CAPTION>
CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
----------------------------------------------------------------------------------------------------------------------------------
                                                                Preferred Stock
                                                     -----------------------------------
                                                                  Series "C"                            Common Stock
                                                     -----------------------------------  ----------------------------------------
                                                          Shares               Amount           Shares                  Amount
                                                     ------------------    -------------  --------------------    ----------------
<S>                                                     <C>                <C>               <C>                    <C>
BALANCE, DECEMBER 31, 1996                                                                       428,571               $ 429
Reverse acquisition of TIC:
     Exchange of TIC common shares for CCI
     Series "A" Preferred shares                                                                (428,571)               (429)
     Addition of CCI common stock                                                              1,041,494               1,041
Exchange of CVV common stock for CCI common
     shares and Series "B" Preferred shares                                                      450,563                 451
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                                               228,658                 229
Issuance of warrants below fair value
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                                                24,284                  24
Issuance of options for common shares and
     Series "A" Preferred shares below fair value
Net loss for the year ended December 31, 1997
                                                     -------------    -------------  --------------------    ----------------
BALANCE, DECEMBER 31, 1997                                      -                -             1,744,999               1,745
Comprehensive loss:
     Net loss for the year ended December 31, 1998
     Other comprehensive loss consisting of
          foreign currency translation adjustment
                                                     -------------    -------------  --------------------    ----------------
          Total comprehensive loss                              -                -                     -                   -
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                                               600,504                 600
Conversion of Series "A" Preferred shares into
     common shares                                                                             9,307,060               9,307
Exchange of Telecom common stock for CCI
     common shares                                                                                85,714                  86
Issuance of options for common shares
     below fair value
                                                     -------------    -------------  --------------------    ----------------
BALANCE, DECEMBER 31, 1998                                      -                -            11,738,277              11,738
Comprehensive loss:
     Net loss for the year ended December 31, 1999
     Other comprehensive loss consisting of
          foreign currency translation adjustment
                                                     -------------    -------------  --------------------    ----------------
          Total comprehensive loss                              -                -                     -                   -

Issuance of Series "C" Preferred Stock, net             9,728,909           $9,729
Issuance of warrants
Repurchases and retirements of common stock                                                     (152,788)               (153)
Forgiveness of related party liability
Issuance of warrants on debt
Issuance of options for common shares
     below fair value
                                                     -------------    -------------  --------------------    ----------------
BALANCE, DECEMBER 31, 1999                              9,728,909            9,729            11,585,489              11,585
Comprehensive income (loss):
     Net loss for three months ended March 31, 2000
     Other comprehensive income consisting of
          foreign currency translation adjustment
                                                     -------------    -------------  --------------------    ----------------
          Total comprehensive loss                              -                -                     -                   -

Exercise of stock options                                                                         11,000                  11
Issuance of options for common shares
     below fair value
                                                     -------------    -------------  --------------------    ----------------
BALANCE, MARCH 31, 2000                                 9,728,909           $9,729            11,596,489            $ 11,596
                                                     =============    =============  ====================    ================


See notes to consolidated financial statements.
</TABLE>
<PAGE>

CONTINUED

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2000 AND YEARS ENDED DECEMBER 31, 1999, 1998, AND 1997
----------------------------------------------------------------------------------------------------------------------------------
                                                                                                                Accumulated
                                                               Additional                                       Other Compre-
                                                                 Paid-in                 Accumulated            hensive Income
                                                                 Capital                  Deficit                   (Loss)
                                                         -------------------    ----------------------   ------------------------
<S>                                                            <C>                       <C>                     <C>
BALANCE, DECEMBER 31, 1996                                                                  $ (661,447)
Reverse acquisition of TIC:
     Exchange of TIC common shares for CCI
     Series "A" Preferred shares                                    $ 14,315
     Addition of CCI common stock                                     85,949
Exchange of CVV common stock for CCI common
     shares and Series "B" Preferred shares                        7,095,948
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                 9,999,621
Issuance of warrants below fair value                                657,143
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                   299,972
Issuance of options for common shares and
     Series "A" Preferred shares below fair value                  1,479,074
Net loss for the year ended December 31, 1997                                               (4,594,294)
                                                         --------------------    ----------------------   ------------------------
BALANCE, DECEMBER 31, 1997                                        19,632,022                (5,255,741)
Comprehensive loss:
     Net loss for the year ended December 31, 1998                                         (10,230,796)
     Other comprehensive loss consisting of
          foreign currency translation adjustment                                                                       $ (20,515)
                                                         --------------------    ----------------------   ------------------------
          Total comprehensive loss                                         -               (10,230,796)                   (20,515)
Issuance of CCI common stock and Series
     "A" Preferred shares for cash                                 4,955,935
Conversion of Series "A" Preferred shares into
     common shares                                                    (8,377)
Exchange of Telecom common stock for CCI
     common shares                                                   599,914
Issuance of options for common shares
     below fair value                                              1,000,245
                                                         --------------------    ----------------------   ------------------------
BALANCE, DECEMBER 31, 1998                                        26,179,739               (15,486,537)                   (20,515)
Comprehensive loss:
     Net loss for the year ended December 31, 1999                                         (20,277,479)
     Other comprehensive loss consisting of
          foreign currency translation adjustment                                                                        $ (9,497)
                                                         --------------------    ----------------------   ------------------------
          Total comprehensive loss                                         -               (20,277,479)                   (30,012)

Issuance of Series "C" Preferred Stock, net                       67,784,469
Issuance of warrants                                                 750,677
Repurchases and retirements of common stock                       (1,215,707)
Forgiveness of related party liability                               235,175
Issuance of warrants on debt                                         162,191
Issuance of options for common shares
     below fair value                                              1,251,349
                                                         --------------------    ----------------------   ------------------------
BALANCE, DECEMBER 31, 1999                                        95,147,893               (35,764,016)                   (30,012)
Comprehensive income (loss):
     Net loss for three months ended March 31, 2000                                         (6,694,280)
     Other comprehensive income consisting of
          foreign currency translation adjustment                                                                       $ 100,373
                                                         --------------------    ----------------------   ------------------------
          Total comprehensive loss                                         -                (6,694,280)                    70,361

Exercise of stock options                                                230
Issuance of options for common shares
     below fair value                                                264,223
                                                         --------------------    ----------------------   ------------------------
BALANCE, MARCH 31, 2000                                          $95,412,346             $ (42,458,296)                  $ 70,361
                                                         ====================    ======================   ========================

See notes to consolidated financial statements.
</TABLE>
<PAGE>

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES
<TABLE>
<CAPTION>

CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
FOR THE THREE MONTHS ENDED MARCH 31, 2000, 1999 AND 1998
--------------------------------------------------------------------------------------------------------------------------

                                                                      Three Months      Three Months       Three Months
                                                                         Ended             Ended              Ended
                                                                        March 31          March 31           March 31
                                                                          2000              1999               1998
                                                                     ---------------   ---------------   -----------------

<S>                                                                   <C>                <C>                 <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
    Net loss                                                           $ (6,694,280)     $ (3,240,998)       $ (1,376,134)
    Adjustments to reconcile net loss to net cash used in
       operating activities:
          Depreciation and amortization                                   2,908,715         1,205,871             428,897
          Provision for bad debts                                            35,944            15,000                   -
          Minority interest in loss of subsidiaries                        (657,741)         (355,260)             (4,096)
          Issuance of options for common shares below fair value            264,223           317,005                   -
          Amortization of discount on notes payable                         589,085           235,758                   -
          Issuance of warrants below fair value                                   -            54,246                   -
          Change in assets and liabilities, net of effects
            of acquisitions:
             Accounts receivable                                           (612,553)         (133,328)            (10,257)
             Due from affiliate                                                   -                 -               1,359
             Inventory                                                     (105,538)           68,490              (3,704)
             Other current assets                                        (2,266,256)         (180,781)            (32,347)
             Other assets                                                  (409,937)          (42,273)              3,072
             Accounts payable and accrued liabilities                     2,763,551           411,171             (13,433)
             Due to affiliates                                                    -          (272,266)             41,604
             Other long-term liabilities                                      8,213            20,325                   -
                                                                     ---------------   ---------------   -----------------
                  Net cash used in operating activities                  (4,176,574)       (1,897,040)           (965,039)
                                                                     ---------------   ---------------   -----------------

CASH FLOWS FROM INVESTING ACTIVITIES:
    Purchases of property and equipment                                  (2,691,898)       (3,506,368)           (271,169)
                                                                     ---------------   ---------------   -----------------
                  Net cash used in investing activities                  (2,691,898)       (3,506,368)           (271,169)
                                                                     ---------------   ---------------   -----------------

CASH FLOWS FROM FINANCING ACTIVITIES:
    Net proceeds from issuance of common stock                                    -                 -           3,161,661
    Net proceeds from exercise of stock options                                 241                 -                   -
    Net proceeds from issuance of Series "A" Preferred Stock                      -                 -           1,794,965
    Proceeds from related party note                                              -         5,000,000
    Proceeds from related party borrowings                                        -         4,703,811              22,451
    Payments on promissory notes                                           (199,666)       (4,783,029)                  -
                                                                     ---------------   ---------------   -----------------
                  Net cash (used by) provided by financing activities      (199,425)        4,920,782           4,979,077
                                                                     ---------------   ---------------   -----------------

EFFECT OF EXCHANGE RATES ON CASH                                             12,559               498                   -
                                                                     ---------------   ---------------   -----------------
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS                     (7,055,338)         (482,128)          3,742,869
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD                         26,303,296         4,215,281           6,171,515
                                                                     ---------------   ---------------   -----------------
CASH AND CASH EQUIVALENTS AT END OF PERIOD                             $ 19,247,958       $ 3,733,153         $ 9,914,384
                                                                     ===============   ===============   =================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
    Cash paid during the quarter for interest                             $ 107,577           $ 4,388                 $ -
                                                                     ===============   ===============   =================
    Cash paid during the quarter for income taxes (including prepaid)      $ 41,164          $ 27,196                 $ -
                                                                     ===============   ===============   =================


See notes to consolidated financial statements.
</TABLE>
<PAGE>

CONVERGENCE COMMUNICATIONS, INC.
AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

MARCH 31, 2000
(Unaudited)

1.       Basis of Presentation

         Convergence  Communications,  Inc.  and  subsidiaries  is a provider of
integrated  broadband  communications  and  Internet  services  through  its own
metropolitan area networks.  We operate in recently  deregulated and high growth
markets,  principally  Mexico,  Central  America and the Andean  region of South
America.  We offer  business  entities,  governmental  agencies and  residential
customers high-speed broadband data connections, high-speed and dial-up Internet
access,  voice and video  services.  Our  networks use  technology  based on the
Internet  Protocol,   or  "IP",  and  asynchronous   transfer  mode,  or  "ATM",
technology.

         From its  inception,  we have focused on  providing  telecommunications
services  using  high speed  transmission  networks  within and across  national
borders.   We  intend  to   capitalize  on  the  rapidly   growing   demand  for
telecommunications   services  in  countries   emerging  from   developing   and
state-controlled   economies  and  where  there  is  growing  liberalization  of
regulations governing the provision of telecommunications services.

         Our  consolidated  financial  statements  include  the  accounts of all
wholly and majority-owned subsidiaries,  as well as Chispa Dos, Inc. ("Chispa"),
the holding  entity of  Cablevisa,  S.A.,  Multicable  S.A.  and  Cybernet de El
Salvador S.A. We own 32.6% of the capital stock of Chispa, but we have operating
control  and 50% of the Board of  Directors  seats of  Chispa.  All  significant
intercompany  accounts and transactions  have been eliminated in  consolidation.
All capitalized terms not defined in this report have the meanings given them in
our annual report on Form 10-KSB for the year ended December 31, 1999.

2.       Net loss per common share and common share equivalent

         Net loss per common share and common share  equivalents  is computed by
both the basic method,  which uses the weighted  average number of common shares
and the common stock equivalents on a voting basis for the Series B and Series C
preferred stock outstanding, and the diluted method, which includes the dilutive
common shares from stock options and warrants,  as calculated using the treasury
stock method.

3.       Use of Estimates in Preparing Financial Statements

         The  preparation of financial  statements in conformity  with generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.

4.       Debt Obligations

         Intervan  Notes - In December  1999,  we  financed  amounts not paid at
closing in the  Intervan  Acquisition  through the  delivery  of two  promissory
notes, which are due on the first and second  anniversaries of the closing.  The
promissory note due on December 24, 2000 is in the face amount of $4,500,000 and
is non-interest  bearing. The promissory note due on December 24, 2001 is in the
face amount of $1,500,000 and bears interest  during the second year at the rate
of 8% per annum.  The notes were recorded at the present value of  approximately
$5,300,000,  which reflects the estimated market rate of interest of 10.75%. The
amounts  represented by the promissory notes are subject to downward  adjustment
if Intervan suffers recurring revenue losses after the closing.

         GBNet Notes - In December 1999, we financed amounts not paid at closing
in the GBNet Acquisition  through the delivery of four promissory  notes,  which
are due on the first  through  fourth  anniversaries  of the  closing,  totaling
$9,000,000 (after discount of promissory notes). The promissory notes, which are
non-interest  bearing,  are in face  amounts  sufficient  to provide GBM with an
imputed  interest  rate of 10.75% per annum through  their  anticipated  payment
dates.  Our  obligation to pay the deferred  portions of the purchase  price are
secured  by a  pledge  of  the  shares  of  GBNet,  as  well  as  its  operating
subsidiaries. A portion of those pledged shares will be released to us as we pay
down the  promissory  notes.  GBM will be entitled to retain at least 51% of the
pledged shares until we pay all amounts due under the promissory notes.

         El Salvador Acquisition Note Refinancing - In May 1999, Chispa obtained
a  long-term  loan from a third party  lender  totaling  $4,335,000,  of which a
portion  ($3,607,134)  was used to pay the second  note  payable  payment to the
sellers of the El Salvador Entities. The loan is due in May 2004, bears interest
at LIBOR plus 4.75% quarterly and has mandatory annual payments.

         In conjunction  with the third party loan, a loan that FondElec made to
Chispa was refinanced under the same terms as the third party loan,  except that
the FondElec loan was subordinated to the third party lender's  position and the
due date for the  FondElec  loan was changed to January 1, 2000,  with an annual
renewal until the third party lender is repaid.  In November 1999, Chispa used a
portion of the  proceeds  from  Telematica's  purchase of its interest in Chispa
(approximately  $3.8 million) to pay FondElec  amounts under this loan. (see our
report on Form 10-KSB for the year ended  December 31, 1999 for a more  detailed
description of these loan transactions).

         Under the terms of the loans,  we are required to refrain from engaging
in certain types of business activities (including sales of its assets,  mergers
or other fundamental corporate transactions) without the consent of the lenders.
The loans are secured by the assets and capital stock of Cablevisa, S.A. de C.V.
and  Multicable,   S.A.  de  C.  V.,  which  are  the  two  companies  providing
telecommunications service to subscribers in El Salvador.

<PAGE>

5.    Operating Segment Information

         We make key financial  decisions based on certain  operating results of
our  subsidiaries  and revenue types.  Our operating  segment  information is as
follows for the three months ended March 31, 2000 and 1999:

   NET REVENUES FROM SERVICES BY SUBSIDIARY:
<TABLE>
<CAPTION>

   DIAL UP INTERNET ACCESS                       March 31, 2000        March 31, 1999
                                                ------------------     ----------------
<S>                                               <C>                    <C>
   Intervan (in Mexico)                            $      101,387         $        -
   GBNet (in Central America)                             151,806                  -
   Inter@net (in Venezuela)                               263,149            295,464
   Chispa (in El Salvador)                                 18,472                  -
   Parent Company, eliminations and others                    740                  -
                                                ------------------     ---------------
        Consolidated total                         $      535,554         $  295,464
                                                ==================     ===============

   HIGH SPEED DATA                               March 31, 2000        March 31, 1999
   INTERNET ACCESS
                                                ------------------     ---------------
   Intervan (in Mexico)                            $    2,494,361         $        -
   GBNet (in Central America)                             887,363                  -
   Inter@net (in Venezuela)                                29,290                  -
   Chispa (in El Salvador)                                180,053                  -
   Parent Company, eliminations and others                (21,438)                 -
                                                ------------------     ---------------
        Consolidated total                         $    3,569,629         $        -
                                                ==================     ===============

   CABLE TELEVISION                              March 31, 2000        March 31, 1999
                                                ------------------     ---------------
   Intervan (in Mexico)                            $            -         $        -
   GBNet (in Central America)                                   -                  -
   Inter@net (in Venezuela)                                     -                  -
   Chispa (in El Salvador)                              1,661,884          1,584,702
   Parent Company, eliminations and others                      -                  -
                                                ------------------     ---------------
        Consolidated total                         $    1,661,884        $ 1,584,702
                                                ==================     ===============

   OTHER                                         March 31, 2000        March 31, 1999
                                                ------------------     ----------------
   Intervan (in Mexico)                            $    1,050,193         $        -
   GBNet (in Central America)                             103,578                  -
   Inter@net (in Venezuela)                                12,326             10,240
   Chispa (in El Salvador)                                258,498            148,616
   Parent Company, eliminations and others                 24,761              3,466
                                                ------------------     ---------------
        Consolidated total                         $    1,449,356         $  162,322
                                                ==================     ===============

   TOTAL REVENUES                                March 31, 2000        March 31, 1999
                                                ------------------     ----------------
   Intervan (in Mexico)                            $    3,645,941         $        -
   GBNet (in Central America)                           1,142,747                  -
   Inter@net (in Venezuela)                               304,765            305,704
   Chispa (in El Salvador)                              2,118,908          1,733,318
   Parent Company, eliminations and others                  4,062              3,466
                                                ------------------     ----------------
        Consolidated total                         $    7,216,423         $2,042,488
                                                ==================     ================

   OPERATING                                     March 31, 2000        March 31, 1999
   INCOME (LOSS)
                                                ------------------     ----------------
   Intervan (in Mexico)                            $  (1,715,549)         $        -
   GBNet (in Central America)                           (683,676)                  -
   Inter@net (in Venezuela)                             (355,180)           (156,380)
   Chispa (in El Salvador)                              (640,312)           (279,473)
   Parent Company, eliminations and other             (3,496,887)         (2,540,559)
                                                ------------------     ----------------
        Consolidated total                         $  (6,891,604)        $(2,976,412)
                                                ==================     ================
</TABLE>

6.       Subsequent Events

         MetroTelecom   Acquisition  -  On  April  5,  2000,  we  completed  the
acquisition  of all of the  outstanding  stock  of a  group  of  companies  that
conduct, through directly or indirectly held operating subsidiaries,  high speed
data,  dial-up Internet,  high speed Internet,  telephony and subscription cable
television  services in Guatemala.  In  conjunction  with this  transaction,  we
issued  121,212 shares of our common stock.  For a more detailed  description of
the transaction, see our report on Form 8-K dated April 5, 2000.

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS

         The  following   discussion  and  analysis  relates  to  our  financial
condition  and results of  operations  for the three months ended March 31, 2000
and 1999. This  information  should be read in conjunction with our consolidated
financial  statements and the notes related thereto  appearing  elsewhere in the
document.

A.       OVERVIEW

         We are a  provider  of data and video  telecommunications  services  to
business  and  residential  customers  over  MANs in  Latin  America.  From  our
inception, we have focused on providing  telecommunications services in emerging
markets,  primarily in Latin America,  using a high speed  transmission  network
within and across  national  borders.  We intend to  capitalize  on the  rapidly
growing  demand for  telecommunications  services  in  countries  emerging  from
developing   and   state-controlled   economies   and  where  there  is  growing
liberalization  of  regulations  governing the  provision of  telecommunications
services.

         As part of our  business  strategy,  we  expect to  continue  to expand
through additional significant  acquisitions and strategic alliances. We believe
that additional attractive  acquisition  opportunities  currently exist in Latin
America and it is continually  evaluating these opportunities.  Certain of these
transactions,  if  consummated,  may be material to our operations and financial
condition.  Those  acquisitions  may not be  successfully  integrated  into  our
business operations or result in projected benefits.

B.       MATERIAL CHANGES IN RESULTS OF OPERATIONS

Three months  ended March 31, 2000  compared to the three months ended March 31,
1999:

         Revenues.  Our  revenues  for the three  months  ended  March 31,  2000
totaled  $7.2  million,  compared  to $2.0  million for the same period in 1999,
representing a $5.2 million increase.  The following table shows our revenues by
operating subsidiary for the first quarters in 2000 and 1999:

       TOTAL REVENUES                                MARCH 31,         MARCH 31,
       (in thousands)                                  2000               1999
       --------------                                -----------      ----------
       Intervan (1)                                    $ 3,646                -
       GBNet (1)                                         1,143                -
       Inter@net                                           305           $  306
       Chispa                                            2,119            1,733
       Parent Company, eliminations and others               3                3
                                                       -------           ------
          Consolidated total                           $ 7,216          $ 2,042
                                                       =======          =======
__________________

(1)      Indicated subsidiaries were acquired in December 1999.

         The increase in revenues was primarily attributable to ownership of the
Intervan  and GBNet  entities  during the three  months  ended  March 31,  2000.
Chispa's  customer  base grew from 26,684  customers  as of March 1999 to 28,161
customers as of March, 2000, an increase of 1,477 customers,  or 6%. In addition
to the growth of the customer base during 1999,  Chispa began  offering  dial-up
Internet  services and high speed data  services to  residential  and  corporate
customers during the latter half of 1999.

         Variable Cost of Services. Variable cost of services consists primarily
of bandwidth and cable programming  charges.  The cost of these services totaled
$4.1  million in the three  months  ended  March 31,  2000,  an increase of $3.1
million over March 1999. Of total variable cost of services for the three months
ended March 31, 2000, $2.6 million related to our Intervan operations in Mexico,
$0.6 million related to our GBNet  operations in Central  America,  $0.2 million
related to our Inter@net operations in Venezuela and $0.7 million related to our
Chispa operations in El Salvador.

         Salaries,  Wages and Benefits. Our salaries, wages and benefits totaled
$3.2  million for the three  months  ended March 31,  2000,  an increase of $2.6
million over the three months ended March 31, 1999. We maintained a total of 490
employees at March 31, 2000,  compared to 275  employees at March 31, 1999.  The
increase in headcount  reflects both the normal  increases  associated  with our
maturing  operations and the employees we acquired  during the month of December
1999 with our  purchases of Intervan and GBNet,  which had 141 and 35 employees,
respectively,  at March 31, 2000. We increased the salaries,  wages and benefits
of our personnel to match market rates and increases in cost of living.

         Selling, General and Administrative Expenses. We incurred SG&A expenses
of $3.7 million  during the three  months  ended March 31, 2000,  an increase of
$1.8 million  compared to the three months ended March 31, 1999. The increase in
SG&A  expenses   reflects  growth  in  our  operations,   including   completing
significant  acquisitions in December 1999, as well as the increased development
of our networks. The increase in SG&A reflects:

     o    consulting, legal and tax advisor fees, which totaled $1.1 million for
          the three months ended March 31, 2000,  compared with $0.6 million for
          the three months ended March 31, 1999

     o    an increase in travel and  promotion  costs,  to $0.8  million for the
          three months  ended March 31,  2000,  compared to $0.3 million for the
          three months ended March 31, 1999.  These expenses relate primarily to
          the  expansion  of our  operations  into Central  America,  Mexico and
          Venezuela and the proposed  vendor and equipment  financing  agreement
          with Alcatel

     o    on a company-wide basis, we recorded a provision for doubtful accounts
          of $0.2 million for the three months ended March 31, 2000, compared to
          less than $0.1 for the three  months  ended March 31, 1999 as a result
          of acquisitions, increased operations and payment in arrears.

         Stock  Compensation  Expense.  We incurred non-cash stock  compensation
expense in the three  months ended March 31, 2000 of $0.26  million  compared to
$0.32 million for the three months ended March 31, 1999.

         Depreciation  and  Amortization.   Our  depreciation  and  amortization
expense  totaled  $2.9  million  in the  three  months  ended  March  31,  2000,
representing  an increase of $1.7  million over the three months ended March 31,
1999.  The increase  relates  primarily to  amortization  of  intangible  assets
relating to our acquisitions in December 1999.

          Interest  Expense,  Net. Our net interest expense totaled $0.4 million
during the three months ended March 31, 2000,  consisting of interest expense of
$0.7 million and interest  income of $0.3 million.  Net interest  expense during
the three months ended March 31, 2000  decreased  slightly over the three months
ended March 31, 1999 due to increased  interest  income  during the three months
ended March 31, 2000.  The average  interest rate  recorded on our  indebtedness
outstanding  during the three  months  ended  March 31,  2000 was  approximately
10.75%, compared to approximately 10% for the three months ended March 31, 1999.

         Provision for Income Taxes. We recorded a provision for income taxes of
$0.05  million  during the three months ended March 31, 2000,  compared to $0.03
million for the three months ended March 31, 1999.  Intervan,  which operates in
Mexico, recognized the majority of this income tax expense.

         Net Loss.  We incurred a net loss of $6.7  million in the three  months
ended March 31, 2000, an increase of $3.5 million compared to the same period in
1999. The principal reasons for the increased loss were:

     o    the $1.7 million increase in our depreciation and amortization expense
          on intangible assets as a result of acquisitions in December 1999

     o    the $0.4  million  increase in interest  expense  attributable  to our
          increased indebtedness as a result of acquisitions in December 1999

     o    the $2.6 million increase in salary and benefits expense  attributable
          to acquisitions and as a result of growth in operations

     o    the $1.8  million  increase in SG&A  expenses due to the growth in our
          operations and as a result of acquisitions

     o    the above  increases  were  offset by a $2.1  million  increase in net
          revenues over variable cost of services.

Three months  ended March 31, 1999  compared to the three months ended March 31,
1998:

         During the quarter ended March 31, 1999, we had recently  completed our
development  activities and commenced planned principal  operations.  We were in
the development stage during the quarter ended March 31, 1998.

         Revenues.  Our  revenues  for the three  months  ended  March 31,  1999
totaled $2.04 million,  compared to $0.03 million for 1998, representing a $2.01
million increase. The following table shows our revenues by operating subsidiary
for 1999 and 1998:

        TOTAL REVENUES                              MARCH 31,       MARCH 31,
        (in thousands)                                1999             1998
        ---------------                            ---------        ---------
        Inter@net(1)                                    $ 306        $   -
        Chispa (1)                                      1,733            -
        Parent Company, eliminations and others             3           28
                                                       ------        -----
             Consolidated total                        $2,042        $  28
                                                       ======        =====
________________

(1) Inter@net and Chispa were both acquired in the third fiscal quarter of 1998.

         The  increase  in  revenues  for the  quarter  ended March 31, 1999 was
primarily attributable to having our ownership interests in Inter@net and Chispa
during the three months ended March 31, 1999.

         Variable Cost of Services.  Our variable cost of services  totaled $1.0
million in the three months  ended March 31,  1999,  an increase of $0.9 million
over the same period in 1998.

         Salaries,  Wages and Benefits. Our salaries, wages and benefits totaled
$0.6  million for the three  months  ended March 31,  1999,  an increase of $0.5
million from the same period in 1998.  We maintained a total of 275 employees at
March 31,  1999,  compared to fewer than 20  employees  at March 31,  1998.  The
increase in headcount  reflects  normal  increases in our employee  count as our
operations matured and the employees we acquired through our acquisitions during
the months of July and August of 1998 of Chispa and Inter@net, which had 220 and
38 employees, respectively, at March 31, 1999.

         Selling, General and Administrative Expenses. We incurred SG&A expenses
of $1.9 million in the three  months  ended March 31, 1999,  an increase of $1.1
million  compared to the same  period in 1998.  The  increase  in SG&A  expenses
reflects growth in our operations, including completing significant acquisitions
in  1998  and  increased  development  of our  networks.  The  increase  in SG&A
reflects:

          o    consulting,  legal  and tax  advisor  fees,  which  totaled  $0.6
               million for the three months ended March 31, 1999,  compared with
               $0.3  million for the same period in 1998 for an increase of $0.3
               million.

          o    an  increase  in  travel  and  promotion  costs  to $0.3  million
               compared  to less than $0.1  million  for the same period in 1998
               for an increase of $0.2 million.

          o    the  increase  in  the  1999  quarter  related  primarily  to the
               expansion of our  operations  into El Salvador and  Venezuela and
               researching  potential  business  offerings  in New  Zealand  and
               Central America.

          Stock  Compensation  Expense.  We incurred non-cash stock compensation
expense in the three months ended March 31, 1999 totaling $0.3 million  compared
to none in the same period of 1998.

         Depreciation  and  Amortization.   Our  depreciation  and  amortization
expense  totaled  $1.2  million  for the three  months  ended  March  31,  1999,
representing  an increase of $0.8  million  compared to the same period in 1998.
The significant  increase  relates  primarily to the  amortization of intangible
assets relating to acquisitions.

         Interest Expense, Net. Our net interest expense totaled $0.6 million in
the quarter ended March 31, 1999, consisting of interest expense of $0.6 million
and interest  income of $0.06 million.  Net interest  expense was less than $0.1
million for the same period in 1998. The significant  increase relates primarily
to the interest from debt issued to complete acquisitions in 1998.

         Net Loss.  We incurred a net loss of $3.2  million in the three  months
ended March 31, 1999,  an increase of $1.9 million over the same period in 1998.
The principal reasons for the increased loss were:

          o    the $1.1 million  increase in SG&A  expenses due to the growth in
               our operations and as a result of acquisitions in 1998

          o    the $0.8 million  increase in our  depreciation  and amortization
               expense on intangible assets as a result of acquisitions in 1998

          o    the $0.5 million  increase in salary and benefit  expenses due to
               the growth in our operations and as a result of  acquisitions  in
               1998

          o    the $0.3 million increase in stock-based  compensation expense to
               attract key management

          o    the above increases were offset by a $1.1 million increase in net
               revenues over variable cost of services.

C.       LIQUIDITY AND CAPITAL RESOURCES

         Since  inception,  we have funded our cash  requirements  at the parent
company  level  through debt and equity  transactions.  The proceeds  from these
transactions  were primarily used to fund our investments  in, and  acquisitions
of, start-up network  operations,  to provide working  capital,  and for general
corporate purposes, including the expenses we incurred in seeking and evaluating
new business opportunities.  Our foreign subsidiary interests have been financed
by a combination of equity investments and shareholder loans.

         We will continue to make significant  capital  expenditures in the next
several years in connection with building our networks,  the further development
of our  operations in Mexico,  Venezuela and Central  America,  and new customer
accounts (for which we install our equipment on customer premises). We intend to
meet our capital requirements during 2000 from a combination of the following:

          o    unused proceeds from our October 1999 Financing

          o    borrowings  under any definitive  vendor  financing  agreement we
               execute with Alcatel

          o    additional private equity  transactions  relating to the exercise
               of outstanding options and warrants,  particularly the options we
               issued  the six  accredited  investors  in  connection  with  our
               October 1999 financing transactions.

         We anticipate that we will require  approximately  $46.5 million during
2000  for  capital  expenditures  related  to  the  expansion  of  our  existing
telecommunications  business,  and  that we  will  require  significant  amounts
thereafter.

         During the first quarter ended March 31, 2000, our operating activities
used $4.2 million, compared with $1.9 million during the quarter ended March 31,
1999. Our investing  activities,  consisting of capital expenditures for network
equipment,  used $2.7  million  during the first  quarter  ended March 31, 2000,
compared  with $3.5  million  during  the  quarter  ended  March 31,  1999.  Our
financing  activities  in the quarter  ended March 31, 2000 used $0.2 million to
repay amounts to a third-party bank,  compared to $4.9 million that was provided
from proceeds from related party note and borrowing  activity during the quarter
ended March 31, 1999.

         As of March 31, 2000, we had current assets of $26.9 million,  compared
to $31.0 million as of December 31, 1999,  for a decrease of $4.1  million.  The
decrease in current  assets was  primarily  due to decreases in cash relating to
capital  expenditures for network  equipment and  disbursements  for operational
expenses.

         We have the ability to  moderate  our  capital  spending  and losses by
varying  the  number  and  extent of our  market  build out  activities  and the
services  we offer in our  various  markets.  If we elect to slow the speed,  or
narrow the focus,  of our business  plan,  we will be able to reduce our capital
requirements  and losses.  The actual  costs of building out and  launching  our
markets would depend on a number of factors,  however,  including our ability to
negotiate  favorable  prices for purchases of network  equipment,  the number of
customers and the services for which they  subscribe,  the nature and success of
the services that we may offer, regulatory changes and changes in technology. In
addition,  actual  costs and  revenues  could vary from the amounts we expect or
budget,  possibly materially,  and such variations are likely to affect how much
additional financing we will need for our operations.  Accordingly, there can be
no assurance  that our actual  financial  needs will not exceed the  anticipated
amounts available to us, including from new, third parties, described above.

         To the extent we acquire the  amounts  necessary  to fund our  business
plan through the issuance of equity securities,  our shareholders may experience
dilution in the value per share of their equity  securities.  The acquisition of
funding  through the issuance of debt could result in a  substantial  portion of
our cash flow from  operations  being  dedicated to the payment of principal and
interest  on  that  indebtedness,   and  could  render  us  more  vulnerable  to
competitive and economic  downturns.  Our  subsidiaries or affiliates could also
obtain  financing  from  third  parties,  but  there  can  be no  assurance  our
subsidiaries or affiliates will be able to obtain the financing required to make
planned capital  expenditures,  provide working capital or meet other cash needs
on terms which are economically acceptable to us.

D.       SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

         Certain statements contained in "Management's  Discussion and Analysis"
constitute  forward-looking  statements  concerning  our  operations,   economic
performance and financial condition.  Because those statements involve risks and
uncertainties,  actual  results may differ  materially  from those  expressed or
implied by those forward-looking statements.

         In addition,  any statements that express or involve  discussions as to
expectations,  beliefs,  plans,  objectives,  assumptions  or  future  events or
performance  are  not  historical   facts  and  may  be   forward-looking   and,
accordingly,  those statements involve estimates,  assumptions and uncertainties
which could cause actual results to differ  materially  from those  expressed in
the  forward-looking  statements.  Accordingly,  those types of  statements  are
qualified in their entirety by reference to, and are accompanied by, the factors
discussed  throughout  this  report.  Among the key  factors  that have a direct
bearing  on our  results  of  operations  are the  potential  risk of  delay  in
implementing our business plan; the political, economic and legal aspects of the
markets  in  which  we  operate;   competition;  and  our  need  for  additional
substantial financing. We have no control over some of these factors.

         The factors  described in this report could cause our actual  operating
results  to  differ  materially  from  those  expressed  in any  forward-looking
statements made by or on behalf of us. Persons reviewing this report, therefore,
should not place undue reliance on those forward-looking statements. Further, to
the extent this report contains forward-looking  statements,  they speak only as
of the date of this  report,  and we  undertake  no  obligation  to  update  any
forward-looking   statement  or   statements   to  reflect  the   occurrence  of
unanticipated  events.  New factors may emerge from time to time,  and it is not
possible for  management  to predict all of such  factors.  Further,  management
cannot  assess the impact of each such  factor on our  business or the extent to
which any factor, or combination of factors,  may cause actual results to differ
materially from those contained in any forward-looking statements.

PART II: OTHER INFORMATION

ITEM 1.       LEGAL PROCEEDINGS

         See the  section  entitled  "Legal  Proceedings"  in our report on Form
10-KSB for the year ended December 31, 1999.

ITEM 2.       CHANGES IN SECURITIES

                  On March 3, 2000,  we issued 11,000 shares of our common stock
to a third party who exercised an option.

ITEM 3.       DEFAULTS UPON SENIOR SECURITIES

                                      None.

ITEM 4.       MATTERS SUBMITTED TO A VOTE OF THE COMPANY'S SHAREHOLDERS

                                      None.

ITEM 5.       OTHER INFORMATION

         MetroTelecom   Acquisition  -  On  April  5,  2000,  we  completed  the
acquisition  of all of the  outstanding  stock  of a  group  of  companies  that
conduct, through directly or indirectly held operating subsidiaries,  high speed
data,  dial-up Internet,  high speed Internet,  telephony and subscription cable
television  services  in  Guatemala.  For a  more  detailed  description  of the
transaction, see our report on Form 8-K dated April 5, 2000.

ITEM 6.  EXHIBITS, FINANCIAL STATEMENTS, SCHEDULES AND REPORTS ON FORM 8-K

A.       EXHIBITS.

                                      None.

         B.       REPORTS ON FORM 8-K

         We filed four  reports on Form 8-K during the  quarter  ended March 31,
2000.

          1.   On March 13, 2000, we filed a report on Form 8-K/A which included
               the  required  audited  financial  statements  for  the  Intervan
               acquisition.

          2.   On  February  28,  2000,  we filed a report on Form  8-K/A  which
               included the required audited financial  statements for the GBNet
               Acquisition.

          3.   On January 21, 2000,  we filed a report on Form 8-K detailing the
               results from our annual meeting of  shareholders  held on January
               14, 2000.

          4.   On January 13, 2000, we filed a report on Form 8-K describing the
               Intervan acquisition.

<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.

                                        CONVERGENCE COMMUNICATIONS, INC.


Date:  May 15, 1999                     BY       /s/ JERRY SLOVINSKI
                                            ----------------------------
                                                 Jerry Slovinski
                                                 Chief Financial Officer