<PAGE>

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                           SECURITIES AND EXCHANGE COMMISSION
                                  Washington, D.C. 20549

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

                                      FORM 10-Q

/x/ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES 
    EXCHANGE ACT OF 1934

    For the quarterly period ended June 30, 1997 

                              OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

For the transition period from                           to    
                                ------------------------    --------------------

                           Commission file number 0-______
                                           
                       INTERNATIONAL WIRELESS 
                    COMMUNICATIONS HOLDINGS, INC.
         ------------------------------------------------------
         (Exact name of registrant as specified in its charter)


                  DELAWARE                           94-3248701
        ----------------------------            --------------------
       (State or other jurisdiction of            (I.R.S. Employer
        incorporation or organization)          Identification Number)

                        400 SOUTH EL CAMINO REAL, SUITE 1275
                            SAN MATEO, CALIFORNIA  94402
                       --------------------------------------
                      (Address of principal executive offices)

                                 (650) 548-0808
                   ---------------------------------------------------
                   (Registrant's telephone number, including area code)


     Indicate by check /x/ whether the registrant (1) has filed all reports 
required to be filed by Sections 13 or 15(d) of the Securities 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

            (1)   Yes    x            No    
                      ----------       ----------
            (2)   Yes    x            No    
                      ----------       ----------

          As of June 30, 1997, there were 816,720 shares of the Registrant's 
common stock, par value $0.01 per share ("Common Stock") outstanding and 
16,915,076 shares of the Registrant's preferred stock, par value $0.01 per 
share ("Preferred Stock") outstanding. Each such share of Preferred Stock is 
currently convertible into one share of Common Stock.
                                           
                This document (excluding Exhibits) contains 36 pages.
                                           
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<PAGE>

                 INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC.
                                           
                                      FORM 10-Q
                                           
                                        INDEX
                                           

PART I.  FINANCIAL INFORMATION 
 
Item 1.   Financial Statements  . . . . . . . . . . . . . . . . . . . .      3 
 
          Consolidated Balance Sheets as of December 31, 1996
          (audited) and June 30, 1997 (unaudited) . . . . . . . . . . .      4 
 
          Consolidated Statements of Operations for the three
          and six month periods ended June 30, 1996 and
          1997 (unaudited) . . . . . . . . . . . . . . . . . . . . . .       5 
 
          Consolidated Statements of Cash Flows for the
          six months ended June 30, 1996 and 1997 (unaudited). . . . .       6 
 
          Notes to Consolidated Financial Statements . . . . . . . . .       7 
 
Item 2.   Management's Discussion and Analysis of Financial
          Condition and Results of Operations. . . . . . . . . . . . .      17
 
PART II.  OTHER INFORMATION  
 
Item 2.   Changes in Securities  . . . . . . . . . . . . . . . . . . .      32
 
Item 4.   Submission of Matters to a Vote of Security Holders. . . . .      32
 
Item 6.   Exhibits and Reports on Form 8-K . . . . . . . . . . . . . .      33 
 
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .      35
 
EXHIBIT INDEX  . . . . . . . . . . . . . . . . . . . . . . . . . . . .      36
                                           


                                         2.

<PAGE>

PART I.   FINANCIAL INFORMATION

ITEM 1.   FINANCIAL STATEMENTS     



















                                        3.

<PAGE>

        INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                           CONSOLIDATED BALANCE SHEETS
                     (IN THOUSANDS, EXCEPT SHARE AND SHARE DATA)

                                    ASSETS

                                                       DECEMBER 31,   JUNE 30,
                                                          1996         1997
                                                       -----------  -----------
                                                        (AUDITED)   (UNAUDITED)
Current assets:
    Cash and cash equivalents                           $  41,657   $  14,571
    Notes receivable from affiliates                          813       5,094
    Notes receivable                                        1,431       1,304
    License deposit                                         5,255          --
    Investments in affiliates held for sale                 2,062       3,444
    Other current assets                                    3,190      10,249
                                                       -----------  -----------
    Total current assets                                   54,408      34,662

Property and equipment, net                                18,426      21,838
Investments in affiliates                                  68,394      66,529
Telecommunication licenses and other intangibles, net      18,484      17,893
License deposit                                             3,042       1,004
Debt issuance costs, net                                    6,431       5,921
Other assets                                                  173         365
                                                       -----------  -----------
Total assets                                           $  169,358  $  148,212
                                                       -----------  -----------
                                                       -----------  -----------

               LIABILITIES, MINORITY INTERESTS, REDEEMABLE CONVERTIBLE
                      PREFERRED STOCK AND STOCKHOLDERS' DEFICIT

Current liabilities:
    Accounts payable and accrued expenses              $    7,313   $   8,737
                                                       -----------  -----------
    Total current liabilities                               7,313       8,737
Long-term debt, net                                        75,466      83,640
                                                       -----------  -----------
    Total liabilities                                      82,779      92,377
Minority interests in consolidated subsidiaries             5,685       5,080
Redeemable convertible Preferred Stock, $.01 par value 
  per share; 21,541,480 shares designated; 15,973,200 
  and 15,981,876 shares issued and outstanding in 1996 
  and 1997, respectively; net of note receivable from 
  stockholder of $26 in 1996 and 1997; liquidation and 
  minimum redemption value of $107,459                    103,021     104,176

Commitments and contingencies (Note 11)
Stockholders' deficit:
  Preferred Stock, $.01 par value per share;
    1,538,520 shares designated; 933,200 shares issued 
    and outstanding in 1996 and 1997; liquidation value 
    of $793                                                     9           9
  Common Stock, $.01 par value per share; 26,000,000
    shares authorized; 636,720 and 816,720 shares
    issued and outstanding in 1996 and 1997, respectively       6           8
  Additional paid-in capital                               31,060      33,303
  Note receivable from stockholder                           (152)       (152)
  Unrealized gain on investments                               68         --
  Cumulative translation adjustment                           271        (249)
  Accumulated deficit                                     (53,389)    (86,340)
                                                       -----------  -----------
        Total stockholders' deficit                       (22,127)    (53,421)
                                                       -----------  -----------
    Total liabilities, minority interests, 
     redeemable convertible Preferred Stock and 
     stockholders' deficit                             $  169,358   $  148,212
                                                       -----------  -----------
                                                       -----------  -----------
                                           
             See accompanying notes to Consolidated Financial Statements.
                                           
                                           4.
<PAGE>

        INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                     CONSOLIDATED STATEMENTS OF OPERATIONS
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                        THREE MONTHS ENDED,     SIX MONTHS ENDED
                                                              JUNE 30              JUNE 30,
                                                        -------------------     ------------------
                                                           1996       1997       1996       1997
                                                        --------    --------    -------   --------
                                                             (UNAUDITED)            (UNAUDITED)
<S>                                                     <C>         <C>         <C>      <C>
Operating revenues                                        $  183    $    498    $   183   $  1,017
Cost of revenues                                             180         659        180      1,248
                                                        --------    --------    -------   --------
                                                               3        (161)         3       (231)

Operating expenses: 
  Selling, general and administrative expenses             4,068       9,480      6,353     15,734
  Equity in losses of affiliates                           1,567       5,193      2,986      9,865
  Minority interest in losses of consolidated 
    subsidiaries                                              --        (244)       --        (463)
                                                        --------    --------    -------   --------
      Loss from operations                                (5,632)    (14,590)    (9,336)   (25,367)

Other income (expense):
  Interest income                                            182         574        424      1,101
  Interest expense                                           (82)     (4,515)      (201)    (8,751)
  Other                                                      (14)      1,133        (13)     1,140
                                                        --------    --------    -------   --------
      Net loss                                           $(5,546)  $ (17,398)   $(9,126)  $(31,877)
                                                        --------    --------    -------   --------
                                                        --------    --------    -------   --------
</TABLE>

             See accompanying notes to Consolidated Financial Statements.
                                           

                                      5.
<PAGE>

        INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                              (IN THOUSANDS)
<TABLE>
<CAPTION>
                                                                            SIX MONTHS ENDED 
                                                                                JUNE 30, 
                                                                         ----------------------
                                                                           1996           1997
                                                                         ---------     --------
                                                                                (UNAUDITED)
<S>                                                                      <C>             <C>
Cash flows from operating activities:
  Net loss                                                               $  (9,126)    $(31,877)
Adjustments to reconcile net loss to net cash used in operating 
  activities:
  Depreciation                                                                 111          506
  Amortization of telecommunication licenses and other intangibles             284          591
  Amortization of debt issuance costs                                           --          510
  Amortization of long-term debt discount                                       --        8,174
  Equity in losses of affiliates                                             2,986        9,865
  Gain on sale of Mobilcom Mexico                                               --       (1,156)
  Minority interests in losses of consolidated subsidiaries                     --         (605)
  Issuance of Common Stock Warrants                                             --        2,281
  Unrealized gain on investments                                                --          (68)
  Changes in operating assets and liabilities:
    Other current assets                                                      (631)      (7,407)
    Accounts payable and accrued expenses                                     (113)       1,424
                                                                         ---------     --------
      Net cash used in operating activities                                 (6,489)     (17,762)
                                                                         ---------     --------
Cash flows from investing activities:
  Issuance of notes receivable from affiliates                              (1,095)      (4,916)
  Repayment of notes receivable from affiliates                               --            635
  Issuance of notes receivable                                              (3,106)        (773)
  Repayment of notes receivable                                               --            900
  Advances to affiliate                                                     (1,822)          --
  Investments in affiliates held for sale                                     --         (1,382)
  Proceeds from sale of Mobilcom Mexico                                       --          3,218
  Purchases of property and equipment                                         (660)      (3,918)
  Investments in affiliates.                                                  (215)     (10,062)
  Purchase of subsidiary                                                    (3,198)         --
  License deposit                                                           (3,042)       7,293
  Other assets                                                                (569)         156
                                                                         ---------     --------
      Net cash used in investing activities                                (13,707)      (8,849)
Cash flows from financing activities:
    Exercise of stock options                                                 --             45
                                                                         ---------     --------
      Net cash provided by financing activities                               --             45
                                                                         ---------     --------
Effect of foreign currency exchange rates on cash and cash equivalents         47          (520)
                                                                         ---------     --------
Net decrease in cash and cash equivalents                                (20,149)       (27,086)
Cash and cash equivalents at beginning of period                          25,398         41,657
                                                                         ---------     --------
Cash and cash equivalents at end of period                              $  5,249       $ 14,571
                                                                         ---------     --------
                                                                         ---------     --------
Supplemental cash flow information
  Cash paid for interest                                                 $     4       $    --
                                                                         ---------     --------
                                                                         ---------     --------
Non-cash financing and investing activities:
  Conversion of notes payable to related party and interest
  to redeemable convertible Preferred Stock                             $  2,052       $    --
                                                                         ---------     --------
                                                                         ---------     --------
  Net warrant exercises of redeemable convertible Preferred Stock        $    --       $     81
                                                                         ---------     --------
                                                                         ---------     --------
  Issuance of Common Stock Warrants                                      $    --       $  2,281
                                                                         ---------     --------
                                                                         ---------     --------
</TABLE>
           See accompanying notes to Consolidated Financial Statements.

                                           6.

<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                  NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1) NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

    NATURE OF BUSINESS 

   International Wireless Communications Holdings, Inc. ("IWC Holdings") was 
   incorporated in Delaware in July 1996 as a holding company whose primary 
   assets are all of the issued and outstanding capital stock of 
   International Wireless Communications, Inc. ("IWC") and a note receivable 
   from IWC in a principal amount equal to the net proceeds from the Debt 
   Offering (as defined below). (IWC Holdings and IWC are collectively 
   referred to herein as the "Company.") IWC was incorporated in Delaware in 
   January 1992 and develops, owns and operates wireless communications 
   companies in emerging markets in Asia and Latin America. These local 
   wireless businesses ("LWBs") provide a variety of communication services, 
   including cellular, wireless local loop ("WLL"), enhanced capacity 
   trunked radio ("ECTR") and paging.  Together with its strategic partners, 
   the Company has interests in Brazil, China, India, Indonesia, Malaysia, 
   New Zealand, Pakistan, Peru, and the Philippines.

   To date, the Company has invested principally in LWB's that are in their 
   early developmental stages.  In addition, the Company intends to pursue 
   additional investment opportunities.  The Company believes that its 
   existing cash balance is sufficient to meet its operating and contractual 
   obligations through fiscal 1997 .  It is not sufficient, however, to meet 
   the Company's business objective of participation in additional equity 
   rounds to finance the infrastructure buildout of its operating and 
   nonoperating LWBs.  The ability of the Company to make additional 
   investments is dependent on the availability of external financing.  In 
   the event the Company is unable to obtain external financing it may 
   ultimately be unable to either maintain its existing ownership interests 
   or fully realize the underlying potential value of the LWBs.

   In August 1996, IWC Holdings issued and sold 196,720 units, each 
   consisting of a $1,000 principal amount 14% Senior Discount Note due 2001 
   (an "Original Note," and, collectively, the "Original Notes") and one 
   nominally priced warrant now exercisable for 14.283 shares of Common Stock
   (a "Warrant," and, collectively, the "Warrants"), for total gross proceeds 
   of approximately $100 million (the "Debt Offering").  In November 1996, 
   pursuant to the indenture agreement that governs the Original Notes (the 
   "Indenture"), IWC Holdings exchanged new 14% Senior Secured Discount 
   Notes due 2001 (the "Exchange Notes") which were registered under the 
   Securities Act of 1933, as amended (the "1933 Act"), for the Original 
   Notes.  The terms of the Exchange Notes are substantially identical 
   (including principal amount, interest rate, maturity, security and 
   ranking) to the terms of the Original Notes.  (The Exchange Notes and the 
   Original Notes are referred to collectively herein as the "Notes.")

   In connection with the Debt Offering, IWC Holdings and IWC completed a 
   reorganization in which IWC became a wholly owned subsidiary of IWC 
   Holdings through the conversion of each share of the then-outstanding 
   capital stock of IWC into 40 shares of the corresponding class and series 
   of stock of IWC Holdings (the "Stock Conversion"). All data related to 
   shares and per share amounts for all periods presented have been adjusted 
   to reflect the effect of the reorganization and the Stock Conversion.

   In the opinion of management, the accompanying unaudited financial 
   statements of IWC Holdings and its subsidiary, IWC, reflect all 
   adjustments (consisting only of normal recurring adjustments) considered 
   necessary for a fair presentation of the Company's financial condition, 
   results of operation and cash flows for the periods presented.  These 
   financial statements should be read in conjunction with the Company's 
   audited consolidated financial statements as of December 31, 1995 and 
   1996, and for each of the years in the three-year period ended December 
   31, 1996, including the notes thereto.  The results of operations for the 
   three and the six months ended June 30, 1997 are not necessarily 
   indicative of results that may be expected for the year ended December 
   31, 1997.  

                                         7.

<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

   BASIS OF CONSOLIDATION

   The accompanying consolidated financial statements of the Company include 
   the accounts of IWC, its wholly owned subsidiaries, SRC Servicos de Radio 
   Comunicacoes Ltda. ("SRC"), TeamTalk Limited ("TeamTalk"), New Zealand 
   Wireless Limited ("New Zealand Wireless"), together with offshore holding 
   companies, and its four majority-owned subsidiaries, M/S Mobilcom (Pte) Ltd. 
   ("Mobilcom Pakistan"), PeruTel S.A. ("PeruTel"), Star Telecom Overseas 
   (Cayman Islands) Limited ("STOL"), and Promociones Telefonicas S.A. 
   ("Protelsa").  Wireless Data Services, Ltd. ("WDS"), although 50% owned 
   by the Company, has also been consolidated in the accompanying 
   consolidated financial statements as the Company has the ability to 
   exercise control over WDS.  All significant intercompany accounts and 
   transactions have been eliminated in consolidation.

(2) BALANCE SHEET COMPONENTS 
          
    Balance sheet components are as follows (in thousands):

                                                       DECEMBER 31,    JUNE 30,
                                                          1996           1997
                                                      ------------   ----------
  Other current assets
    Other receivables                                   $  1,373      $   3,701
    Refund of license deposit                                 --          3,967
    Prepaid expenses and other                             1,817          2,581
                                                      ------------   ----------
                                                        $  3,190      $  10,249
                                                       ------------   ----------
                                                       ------------   ----------
  Property and equipment
    Furniture and fixtures                              $    320      $     425
    Computer and office equipment                            935          1,705
    Automobiles                                              197            266
    Leasehold improvements                                   276            510
    Telecommunication equipment                            9,930         11,282
    Construction in process                                7,620          9,008
                                                       ------------   ----------
                                                          19,278         23,196
    Less accumulated depreciation                            852          1,358
                                                       ------------   ----------
       Property and equipment, net                       $18,426      $  21,838
                                                       ------------   ----------
                                                       ------------   ----------
    Telecommunication licenses and other intangibles
       SRC/Via 1                                        $  6,680      $   6,680
       Mobilcom Pakistan                                   5,439          5,439
       TeamTalk                                            1,760          1,760
       STOL                                                3,965          3,965
       Protelsa                                            1,557          1,557
       WDS                                                   221            221
       Other                                                 200            200
                                                       ------------   ----------
                                                          19,822         19,822
    Less accumulated amortization                          1,338          1,929
                                                       ------------   ----------
       Telecommunication licenses and other 
        intangibles, net                                 $18,484      $  17,893
                                                       ------------   ----------
                                                       ------------   ----------
    Accounts payable and accrued expenses
     Accounts payable                                   $  5,163      $   3,125
     Professional services                                   718            458
     Employee compensation and benefits                      619            577
     Equipment purchases                                      27          3,775
     Other                                                   786            802
                                                       ------------   ----------
                                                        $  7,313      $   8,737
                                                       ------------   ----------
                                                       ------------   ----------
                                          8.
<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                     NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(3)  CASH AND CASH EQUIVALENTS 

     As of June 30, 1997, available-for-sale securities consisted of the 
     following (in thousands):

                                                    Unrealized      Estimated
                                           Cost    gains/(losses)   fair value
                                       ----------  --------------   ----------
     U.S government securities           $     50    $  --          $    50
     Corporate debt securities              1,700       --            1,700
                                       ----------  --------------   ----------
                                         $  1,750    $  --          $ 1,750
                                       ----------  --------------   ----------
                                       ----------  --------------   ----------

     As of June 30, 1997, cash, cash equivalents and available-for-sale 
     securities were classified as follows (in thousands):
          

     Cash                              $   4,735
     Cash equivalents                      9,836      
                                       ----------  
                                       $  14,571
                                       ----------     
     
     Cash and cash equivalents includes $3,218,000 representing the proceeds 
     of disposition of the Company's interest in Mobilcom Mexico, which sale
     was consummated on June 27, 1997. Pursuant to the Indenture, these proceeds
     may only be used for a Permitted Investment (as defined in the Indenture),
     which includes investments in cash equivalents, investments in LWBs
     classified as Restricted Subsidiaries or Restricted Affiliates under the
     Indenture and, subject to certain limitations, investments in LWBs
     classified as Unrestricted Subsidiaries or Unrestricted Affiliates under
     the Indenture.  If all or a portion of such proceeds are not used for a
     Permitted Investment within 270 days after June 27, 1997, then the Company
     may only invest such unused proceeds in cash equivalents pending the making
     of an offer by the Company, under certain circumstances, to the then
     holders of the Notes to repurchase such Notes. For a more detailed
     description of the restrictions on the use of the proceeds from the
     Company's sale of its interest in Mobilcom Mexico, see "Description of
     Exchange Notes" in the Company's Registration Statement on Form S-1,
     declared effective by the Securities and Exchange Commission on November
     21, 1996 (Reg. No. 333-11987).

     
(4)  INVESTMENTS IN AFFILIATES HELD FOR SALE
     
     In June 1997, the Company sold its 1.56% equity interest in Corporacion
     Mobilcom, S.A. de C.V. ("Mobilcom Mexico") for $3,218,000 to a third party
     affiliated with an existing shareholder in Mobilcom Mexico.  The Company 
     carried this investment in Mobilcom Mexico at its historical cost basis 
     of $2,062,000. As a result, the Company reported a gain of $1,156,000 
     (pre-tax and after-tax) in other income as of June 30, 1997. 

     In addition to the above, the Company has recently initiated the
     disposition of three additional ECTR investments as the Company re-aligns
     its investment strategy and re-distributes its resources to its larger
     cellular and WLL investments.  The investments held for sale include
     TeamTalk, the Company's wholly owned New Zealand subsidiary; Universal
     Telecommunications Service, Inc. ("UTS") in the Philippines and PT Mobilkom
     Telekomindo ("Mobilkom") in Indonesia.  The Company anticipates that the
     sale of all three investments will occur within the next 12 months.  These
     investments are carried at their historical cost and the Company
     anticipates that the proceeds from disposition of the three investments
     will exceed the Company's historical cost basis.
     
     Investments in affiliates held for sale are as follows as of December 31, 
     1996 and June 30, 1997 (in thousands):
                                                  
                                      1996        1997
                                    --------     -------
     Mobilcom Mexico                $  2,062       $  --
     UTS                                  --       1,944
     Mobilkom                             --       1,500
                                    --------     -------
                                    $  2,062    $  3,444
                                    --------     -------
                                    --------     -------

    The Company has not changed the basis of accounting for the three 
    investments held for sale. The Company continues to consolidate TeamTalk 
    and has not reclassified this investment as an asset held for sale. The 
    Company's investment in, and advances to, TeamTalk amounted to 
    $15,103,000 as of June 30, 1997.

                                      9.
<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(5)  INVESTMENTS IN AFFILIATES

     The Company's investments in affiliates represent interests in various 
     LWBs in several developing countries. These investments are accounted for 
     under the equity or cost methods of accounting.
               
     EQUITY INVESTMENTS
               
     For those investments in companies in which the Company's voting interest 
     is 20% to 50%, or for investments in companies in which the Company 
     exerts significant influence through board representation and management 
     authority even if its ownership is less than 20%, the equity method of 
     accounting is used.  Under this method, the investment, originally 
     recorded at cost, is adjusted to recognize the Company's share in losses 
     of affiliates, limited to the extent of the Company's investment in and 
     advances to affiliates, including any debt guarantees or other 
     contractual funding commitments. All affiliated companies have fiscal 
     years ended December 31.  Investments in affiliated companies are as 
     follows as of December 31, 1996 and June 30, 1997 (in thousands):














                                     10.

<PAGE>

            INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                       NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
1996

<TABLE>
<CAPTION>
                                     MALAYSIA   INDONESIA     CHINA       PHILIPPINES     VARIOUS 
                                     ---------  ---------     -------    ------------     --------
                                     SYARIKAT 
                                      TELEFON                             UNIVERSAL 
                                     WIRELESS    PT RAJASA      STAR     TELECOMMUN- 
                                      (M) SDN    HAZANAH       DIGITEL    ICATIONS
                                        BHD      PERKASA       LIMITED   SERVICE, INC.    OTHER 
Affiliated company                   ("STW")    ("RHP")       ("SDL")      ("UTS")      COMPANIES     TOTALS 
                                     ---------  ---------     --------   ------------    ---------     -------
<S>                                  <C>        <C>           <C>         <C>            <C>           <C>

Percentage of ownership                    30%        28%          40%           19%     Various 

Investments in affiliated 
companies as of December 31, 1995      $20,241    $24,220      $ --           $   --      $  2,785     $47,246

Additional investment                    1,201      8,556       20,000          1,906       (1,658)     30,005

Amortization                               969      1,278          347             51          525       3,170
Losses (gains)                           3,563      3,468        1,000            (20)         602       8,613 
                                     ---------  ---------     --------   ------------    ---------     -------
Equity in losses of affiliates           4,532      4,746        1,347             31        1,127      11,783 
                                     ---------  ---------     --------   ------------    ---------     -------
Investments in affiliated 
companies as of December 31, 1996      $16,910    $28,030      $18,653         $1,875     $  --        $65,468 
                                     ---------  ---------     --------   ------------    ---------     -------
                                     ---------  ---------     --------   ------------    ---------     -------
Portion of investment 
exceeding the Company's 
share of the underlying 
historical net assets as of    
December 31, 1996                      $15,852    $28,030      $10,653         $  882     $  --        $55,417 
                                     ---------  ---------     --------   ------------    ---------     -------
                                     ---------  ---------     --------   ------------    ---------     -------
1997 
                                      MALAYSIA  INDONESIA      CHINA      PHILIPPINES 
                                      --------  ---------      --------   -----------
Affiliated company                      STW        RHP            SDL       UTS (1)       TOTALS 
                                      --------  ---------      --------   -----------    ---------
Percentage of ownership                    30%        28%           40%           19% 
 
Investments in affiliated
companies as of
December 31, 1996                      $16,910    $28,030       $18,653        $1,875      $65,468

Additional investment                   --           --           9,000        (1,662)       7,338
 
Amortization                               442        838           271            23        1,574
Losses                                   1,583      3,773         2,745           190        8,291 
                                      --------  ---------      --------   -----------    ---------
Equity in losses of affiliates           2,025      4,611         3,016           213        9,865 
                                      --------  ---------      --------   -----------    ---------
Investments in affiliated 
companies as of June 30, 1997          $14,885    $23,419       $24,637       $  --        $62,941 
                                      --------  ---------      --------   -----------    ---------
                                      --------  ---------      --------   -----------    ---------
Portion of investment exceeding 
the Company's share of the 
underlying historical net assets 
as of June 30, 1997                    $14,885    $23,419        $19,382        $859       $58,545 
                                      --------  ---------      --------   -----------    ---------
                                      --------  ---------      --------   -----------    ---------
</TABLE>
__________________________________

(1) During 1997, the Company decided to offer UTS for sale and has
    reclassified this investment as a current asset (see Note 4).

                                         11.
<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                    NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     On September 23, 1996, the Company entered into a subscription agreement 
     (the "Subscription Agreement") between Star Telecom Holding Limited 
     ("STHL"), the Company's partner in STOL, and SDL to purchase a 40% 
     interest in SDL.  Under the Subscription Agreement, the Company invested 
     $20,000,000 during 1996. The Company, including the Designated Assignee 
     of IWC, IWC China Limited, amended the Subscription Agreement, dated as 
     of September 23, 1996, among SDL and STHL. The Amendment to Subscription 
     Agreement and Waiver, dated as of June 18, 1997, ("Amendment and 
     Waiver") modified certain provisions in the Subscription Agreement, 
     including waiving the fulfillment of the conditions precedent to its 
     obligations to enter into and complete a second subscription of SDL 
     shares for an aggregate subscription price of $19,000,000 and pay and 
     deliver to STHL the second $9,000,000 premium on June 18, 1997.  The 
     Company funded the $9,000,000 premium on June 18, 1997.
               
     Financial information for affiliated companies accounted for under the 
     equity method of accounting is as follows (in thousands):
     
                                    AS OF AND FOR THE YEAR ENDED
                                          DECEMBER 31, 1996
                                   ----------------------------------
                                    STW          RHP           SDL
                                   --------   --------      ---------
     Current assets                $    820   $  13,354     $  11,215
     Noncurrent assets               41,686      64,556        55,617
     Current liabilities              6,909      23,341        12,460
     Noncurrent liabilities          33,526      63,834        47,817
     Net revenues                     1,858      10,268           436
     Net loss                       (11,873)    (12,072)       (2,618)
     
     
                                    AS OF AND FOR THE SIX MONTHS ENDED
                                              JUNE 30, 1997
                                   ----------------------------------
                                    STW           RHP         SDL
                                 (UNAUDITED) (UNAUDITED)  (UNAUDITED) 
                                 ----------- -----------  -----------
     
     Current assets                $  8,285    $  25,827   $  16,289
     Noncurrent assets               36,995       75,979      95,508
     Current liabilities              7,274       56,710      25,205
     Noncurrent liabilities          36,707       60,525      65,648
     Net revenues                     1,439        7,895         642
     Net loss                        (5,277)     (13,398)     (6,869)
     
     
     COST INVESTMENTS
     
     The Company uses the cost method of accounting for two other investments as
     of June 30, 1997. These are RPG Paging Services Limited ("RPSL") and
     Telecomunicaciones Globales, S.A. de C.V. ("Global Telecom").  The Company 
     owns its holding in RPSL indirectly through its interest in STOL.  STOL 
     purchased an additional 9% of RPSL in January 1997 for $2,100,000 which 
     increased the Company's indirect interest from 7% to 13.3%.  The 
     Company acquired its interest in Global Telecom, a Mexican long distance 
     company in January 1997 for $62,000. The Company considers the RPSL and 
     Global Telecom investments to be long-term in nature and are not held 
     for trading purposes.  As of June 30, 1997, the Company's ownership 
     interests in these entities were 13.3% and 1.56%, respectively.

                                       12.

<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


    The following represents the Company's carrying value of these 
    cost investments (in thousands):


                                DECEMBER 31,    JUNE 30,
                                    1996          1997 
                                ------------    --------
     Mobilkom                   $  1,500       $  --
     RPSL                          1,426         3,526
     Global Telecom                   --            62
                                ------------    --------
                                $  2,926       $ 3,588
                                ------------    --------
                                ------------    --------
                                           
     During 1997, the Company reclassified Mobilkom as an investment in 
     affiliates held for sale (see Note 4).
     
     PRO FORMA SUMMARY
                                                
     The following pro forma summary combines the consolidated results of 
     operations of the Company as if (i) TeamTalk had been a wholly owned 
     consolidated subsidiary as of January 1, 1996, (ii) ownership in RHP had 
     been 28.3% as of January 1, 1996, (iii) the acquisition of STOL had 
     occurred as of January 1, 1996, (iv) the acquisition of SDL had occurred 
     as of January 1, 1996 and (v) the acquisition of Protelsa had occurred 
     as of January 1, 1996.  This pro forma summary does not necessarily 
     reflect the results of operations as they would have been if the Company 
     had acquired the entities as of January 1, 1996.
     
     Unaudited pro forma consolidated results of operations for the various 
     acquisitions as described above are as follows (in thousands):
     

                                  SIX MONTHS ENDED
                                     JUNE 30,
                                 -------------------
                                  1996        1997
                                --------    --------
     Revenues                   $    481    $  1,017
     Net loss                    (14,439)    (29,816)
     
     
(6)  NOTES RECEIVABLE FROM AFFILIATES
     
     In March 1997, the Company loaned $3,500,000 to SDL.  This loan, which 
     is evidenced by a promissory note, accrues interest at 9% per annum and 
     is due upon written demand by the Company.  The Company anticipates 
     repayment within the next 12 months.
     
     In June 1997, STOL loaned $1,500,000 to SDL.  This loan accrues interest 
     at 8.75% per annum and is due upon written demand by STOL.  The Company 
     anticipates repayment within the next 12 months.
               
(7)  NOTES RECEIVABLE

     In March 1997, the Company loaned $500,000 to an unrelated third party.  
     This loan, which has a one year term, accrues interest at the rate of 
     15% per annum and is guaranteed by another unrelated third party.  At 
     the sole discretion of the Company, the loan may be converted at any 
     time during its one year term into 51% of the outstanding capital stock 
     of Nexbeep S.A., formerly named Clasbeep S.A., an Ecuadorian paging 
     corporation that is wholly owned by the borrower. 
     
     In April 1997, the Company collected $900,000 on a loan the Company had 
     extended to a co-shareholder of Mobilcom Mexico.  The balance of the 
     loan, which is in the form of a promissory note, plus accrued interest, 
     was repaid in July 1997 (see Note 12).
     

                                       13.
<PAGE>


       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(8)  LICENSE DEPOSIT

     In August 1996, STOL and the Company deposited $3,005,000 and $2,250,000,
     respectively, for a 30% equity interest in a Taiwan paging project.  In 
     early February 1997, it was announced that the respective bid 
     applications were unsuccessful and the Company reclassified the deposits as
     a current asset.  In June 1997, STOL received a refund of $1,669,000 of its
     deposit, net of its pro rata share of application expenses of $347,000. 
     The remaining balance of $989,000 has been classified on the accompanying 
     balance sheet as other current assets and was received by STOL in July 
     1997.  In June 1997, the Company received a refund of $1,029,000, net of 
     its pro rata share of application expenses of $220,000.  The remaining 
     balance of $1,001,000 has been classified on the accompanying balance 
     sheet as other current assets and was received by the Company in August 
     1997.
               
     In June 1996, the Company deposited $3,042,000 for a 20% interest in a
     consortium pursuing ECTR licenses in Taiwan.  The consortium was successful
     in winning four of twelve license applications.  The Company is awaiting a 
     refund of $1,977,000, which represents its pro rata portion of the deposit 
     applied to the unsuccessful applications, net of the Company's pro rata 
     share of application expenses of $61,000.  This amount has been classified 
     on the accompanying balance sheet as other current assets. The remaining 
     deposit of $1,004,000 will represent the Company's initial capital 
     contribution to the ECTR venture to be formed.
     
(9)  REDEEMABLE CONVERTIBLE PREFERRED STOCK AND RETAINED DEFICIT
     
     On May 5, 1997, the Company entered into an agreement with Vanguard 
     Cellular Financial Corp. (together with its wholly owned subsidiary, 
     Vanguard Cellular Operating Corp., "Vanguard"), pursuant to which 
     Vanguard surrendered then-outstanding warrants to purchase 323,880 
     shares of Series C Preferred Stock, 416,720 shares of Series D Preferred 
     Stock and 64,120 shares of Series F Preferred Stock in exchange for the 
     issuance by the Company of a warrant to acquire 249,970 shares of Common 
     Stock at a purchase price of $0.25 per share and a second warrant to 
     purchase 554,750 shares of Common Stock at an exercise price of $9.375 
     per share.  This second warrant was subsequently surrendered by Vanguard 
     in exchange for the issuance to certain officers and employees of 
     Vanguard of an option to purchase 53,330 shares of Common Stock at an 
     exercise price of $9.375 per share under International Wireless 
     Communications Holdings, Inc. 1996 Stock Option/Stock Issuance Plan (the 
     "1996 SO/SIP") and options to purchase an aggregate of 501,420 shares of 
     Common Stock at a purchase price of $9.375 per share outside the 1996 
     SO/SIP.  (The foregoing transaction is hereinafter referred to as the 
     "Vanguard Warrant/Option Exchange.")  Such transaction and the issuance 
     of such options and warrants by the Company were approved by the Board 
     of Directors of the Company on February 28, 1997, and by the 
     stockholders of the Company on May 5, 1997.  The Company recognized an 
     expense of $2.3 million from the first warrant based on the difference 
     between its fair value and the $0.25 exercise price of each share.
     
     On or prior to June 12, 1997 holders of warrants to purchase an 
     aggregate of 28,800 shares of Series D Preferred Stock exercised such 
     warrants pursuant to the cashless "net-exercise" provisions thereof.  
     Upon such exercises, such warrantholders received an aggregate of 8,676 
     shares of Series D Preferred Stock.
     
     The holders of the Warrants issued in connection with the Debt Offering 
     were initially entitled to purchase 11.638 shares of Common Stock per 
     Warrant, representing in the aggregate approximately 10.0% of the 
     outstanding stock of the Company on a fully-diluted basis as of August 
     15, 1996.  Because the Company did not complete a qualifying initial 
     public offering of Common Stock in which the Company raised at least $50 
     million in net cash proceeds on or prior to May 15, 1997, pursuant to 
     the terms of the Warrants, on May 15, 1997, each unexercised Warrant 
     entitled the holder thereof to purchase an additional 2.645 shares of 
     Common Stock or an aggregate of 14.283 shares of Common Stock.

                                  14.
<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(10) STOCK OPTION/STOCK ISSUANCE PLAN
     
     On May 5, 1997, the stockholders of the Company approved an amendment to 
     the 1996 SO/SIP increasing the aggregate number of shares of Common Stock 
     available for issuance over the term of the plan by 411,526 shares to a 
     total of 2,811,526 shares.  Such amendment was approved by the Board of 
     Directors of the Company on February 28, 1997. 
     
     On May 5, 1997, the Option Committee of the Board of Directors of the 
     Company granted options to purchase an aggregate of 342,000 shares of 
     Common Stock at an exercise price of $9.375 per share under the 1996 
     SO/SIP to certain officers and service providers of the Company.  
     Also on May 5, 1997, as part of the Vanguard Warrant/Option Exchange, 
     the Company issued an option to purchase 53,330 shares at an exercise 
     price of $9.375 per share under the 1996 SO/SIP to a director of the 
     Company.
     
     On May 15, 1997, the Company issued and sold 180,000 shares of Common 
     Stock to a former officer of the Company for an aggregate purchase price 
     of $45,000 upon the exercise by such officer of an option to purchase such 
     shares granted under the 1996 SO/SIP.

(11) COMMITMENTS AND CONTINGENCIES

     CAPITAL CONTRIBUTIONS

     In order to protect IWC's investments in affiliates from ownership 
     dilution, IWC anticipates making additional capital contributions to the 
     LWBs as approved.
     
     GUARANTEE OF DEBT OF EQUITY INVESTEE
     
     In connection with a Malaysian Ringgit 91,000,000 (approximately 
     $36.1 million as translated using effective exchange rates at June 30, 
     1997) senior credit facility through a syndicate of Malaysian banks 
     obtained by the Company's 30% equity investee, STW, the Company along 
     with other STW shareholders, executed a financial "keep well" covenant 
     pursuant to which they have agreed (i) to ensure that STW will remain 
     solvent and be able to meet its financial liabilities when due and (ii) 
     to ensure that the project is completed in a timely manner and to make 
     additional debt and equity as and investments in STW, as necessary to 
     meet cost overruns. The loan is repayable by STW in eleven semi-annual 
     installments beginning October 8, 1997. The Company and other STW 
     shareholders have separately executed an agreement, whereby each 
     shareholder has agreed to share in the liability on a pro rata basis in 
     relation to their interest in STW. In the event that the bank were to 
     seek repayment from the STW shareholders and the other shareholders were 
     unable to honor their pro rata share in the liability, the Company might 
     be liable for the full amount of the outstanding amount of the loan. As 
     of June 30, 1997, this credit facility was fully drawn down. 
     
     The Company does not believe it is practicable to estimate the fair 
     value of the guarantee and does not believe exposure to loss is likely. 
     Accordingly, no provision has been made in the accompanying consolidated 
     financial statements. 
     
     The Company, indirectly through its affiliate, New Zealand Wireless, 
     owns 15% of Mobilkom.  Mobilkom expects to fund the continued buildout of
     its network and the acquisition of subscriber terminals primarily through a
     seven-year $50 million revolving/reducing credit facility which it has
     obtained from a syndicate of Thai banks.  Borrowings under the credit
     facility bear interest at a floating rate based on LIBOR and are secured by
     substantially all of Mobilkom's assets and a pledge of all the capital
     stock held by the Company and Mobilkom's other shareholders. Another
     Mobilkom shareholder has guaranteed borrowings of up to $25 million under
     the credit facility. As of June 30, 1997, borrowings of approximately
     $22,637,000 were outstanding under this facility. 
     
     The Company indirectly owns a 19.8% equity interest in Mobisel, a 
     provider of cellular services in Indonesia through its 28.3% ownership 
     in RHP. Mobisel has obtained a six-year $60 million credit facility from 
     Nissho Iwai International (Singapore) Pte. Ltd. ("Nissho Iwai") to 
     finance the construction of its network. Borrowings under the 

                                  15.
<PAGE>

       INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC. AND SUBSIDIARY

                         NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

     credit facility bear interest at a floating rate based on LIBOR and are 
     secured by all of Mobisel's assets and a pledge of all the capital stock 
     held by RHP and Mobisel's other shareholders. RHP has also guaranteed 
     the credit facility. As of June 30, 1997, this credit facility was fully 
     drawn down.
     
     The Company, indirectly through its wholly owned subsidiary, IWC China 
     Limited, owns a 40% equity interest in SDL.  The Company, including the 
     Designated Assignee of IWC, IWC China Limited, amended the Subscription 
     Agreement, dated as of September 23, 1996, among SDL and STHL.  The 
     Amendment and Waiver modified certain provisions in the SDL Subscription 
     Agreement, including waiving the fulfillment of the conditions precedent 
     to its obligations to enter into and complete a second subscription of 
     SDL shares for an aggregate subscription price of $19,000,000.  Pursuant 
     to the Amendment and Waiver, IWC China Limited is required to fund the 
     second subscription of SDL shares no later than June 17, 1998.
     
(12) SUBSEQUENT EVENTS
     
     In July 1997, the Company, STOL and STHL entered into an agreement with 
     a third party providing for the issuance and sale to such third party of 
     new shares equivalent to up to a 20% equity interest in STOL subject to 
     the achievement by STOL of certain performance milestones.  As of August 
     1, 1997, no new shares in STOL had been issued to such third party. 
     
     In July 1997, the Company collected the remainder of the note 
     receivable, including accrued interest in the amount of $608,000 from 
     its former co-shareholder in Mobilcom Mexico.
     
     In July 1997, International Wireless Communications Limited ("IWCL"), a 
     wholly owned indirect subsidiary of the Company, entered into various 
     agreements relating to the purchase by IWCL of a 26% indirect equity 
     interest in Pakistan Mobile Communications (Pvt) Ltd. ("PMCL"), a 
     Pakistan cellular operating company, from Motorola International 
     Development Corporation ("MIDC") and Continental Communications Limited 
     ("CCL"), two current shareholders of PMCL, for an aggregate purchase 
     price of $28.6 million to be paid in a combination of cash and shares of 
     the Company's Common Stock (the "PMCL Purchase").  The Company 
     anticipates that Vanguard will co-invest with IWCL in the PMCL Purchase 
     by purchasing from MIDC and CCL an approximately 6% indirect equity 
     interest in PMCL, thereby reducing the indirect equity interest IWCL 
     purchases from MIDC and CCL to approximately 20%.  
     
     Pursuant to the terms of the agreements entered into in connection with 
     the PMCL Purchase, the PMCL Purchase will be consummated on or after 
     August 13, 1997, subject to the satisfaction of certain closing 
     conditions.  The Company is currently negotiating a bridge financing 
     facility with Toronto Dominion Investments, Inc. and Vanguard Cellular 
     Financial Corp. and has received written commitments from certain other 
     shareholders of the Company to provide an aggregate of $29 million in 
     exchangeable bridge loans to the Company and to an indirect wholly owned 
     subsidiary of the Company in order to finance the purchase of an 
     interest in PMCL, meet certain funding requirements of PMCL and for 
     general corporate purposes of the Company (the "Pakistan Bridge 
     Facility").  The closing of the Pakistan Bridge Facility is subject to 
     various conditions precedent, including receipt of requisite approvals 
     from the Board of Directors and stockholders of the Company and the 
     satisfaction of all conditions precedent (other than funding of purchase 
     price) to the closing of the PMCL Purchase.  There can be no assurance 
     that such conditions precedent shall be satisfied or waived on or after 
     August 13, 1997, or that the PMCL Purchase or the Pakistan Bridge 
     Facility will be consummated as currently anticipated or at all.

                                     16.


<PAGE>


          INTERNATIONAL WIRELESS COMMUNICATIONS HOLDINGS, INC.
                              
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
RESULTS OF OPERATIONS.

THE DISCUSSION IN THIS REPORT CONTAINS FORWARD-LOOKING STATEMENTS THAT INVOLVE
RISKS AND UNCERTAINTIES. THE COMPANY'S ACTUAL RESULTS COULD DIFFER MATERIALLY
FROM THOSE DISCUSSED HEREIN. FACTORS THAT COULD CAUSE OR CONTRIBUTE TO SUCH
DIFFERENCES INCLUDE, BUT ARE NOT LIMITED TO, THOSE DISCUSSED IN "RISK FACTORS
THAT MAY AFFECT FUTURE RESULTS" AS WELL AS THOSE DISCUSSED IN THIS SECTION AND
ELSEWHERE IN THIS REPORT, AND THE RISKS DISCUSSED IN THE "RISK FACTORS" SECTION
INCLUDED IN THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER
31, 1996, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON APRIL 15, 1997.

OVERVIEW

The Company develops, owns and operates LWBs in emerging markets in Asia 
and Latin America. These LWBs provide a variety of communication services, 
including cellular, WLL, ECTR and paging.  Together with its strategic 
partners, the Company has interests in LWBs in Brazil, China, India, 
Indonesia, Malaysia, New Zealand, Pakistan, Peru, and the Philippines.

The Company has recently undertaken a realignment of its investment strategy 
and has initiated the redistribution of its resources away from its smaller 
ECTR investments to its larger cellular and WLL investments. As part of this 
realignment, in June 1997, the Company sold its 1.56% equity interest in 
Mobilcom Mexico to an affiliate of a co-shareholder in Mobilcom Mexico for 
$3.2 million. In addition, the Company proposes to sell all or a portion of 
its interests in TeamTalk, Mobilkom and UTS. The Company anticipates that the 
sale of these three investments will occur within the next 12 months. 
However, in part because there exists no public market for the Company's 
ownership interests in these LWBs, there can be no assurance that any of 
these LWBs will be sold upon terms acceptable to the Company within such 
time period or at all.

RESULTS OF OPERATIONS

THREE MONTHS ENDED JUNE 30, 1996 AND 1997

    For the three month period ended June 30, 1996, the Company's net loss 
was $5.5 million compared to $17.4 million for the corresponding period in 
1997, an increase of 214%. This increase was due primarily to higher selling, 
general and administrative expenses, an increase in interest expense and 
increases in equity in losses of affiliates, as more fully described below. 
In addition, the Company recognized an expense of $2.3 million pursuant to 
the Vanguard Warrant/Option Exchange. The net loss was partially offset by 
the gain on sale of an investment held for sale.

    For the three month period ended June 30, 1996, the Company's selling, 
general and administrative expenses were $4.1 million as compared to $9.5 
million for the corresponding period in 1997. This increase was primarily due 
to an increase in the selling, general and administrative expenses associated 
with the Company's consolidation of the SRC operations. SRC's selling, 
general and administrative costs increased from $666,000 for the three months 
ended June 30, 1996 to $1.8 million for the corresponding period in 1997, an 
increase of 167%, as the Brazilian ECTR venture expanded its coverage area and 
network operations. In addition, the Company's selling, general and 
administrative expenses were affected by the consolidated results of the 
Company's four developmental stage subsidiaries as their selling, general and 
administrative expenses increased from $56,000 for the three month period 
ended June 30, 1996 to $1.3 million for the corresponding period in 1997 as 
these entities continued to develop their network operations and commence the 
deployment of their wireless operations.

    For the three month period ended June 30, 1996, the equity in losses of 
affiliates was $1.6 million compared to $5.2 million for the corresponding 
period in 1997, an increase of 231%. For the three month period ended June 
30, 1996, the equity in losses in affiliates was attributable to $1.0 million 
of operating losses and $520,000 of expense relating to the amortization of 
telecommunication licenses. For the corresponding period in 1997, the equity 
in losses of affiliates was attributable to $4.5 million of operating losses 
and $732,000 of expense relating to the amortization of telecommunication 
licenses.

    The Company's equity in losses of affiliates attributable to RHP was 
$274,000 for the three month period ended June 30, 1996 as compared to $2.9 
million for the corresponding period in 1997. Mobisel continued to expand 
its operations and build out its nationwide cellular network. During this 
expansion phase, Mobisel's gross profit temporarily declined due primarily to 
greater pulse sharing and airtime costs and an increase in depreciation 
expense due to the Phase I build-out of Mobisel's nationwide cellular 
network. In addition, as part of its expansion effort, Mobisel experienced 
growth in its selling, general and administrative expense base in order to 
meet the anticipated growth in its operations. Also, interest expense 
increased for the three month period ended June 30, 1997.

     The Company's equity in losses of affiliates attributable to SDL for the 
three month period ended June 30, 1997 was $1.1 million, including expense 
attributable to the amortization of telecommunication licenses of $80,000.

    For the three month period ended June 30, 1996 the Company's interest 
expense was $82,000 as compared to $4.5 million for the corresponding period 
in 1997. The increase in interest expense was primarily due to interest 
expense associated with the Debt Offering.

    The Company's other income and expense improved from an expense of 
$14,000 for the three month period ended June 30, 1996 to other income of 
$1.1 million for the corresponding period in 1997. This increase resulted 
from the gain on sale of the Company's investment in Mobilcom Mexico in June 
1997.

   SIX MONTHS ENDED JUNE 30, 1996 AND 1997

   The Company's net loss increased from $9.1 million for the six month 
period ended June 30, 1996 to $31.9 million for the corresponding period in 
1997, an increase of 249%.  This increase was due primarily to an increase in 
interest expense, higher selling, general and administrative expenses and 
increases in equity losses of affiliates, as more fully described below.  In 
addition, the Company recognized an expense of $2.3 million pursuant to the 
Vanguard Warrant/Option Exchange. The net loss was partially offset by the 
gain on sale of an investment held for sale.

   The Company's operating revenue increased from $183,000 for the six month 
period ended June 30, 1996 to $1.0 million for the corresponding period in 
1997, an increase of 456%.  The operating revenue, was offset by an increase 
in the cost of revenues from $180,000 for the six month period ended June 30, 
1996 to $1.2 million for the corresponding period in 1997, an increase of 
593% as the company's wholly owned subsidiary, TeamTalk, continued to expand 
its ECTR operations.  The Company anticipates that operating revenues and 
costs of revenues will continue to increase as the Company's consolidated 
subsidiaries shift from the development of their networks to the provision of 
their wireless services. 

   The Company's selling, general and administrative expenses increased from 
$6.4 million for the six month period ended June 30, 1996 to $15.7 million 
for the corresponding period in 1997, an increase of 148%.  This increase was 
primarily due to an increase in selling, general and administrative expenses 
associated with the Company's two operational consolidated subsidiaries, 
TeamTalk and SRC as their selling, general and administrative expenses 
increased from $1.2 million for the six month period ended June 30, 1996 to 
$5.0 million for the corresponding period in 1997, an increase of 307%.  
These two entities continued to develop their ECTR operations and expand 
their services resulting in the increase in selling, general and 
administrative expenses.  The Company believes that the consolidated selling, 
general and administrative expenses of its operational subsidiaries will 
stabilize, as future growth of expenses increases consistent with the growth 
in its operating revenues.  In addition, the Company's selling, general and 
administrative expenses were affected by the consolidated results of the 
Company's four developmental stage subsidiaries as their selling, general and 
administrative expenses increased from $54,000 for the six month period ended 
June 30, 1996 to $2.1 million for the corresponding period in 1997 as these 
entities continued to develop their network operations and commenced 
deployment of their wireless operations.  In addition to the consolidated 
subsidiaries, the Company experienced continued growth in its own general and 
administrative expenses, including salaries and benefits expense, 
professional fees and all other general and administrative expenses as the 
Company increased its corporate and regional operations to meet the needs of 
the local wireless businesses.  The Company's own general and administrative 
expenses increased from $5.0 million for the six months ended June 30, 1996 
to $8.6 million for the corresponding period in 1997, an increase of 71%.

                                   17.

<PAGE>


   The Company's equity in losses of affiliates increased from $3.0 million 
for the six month period ended June 30, 1996 to $9.9 million for the 
corresponding period in 1997, an increase of 230%.  For the six month period 
ended June 30, 1996, the equity in losses of affiliates was attributable to 
$1.9 million of operating losses and $1.0 million of expense relating to the 
amortization of telecommunication licenses.  For the corresponding period in 
1997, equity in losses of affiliates consisted of $8.3 million of operating 
losses and $1.6 million of expense relating to amortization of 
telecommunication licenses.  The increase in the equity in losses of 
affiliates is attributable primarily to the increase in the underlying 
operating losses of RHP and SDL.

   The Company's equity in losses of affiliate attributable to RHP increased 
from $648,000 for the six month period ended June 30, 1996 to $4.6 million 
for the corresponding period in 1997 as RHP's 70% owned consolidated 
subsidiary, Mobisel, continued to expand its operations and build-out its 
nationwide cellular network. During this expansion phase, Mobisel's gross 
profit temporarily declined due primarily to greater pulse sharing and 
airtime costs and an increase in depreciation expense due to the Phase I 
build-out of Mobisel's nationwide cellular network.  In addition, as part of 
its expansion effort, Mobisel experienced growth in its selling, general and 
administrative expense base in order to meet the anticipated growth in its 
operations. Interest expense increased for the six month period ended June 
30, 1997 as Mobisel had fully drawn down the $60.0 million construction 
facility, arranged in October 1996, to finance the construction of its 
nationwide network.  As part of this expansion effort, Mobisel entered into 
and utilized the majority of a syndicated short-term notes facility arranged 
in January 1997.  These funds enabled Mobisel to continue the build-out of 
its nationwide cellular network, and were utilized for general corporate 
purposes.

   The Company's equity in losses of affiliates attributable to its 40% 
interest in SDL, which the Company acquired in November 1996, was $3.0 
million for the six month period ended June 30, 1997, including the Company's 
amortization of telecommunication license expense attributable to SDL of 
$271,000 for the six month period ended June 30, 1997.  SDL operating losses 
are anticipated to increase throughout the foreseeable future as SDL 
continues to expand its regional operations in the Peoples Republic of China. 

   The Company's interest income increased from $424,000 for the six month 
period ended June 30, 1996 to $1.1 million for the corresponding period in 
1997, an increase of 160%.  This increase was due primarily to interest 
earned on the proceeds from the Debt Offering in August 1996, which were 
invested in short-term interest-bearing securities.

    The Company's interest expense increased from $201,000 for the six month 
period ended June 30, 1996 to $8.8 million for the corresponding period in 
1997. The increase in interest expense was primarily due to interest expense 
associated with the Debt Offering.

   The Company's other income and expense improved from an expense of $13,000 
for the six month period ended June 30, 1996 to other income of  $1.1 million 
for the corresponding period in 1997.  This increase resulted from the gain 
on sale of the Company's investment in Mobilcom Mexico in June 1997.  


                                     18.

<PAGE>

LIQUIDITY AND CAPITAL RESOURCES
          
   To date, the Company has funded its cash requirements primarily through 
the use of the net proceeds of a series of Preferred Stock private 
placements, bridge loans and the Debt Offering. The bridge loans have 
generally been converted into Preferred Stock. The proceeds from these 
financings were mainly used to fund the Company's investments in operating 
companies and developmental stage projects, to provide working capital and 
for general corporate purposes, including the expenses incurred in seeking 
and evaluating new investment opportunities. As of December 31, 1996 and June 
30, 1997, the Company had cash and cash equivalents balances of $41.6 million 
and $14.6 million, respectively.

   The Company has generated negative cash flow from operations since 
inception, and its operating companies and developmental stage projects are 
not expected to provide any cash to the Company in the foreseeable future. As 
a result, the Company is and will remain dependent upon raising funds from 
outside sources to fund its working capital needs, investments in operating 
companies and developmental stage projects, other cash requirements and to 
repay the Notes and any other indebtedness it may incur when it becomes due 
and payable.

   The Company believes that its existing cash balance is sufficient to meet 
its minimum operating and contractual obligations through the end of fiscal 
1997. However, the Company will require additional financing prior to 
December 31, 1997 to meet its business objective of participating in 
additional equity rounds of financing on the operating company and 
developmental stage project level to finance the expansion of the operations 
of such operating companies and developmental stage projects. There can be no 
assurance that such additional financing will be available to the Company on 
acceptable terms when required by the Company or at all. The Company's 
inability to obtain such additional financing on acceptable terms would have 
a material adverse effect on the Company. In addition, the Company intends to 
pursue additional investment opportunities for wireless communications 
projects and will require additional sources of financing in order to pursue 
those investments. However, there can be no assurance that such additional 
financing will be available on favorable terms or at all. See "--Additional 
Factors That May Affect Future Results--Company Level Risks--Negative 
Operating Cash Flow; Dependence on Additional Financing; No Commitments for 
Additional Financing."

   The Company is currently negotiating the Pakistan Bridge Facility with 
Toronto Dominion Investments, Inc. and Vanguard Cellular Financial Corp. and 
has received written commitments from these and certain other stockholders of 
the Company for an aggregate of $29 million in exchangeable bridge loans as 
part of the Pakistan Bridge Facility. The Pakistan Bridge Facility is 
structured as a two-tier facility, with $7 million proposed to be loaned to 
IWC Holdings for general corporate and other purposes and $22 million 
proposed to be loaned to Pakistan Wireless Holdings Limited ("PWH"), a newly 
formed indirect wholly owned subsidiary of the Company, for the specific 
purpose of financing the cash portion of the purchase price of the Company's 
investment in PMCL and the Company's pro rata share of shareholder capital 
calls and shareholder loans required to finance the operations of PMCL. The 
closing of the Pakistan Bridge Facility is subject to various conditions 
precedent, including receipt of requisite approvals from the Board of 
Directors and stockholders of the Company and the satisfaction of all 
conditions precedent (other than funding of purchase price) to the closing of 
the PMCL Purchase. There can be no assurance that such conditions precedent 
shall be satisfied or waived or that the PMCL Purchase or the Pakistan Bridge 
Facility will be consummated as currently contemplated or at all. Further, 
the Pakistan Bridge Facility, as currently contemplated, contains significant 
restrictions on the Company's ability to raise additional debt or equity 
financing until all amounts outstanding under the Pakistan Bridge Facility 
are repaid in full.

   The Company has recently undertaken a realignment of its investment 
strategy and has initiated the redistribution of its resources away from its 
smaller ECTR investments to its larger cellular and WLL investments. As part 
of this realignment and in order to raise additional capital, the Company 
proposes to sell all or a portion of its interests in TeamTalk, Mobilkom and 
UTS. The Company anticipates that the sale of these three investments will 
occur within the next 12 months. However, in part because there exists no 
public market for the Company's ownership interests in these investments, 
there can be no assurance that any of these investments will be sold upon 
terms acceptable to the Company within such time period or at all.

          
   At the project level, IWC and its partners typically fund initial project 
investments using capital contributions either in the form of equity or 
shareholder loans. When projects become operational, IWC seeks to fund 
ongoing development of the project using third-party financing, preferably on 
a non-recourse basis to the Company.

   Mobilkom, IWC's national ECTR operating company in Indonesia, arranged a 
$50.0 million credit facility through a syndicate of Thai banks. This 
facility is secured by all of the assets and capital stock of Mobilkom, and 
$25.0 million of the facility has been guaranteed by Jasmine International 
Public Company Limited ("Jasmine"), a 56.25% owner of Mobilkom. As of June 
30, 1997, approximately $22.6 million was outstanding under this facility. 
The Company anticipates that the current $50.0 million facility will be 
sufficient for Mobilkom to meet all of its 

                                      19.
<PAGE>

currently anticipated expenditures through 1997. Borrowings outstanding under 
this credit facility must be repaid in 16 quarterly installments commencing 
in 2000.

   Mobisel, IWC's national cellular operating company in Indonesia, in which 
the Company held an indirect 19.8% interest as of June 30, 1997 through IWC's 
investment in RHP, has obtained a $60.0 million credit facility from Nissho 
Iwai.  This facility is secured by all of Mobisel's assets and a pledge of 
all of the capital stock of Mobisel held by RHP, which has also guaranteed 
the credit facility. The use of borrowings under the credit facility with 
Nissho Iwai is limited to expenditures necessary for the implementation and 
construction of Mobisel's network. Borrowings outstanding under this credit 
facility must be repaid in six equal semi-annual installments beginning in 
late 1998.  As part of this initiative and to meet its short term needs 
Mobisel will require substantial additional financing to complete its planned 
capital expenditures through 1997 and for other purposes. Accordingly, 
Mobisel has commenced discussions with a number of potential financing 
sources in order to obtain additional financing.  Mobisel entered into a 
syndicated short-term notes facility agreement in January 1997 with PT Bank 
Umum Servitia, as arranger, whereby the banks agreed to purchase Indonesian 
Rupiah("Rp")60,000,000,000 of short-term notes and interest notes of 
Rp15,000,000,000 (in aggregate approximately $30.8 million as at June 30, 
1997).  These short-term notes would have repayment priority to the existing 
loans outstanding.  Mobisel is continuing to pursue various other long-term 
financing solutions to enable it to meet its business plan objectives.

   STW, IWC's national WLL operating company in Malaysia, has arranged a 
Malaysian Ringgit 91.0 million (approximately $36.1 million as of June 30, 
1997) credit facility through a syndicate of Malaysian banks. This facility 
is secured by substantially all of STW's assets and a pledge of all of the 
capital stock of STW held by IWC and STW's other shareholders, and has been 
guaranteed by Shubila Holding Sdn Bhd, the 60% owner of STW, and certain 
officers of STW (including a former officer of IWC). In addition, STW has 
agreed to assign to and deposit with the banks all of its cash, including 
revenues, loan drawings and shareholder advances. In addition to pledging 
their capital stock in STW, IWC and the other STW shareholders have entered 
into a "keep well" covenant pursuant to which they have agreed (i) to insure 
that STW remains solvent and able to meet its financial liabilities when due, 
and (ii) to insure the timely completion of its WLL project and to make 
additional debt or equity investments in STW necessary to meet any cost 
overruns. The Company and other STW shareholders have also separately 
executed an agreement, whereby each shareholder has agreed to share in the 
liability on a pro rata basis in relation to their interest in STW. In the 
event that the banks were to seek repayment from the STW shareholders and the 
other shareholders were unable to honor their pro rata share of the 
liability, the Company might be liable for the full amount of the outstanding 
amount of the loan. Borrowings outstanding under this credit facility must be 
repaid in eleven semi-annual installments beginning October 8, 1997.

ADDITIONAL FACTORS THAT MAY AFFECT FUTURE RESULTS

   THE COMPANY OPERATES IN A RAPIDLY CHANGING ENVIRONMENT THAT INVOLVES A 
NUMBER OF RISKS, SOME OF WHICH ARE BEYOND THE COMPANY'S CONTROL.  THE 
FOLLOWING DISCUSSION HIGHLIGHTS SOME OF THESE RISKS.  THESE RISKS SHOULD BE 
READ IN CONJUNCTION WITH THE "RISK FACTORS" SECTION INCLUDED IN THE COMPANY'S 
ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED DECEMBER 31, 1996, AS FILED 
WITH THE COMMISSION ON APRIL 15, 1997.  

COMPANY LEVEL RISKS

CONTINUING LOSSES; LIMITED OPERATING HISTORY 

The Company has incurred net losses since its inception and had an accumulated
stockholders' deficit of approximately $53.4 million as of June 30, 1997. The
Company anticipates that its net losses will increase significantly in the
foreseeable future, and there can be no assurance as to whether or when the
Company's operations will become profitable. See "--Results of Operations."  The
Company has a limited operating history. Since its inception in January 1992,
the Company's activities have been concentrated primarily in the early stage
development of its wireless projects, including the selection of local partners,
the formation of operating companies and the pursuit of operating licenses. 

NEGATIVE OPERATING CASH FLOW; DEPENDENCE ON ADDITIONAL FINANCING; NO COMMITMENTS
FOR ADDITIONAL FINANCING

                                      20.

<PAGE>

   The Company used cash in operations and investing activities of $73.2 
million for the year ended December 31, 1996, and $26.6 million for the six 
months ended June 30, 1997, and expects such negative cash flows to continue 
and likely increase in the foreseeable future. Because of such negative cash 
flow and negative working capital and the capital intensive nature of the 
Company's business, the Company will require continuing sources of outside 
debt and equity financing to fund its working capital needs, investments and 
other cash requirements. 

   In particular, the Company will require additional financing prior to 
December 31, 1997, to meet currently anticipated requirements for working 
capital and investments in its operating companies and developmental stage 
projects. In addition, the Company intends to pursue additional investment 
opportunities for wireless projects and anticipates that it will require 
additional sources of financing in order to fund those investments. However, 
the Company has neither received commitments nor completed arrangements for 
additional financing, and there can be no assurance that any additional debt 
or equity financing will be available to the Company on acceptable terms when 
required by the Company or at all. If adequate sources of additional 
financing are not available, the Company may be forced (i) to delay, scale 
back or eliminate one or more of its projects, (ii) to suffer a significant 
dilution of its equity interest or loss of value in one or more of its 
investments, or (iii) to liquidate one or more of its investments.  In 
addition, the Company may be unable to repay its liabilities (including the 
Notes) as they become due, and may be unable to meet its working capital and 
other cash requirements. The Indenture contains certain restrictions on the 
ability of the Company to make investments in, or guarantee the indebtedness 
of, the operating companies and developmental stage projects. Accordingly, 
the Company's inability to obtain such additional financing would have a 
material adverse effect on the Company and could result in its insolvency or 
liquidation. 

SUBSTANTIAL LEVERAGE

   The Company is highly leveraged and has indebtedness that is substantial 
in relation to its stockholders' equity, including its redeemable convertible 
Preferred Stock. As of June 30, 1997, the Company's long term debt was $83.6 
million, and its stockholders' deficit and redeemable convertible Preferred 
Stock was $50.8 million. The high level of the Company's indebtedness will 
have important consequences, including (i) limitations on the Company's 
ability to obtain additional debt financing in the future and (ii) 
limitations on the Company's flexibility in reacting to changes in the 
industry and economic conditions generally.  In addition, most of the 
existing operating companies and developmental stage projects will not be 
subject to any limitations restricting the incurrence of additional 
indebtedness, and, to the extent that the Company is successful in its 
strategy of obtaining additional financing at the operating company or 
developmental stage project level, the amount of such indebtedness could 
increase substantially, which may have consequences similar to those 
described in clauses (i) and (ii) above with respect to the Company. 

RISK OF INABILITY TO REPAY NOTES AT MATURITY

   The Company has had net losses and has generated negative cash flow from 
operations since inception.  Further, as discussed below under "--Holding 
Company Structure; Limitations on Access to Cash Flow of Operating 
Companies," the Company does not expect that it will generate positive cash 
flow through dividends or other distributions from its operating companies 
for the foreseeable future. Accordingly, the Company's ability to repay the 
Notes and any other indebtedness which it may incur from time to time at 
maturity will be dependent on developing one or more sources of financing 
prior to the maturity of such indebtedness. The Company may, among other 
things, (i) seek to refinance all or a portion of such indebtedness at 
maturity through sales of additional debt or equity securities of the Company 
or other borrowings, (ii) seek to sell all or a portion of its interests in 
one or more of its operating companies or developmental stage projects 
(subject to the restrictions described below under "--Company Level 
Risks--Restrictions on Transfer of Ownership Interests") or (iii) negotiate 
with its financial and strategic partners to permit the cash, if any, 
produced by the operating companies to be distributed to equity holders. 
There can be no assurance that (i) the Company will be able to obtain debt or 
equity refinancing on acceptable terms, or at all, in the future, (ii) the 
Company will be able to sell assets in a timely manner or on commercially 
acceptable terms or in an amount that will be sufficient to repay its 
indebtedness when due, (iii) the Company will be able to obtain the consents 
and approvals required in order to sell its interests in, or to receive 
dividends from, its operating companies or developmental stage projects or 
(iv) that the operating companies or developmental stage projects will in 
fact generate positive cash flow or that any such cash flow will be 
distributed to equity holders (particularly since the Company expects that 
its operating companies will generally reinvest all of their cash flow in 
development opportunities for the foreseeable future). In addition, a default 
under the Notes or such other indebtedness as the Company may incur in the 
future, for example, could in turn permit lenders under STW's Malaysian 
Ringgit 91 million (approximately $36.1 million as translated using 

                                      21.
<PAGE>

effective exchange rates at June 30, 1997) senior credit facility, and 
possibly under other debt instruments of the operating companies, to declare 
borrowings outstanding thereunder to be due and payable pursuant to 
cross-default clauses, permitting the lenders under such debt instruments to 
proceed against any collateral pledged as security therefor. Any failure by 
the Company to repay the Notes when due would have a material adverse effect 
on the Company.

RISK OF GOVERNMENTAL ACTIONS RESULTING IN VIOLATION OF INDENTURE

   The Indenture pursuant to which the Notes were issued, contains covenants 
that impose certain requirements with respect to sales or other dispositions 
of assets with a fair market value in excess of $500,000 (including capital 
stock in operating companies and in developmental stage projects) by the 
Company and certain subsidiaries of the Company ("Asset Sales"). Among other 
things, the Indenture requires that at least 85% of the consideration for an 
Asset Sale be in cash and that the Company receive consideration equal to the 
fair market value of the assets in question. However, if an Asset Sale occurs 
because of governmental action (for example, by expropriation or 
confiscation), or in certain other circumstances including, among other 
things, a sale of the Company's investment in certain operating companies 
compelled by other stockholders of such operating company or pursuant to 
rights granted to certain bank lenders of certain operating companies, the 
requirement that the Company receive fair market value for the assets shall 
be deemed to have been satisfied to the extent that the difference between 
the fair market value of such assets and the actual consideration received in 
such Asset Sale (and all other Asset Sales subject to this exception) is less 
than 10% of the "total market value of equity" of the Company. However, if an 
Asset Sale is compelled by governmental action, the Indenture still requires 
that at least 85% of the consideration be in cash. 

   In certain of the countries in which the Company has made investments, 
there is a risk that the Company's investments may be confiscated or 
expropriated by governmental authorities. In particular, in early 1996, the 
Malaysian government initiated efforts to consolidate the Malaysian 
telecommunications industry, which, if completed would have forced a sale or 
merger of STW, the Company's Malaysian operating company, to or with one of a 
limited number of surviving telecommunications companies. There can be no 
assurance that the Malaysian government will not seek to take similar actions 
in the future. Likewise, other countries may seek to expropriate or 
confiscate assets of the Company. To the extent that the consideration, if 
any, received by the Company in connection with these expropriations or 
confiscations failed to satisfy the covenants under the Indenture, such a 
violation will be deemed an event of default under the Indenture entitling 
the holders of the Notes to demand immediate repayment thereof and to proceed 
against their collateral, which would have a material adverse effect on the 
Company. See "--Project Level Risks--Risks Inherent in Foreign Investment." 

HOLDING COMPANY STRUCTURE; LIMITATIONS ON ACCESS TO CASH FLOW OF OPERATING
COMPANIES

   The Company is a holding company with no business operations of its own. 
All of the operations of the Company are conducted through its wholly owned 
subsidiary, IWC, and its affiliated companies, which are separate and 
distinct legal entities and have no obligation, contingent or otherwise to 
make any funds available to the Company to enable it to make investments in 
operating companies or developmental stage projects, meet working capital 
needs or other liabilities of the Company (including liabilities under the 
Notes), or for any other reason. In addition, most of the operating companies 
have generated negative cash flow from operations, and the Company expects 
that most operating companies will continue to generate negative cash flow 
from operations for the foreseeable future. Further, to the extent that any 
of the operating companies generates positive cash flow, the Company may be 
unable to access such cash flow because (i) it owns 50% or less of the equity 
of most of such entities and, therefore, does not have the requisite control 
to cause such entities to pay dividends to their equity holders; (ii) certain 
of such entities are currently or may become parties to credit or other 
borrowing agreements that restrict or prohibit the payment of dividends, and 
such entities are likely to continue to be subject to such restrictions and 
prohibitions for the foreseeable future; (iii) the Company expects that its 
operating companies will generally reinvest all of their cash flow in 
development opportunities for the foreseeable future; and/or (iv) some of the 
countries in which such entities conduct business, tax the payment and 
repatriation of dividends or otherwise restrict the repatriation of funds. As 
a result, the Company does not expect that it will be able to generate any 
significant cash flow through dividends or other distributions from the 
operating companies in the foreseeable future, and there can be no assurance 
that the Company will be able to generate any significant cash flow from the 
operating companies at any time in the future. 

RESTRICTIONS ON TRANSFER OF OWNERSHIP INTERESTS

                                      22.
<PAGE>

   The Company's ability to sell or transfer its ownership interests in its 
operating companies and developmental stage projects is generally subject to 
(i) limitations contained in the agreements between the Company and its local 
partners including, in certain cases, complete prohibitions on sales or 
transfers for a period of years, co-sale rights and/or rights of first 
refusal and (ii) provisions in local operating licenses and local 
governmental regulations that, in certain cases, prohibit or restrict the 
transfer of the Company's ownership interests in such operating companies and 
developmental stage projects. Moreover, the Company and its local partners 
have in the past been required to pledge their capital stock in certain 
operating companies to secure credit facilities obtained by those operating 
companies, and the Company may be prohibited from transferring or otherwise 
disposing of such capital stock so long as it is pledged as collateral for 
those credit facilities. In addition, none of the operating companies or 
developmental stage projects currently has any publicly traded securities and 
there can be no assurance that in the future there will be either a public or 
private market for the securities of the Company's operating companies or 
developmental stage projects. As a result, the Company's ability to liquidate 
any or all of its investments may be substantially limited and there can be 
no assurance that the Company will be able to do so in a timely manner, or at 
all in the event that the Company is required to do so in order to satisfy 
its cash needs, including providing funds for investments and repayment of 
indebtedness. Moreover, even if any sales are completed, the prices realized 
on those sales could be less than the Company's investment, and there may be 
substantial local taxes imposed on the Company in the case of any such sales 
and, in any event, there can be no assurance that there will not be 
substantial taxes or other restrictions on the ability of the Company to 
repatriate any amounts realized upon the sale of any such investments. In 
addition, certain of the operating companies and developmental stage projects 
are or may be parties to credit agreements that restrict their ability to pay 
dividends or make other distributions to their equity investors, and the 
Company's local partners, by virtue of their majority ownership interest in 
the operating companies and developmental stage projects, generally have the 
right to determine the timing and amount of any such dividends or 
distributions. 

LACK OF CONTROL OF OPERATING COMPANIES AND DEVELOPMENTAL STAGE PROJECTS

   The Company anticipates that it will often have a minority interest in its 
operating companies and developmental stage projects, in part because 
applicable laws often limit foreign investors to minority equity positions. 
Although the Company is actively involved in the management of most of the 
operating companies and developmental stage projects in which it has an 
ownership interest and intends to invest in the future in operating companies 
and developmental stage projects in which it can participate in management, 
its minority voting positions may preclude it from controlling such entities 
and implementing strategies that it favors, including strategies involving 
the expansion or development of projects or the pursuit of certain financing 
alternatives. Moreover, even where the Company has majority control of a 
project, the exercise of such control may be subject to contractual, 
regulatory or other restrictions. In addition, the Company may be unable to 
access the cash flow, if any, of its operating companies. See "--Company 
Level Risks--Holding Company Structure; Limitations on Access to Cash Flow of 
Operating Companies." 

RISKS INHERENT IN GROWTH STRATEGY

   The Company has grown rapidly since inception, and as of June 30, 1997,
had operating companies or developmental stage projects in 13 foreign countries.
Subject to the availability of additional financing, the Company anticipates
that it will make additional investments in wireless projects in other foreign
countries and is actively seeking and evaluating new investment opportunities in
foreign countries where it currently has operating companies or developmental
stage projects. This strategy presents the risks inherent in assessing the
value, strengths and weaknesses of development opportunities, in evaluating the
costs and uncertain returns of building and expanding the facilities for
operating systems and in integrating and managing the operations of additional
operating systems. The Company's growth strategy will place significant demands
on the Company's operational, financial and marketing resources and on its
management. Any failure to manage the Company effectively could have a material
adverse effect on the Company. 

RISK OF REGISTRATION UNDER INVESTMENT COMPANY ACT OF 1940

   Because the Company often acquires minority ownership positions in
operating companies and development stage projects, there is a risk that these
ownership positions could be deemed to be investment securities and that the
Company could be characterized as an investment company under the Investment
Company Act of 1940 (the "Investment Company Act"). Due to the Company's active
role in developing and managing the operating companies and its contractual
rights as an equity holder, the Company believes that a substantial majority of
its interests in the operating companies are the equivalent of joint venture
interests rather than investment securities. Therefore, the 

                                      23.
<PAGE>

Company believes that it is not an investment company and intends to continue 
its business and conduct its operations so as not to become subject to the 
Investment Company Act. If the Commission or its staff were to take the 
position, or if it were otherwise asserted, that the Company is an investment 
company, the Company could be required either (i) to liquidate its 
investments in one or more operating companies or developmental stage 
projects and change the manner in which it conducts its operations to avoid 
being required to register as an investment company or (ii) to register as an 
investment company. If the Company were required to register under the 
Investment Company Act, it would be subject to substantive regulations with 
respect to capital structure, operations, transactions with affiliates and 
other matters. In addition, a determination that the Company is subject to 
the Investment Company Act would constitute an event of default under the 
Indenture and permit acceleration of the Notes. If the Company were found to 
be an investment company but was not registered under the Investment Company 
Act, the Company would be prohibited from, among other things, conducting 
public offerings in the U.S. or engaging in interstate commerce in the U.S., 
the Company would be subject to monetary penalties and injunctive relief in 
an action brought by the Commission, and certain contracts to which the 
Company is a party (including the Indenture and the Notes) might be rendered 
unenforceable or subject to rescission by any party thereto. As a result, any 
determination that the Company is an investment company would have a material 
adverse effect on the Company and would likely require that the Company cease 
operations.

CONTROL OF THE COMPANY

   At June 30, 1997, Vanguard beneficially owned approximately 27.4% of the
Company's equity.  Vanguard has provided and continues to provide a number of
services to the Company relating to the formation, development and operation of
wireless communications services, including identification and evaluation of
wireless communications opportunities, review of business and technical plans
and assistance in training operating company personnel. Vanguard has the right
to elect three directors to the Company's Board of Directors and currently has
three representatives on such Board, including Haynes G. Griffin, Chairman of
the Board of Directors. As a result, Vanguard may have the ability to
effectively control the Company and direct its business and affairs. 

CONFLICTS OF INTEREST

   Vanguard is not precluded from competing with the Company by itself or 
through affiliates by developing, owning and/or operating international 
wireless communications businesses, including businesses that use the same or 
similar technologies or provide the same services as the Company's existing 
and future operating companies. This is true even though the Company acquired 
substantially all of Vanguard's interests in certain of its international 
wireless projects in December 1995. Further, although many of the agreements 
governing the relationship between the Company and its local partners contain 
preemptive rights, rights of first refusal and/or rights of co-sale with 
respect to the sale of shares in the Company's joint ventures, Vanguard is 
not precluded from co-investing with the Company in such joint ventures. For 
example, in April 1997, Vanguard purchased a 7% equity interest in SDL 
directly from STHL, the Company's local partner in SDL. Also, it is currently 
anticipated that Vanguard will co-invest with the Company in PMCL and acquire 
a 6% indirect interest in PMCL.

   In addition, in May 1995, the Company and Vanguard consummated the 
Vanguard Warrant/Option Exchange, pursuant to which Vanguard surrendered 
warrants to purchase shares of Preferred Stock of the Company in exchange for 
the issuance of a warrant to purchase Common Stock of the Company at $0.25 
per share issued to Vanguard and options to purchase Common Stock of the 
Company at $9.375 per share issued to various members of the management of 
Vanguard, including two individuals who currently serve as directors of the 
Company. The Company recognized an expense of $2.3 million in connection with 
the issuance of the warrant to Vanguard, which amount represents the 
difference between the fair value of the shares underlying such warrant and 
its $0.25 exercise price.  Although the directors designated by Vanguard may 
abstain from voting on matters in which the interests of the Company and 
Vanguard are in conflict, they are not obligated to do so, and the Company 
has not adopted any formal policies or procedures designed to prevent actual 
conflicts of interest from occurring. As a result, the presence of potential 
or actual conflicts could affect the process or outcome of Board 
deliberations. There can be no assurance that such conflicts of interest will 
not materially adversely affect the Company. 
 
INFORMATION RELATING TO DEMOGRAPHIC, ECONOMIC, MARKET AND RELATED INFORMATION

   The information contained herein includes certain demographic and economic
information, as well as information regarding cellular service, installation and
penetration in the countries in which the Company has operating companies or
developmental stage projects. This information was obtained from a number of
sources and the Company has not independently verified any such information and
there can be no assurance as to its accuracy. In addition, much of the
information related to POPs are estimates and reflect data that may be incorrect
or imprecise and such estimates and data have been obtained from a number of
sources and the Company has not independently verified any such information. 

DEPENDENCE ON KEY PERSONNEL

                                      24.
<PAGE>

   The success of the Company and its growth strategy depends in large part on
the ability of the Company to attract and retain key management, marketing and
operating personnel at each of the Company, operating company and developmental
stage project levels. There can be no assurance the Company will be able to
attract and retain the qualified personnel needed for its business, particularly
because of the amount of international travel required of the Company's managers
and because experienced local managers are often unavailable. In addition, the
loss of the services of one or more members of its senior management team,
particularly John D. Lockton or Hugh B. L. McClung, could have a material
adverse effect on the Company. 

CLASSIFICATION OF NOTES AS DEBT; ORIGINAL ISSUE DISCOUNT

   Although the Company intends to treat the Notes as debt for all purposes,
there can be no assurance that the Internal Revenue Service will agree that the
Notes qualify as debt for federal income tax purposes. If the Notes are not
respected as debt for such purposes, they would likely be recharacterized as an
equity interest in the Company and the interest that accretes on the Notes would
not be deductible by the Company when accrued or paid. Loss of such interest
deductions would increase income taxes ultimately payable by the Company, and
thus, reduce cash flow otherwise available to repay the Notes, which would have
a material adverse effect on the Company. Recharacterization of the Notes as
equity could also adversely affect non-corporate holders as well as non-United
States holders of the Notes. 

   Assuming the Notes are respected as debt for federal income tax purposes,
they will be subject to the original issue discount provisions of the Code
because they will have been issued at a non-de minimis discount from their
principal amount. Consequently, the holders of the Notes generally will be
required to include amounts in gross income for federal income tax purposes in
advance of receipt of the cash payments to which the income is attributable. 

   If a bankruptcy case is commenced by or against the Company under the
United States Bankruptcy Code after the issuance of the Notes, the claim of a
holder of any of the Notes with respect to the principal amount thereof may be
limited to an amount equal to the sum of (i) the initial offering price
allocable to the Notes and (ii) that portion of the original issued discount
which is not deemed to constitute "unmatured interest" for purposes of the
Bankruptcy Code. Any original issued discount that was not amortized as of any
such bankruptcy filing would constitute "unmatured interest." 


REPORTING STANDARDS; FINANCIAL STATEMENTS OF OPERATING COMPANIES; TIMELY
COMPLIANCE WITH INFORMATIONAL AND FILING REQUIREMENTS

   Companies in developing countries are subject to accounting, auditing and
financial standards and requirements that differ, in some cases significantly,
from those applicable to U.S. companies. In addition, there may be substantially
less publicly available information about companies in a developing country than
there is about U.S. companies. The Company's ability to comply with the
informational and filing requirements of the Indenture and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), to which it is or will be
subject will depend on the timely receipt of accurate and complete financial and
other information from the Company's operating companies and developmental stage
projects. The failure to receive such information on a timely basis could have a
material adverse effect on the Company, including preventing it from satisfying
the informational and filing requirements of the Indenture and the Exchange Act.

RISK OF INABILITY TO FINANCE A CHANGE OF CONTROL OFFER

   Upon the occurrence of a Change of Control (as defined in the Indenture to
include (i) a sale or transfer by the Company or a Restricted Subsidiary (as
defined in the Indenture) of all or substantially all of its assets; (ii) the
adoption of a plan of liquidation; (iii) the acquisition of greater than 50% of
the voting power by an entity other than Vanguard or (iv) upon the change of a
majority of the Board of Directors), the Company will be required to make an
offer to purchase all of the outstanding Notes at the price set forth in the
Indenture. The Company's failure to purchase the Notes would result in a default
under the Indenture. In the event of a Change of Control, there can be no
assurance that the Company would have sufficient assets to satisfy all of its
obligations under the Indenture. Future debt of the Company may also contain
prohibitions of certain events or transactions which would constitute a Change
of Control or require the obligations thereunder to be retired upon a Change of
Control. 

                                      25.
<PAGE>

NO CASH DIVIDENDS ON COMMON STOCK

   The Company is prohibited under the terms of the Indenture from paying
dividends or making other distributions with respect to the Company's capital
stock, including the Common Stock while the Notes are outstanding. The Company
anticipates that all earnings, if any, will be retained for the operation and
expansion of the Company's business. 

PROJECT LEVEL RISKS

OPERATING LOSSES AND NEGATIVE CASH FLOW; DEPENDENCE ON ADDITIONAL
FINANCING/CAPITAL

   Most of the operating companies have generated operating losses and
negative cash flow from operations, and the Company expects that most of its
operating companies will continue to generate operating losses and negative cash
flow from operations for the foreseeable future. The business of the operating
companies and developmental stage projects, particularly WLL projects, is
capital intensive and, in light of such anticipated negative cash flow from
operations, will require continuing sources of outside financing to fund working
capital needs, capital expenditures and other cash requirements. The Company's
strategy is to seek such additional financing at the operating companies
primarily from third parties and not from the Company or its partners. However,
there can be no assurance that the operating companies and developmental stage
projects will be able to obtain the financing required to make planned capital
expenditures, provide working capital or meet other cash needs. Failure to
obtain such financing could have a material adverse effect on the Company and,
among other things, could result in the loss or revocation of licenses held by
the operating companies or developmental stage projects or require that certain
planned projects be delayed or abandoned. In particular, at June 30, 1997 a
significant portion of the Company's investments had been made in three
operating companies (namely STW, which is developing a national WLL system in
Malaysia; Mobisel, which is developing a national cellular system in Indonesia;
and SDL, which is developing various regional cellular systems in China), and
each of these operating companies will be required to obtain substantial
additional financing in order to complete planned capital expenditures. 

   In most cases, under agreements with its local partners, the Company and
its partners may be required to make additional equity investments in operating
companies or developmental stage projects, and the Company's or such partners'
inability or unwillingness to do so could result in the dilution of such party's
equity interest or a significant impairment or loss of the value of the
Company's investment. Moreover, the Company and its other strategic partners
have in the past been required, and in the future likely will be required, to
guarantee and/or pledge their respective equity interests to secure certain
indebtedness of the operating companies and developmental stage projects and
otherwise to provide certain assurances to lenders. See "--Liquidity and Capital
Resources." The Indenture contains certain restrictions on the ability of the
Company to make investments in, or guarantee the indebtedness of, the operating
companies and developmental stage projects. 

   In addition, there can be no assurance that the operating companies or
developmental stage projects will be able to pay their indebtedness or other
liabilities when due. Any failure to pay such indebtedness or other liabilities
when due could have a material adverse effect on the Company. See "--Company
Level Risks--Negative Operating Cash Flow; Dependence on Additional Financing;
No Commitments For Additional Financing" below. 

   To date, most of the debt financing obtained by the operating companies has
been secured by assets of the respective operating companies, and it is likely
that any debt financing the operating companies or developmental stage projects
obtain in the foreseeable future will also be similarly secured. The pledge of
assets to secure debt financing may limit the operations of the operating
companies and make it substantially more difficult to obtain additional
financing from other sources. 

EARLY STAGE OF DEVELOPMENT OF WIRELESS PROJECTS

   Most of the Company's wireless projects are in the early stages of
development. Only the eight operating companies, Via 1, SDL, RPSL, Mobisel,
Mobilkom, STW, TeamTalk and UTS, currently provide wireless communications
services on a commercial basis, and many of these operating companies have only
recently initiated such commercial service and have a limited number of
subscribers. Although MOUs have been signed with local partners in the operating
companies and developmental stage projects, in many cases definitive joint
venture and 

                                      26.
<PAGE>

shareholder agreements have not been prepared or signed, definitive legal 
entities have not been formed and/or required equity and debt financing has 
not been secured. Even where an MOU or definitive joint venture or 
shareholder agreement has been signed, there can be no assurance that the 
terms of the Company's participation in an operating company or developmental 
stage project will not be modified in a manner that is materially adverse to 
the Company, particularly because the Company usually holds a minority 
interest. The successful development and commercialization of these projects 
will depend on a number of significant financial, logistical, technical, 
marketing, legal and other factors, the outcome of which cannot be predicted. 
Virtually all of the operating companies are, and in the future will be, 
newly-formed entities that have a limited operating history and that operate 
at a loss for a substantial period of time. These operating companies will 
require significant amounts of additional financing to fund capital 
expenditures, working capital requirements and other cash needs, including 
the costs of obtaining additional licenses. In addition, there can be no 
assurance that these projects will not encounter engineering, design or other 
operational problems. For example, STW, the Company's Malaysian WLL operating 
company, has experienced significant delays in network deployment and its 
marketing plans primarily as a result of adverse effects on STW of an attempt 
during the first half of 1996 by the Malaysian government to consolidate the 
Malaysian telecommunications industry. See "--Risks Inherent in Foreign 
Investment." As a result, in late 1996, IWC and its principal strategic 
partner in STW extensively reviewed and revised STW's business plan and 
strategy. There can be no assurance that the Company can successfully develop 
any of its existing or planned developmental stage projects or that any of 
these projects or any of its operating companies will achieve commercial 
success. Further, the Company's current and anticipated ownership interests 
in the operating companies and developmental stage projects are subject to 
modification and may even be eliminated completely due to the occurrence of 
certain events such as the re-negotiation of existing MOUs and/or agreements, 
changes in foreign laws or regulations affecting foreign ownership, 
government expropriation, financing contingencies and other factors. 
Likewise, the Company may voluntarily withdraw from one or more operating 
companies and/or developmental stage projects. 

RISKS INHERENT IN FOREIGN INVESTMENT

   The Company has invested substantial resources outside of the United States
and plans to continue to do so in the future. Governments of many developing
countries have exercised and continue to exercise substantial influence over
many aspects of the private sector. For example, foreign ownership of
telecommunications ventures is prohibited in China. In addition, in some cases,
the government owns or controls (i) companies that are or may in the future
become competitors of the Company or (ii) companies (such as national telephone
companies) upon which the operating companies and developmental stage projects
may depend for required interconnections to land-line telephone networks and
other services. Similarly, government actions in the future could have a
significant adverse effect on economic conditions in a developing country or may
otherwise have a material adverse effect on the Company and its operating
companies and developmental stage projects. Expropriation, confiscatory
taxation, nationalization, political, economic or social instability or other
developments could materially adversely affect the value of the Company's
interests in operating companies and developmental stage projects in particular
developing countries. 

   For example, in early 1996 the Malaysian government announced a program
designed to consolidate the Malaysian telecommunications industry which, if
completed, would have forced the sale or merger of STW, the Company's Malaysian
operating company, to one of a limited number of surviving telecommunications
companies. Although the Malaysian government announced in July 1996 that it did
not intend to proceed with this program, the activities of the Malaysian
government in connection with such program resulted in significant delays in
STW's network deployment and marketing plans thereby contributing to a 37%
decrease in STW's subscribers during the quarter ended September 30, 1996. There
can be no assurance that the Malaysian government will not initiate similar
programs in the future. There can also be no assurance that the Malaysian
national telephone company will not otherwise impose restrictions on STW,
including restrictions on the ability of STW to interconnect its wireless
network with the national telephone company's system, which could have a
material adverse effect on the Company.  Moreover, there can be no assurance
that other countries where the Company has operating companies or developmental
stage projects will not initiate similar programs or impose other restrictions,
which could have a material adverse effect on the Company. 

   The Company also may be adversely affected by political or social unrest or
instability in foreign countries. Such unrest or instability resulting from
political, economic, social or other conditions in foreign countries could have
a material adverse effect on the Company. For example, in China, because foreign
ownership of telecommunications operators is prohibited, the Company, through
its ownership interest in SDL, has interests in China telecommunications
projects through certain "cooperative agreements" with Chinese cellular
operators. Pursuant to the terms of the 

                                      27.
<PAGE>

cooperative agreements, SDL provides equipment and technical and engineering 
services to the cellular operators and, in return, is allocated a portion of 
the revenues or profits from the cellular operations. There can be no 
assurance that the Chinese government will not prohibit or otherwise impose 
restrictions on these types of arrangements, which could have a material 
adverse effect on the Company. 

   The Company does not have political risk insurance in the countries in
which it currently conducts business. Moreover, applicable agreements relating
to the Company's interests in its operating companies are frequently governed by
foreign law. As a result, in the event of a dispute, it may be difficult for the
Company to enforce its rights. Accordingly, the Company may have little or no
recourse upon the occurrence of any of these developments or if any of its
partners seek to re-negotiate existing or future MOUs and/or other agreements.
To the extent that any of the operating companies seeks to make a dividend or
other distribution to the Company, or to the extent that the Company seeks to
liquidate its investment in an operating company or developmental stage project
and repatriate monies from a relevant country, local taxes, foreign exchange
controls or other restrictions may effectively prevent the transfer of funds to
the Company or the exchange of local currency for U.S. dollars. 

TECHNOLOGICAL RISK; RISK OF OBSOLESCENCE

   The Company's operating companies and developmental stage projects
generally use new and emerging technologies. For example, SDL, the Company's
China Regional Cellular project, is required by the Chinese government to
migrate to CDMA, a cellular technology that is not widely deployed on a
commercial basis at the present time. Additionally, the MPT 1327 ECTR technology
selected by a number of the Company's ECTR operating companies is currently
operational in many countries but has had limited deployment for public use in
developing countries. Although many of the technologies currently in use and to
be used in the future by the Company have been developed by international
telecommunications companies such as Nokia, Philips, Motorola, Ericsson, Lucent
Technologies and Nortel, most are generally advanced technologies which have
only recently been developed and commercially introduced. There can be no
assurance that the operating companies and developmental stage projects will not
experience technical problems in the commercial deployment of these
technologies, particularly because they are being introduced in developing
countries. In addition, the technology used in wireless communications is
evolving rapidly and one or more of the technologies currently utilized or
planned by the Company to be utilized may be unpopular with its customers or may
become obsolete, which in either case would likely have a material adverse
effect on the Company. There can be no assurance that the Company will be able
to keep pace with ongoing technological changes in the wireless
telecommunications industry. 

RISK OF MODIFICATION OR LOSS OF LICENSES; UNCERTAINTY AS TO THE AVAILABILITY,
COST AND TERMS OF LICENSES; RESTRICTIONS ON LICENSES

   The Company's ability to retain and exploit the existing telecommunications
licenses held by its operating companies and developmental stage projects, to
renew such licenses when they expire, and to obtain new licenses in the future,
are essential to the Company's operations. However, these licenses are typically
granted by governmental agencies in developing countries, and there can be no
assurance that these governmental agencies will not seek to unilaterally limit,
revoke or otherwise adversely modify the terms of these licenses in the future,
any of which could have a material adverse effect on the Company, and the
Company may have limited or no legal recourse if any of these events were to
occur. In addition, there can be no assurance that renewals to these licenses
will be granted or, if renewed, that the renewal terms will not be substantially
less favorable to the holders of the licenses than the original license terms,
any of which could have a material adverse effect on the Company. Likewise, many
of the Company's operating companies and developmental stage projects have not
yet obtained all of the licenses necessary for their proposed operations, and no
assurance can be given that any such licenses will be obtained. For example, the
Brazilian government has not approved the transfer to Via 1, the Company's
Brazilian ECTR operating company, of the licenses contributed or to be
contributed to it by its current and proposed shareholders, and there can be no
assurance that such approval will be obtained. The failure to obtain such
approval or to obtain other licenses would have a material adverse effect on the
Company. 

   The Company believes that the opportunity to acquire substantial new
wireless licenses in developing countries will exist only for a limited time.
Further, although the Company's operating companies and developmental stage
projects have, to date, obtained many of their operating licenses through
private negotiations without having to participate in competitive bidding
processes, the Company anticipates that governments of developing countries will

                                      28.
<PAGE>

increasingly discover the value of new wireless technologies and may require 
bidding for licenses, which would likely increase the cost of these licenses, 
perhaps substantially. In addition, the operating companies and developmental 
stage projects may be required to purchase licenses from other license 
holders in certain circumstances, for example, to gain network capacity or to 
increase geographic coverage. Furthermore, relevant governmental authorities 
may grant additional telecommunications licenses covering the same 
geographical areas as the operating companies' and developmental stage 
projects' licenses or otherwise grant licenses which allow other companies to 
compete directly with such operating companies and developmental stage 
projects for wireless subscribers. Although the inherent limitation on 
suitable frequency bands may provide some protection against the issuance of 
competing licenses, there can be no assurance that such competitive licenses 
will not be granted or, if granted, that they will not have a material 
adverse effect on the Company. In addition, licenses may be subject to 
significant operating restrictions or conditions, including restrictions on 
interconnection to the public telephone system or requirements that the 
operating companies or developmental stage projects complete construction or 
commence commercial operation of the networks by specified deadlines, which 
conditions, if not satisfied, may result in loss or revocation of the 
license. Accordingly, even if an operating company or developmental stage 
project is able to obtain a required license, there can be no assurance that 
such operating requirements will be satisfied and, as a result, there can be 
no assurance that such license will not be lost or revoked or that the 
restrictions imposed upon such license will prevent the commercial 
exploitation of such license, which could have a material adverse effect on 
the Company. 

DEPENDENCE ON OTHER TELECOMMUNICATIONS PROVIDERS

   The success of the Company's wireless systems will in many cases depend 
upon services provided by other telecommunications providers, some of which 
are competitors of the Company, the operating companies and/or the 
developmental stage projects. For example, the Company's operating companies 
and developmental stage projects generally require interconnection agreements 
with national or regional telephone companies in order for its wireless 
systems to connect with land-line telephone systems, and may require the use 
of microwave or fiber optic networks belonging to other parties to link its 
wireless systems. Although a number of operating companies have entered into 
required interconnection and/or linking agreements or have interconnection 
and/or linking arrangements in place, the revocation, loss or modification of 
any of these existing agreements or arrangements or the failure to obtain 
necessary agreements and/or arrangements in the future could have a material 
adverse effect on the Company. Specifically, STW, the Company's Malaysian WLL 
project, has in the past had difficulties obtaining interconnect services 
from its interconnect provider, which is a competitor of STW, despite the 
existence of a formal interconnection agreement with such provider.

DEPENDENCE ON PARTNERS

   The Company will generally continue to depend on its local partners to 
obtain required licenses in all of its wireless projects. In addition, the 
Company may become dependent on strategic partners with resources beyond 
those of the Company to pursue larger scale projects, including certain WLL 
projects. In WLL projects, the Company may require the participation of a 
larger telecommunications company possessing the substantial capital and 
operating resources required to finance and deploy a WLL system. The failure 
of the Company to identify and enter into relationships with strong partners, 
or the failure of those partners to provide these resources, may have a 
material adverse effect on the Company. 

CONSTRUCTION RISKS

   The operating companies and developmental stage projects in which the 
Company invests typically require substantial construction of new wireless 
networks and additions to existing wireless networks. Construction activity 
will require the operating companies and developmental stage projects to 
obtain qualified subcontractors and necessary equipment on a timely basis, 
the availability of which varies significantly from country to country. 
Construction projects are subject to cost overruns and delays not within the 
control of the operating company or the developmental stage project or its 
subcontractors, such as those caused by acts of governmental entities, 
financing delays and catastrophic occurrences. Delays also can arise from 
design changes and material or equipment shortages or delays in delivery. 
Accordingly, there can be no assurance that the operating companies or 
developmental stage projects will be able to complete current or future 
construction projects for the amount budgeted or within the time periods 
projected, or at all. Failure to complete construction for the amount 
budgeted or on a timely basis could jeopardize subscriber contracts, 
franchises or licenses and could have a material adverse effect on the 
Company. In particular, telecommunications 

                                      29.
<PAGE>

licenses often are granted on the condition that network construction be 
completed or commercial operations be commenced by a specified date. Failure 
to comply with these deadlines could result in the loss or revocation of the 
licenses. In that regard, certain operating companies have failed to meet 
such deadlines in the past. Specifically, UTS, which provides ECTR services 
in the Visayas and Mindanao regions of the Philippines, failed to comply with 
the service date requirement contained in its provisional authority but 
subsequently cured such failure and expects to receive a final operating 
authority from the Philippine government by the end of 1997. Similarly, in 
the Via 1 Project, because the Company and its proposed partners were unable 
to comply with operations commencement deadlines with respect to their 
licenses, they had to apply for, and have received, extensions of such 
deadlines. Although such failures have not to date led to the loss of any 
licenses, there can be no assurance that the relevant governmental 
authorities will not seek to revoke licenses as a result of these past 
defaults or refuse to grant deadline extensions to similar defaults occurring 
in the future, which could have a material adverse effect on the Company. 

SUBSTANTIAL LEVERAGE

   As discussed above, the operating companies and developmental stage
projects will require continuing sources of additional financing. Certain of the
operating companies have substantial indebtedness and, to the extent that
additional debt financing is available, such operating companies may incur
additional indebtedness, and other operating companies or developmental stage
projects may in the future incur substantial indebtedness, in relation to their
respective base of equity capital. To the extent that any of the operating
companies or developmental stage projects now has or in the future incurs a high
level of indebtedness, such indebtedness will have important consequences to the
Company, including (i) a possible restriction on such entity's ability to pay
dividends or make other distributions to the Company, (ii) a possible limitation
on such entity's ability to obtain additional debt financing and (iii) a
possible impairment of such entity's ability to react to changes in the industry
and economic conditions generally. 

COMPETITION

   Although the implementation of advanced wireless technologies is in the
early stages of deployment in most developing countries, the Company believes
that its business will become increasingly competitive, particularly as
businesses and foreign governments realize the market potential of these
wireless technologies. A number of large American, Japanese and European
companies, including U.S.-based regional Bell operating companies ("RBOCs") and
large international telecommunications companies, are actively engaged in
programs to develop and commercialize wireless technologies in developing
counties. In many cases, the Company will also compete against local land-line
carriers, including government-owned telephone companies. Most of these
companies have substantially greater financial and other resources, including
research and development staffs and technical and marketing capabilities than
the Company. The Company anticipates that there will be increasing competition
for additional licenses and increased competition to the extent such licenses
are obtained by others. Although the Company intends to employ relatively new
technologies, there will be a continuing competitive threat from even newer
technologies which may render the technologies employed by the Company obsolete.

REGULATION

   The wireless services of the Company's operating companies and
developmental stage projects are subject to governmental regulation, which may
change from time to time. There can be no assurance that material and adverse
changes in the regulation of the Company's existing or future operating
companies or developmental stage projects will not occur in the future. To date,
certain operating companies and developmental stage projects have been subject
to foreign ownership restrictions, service requirements, restrictions on
interconnection of wireless systems to government-owned or private telephone
networks, subscriber rate-setting, technology and construction requirements,
among others. These regulations may be difficult to comply with, particularly
given demographic, geographic or other issues in a particular market. Further,
changes in the regulatory framework may limit the ability to add subscribers to
developing systems. An operating company's or developmental stage project's
failure to comply with applicable governmental regulations or operating
requirements could result in the loss of licenses or otherwise could have a
material adverse effect on the Company. 

FOREIGN CORRUPT PRACTICES ACT

                                      30.
<PAGE>

   The Company is subject to the Foreign Corrupt Practices Act ("FCPA"), which
generally prohibits U.S. companies and their intermediaries from bribing foreign
officials for the purpose of obtaining or keeping business or licenses or
otherwise obtaining favorable treatment. Although the Company has taken
precautions to comply with the FCPA, there can be no assurance that such
precautions will protect the Company against liability under the FCPA,
particularly as a result of actions which may in the past have been taken or
which may be taken in the future by agents and other intermediaries for whose
actions the Company may be held liable under the FCPA. In particular, the
Company may be held responsible for actions taken by its strategic or local
partners even though such strategic or local partners are themselves typically
foreign companies which are not subject to the FCPA; and the Company has no
ability to control such strategic or local partners. Any determination that the
Company has violated the FCPA could have a material adverse effect on the
Company.

TAX RISKS

   Distributions of earnings and other payments received from the Company's
operating subsidiaries and affiliates are likely to be subject to withholding
taxes imposed by the jurisdictions in which such entities are formed or
operating. In general, a U.S. corporation may claim a foreign tax credit against
its federal income tax expense for such foreign withholding taxes and foreign
taxes paid directly by corporate entities in which the Company owns 10% or more
of the voting stock. The ability to claim such foreign tax credits and to
utilize net foreign losses is, however, subject to numerous limitations, and the
Company may incur incremental tax costs as a result of these limitations or
because the Company is not in a tax paying position in the U.S. 

   Special U.S. tax rules apply to U.S. taxpayers that own stock in a "passive
foreign investment company" (a "PFIC") that could also increase the Company's
effective rate of taxation. In general, a non-U.S. corporation will be treated
as a PFIC if at least 75 percent of its income is "passive income" or if at
least 50 percent of its assets are held for the production of "passive income."
A non-U.S. corporation that owns 25 percent or more of the stock of a non-U.S.
subsidiary is treated as receiving a proportionate share of the income of, and
as owning a proportionate share of the assets of, such subsidiary. 

   It is possible that certain operating companies in which the Company owns
an equity interest are PFICs. Generally, except to the extent the Company makes
an election to treat a PFIC in which it owns stock as a "qualified electing
fund" (a "QEF") in the first taxable year in which the Company owns the PFIC's
stock, (i) the Company would be required to allocate gain recognized upon the
disposition of stock in the PFIC and income recognized upon receiving certain
dividends ratably over the Company's holding period for the stock in the PFIC,
(ii) the amount allocated to each year other than the year of the disposition or
dividend payment would be taxable at the highest U.S. tax rate applicable to
corporations, and an interest charge for the deemed deferral benefit would be
imposed with respect to the tax attributable to each year, and (iii) gain
recognized upon disposition of PFIC shares would be taxable as ordinary income. 

   If the Company were to make the QEF election, as described above, the
Company would be required in each year that the PFIC qualification tests are met
to include its pro rata share of the QEF's earnings as ordinary income and its
pro rata share of the QEF's net capital gain as long-term capital gain, whether
or not such amounts are actually distributed. The Company has not made any QEF
elections with respect to any non-U.S. corporation in which it holds stock. 

   The Company may also be required to include in its income for U.S. income
tax purposes its proportionate share of the earnings of those foreign corporate
subsidiaries that are classified as "controlled" foreign corporations without
regard to whether distributions have been received from such companies.

                                      31.
<PAGE>

PART II.  OTHER INFORMATION


ITEM 2.  CHANGES IN SECURITIES.

SALES OF UNREGISTERED SECURITIES DURING THE THREE MONTHS ENDED JUNE 30, 1997

Between April 1997 and June 1997, the Company issued an aggregate of 8,676
shares of Series D Preferred Stock to certain holders of warrants to purchase
Series D Preferred Stock upon the exercise of such warrants pursuant to the
cashless "net exercise" provisions thereof.

On May 5, 1997, the Company issued options to purchase an aggregate of 342,000
shares of Common Stock at an exercise price of $9.375 per share under the 1996
SO/SIP to certain officers and service providers of the Company. 

Also on May 5, 1997, as part of the Vanguard Warrant/Option Exchange, the
Company issued to Vanguard, an affiliate of the Company, a warrant to acquire
249,970 shares of Common Stock at a purchase price of $0.25 per share and a
second warrant to purchase 554,750 shares of Common Stock at an exercise price
of $9.375 per share.  This second warrant was subsequently surrendered by
Vanguard in exchange for the issuance to certain officers and employees of
Vanguard of an option to purchase 53,330 shares of Common Stock at an exercise
price of $9.375 per share under the 1996 SO/SIP and options to purchase an
aggregate of 501,420 shares of Common Stock at a purchase price of $9.375 per
share outside the 1996 SO/SIP .

On May 15, 1997, the Company issued and sold 180,000 shares of Common Stock to a
former officer of the Company for an aggregate purchase price of $45,000
pursuant to the exercise of an option to purchase such shares granted under the
1996 SO/SIP.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

On May 5, 1997, holders of the requisite number of shares of the Company's
capital stock approved the following matters by written consent in lieu of a
meeting:

(a)  The Vanguard Warrant/Option Exchange, including the issuance of warrants
     and options to purchase shares of the Company's Common Stock pursuant
     thereto;

(b)  An amendment to the 1996 SO/SIP increasing by 411,526 the number of shares
     of Common Stock authorized for issuance pursuant to the 1996 SO/SIP,
     thereby increasing the total number of shares of Common Stock available for
     issuance over the term of the 1996 SO/SIP to 2,811,526 shares (the "Option
     Plan Increase");

(c)  A waiver of certain anti-dilution and other rights under the Company's
     Amended and Restated Certificate of Incorporation in connection with the
     transactions effected as part of the Vanguard Warrant/Option Exchange and
     in connection with the Option Plan Increase; and

(d)  Certain amendments to the Series F Redeemable Convertible Preferred Stock
     Securities Purchase Agreement, dated December 6, 1996, the Registration
     Rights Agreement, dated December 18, 1996, and the Fifth Amended and
     Restated Investor Rights Agreement in connection with the Vanguard
     Warrant/Option Exchange and the Option Plan Increase.

Holders of 594,800 shares of the Company's Common Stock, representing 93% of the
then-outstanding shares of Common Stock; 753,200 shares of the Company's Series
A Preferred Stock, representing 81% of the then-outstanding shares of Series A
Preferred Stock; 820,440 shares of the Company's Series B Preferred Stock,
representing 67% of the then-outstanding shares of Series B Preferred Stock;
1,550,160 shares of the Company's Series C Preferred Stock, representing 88% of
the then-outstanding shares of Series C Preferred Stock; 3,278,840 shares of the
Company's Series D Preferred Stock, representing 90% of the then-outstanding
shares of Series D Preferred Stock; 3,972,240 shares of the Company's Series E
Preferred Stock, representing 100% of the then-outstanding shares of Series E
Preferred Stock; and 4,496,600 shares of the Company's Series F Preferred Stock,

                                      32.
<PAGE>

representing 84% of the then-outstanding shares of Series F Preferred Stock
voted in favor of the foregoing matters.  No holders of shares of the then-
outstanding capital stock of the Company voted against the foregoing matters.

ITEM 6.   EXHIBITS AND REPORTS ON FORM 8-K
     
(a)  EXHIBITS. 


EXHIBIT  
 NO.       DESCRIPTION 
------    ------------
 10.15A   Deed of Adherence among Star Telecom Overseas (Cayman Islands) 
          Limited, International Wireless Communications, Inc. ("IWC"), Star 
          Telecom Holding Limited ("STHL") and Baring Communications Equity 
          (Asia Pacific) Limited, dated July 18, 1997 
 
 10.16D   Amendment to Subscription Agreement and Waiver among Star Digitel 
          Limited ("SDL"), STHL, IWC and IWC China Limited, dated June 18, 1997 
 
 10.16E   Side Letter  regarding Indemnification between IWC China Limited and 
          SDL, dated June 18, 1997  
 
 10.24E*  Interconnection  Agreement between Telekom Malaysia Berhad and 
          Syarikat Telefon Wireless (M) Sdn Bhd, dated April 9, 1997 
 
 10.26A   Side Letter regarding Guaranty  between Vanguard Cellular  Financial 
          Corp. and the Registrant, dated May 29, 1997 
 
 10.27A   Share Purchase Agreement between Motorola International Development 
          Corporation ("MIDC") and International Wireless Communications 
          Pakistan Limited ("IWCPL"), dated July 17, 1997 
 
 10.27B   Share Purchase Agreement between Continental Communications Limited 
          ("CCL") and IWCPL, dated July 17, 1997 
 
 10.27C   Form of Restated and Amended Shareholders Agreement among MIDC, Saif 
          Telecom (Pvt) Ltd ("Saif") and IWCPL 
 
 10.27D   Form of Side Letter regarding Shareholder Obligations among IWCPL, 
          Saif, MIDC and Saif 
 
 10.27E   Shareholders' Agreement among IWCPL, International Wireless 
          Communications Limited ("IWCL") and South Asia Wireless 
          Communications (Mauritius) Limited ("SAWC"), dated July 17, 1997 
 
 10.27F   Letter Supplemental to Shareholders Agreement Relating to 
          International Wireless Communications Pakistan Limited between IWCL 
          and SAWC, dated July 17, 1997 
 
 10.27G   License granted to Pakistan Mobile Communications Limited by the 
          Government of Pakistan, Ministry of Communications, dated July 6, 
          1992 
 
 27.1     Financial Data Schedule 
__________________________

*  Confidential treatment has been requested as to certain portions of this
   agreement.

                                      33.
<PAGE>


(B)   REPORTS ON FORM 8-K 

      No Current Reports on Form 8-K were filed during the quarter ended 
      June 30, 1997. 






















                                      34.
<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.

Date:  August 11, 1997         INTERNATIONAL WIRELESS
                              COMMUNICATIONS HOLDINGS, INC.
                              (Registrant)
                              
                              
                              
                              By:  /s/ Douglas S. Sinclair                      
                                   -----------------------
                                   Douglas S. Sinclair
                                   Vice President and Chief Financial Officer 
                              
                              By:  /s/ Keith D. Taylor                          
                                   -----------------------
                                   Keith D. Taylor 
                                   Controller and Chief Accounting Officer












                                      35.
<PAGE>

                                  EXHIBIT INDEX


 EXHIBIT                                                             EDGAR 
    NO.    DESCRIPTION                                             DOCUMENT NO.
--------  ------------                                             -----------
 
  10.15A  Deed of Adherence among Star Telecom Overseas (Cayman            2
          Islands)  Limited, International Wireless Communications, 
          Inc. ("IWC"), Star Telecom Holding Limited ("STHL") and 
          Baring Communications Equity (Asia Pacific) Limited, dated 
          July 18, 1997                                                    
 
  10.16D  Amendment to Subscription Agreement and Waiver among Star        3
          Digitel Limited ("SDL"), STHL, IWC and IWC China Limited, 
          dated June 18, 1997                                              
 
  10.16E  Side Letter regarding Indemnification between IWC China          4
          Limited and SDL, dated June 18, 1997                             
 
  10.24E* Interconnection Agreement between Telekom Malaysia Berhad        5
          and Syarikat Telefon Wireless (M) Sdn Bhd, dated April  9, 
          1997                                                             
 
  10.26A  Side Letter regarding Guaranty between Vanguard Cellular         6
          Financial Corp. and the Registrant, dated May 29, 1997           
 
  10.27A  Share Purchase Agreement between Motorola International          7
          Development Corporation ("MIDC") and International 
          Wireless Communications Pakistan  Limited ("IWCPL"), dated 
          July 17, 1997                                                    
 
  10.27B  Share Purchase Agreement between Continental Communications      8
          Limited ("CCL") and IWCPL, dated July 17, 1997                   
 
  10.27C  Form of Restated and Amended Shareholders Agreement among        9
          MIDC, Saif Telecom (Pvt) Ltd ("Saif") and IWCPL                  
 
  10.27D  Form of Side Letter regarding Shareholder Obligations           10
          among IWCPL, Saif, MIDC and Saif                                
 
  10.27E  Shareholders' Agreement among IWCPL, International              11
          Wireless Communications Limited ("IWCL") and South Asia 
          Wireless Communications (Mauritius) Limited ("SAWC"), 
          dated July 17, 1997                                             
 
  10.27F  Letter Supplemental to Shareholders Agreement Relating to       12
          International Wireless Communications Pakistan Limited 
          between IWCL and SAWC, dated July 17, 1997                      
 
  10.27G  License granted to Pakistan Mobile Communications Limited       13
          by the Government of Pakistan, Ministry of Communications, 
          dated July 6, 1992                                              
 
   27.1   Financial Data Schedule                                         14

_____________________
*  Confidential treatment has been requested as to certain portions of this
   agreement.



                                      36.