##### Table of Contents



UNITED STATES
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 September 30, 2003


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: 0-16718

Northland Cable Properties Seven Limited Partnership




(Exact Name of Registrant as Specified in Charter)


|                        |  |                                     
|----------------------- |  | ------------------------------------
|Washington              |  | 91-1366564                          
|                        |  |                                     
|(State of Organization) |  | (I.R.S. Employer Identification No.)

|                                         |  |  |            | 
|---------------------------------------- |  |  | ---------- | 
|101 Stewart Street, Seattle, Washington  |  |  | 98065      | 
|                                        
|(Address of Principal Executive Offices) |  |  | (Zip Code) | 

|                                                     |  | 
|---------------------------------------------------- |  | 
|(206) 621-1351                                       |  | 
|                                                     |  | 
|(Registrants telephone number, including area code) |  | 

|                                                                                   |  | 
|---------------------------------------------------------------------------------- |  | 
|N/A                                                                                |  | 
|                                                                                   |  | 
|(Former name, former address and former fiscal year, if changed since last report) |  | 

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities 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 subject to such
filing requirements for the past 90 days.

Yes [X]      No[  ]

Indicate by checkmark whether the registrant is an accelerated filer (as
defined in Rule 12b-2 of the Exchange Act.)

Yes [  ]      No [X]





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TABLE OF CONTENTS



|                               |                                                                                                          |  |  |  |  |  |  | 
|------------------------------ | -------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  | 
|PART 1 - FINANCIAL INFORMATION
|                               | ITEM 1. Financial Statements                                                                            
|                               | ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Continuing Operations
|                               | ITEM 3. Quantitative and Qualitative Disclosures About Market Risk                                      
|                               | ITEM 4. Controls and procedures                                                                         
|PART II - OTHER INFORMATION   
|                               | ITEM 1 Legal proceedings                                                                                
|                               | ITEM 2 Changes in securities                                                                            
|                               | ITEM 3 Defaults upon senior securities                                                                  
|                               | ITEM 4 Submission of matters to a vote of security holders                                              
|                               | ITEM 5 Other information                                                                                
|                               | ITEM 6 Exhibits and Reports on Form 8-K                                                                 
|SIGNATURES                    
|EXHIBIT 10.39                 
|EXHIBIT 31(A)                 
|EXHIBIT 31(B)                 
|EXHIBIT 32(A)                 
|EXHIBIT 32(B)                 



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##### Table of Contents









PART 1 - FINANCIAL INFORMATION
ITEM 1. Financial Statements

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
BALANCE SHEETS - (UNAUDITED)

|                                                                                                        |                          |                                   |            |               |            |              |             |             |             |  
|------------------------------------------------------------------------------------------------------- | ------------------------ | --------------------------------- | ---------- | ------------- | ---------- | ------------ | ----------- | ----------- | ----------- | -
|                                                                                                        |                          |                                   |            | September 30, |            | December 31,
|                                                                                                        |                          |                                   |            | 2003          |            | 2002        
|                                                                                                        |                          |                                   |            |               |            |             
|ASSETS                                                                                                  |                          |                                   |            |               |            |              |             |            
|Cash                                                                                                    |                          | $                                 | 153,812    |               |            | $            | 519,698     |            
|Accounts receivable                                                                                     |                          |                                   | 455,505    |               |            |              | 485,780     |            
|Due from affiliates                                                                                     |                          |                                   | 4,501      |               |            |              | 34,376      |            
|Prepaid expenses                                                                                        |                          |                                   | 243,154    |               |            |              | 101,471     |            
|System sale receivable                                                                                  |                          |                                   | 1,153,850  |               |            |              |            |            
|Property and equipment, net of accumulated
depreciation of $14,708,781 and $13,115,638,
respectively    |                          |                                   | 11,608,052 |               |            |              | 12,582,150  |            
|Franchise agreements, net of accumulated
amortization of $10,321,249                                    |                          |                                   | 9,607,185  |               |            |              | 9,607,185   |            
|Loan fees and other intangibles, net of accumulated
amortization of $987,732 and $991,875, respectively |                          |                                   | 104,349    |               |            |              | 517,422     |            
|Assets of discontinued operations                                                                       |                          |                                   |           |               |            |              | 6,744,817   |            
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|Total assets                                                                                            |                          | $                                 | 23,330,408 |               |            | $            | 30,592,899  |            
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|LIABILITIES AND PARTNERS CAPITAL (DEFICIT)                                                             |                          |                                   |            |               |            |              |             |            
|Accounts payable and accrued expenses                                                                   |                          | $                                 | 1,476,452  |               |            | $            | 1,910,050   |            
|Due to Managing General Partner and affiliates                                                          |                          |                                   | 915,909    |               |            |              | 973,023     |            
|Deposits                                                                                                |                          |                                   | 18,513     |               |            |              | 16,275      |            
|Subscriber prepayments                                                                                  |                          |                                   | 370,403    |               |            |              | 319,343     |            
|Notes payable                                                                                           |                          |                                   | 19,714,185 |               |            |              | 40,054,185  |            
|Liabilities of discontinued operations                                                                  |                          |                                   |           |               |            |              | 947,670     |            
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|                                                                                                        |                          | Total liabilities                 |            |               | 22,495,462 |              |             |             | 44,220,546  |  
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|Partners capital (deficit):                                                                            |                          |                                   |            |               |            |              |             |            
|General Partners:                                                                                       |                          |                                   |            |               |            |              |             |            
|                                                                                                        | Contributed capital, net |                                   |            | (25,367       | )          |              |             | (25,367     | )          
|                                                                                                        | Accumulated deficit      |                                   |            | (178,752      | )          |              |             | (323,378    | )          
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|                                                                                                        |                          |                                   | (204,119   | )             |            |              | (348,745    | )          
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|Limited Partners:                                                                                       |                          |                                   |            |               |            |              |             |            
|                                                                                                        | Contributed capital, net |                                   |            | 18,735,576    |            |              |             | 18,735,576  |            
|                                                                                                        | Accumulated deficit      |                                   |            | (17,696,511   | )          |              |             | (32,014,478 | )          
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|                                                                                                        |                          |                                   | 1,039,065  |               |            |              | (13,278,902 | )          
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|                                                                                                        |                          | Total partners capital (deficit) |            |               | 834,946    |              |             |             | (13,627,647 | )
|                                                                                                        |                          |                                   |            |               |            |              |             |            
|Total liabilities and partners capital (deficit)                                                       |                          | $                                 | 23,330,408 |               |            | $            | 30,592,899  |            
|                                                                                                        |                          |                                   |            |               |            |              |             |            

The accompanying notes are an integral part of these balance sheets.





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NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS - (UNAUDITED)

|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |            |  
|----------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------- | - | --------------------------------------- | ---------- | ---- | - | ---------- | ---------- | -
|                                                |                                                                                                                                                            |   | For the nine months ended September 30,
|                                                |                                                                                                                                                            |   |                                        
|                                                |                                                                                                                                                            |   | 2003                                    |            | 2002
|                                                |                                                                                                                                                            |   |                                         |            |     
|Service revenues                                |                                                                                                                                                            | $ | 10,463,105                              |            |      | $ | 10,131,744 |           
|Expenses:                                       |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                | Cable system operations (including
$108,334 and $96,928 to affiliates in
2003 and 2002, respectively), excluding
depreciation and amortization shown below |   |                                         | 703,879    |      |   |            | 694,460    |  
|                                                | General and administrative (including
$1,023,686 and $903,165 to affiliates
in 2003 and 2002, respectively)                                                |   |                                         | 2,711,880  |      |   |            | 2,511,800  |  
|                                                | Programming (including $29,477 and
$38,320 to affiliates in 2003 and 2002,
respectively)                                                                   |   |                                         | 3,485,320  |      |   |            | 3,296,318  |  
|                                                | Depreciation and amortization                                                                                                                              |   |                                         | 1,609,749  |      |   |            | 1,677,090  |  
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                |                                                                                                                                                            |   | 8,510,828                               |            |      |   | 8,179,668  |           
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Income from operations                          |                                                                                                                                                            |   | 1,952,277                               |            |      |   | 1,952,076  |           
|Other income (expense):                         |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                | Interest expense and loan fees                                                                                                                             |   |                                         | (1,238,037 | )    |   |            | (1,324,645 | )
|                                                | Interest income and other, net                                                                                                                             |   |                                         | 1,747      |      |   |            | 2,004      |  
|                                                | Loss on disposal of assets                                                                                                                                 |   |                                         | (18,348    | )    |   |            | (20,975    | )
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                |                                                                                                                                                            |   | (1,254,638                              | )          |      |   | (1,343,616 | )         
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Income from continuing operations               |                                                                                                                                                            | $ | 697,639                                 |            |      | $ | 608,460    |           
|Discontinued operations (note 3)                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                | Income (loss) from operations of Washington
systems, net (including gain on sale of systems
of $14,113,294 in 2003)                                        |   |                                         | 13,764,954 |      |   |            | (705,596   | )
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Net income (loss)                               |                                                                                                                                                            |   | 14,462,593                              |            |      |   | (97,136    | )         
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Allocation of net income (loss):                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                | General Partners                                                                                                                                           |   | $                                       | 144,626    |      |   | $          | (971       | )
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|                                                | Limited Partners                                                                                                                                           |   | $                                       | 14,317,967 |      |   | $          | (96,165    | )
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Net income (loss) per limited partnership unit: |                                                                                                                                                            |   |                                         |            |      |   |            |           
|(49,656 units)                                  |                                                                                                                                                            | $ | 288                                     |            |      | $ | (2         | )         
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           
|Net income (loss) per $1,000 investment         |                                                                                                                                                            | $ | 577                                     |            |      | $ | (4         | )         
|                                                |                                                                                                                                                            |   |                                         |            |      |   |            |           

The accompanying notes are an integral part of these statements.





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NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
STATEMENTS OF OPERATIONS - (UNAUDITED)

|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |           |  
|----------------------------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------------------------------------- | --------- | ---- | - | --------- | --------- | -
|                                                |                                                                                                                                                           |   | For the three months ended September 30,
|                                                |                                                                                                                                                           |   |                                         
|                                                |                                                                                                                                                           |   | 2003                                     |           | 2002
|                                                |                                                                                                                                                           |   |                                          |           |     
|Service revenues                                |                                                                                                                                                           | $ | 3,462,148                                |           |      | $ | 3,439,111 |          
|Expenses:                                       |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                | Cable system operations (including
$35,718 and $33,145 to affiliates in
2003 and 2002, respectively), excluding
depreciation and amortization shown below |   |                                          | 247,132   |      |   |           | 237,027   |  
|                                                | General and administrative (including
$325,238 and $320,738 to affiliates
in 2003 and 2002, respectively)                                                 |   |                                          | 942,124   |      |   |           | 891,249   |  
|                                                | Programming (including $3,663 and
$19,022 to affiliates in 2003 and 2002,
respectively)                                                                   |   |                                          | 1,106,655 |      |   |           | 1,116,617 |  
|                                                | Depreciation and amortization                                                                                                                             |   |                                          | 537,701   |      |   |           | 565,610   |  
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                |                                                                                                                                                           |   | 2,833,612                                |           |      |   | 2,810,503 |          
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Income from operations                          |                                                                                                                                                           |   | 628,536                                  |           |      |   | 628,608   |          
|Other income (expense):                         |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                | Interest expense and loan fees                                                                                                                            |   |                                          | (403,282  | )    |   |           | (581,516  | )
|                                                | Interest income and other, net                                                                                                                            |   |                                          | 523       |      |   |           | 1,335     |  
|                                                | Loss on disposal of assets                                                                                                                                |   |                                          | (1,616    | )    |   |           | (20,442   | )
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                |                                                                                                                                                           |   | (404,375                                 | )         |      |   | (600,623  | )        
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Income from continuing operations               |                                                                                                                                                           | $ | 224,161                                  |           |      | $ | 27,985    |          
|Discontinued operations (note 3)                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                | Loss from operations of Washington
systems, net                                                                                                           |   |                                          |          |      |   |           | (294,548  | )
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Net income (loss)                               |                                                                                                                                                           |   | 224,161                                  |           |      |   | (266,563  | )        
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Allocation of net income (loss):                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                | General Partners                                                                                                                                          |   | $                                        | 2,242     |      |   | $         | (2,666    | )
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|                                                | Limited Partners                                                                                                                                          |   | $                                        | 221,919   |      |   | $         | (263,897  | )
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Net income (loss) per limited partnership unit: |                                                                                                                                                           |   |                                          |           |      |   |           |          
|(49,656 units)                                  |                                                                                                                                                           | $ | 4                                        |           |      | $ | (5        | )        
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          
|Net income (loss) per $1,000 investment         |                                                                                                                                                           | $ | 9                                        |           |      | $ | (11       | )        
|                                                |                                                                                                                                                           |   |                                          |           |      |   |           |          

The accompanying notes are an integral part of these statements.





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NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
STATEMENTS OF CASH FLOWS - (UNAUDITED)

|                                                                                     |                                                  |                                                |             |                                         |            |      |            |           |         |  
|------------------------------------------------------------------------------------ | ------------------------------------------------ | ---------------------------------------------- | ----------- | --------------------------------------- | ---------- | ---- | ---------- | --------- | ------- | -
|                                                                                     |                                                  |                                                |             | For the nine months ended September 30,
|                                                                                     |                                                  |                                                |             |                                        
|                                                                                     |                                                  |                                                |             | 2003                                    |            | 2002
|                                                                                     |                                                  |                                                |             |                                         |            |     
|CASH FLOWS FROM OPERATING ACTIVITIES:                                                |                                                  |                                                |             |                                         |            |      |            |          
|Net income (loss)                                                                    |                                                  | $                                              | 14,462,593  |                                         |            | $    | (97,136    | )        
|Adjustments to reconcile net income (loss) to
cash provided by operating activities: |                                                  |                                                |             |                                         |            |      |            |          
|                                                                                     | Depreciation and amortization                    |                                                |             | 1,793,679                               |            |      |            | 2,548,884 |        
|                                                                                     | Unrealized gain on interest rate swap agreements |                                                |             |                                        |            |      |            | (277,449  | )      
|                                                                                     | Non cash interest expense                        |                                                |             |                                        |            |      |            | 173,835   |        
|                                                                                     | Loan fee amortization                            |                                                |             | 541,557                                 |            |      |            | 215,486   |        
|                                                                                     | (Gain) loss on sale of assets                    |                                                |             | (14,094,946                             | )          |      |            | 20,975    |        
|                                                                                     | (Increase) decrease in operating assets:         |                                                |             |                                         |            |      |            |           |        
|                                                                                     |                                                  | Accounts receivable                            |             |                                         | 28,870     |      |            |           | (63,098 | )
|                                                                                     |                                                  | Due from affiliates                            |             |                                         | 29,875     |      |            |           | (19,716 | )
|                                                                                     |                                                  | Prepaid expenses                               |             |                                         | (136,732   | )    |            |           | (67,558 | )
|                                                                                     | Increase (decrease) in operating liabilities     |                                                |             |                                         |            |      |            |           |        
|                                                                                     |                                                  | Accounts payable and accrued expenses          |             |                                         | (1,004,465 | )    |            |           | 395,027 |  
|                                                                                     |                                                  | Due to Managing General Partner and affiliates |             |                                         | (62,083    | )    |            |           | 731,740 |  
|                                                                                     |                                                  | Deposits                                       |             |                                         | 2,238      |      |            |           | (53,405 | )
|                                                                                     |                                                  | Subscriber prepayments                         |             |                                         | 51,060     |      |            |           | (17,796 | )
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|Net cash provided by operating activities                                            |                                                  |                                                | 1,611,646   |                                         |            |      | 3,489,789  |          
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|CASH FLOWS FROM INVESTING ACTIVITIES:                                                |                                                  |                                                |             |                                         |            |      |            |          
|Purchase of property and equipment, net                                              |                                                  |                                                | (652,944    | )                                       |            |      | (1,524,064 | )        
|Proceeds from sale of systems                                                        |                                                  |                                                | 19,281,427  |                                         |            |      |           |          
|Proceeds from sale of assets                                                         |                                                  |                                                |            |                                         |            |      | 500        |          
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|Net cash provided by (used in) investing activities                                  |                                                  |                                                | 18,628,483  |                                         |            |      | (1,523,564 | )        
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|CASH FLOWS FROM FINANCING ACTIVITIES:                                                |                                                  |                                                |             |                                         |            |      |            |          
|Principal payments on borrowings                                                     |                                                  |                                                | (20,340,000 | )                                       |            |      | (874,017   | )        
|Loan fees                                                                            |                                                  |                                                | (423,853    | )                                       |            |      | (403,945   | )        
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|Net cash used in financing activities                                                |                                                  |                                                | (20,763,853 | )                                       |            |      | (1,277,962 | )        
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|(DECREASE) INCREASE IN CASH                                                          |                                                  |                                                | (523,724    | )                                       |            |      | 688,263    |          
|CASH, beginning of period                                                            |                                                  |                                                | 677,536     |                                         |            |      | 125,060    |          
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|CASH, end of period                                                                  |                                                  | $                                              | 153,812     |                                         |            | $    | 813,323    |          
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          
|SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:                                    |                                                  |                                                |             |                                         |            |      |            |          
|                                                                                     | Cash paid during the period for interest         |                                                | $           | 1,458,516                               |            |      | $          | 2,404,097 |        
|                                                                                     |                                                  |                                                |             |                                         |            |      |            |          

The accompanying notes are an integral part of these statements.





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NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP
NOTES TO UNAUDITED FINANCIAL STATEMENTS

(1)  Basis of Presentation

These unaudited financial statements are being filed in conformity with Rule
10-01 of Regulation S-X regarding interim financial statement disclosure and do
not contain all of the necessary footnote disclosures required for a fair
presentation of the balance sheets, statements of operations and statements of
cash flows in conformity with accounting principles generally accepted in the
United States of America. However, in the opinion of management, this data
includes all adjustments, consisting only of normal recurring accruals,
necessary to present fairly the Partnerships financial position at September
30, 2003, its statements of operations for the nine and three months ended
September 30, 2003 and 2002, and its statements of cash flows for the nine
months ended September 30, 2003 and 2002. Results of operations for these
periods are not necessarily indicative of results to be expected for the full
year. These financial statements and notes should be read in conjunction with
the Partnerships Annual Report on Form 10-K for the year ended December 31,
2002.

Effective January 1, 2003, the Partnership adopted Statement of Financial
Accounting Standards (SFAS) No. 143, Accounting for Asset Retirement
Obligations, which addresses financial accounting and reporting for
obligations associated with the retirement of tangible long lived assets and
associated asset retirement obligations (ARO). Under the scope of this
pronouncement, the Partnership has ARO associated with the removal of equipment
from poles and headend sites that are leased from third parties. Based on
managements analyses, the Partnership has concluded that for the reasons
mentioned below, it is not able to reasonably estimate the fair values of the
ARO. First, to operate the cable television network, the Partnership will
always need to have equipment deployed at these poles and headend sites.
Additionally, the Partnership has not historically incurred any ARO and, given
the length of time in the future when any potential obligations might exist,
management believes that estimating any probability at this time is not
practical. As a result, upon adoption of SFAS No. 143 the Partnership did not
record any ARO associated with the obligation to remove the equipment.

On March 11, 2003, the Partnership sold the operating assets and franchise
rights of its cable systems in and around Sequim and Camano Island, Washington.
The accompanying financial statements have been restated to report the
discontinued operations of the Partnership, effected for this sale.

Certain prior period amounts have been reclassified to conform to the current
period presentation. This includes reclassification of unrealized gains and
losses on interest rate swap agreements, which were previously classified in a
separate financial statement caption within other income (expense), to the
interest expense financial statement caption.

(2)  Intangible Assets

In accordance with the provisions of SFAS No. 142, Goodwill and Other
Intangible Assets, the Partnership does not amortize goodwill or any other
intangible assets determined to have indefinite lives. The Partnership has
determined that its franchises meet the definition of indefinite lived assets.
The Partnership tests these assets for impairment on an annual basis during the
fourth quarter, or on an interim basis if an event occurs or circumstances
change that would reduce the fair value of a reporting unit below its carrying
value. The book value of the Partnerships intangible assets, effecting for
the sale of the Washington Systems described in note 3, is presented in the
following table:



|                                    |                                 |   |                    |            |              |   |             |             |     |   |           |           | 
|----------------------------------- | ------------------------------- | - | ------------------ | ---------- | ------------ | - | ----------- | ----------- | --- | - | --------- | --------- | 
|                                    |                                 |   | September 30, 2003
|                                    |                                 |   |                   
|                                    |                                 |   | Gross              |            |              |   |             |             | Net
|                                    |                                 |   | Carrying           |            | Accumulated  |   | Carrying   
|                                    |                                 |   | Amount             |            | Amortization |   | Amount     
|                                    |                                 |   |                    |            |              |   |            
|Indefinite-lived intangible assets: |                                 |   |                    |            |              |   |             |             |     |   |           |          
|                                    | Franchise agreements            |   | $                  | 19,928,434 |              |   | $           | (10,321,249 | )   |   | $         | 9,607,185 | 
|Definite-lived intangible assets:   |                                 |   |                    |            |              |   |             |             |     |   |           |          
|                                    | Loan fees and other intangibles |   |                    | 1,092,081  |              |   |             | (987,732    | )   |   |           | 104,349   | 
|                                    |                                 |   |                    |            |              |   |             |             |     |   |           |          
|                                    |                                 | $ | 21,020,515         |            |              | $ | (11,308,981 | )           |     | $ | 9,711,534 |          
|                                    |                                 |   |                    |            |              |   |             |             |     |   |           |          

[Additional columns below]

[Continued from above table, first column(s) repeated]

|                                    |                                 |   |                   |            |              |   |             |             |     |   |            |           | 
|----------------------------------- | ------------------------------- | - | ----------------- | ---------- | ------------ | - | ----------- | ----------- | --- | - | ---------- | --------- | 
|                                    |                                 |   | December 31, 2002
|                                    |                                 |   |                  
|                                    |                                 |   | Gross             |            |              |   |             |             | Net
|                                    |                                 |   | Carrying          |            | Accumulated  |   | Carrying   
|                                    |                                 |   | Amount            |            | Amortization |   | Amount     
|                                    |                                 |   |                   |            |              |   |            
|Indefinite-lived intangible assets: |                                 |   |                   |            |              |   |             |             |     |   |            |          
|                                    | Franchise agreements            |   | $                 | 19,928,434 |              |   | $           | (10,321,249 | )   |   | $          | 9,607,185 | 
|Definite-lived intangible assets:   |                                 |   |                   |            |              |   |             |             |     |   |            |          
|                                    | Loan fees and other intangibles |   |                   | 1,509,297  |              |   |             | (991,875    | )   |   |            | 517,422   | 
|                                    |                                 |   |                   |            |              |   |             |             |     |   |            |          
|                                    |                                 | $ | 21,437,731        |            |              | $ | (11,313,124 | )           |     | $ | 10,124,607 |          
|                                    |                                 |   |                   |            |              |   |             |             |     |   |            |          





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##### Table of Contents



Amortization of loan fees for the remainder of 2003 and through the remaining
term of the related debt is expected to be as follows:

|     |  |   |         | 
|---- |  | - | ------- | 
|2003 |  | $ | 52,174  | 
|2004 |  |   | 52,175  | 
|     |  |   |         | 
|     |  | $ | 104,349 | 
|     |  |   |         | 

(3)  System Sales

On March 11, 2003, the Partnership sold the operating assets and franchise
rights of its cable systems in and around the communities of Sequim and Camano
Island, Washington (the Washington Systems). The Washington Systems were sold
at a price of approximately $20,340,000 of which the Partnership received
approximately $19,280,000 at closing. The sales price was adjusted at closing
for the proration of certain revenues and expenses and approximately $1,060,000
will be held in escrow and released to the Partnership one year from the
closing of the transaction, subject to general representations and warranties.
Historically, the Partnership has entered into similarly structured
transactions, and has collected the amount held in escrow. Substantially all
of the proceeds were used to pay down amounts outstanding under the
Partnerships credit agreement.

The sale was made pursuant to an offer by Wave Division Networks, LLC, which
was formalized in a Purchase and Sale Agreement dated October 28, 2002. Based
on the offer made by Wave Division Networks, LLC, management determined that
acceptance would be in the best economic interest of the Partnership, and that
the sale was not a result of declining or deteriorating operations nor was it
necessary to create liquidity or reduce outstanding debt. It is the opinion of
management that the Partnership could have continued existing operations and
met all obligations as they became due.

The assets and liabilities attributable to the Washington Systems as of
December 31, 2002 have been reported as assets and liabilities from
discontinued operations in the accompanying balance sheets, and consist of the
following:

|                                                                        |                   |   |                   |           | 
|----------------------------------------------------------------------- | ----------------- | - | ----------------- | --------- | 
|                                                                        |                   |   | As of            
|                                                                        |                   |   | December 31, 2002
|                                                                        |                   |   |                  
|Cash                                                                    |                   | $ | 157,838           |          
|Accounts receivable                                                     |                   |   | 242,211           |          
|Prepaid expenses                                                        |                   |   | 15,819            |          
|Property and equipment (net of accumulated
depreciation of $10,816,079) |                   |   | 5,215,097         |          
|Franchise agreements (net of accumulated
amortization of $528,415)      |                   |   | 961,053           |          
|Goodwill (net of accumulated amortization of $70,130)                   |                   |   | 152,799           |          
|                                                                        |                   |   |                   |          
|                                                                        | Total assets      |   | $                 | 6,744,817 | 
|                                                                        |                   |   |                   |          
|Accounts payable and accrued expenses                                   |                   |   | 589,453           |          
|Deposits                                                                |                   |   | 2,025             |          
|Subscriber prepayments                                                  |                   |   | 356,192           |          
|                                                                        |                   |   |                   |          
|                                                                        | Total liabilities |   | $                 | 947,670   | 
|                                                                        |                   |   |                   |          





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##### Table of Contents



In addition, the revenue, expenses and other items attributable to the
operations of the Washington Systems for the period from January 1, 2003 to
March 11, 2003 (the date of the sale of the Washington Systems), and for the
nine and three months ended September 30, 2002 have been reported as
discontinued operations in the accompanying statements of operations, and
include the following:

|                                                         |                                                                                                           |   |                     |            |      |   |           |           |  
|-------------------------------------------------------- | --------------------------------------------------------------------------------------------------------- | - | ------------------- | ---------- | ---- | - | --------- | --------- | -
|                                                         |                                                                                                           |   | For the nine months
|                                                         |                                                                                                           |   | ended September 30,
|                                                         |                                                                                                           |   | 2003                |            | 2002
|                                                         |                                                                                                           |   |                     |            |     
|Service revenues                                         |                                                                                                           | $ | 1,129,917           |            |      | $ | 4,346,182 |          
|Expenses:                                                |                                                                                                           |   |                     |            |      |   |           |          
|                                                         | Operating (including $13,642 and $56,313 to
affiliates in 2003 and 2002, respectively)                    |   |                     | 130,423    |      |   |           | 414,767   |  
|                                                         | General and administrative (including $144,476
and $431,785 to affiliates in 2003 and 2002,
respectively) |   |                     | 283,904    |      |   |           | 1,051,009 |  
|                                                         | Programming (including $32,896 and $107,469 to
affiliates in 2003 and 2002, respectively)                 |   |                     | 388,583    |      |   |           | 1,362,860 |  
|                                                         | Depreciation and amortization                                                                             |   |                     | 183,930    |      |   |           | 871,795   |  
|                                                         |                                                                                                           |   |                     |            |      |   |           |          
|                                                         |                                                                                                           |   | 986,840             |            |      |   | 3,700,431 |          
|                                                         |                                                                                                           |   |                     |            |      |   |           |          
|Income from operations                                   |                                                                                                           |   | 143,077             |            |      |   | 645,751   |          
|Other income (expense):                                  |                                                                                                           |   |                     |            |      |   |           |          
|                                                         | Interest expense                                                                                          |   |                     | (347,130   | )    |   |           | (978,221  | )
|                                                         | Loan fees                                                                                                 |   |                     | (144,287   | )    |   |           | (373,126  | )
|                                                         | Gain on sale of system                                                                                    |   |                     | 14,113,294 |      |   |           |          |  
|                                                         |                                                                                                           |   |                     |            |      |   |           |          
|Income (loss) from operations of
Washington Systems, net |                                                                                                           | $ | 13,764,954          |            |      | $ | (705,596  | )        
|                                                         |                                                                                                           |   |                     |            |      |   |           |          





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##### Table of Contents



|                                                |                                                                    |   |                      |          |  
|----------------------------------------------- | ------------------------------------------------------------------ | - | -------------------- | -------- | -
|                                                |                                                                    |   | For the three months
|                                                |                                                                    |   | ended September 30, 
|                                                |                                                                    |   | 2002                
|                                                |                                                                    |   |                     
|Service revenues                                |                                                                    | $ | 1,455,932            |         
|Expenses:                                       |                                                                    |   |                      |         
|                                                | Operating (including $17,155 paid to affiliates)                   |   |                      | 145,262  |  
|                                                | General and administrative (including $131,735
paid to affiliates) |   |                      | 352,347  |  
|                                                | Programming (including $33,945 paid to
affiliates)                 |   |                      | 466,586  |  
|                                                | Depreciation and amortization                                      |   |                      | 288,280  |  
|                                                |                                                                    |   |                      |         
|                                                |                                                                    |   | 1,252,475            |         
|                                                |                                                                    |   |                      |         
|Income from operations                          |                                                                    |   | 203,457              |         
|Other expense:                                  |                                                                    |   |                      |         
|                                                | Interest expense                                                   |   |                      | (311,818 | )
|                                                | Loan fees                                                          |   |                      | (186,187 | )
|                                                |                                                                    |   |                      |         
|Loss from operations of Washington Systems, net |                                                                    | $ | (294,548             | )       
|                                                |                                                                    |   |                      |         

In accordance with EITF 87-24, Allocation of Interest to Discontinued
Operations, the Partnership allocated interest expense to discontinued
operations using the historic weighted average interest rate applicable to the
Partnerships credit facility and approximately $18,713,000 in principal
payments, which were applied to the credit facility as a result of the sale of
the Washington Systems.

(4) Notes Payable

On November 6, 2003, the Partnership refinanced its existing credit facility
(the Refinanced Credit Facility). The Refinanced Credit Facility establishes
a term loan in the amount of $21,500,000, the proceeds from which were used to
repay the Partnerships existing credit facilities, with a balance of
$19,714,185 at September 30, 2003, to provide working capital and for other
general purposes. The Refinanced Credit Facility matures on March 31, 2009 and
requires the Partnership to make quarterly principal payments beginning March
31, 2004. Annual maturities of the Refinanced Credit Facility are as follows:

|      |      |   |            |           | 
|----- | ---- | - | ---------- | --------- | 
|      |      |   | Principal 
|      |      |   | Payments  
|      |      |   |           
|      | 2004 |   | $          | 3,225,000 | 
|      | 2005 |   |            | 3,440,000 | 
|      | 2006 |   |            | 3,655,000 | 
|      | 2007 |   |            | 4,515,000 | 
|      | 2008 |   |            | 5,375,000 | 
|      | 2009 |   |            | 1,290,000 | 
|      |      |   |            |          
|Total |      | $ | 21,500,000 |          
|      |      |   |            |          





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##### Table of Contents



The interest rate per annum applicable to the Refinanced Credit Facility is a
fluctuating rate of interest measured by reference to either: (i) the U.S.
dollar prime commercial lending rate announced by the lender (Base Rate),
plus a borrowing margin; or (ii) the London interbank offered rate (LIBOR),
plus a borrowing margin. The applicable borrowing margins vary, based on the
Partnerships leverage ratio from 2.75% to 3.50% for Base Rate loans and from
3.75% to 4.50% for LIBOR loans.

The Refinanced Credit Facility contains a number of covenants, which among
other things, require the Partnership to comply with specified financial
ratios, including maintenance, as tested on a quarterly basis, of: (A) a
Maximum Total Leverage Ratio (the ratio of Funded Debt to Annualized EBITDA (as
defined)) of not more than 4.75 to 1.00 initially, decreasing over time to 3.50
to 1.00; (B) a Minimum Interest Coverage Ratio (the ratio of Annualized EBITDA
(as defined) to aggregate Interest Expense for the immediately preceding four
consecutive fiscal quarters) of not less than 2.50 to 1.00 initially,
increasing over time to 3.50 to 1.00; (C) a Minimum Total Debt Service
Coverage Ratio (the ratio of Annualized EBITDA (as defined) to the
Partnerships debt service obligations for the following twelve months) of not
less than 1.00 to 1.00 initially, increasing over time to 1.10 to 1.00; and (D)
Maximum Capital Expenditures of not more than $850,000 in the fourth quarter of
2003, and $2,500,000 in each subsequent fiscal year. As of September 30, 2003,
the Partnership was in compliance with the covenants required by the Refinanced
Credit Facility.

In addition, in the event the Partnership prepays the Refinanced Credit
Facility in excess of $5,375,000 prior to the third anniversary of the closing
of the refinancing transaction, the Partnership would be required to pay a
Prepayment Fee to the lender, as defined by the terms of the Refinanced Credit
Facility.

As of the date of this filling, the Refinanced Credit Facility had an
outstanding balance of $21,500,000 bearing interest at a LIBOR based interest
rate of 5.67%. This interest rate expires in February of 2004, at which time a
new rate will be established.





---



##### Table of Contents



PART I (continued)




ITEM 2. Managements Discussion and Analysis of Financial Condition and Results of Continuing Operations

Results of Continuing Operations - Nine Months Ended September 30, 2003 and 2002

Revenues totaled $10,463,105 for the nine months ended September 30, 2003
representing an increase of $331,361 or approximately 3.3% over the same period
in 2002. Of these revenues, $6,887,305 (66%) was derived from basic services,
$819,915 (8%) from premium services, $1,304,693 (12%) from expanded basic
services, $149,887 (1%) from digital services, $719,942 (7%) from advertising,
$199,728 (2%) from late fees, and $381,635 (4%) from other sources. The
increase in revenues is primarily attributable to: (i) rate increases
implemented in the Partnerships systems during the first quarter of 2003 and
(ii) increased advertising revenue.

Cable system operating expenses, which consist primarily of salary and benefit
costs, totaled $703,879 for the nine months ended September 30, 2003, an
increase of $9,419 or 1.4% over the same period in 2002. Such increase is
primarily attributable to increased operating salaries, offset by a decrease in
system maintenance costs.

General and administrative expenses totaled $2,711,880 for the nine months
ended September 30, 2003, an increase of $200,080 or approximately 8.0% over
the same period in 2002. This increase is primarily attributable to increases
in revenue based fees such as management and franchise fees, marketing expense
and other administrative overhead costs.

Programming expenses totaled $3,485,320 for the nine months ended September 30,
2003, increasing $189,002 or 5.7% over the same period in 2002. This increase
is due primarily to higher costs charged by various program suppliers as well
as costs incurred as the result of offering additional channels in some of the
Partnerships systems.

Depreciation and amortization expense for the nine months ended September 30,
2003 decreased $67,341 or approximately 4.0% over the same period in 2002.
Such decrease is primarily attributable to certain assets becoming fully
depreciated offset by depreciation of recent purchases related to the upgrade
of plant and equipment.

Interest expense and loan fees allocated to continuing operations decreased
approximately $86,608, or approximately 6.5% from $1,324,645 to $1,238,037 for
the nine months ended September 30, 2003. This decrease is primarily
attributable to a $277,449 gain recognized on the Partnerships interest rate
swap agreements in 2002, offset by a reduction in interest expense due to lower
average outstanding indebtedness as a result of required principal repayments
and lower interest rates during 2003 as compared to 2002.

In accordance with EITF 87-24, Allocation of Interest to Discontinued
Operations, the Partnership allocated interest expense to discontinued
operations using the historic weighted average interest rate applicable to the
Partnerships credit facility and approximately $18,713,000 in principal
payments, which were applied to the credit facility as a result of the sale of
the Washington Systems.

The Partnership has elected not to designate its interest rate swap agreements
as hedges under SFAS No. 133. Agreements in place as of December 31, 2001
expired during the first quarter of 2002, and the Partnership has elected not
to enter into any new agreements.

Results of Continuing Operations - Three Months Ended September 30, 2003 and
2002

Revenues totaled $3,462,148 for the three months ended September 30, 2003
representing a slight increase over the same period in 2002. Of these
revenues, $2,352,762 (68%) was derived from basic services, $260,640 (8%) from
premium services, $364,636 (11%) from expanded basic services, $47,687 (1%)
from digital services, $255,061 (7%) from advertising, $64,240 (2%) from late
fees, and $117,122 (3%) from other sources. The increase in revenues is
primarily attributable to: (i) rate increases implemented in the Partnerships
systems during the first quarter of 2003 and (ii) increased advertising
revenue.

Cable system operating expenses totaled $247,132 for the three months ended
September 30, 2003, an increase of $10,105 or approximately 4.3% over the same
period in 2002. Such increase is primarily attributable to increased operating
salaries, offset by a decrease in system maintenance costs.





---



##### Table of Contents



General and administrative expenses totaled $942,124 for the three months ended
September 30, 2003, an increase of $50,875 or approximately 5.7% over the same
period in 2002. This increase is primarily attributable to increases in
revenue based fees such as management and franchise fees, professional services
charges and other administrative overhead costs.

Programming expenses totaled $1,106,655 for the three months ended September
30, 2003, representing a slight decrease over the same period in 2002. Such
decrease is primarily attributable to a decrease in subscribers, offset by
higher costs charged by various programming suppliers.

Depreciation and amortization expense for the three months ended September 30,
2003 decreased $27,909 or approximately 4.9% over the same period in 2002.
Such decrease is primarily attributable to certain assets becoming fully
depreciated offset by depreciation of recent purchases related to the upgrade
of plant and equipment.

Interest expense and loan fees allocated to continuing operations decreased
approximately $178,234, or 30.6% from $581,516 to $403,282 for the three months
ended September 30, 2003. This decrease is attributable to lower average
outstanding indebtedness as a result of required principal repayments and lower
interest rates during 2003 as compared to 2002.

In accordance with EITF 87-24, Allocation of Interest to Discontinued
Operations, the Partnership allocated interest expense to discontinued
operations using the historic weighted average interest rate applicable to the
Partnerships credit facility and approximately $18,713,000 in principal
payments, which were applied to the credit facility as a result of the sale of
the Washington Systems.

The Partnership has elected not to designate its interest rate swap agreements
as hedges under SFAS No. 133. Agreements in place as of December 31, 2001
expired during the first quarter of 2002, and the Partnership has elected not
to enter into any new agreements.

Liquidity and Capital Resources

The Partnerships primary source of liquidity is cash flow provided from
operations. The Partnership generates cash through the monthly billing of
subscribers for cable services. Losses from uncollectible accounts have not
been material. Based on managements analysis, the Partnerships cash flow
from operations will be sufficient to cover future operating costs, debt
service and planned capital expenditures over the next twelve-month period.

Net cash provided by operating activities totaled $1,611,646 for the nine
months ended September 30, 2003. Adjustments to the $14,462,593 net income
for the period to reconcile to net cash provided by operating activities
consisted primarily of a gain of $14,094,946 related primarily to the sale of
the Washington Systems, increases in operating assets of $77,987 and
decreases in operating liabilities of $1,013,250, offset by depreciation and
amortization of $1,793,679 and loan fee amortization of $541,557.

Net cash provided by investing activities consisted of proceeds from the sale
of the Washington Systems of $19,281,427, offset by $652,944 in capital
expenditures for the nine months ended September 30, 2003.

Net cash used in financing activities for the nine months ended September 30,
2003, consisted of $20,340,000 in principal payments on long-term debt, due
primarily to the sale of the Washington Systems and loan fee payments of
$423,853.

Notes Payable

On November 6, 2003, the Partnership refinanced its existing credit facility
(the Refinanced Credit Facility). The Refinanced Credit Facility establishes
a term loan in the amount of $21,500,000, the proceeds from which were used to
repay the Partnerships existing credit facilities, with a balance of
$19,714,185 at September 30, 2003, to provide working capital and for other
general purposes. The Refinanced Credit Facility matures on March 31, 2009 and
requires the Partnership to make quarterly principal payments beginning March
31, 2004. Annual maturities of the Refinanced Credit Facility are as follows:





---



##### Table of Contents



|      |      |   |            |           | 
|----- | ---- | - | ---------- | --------- | 
|      |      |   | Principal 
|      |      |   | Payments  
|      |      |   |           
|      | 2004 |   | $          | 3,225,000 | 
|      | 2005 |   |            | 3,440,000 | 
|      | 2006 |   |            | 3,655,000 | 
|      | 2007 |   |            | 4,515,000 | 
|      | 2008 |   |            | 5,375,000 | 
|      | 2009 |   |            | 1,290,000 | 
|      |      |   |            |          
|Total |      | $ | 21,500,000 |          
|      |      |   |            |          

The interest rate per annum applicable to the Refinanced Credit Facility is a
fluctuating rate of interest measured by reference to either: (i) the U.S.
dollar prime commercial lending rate announced by the lender (Base Rate),
plus a borrowing margin; or (ii) the London interbank offered rate (LIBOR),
plus a borrowing margin. The applicable borrowing margins vary, based on the
Partnerships leverage ratio from 2.75% to 3.50% for Base Rate loans and from
3.75% to 4.50% for LIBOR loans.

The Refinanced Credit Facility contains a number of covenants, which among
other things, require the Partnership to comply with specified financial
ratios, including maintenance, as tested on a quarterly basis, of: (A) a
Maximum Total Leverage Ratio (the ratio of Funded Debt to Annualized EBITDA (as
defined)) of not more than 4.75 to 1.00 initially, decreasing over time to 3.50
to 1.00; (B) a Minimum Interest Coverage Ratio (the ratio of Annualized EBITDA
(as defined) to aggregate Interest Expense for the immediately preceding four
consecutive fiscal quarters) of not less than 2.50 to 1.00 initially,
increasing over time to 3.50 to 1.00; (C) a Minimum Total Debt Service
Coverage Ratio (the ratio of Annualized EBITDA (as defined) to the
Partnerships debt service obligations for the following twelve months) of not
less than 1.00 to 1.00 initially, increasing over time to 1.10 to 1.00; and (D)
Maximum Capital Expenditures of not more than $850,000 in the fourth quarter of
2003, and $2,500,000 in each subsequent fiscal year. As of September 30, 2003,
the Partnership was in compliance with the covenants required by the Refinanced
Credit Facility.

In addition, in the event the Partnership prepays the Refinanced Credit
Facility in excess of $5,375,000 prior to the third anniversary of the closing
of the refinancing transaction, the Partnership would be required to pay a
Prepayment Fee to the lender, as defined by the terms of the Refinanced Credit
Facility.

As of the date of this filling, the Refinanced Credit Facility had an
outstanding balance of $21,500,000 bearing interest at a LIBOR based interest
rate of 5.67%. This interest rate expires in February of 2004, at which time a
new rate will be established.

System Sale

On March 11, 2003, the Partnership sold the operating assets and franchise
rights of its cable systems in and around the communities of Sequim and Camano
Island, Washington (the Washington Systems). The Washington Systems were sold
at a price of approximately $20,340,000 of which the Partnership received
approximately $19,280,000 at closing. The sales price was adjusted at closing
for the proration of certain revenues and expenses and approximately $1,060,000
will be held in escrow and released to the Partnership one year from the
closing of the transaction, subject to general representations and warranties.
Historically, the Partnership has entered into similarly structured
transactions, and has collected the amount held in escrow. Substantially all
of the proceeds were used to pay down amounts outstanding under the
Partnerships credit agreement.

The sale was made pursuant to an offer by Wave Division Networks, LLC, which
was formalized in a Purchase and Sale Agreement dated October 28, 2002. Based
on the offer made by Wave Division Networks, LLC, management determined that
acceptance would be in the best economic interest of the Partnership, and that
the sale was not a result of declining or deteriorating operations nor was it
necessary to create liquidity or reduce outstanding debt. It is the opinion of
management that the Partnership could have continued existing operations and
met all obligations as they became due.





---



##### Table of Contents



Obligations and Commitments

In addition to working capital needs for ongoing operations, the Partnership
has capital requirements for (i) annual maturities and interest payments
related to the Refinanced Credit Facility and (ii) required minimum operating
lease payments. The following table summarizes the contractual obligations of
the Partnership, after effecting for the sales of the Washington Systems
discussed in Note 3, additional borrowings of $1,785,815 and revised payment
terms under the refinance transaction discussed in Note 4, and the anticipated
effect of these obligations on the Partnerships liquidity for the remainder of
2003 and in future years:



|                                                   |  |      |         |      |  |      |           |      |  |  |           |  |  |  |           | 
|-------------------------------------------------- |  | ---- | ------- | ---- |  | ---- | --------- | ---- |  |  | --------- |  |  |  | --------- | 
|                                                   |  | 2003 |         | 2004 |  | 2005 |           | 2006
|                                                   |  |      |         |      |  |      |           |     
|Refinanced Credit Facility principal payments      |  |      |        |      |  |      | 3,225,000 |      |  |  | 3,440,000 |  |  |  | 3,655,000 | 
|Interest payments (current interest rate of 5.67%) |  |      | 311,535 |      |  |      | 1,127,621 |      |  |  | 938,669   |  |  |  | 737,525   | 
|Minimum operating lease payments                   |  |      | 10,406  |      |  |      | 31,898    |      |  |  | 18,698    |  |  |  | 1,898     | 
|                                                   |  |      |         |      |  |      |           |      |  |  |           |  |  |  |           | 
|Total contractual cash obligations                 |  |      | 321,941 |      |  |      | 4,384,519 |      |  |  | 4,397,367 |  |  |  | 4,394,423 | 
|                                                   |  |      |         |      |  |      |           |      |  |  |           |  |  |  |           | 

[Additional columns below]

[Continued from above table, first column(s) repeated]

|                                                   |  |      |           |            |  |       |           |  |  |  |            | 
|-------------------------------------------------- |  | ---- | --------- | ---------- |  | ----- | --------- |  |  |  | ---------- | 
|                                                   |  | 2007 |           | Thereafter |  | Total
|                                                   |  |      |           |            |  |      
|Refinanced Credit Facility principal payments      |  |      | 4,515,000 |            |  |       | 6,665,000 |  |  |  | 21,500,000 | 
|Interest payments (current interest rate of 5.67%) |  |      | 505,906   |            |  |       | 234,667   |  |  |  | 3,855,923  | 
|Minimum operating lease payments                   |  |      | 1,898     |            |  |       | 698       |  |  |  | 65,496     | 
|                                                   |  |      |           |            |  |       |           |  |  |  |            | 
|Total contractual cash obligations                 |  |      | 5,022,804 |            |  |       | 6,900,365 |  |  |  | 25,421,419 | 
|                                                   |  |      |           |            |  |       |           |  |  |  |            | 

(a)  These contractual obligations do not include accounts payable and accrued
liabilities, which are expected to be paid in 2003.

Capital Expenditures

During the first nine months of 2003, the Partnership incurred approximately
$653,000 in capital expenditures, including various line extensions, plant
upgrades and the continuation of digital service deployment. Planned
expenditures for the remainder of 2003 include the initial phase of an upgrade
of the distribution plant to 450MHz in Royston, GA, as well as the construction
of additional extensions and continued digital deployment.

Solicitation of Interest From Potential Partners

Northland Communications Corporation (NCC), as managing general partner of the
Partnership, has been working with a nationally recognized brokerage firm to
solicit interest from potential buyers for the Partnerships cable systems. In
September of this year, the broker contacted numerous potential purchasers and
solicited their respective expressions of interest. In response to that
solicitation, several qualified purchasers have expressed various degrees of
interest in purchasing one or more of the cable systems owned by the
Partnership. NCC is working to further clarify the level of interest of each
interested party, with a goal of determining which of those parties is
sufficiently committed to a possible purchase of the systems. NCC will offer
such parties a due diligence review period, which will take place between
November of 2003 and January of 2004, and anticipates that formal bids will be
solicited and received once this process is complete in February of 2004. Any
bids received will then be evaluated.

Recently Issued Accounting Standards

Effective January 1, 2003, the Partnership adopted Statement of Financial
Accounting Standards (SFAS) No. 143, Accounting for Asset Retirement
Obligations, which addresses financial accounting and reporting for
obligations associated with the retirement of tangible long lived assets and
associated asset retirement obligations (ARO). Under the scope of this
pronouncement, the Partnership has ARO associated with the removal of equipment
from poles and headend sites that are leased from third parties. Based on
managements analyses, the Partnership has concluded that for the reasons
mentioned below, it is not able to reasonably estimate the fair values of the
ARO. First, to operate the cable television network, the Partnership will
always need to have equipment deployed at these poles and headend sites.
Additionally, the Partnership has not historically incurred any ARO and, given
the length of time in the future when any potential obligations might exist,
management believes that estimating any probability at this time is not
practical. As a result, upon adoption of SFAS No. 143 the Partnership did not
record any ARO associated with the obligation to remove the equipment.





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Statement of Financial Accounting Standards No. 149 In April of 2003, the
FASB issued SFAS No. 149, Amendment of Statement 133 on Derivative Instruments
and Hedging Activities. SFAS No. 149 amends and clarifies financial
accounting and reporting for derivative instruments, including certain
derivative instruments embedded in other contracts, and other hedging
activities under SFAS No. 133. The adoption of SFAS No. 149 did not have a
material impact on the Partnerships financial statements.

Statement of Financial Accounting Standards No. 150- In May 2003, the FASB
issued Statement No. 150, Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity, which addresses financial
accounting and reporting for certain financial instruments with characteristics
of both liabilities and equity and requires that those instruments be
classified as liabilities in statements of financial position. Previously many
of those financial instruments were classified as equity. The Statement is
effective for financial instruments entered into or modified after May 31, 2003
and otherwise is effective at the beginning of the first interim period
beginning after June 15, 2003. The adoption of the Statement did not have a
material impact on the Partnerships operating results or financial position.

Critical Accounting Policies

This discussion and analysis of financial condition and results of operations
is based on the Partnerships financial statements, which have been prepared in
accordance with accounting principles generally accepted in the United States
of America. The preparation of these financial statements requires management
to make estimates and assumptions that affect the reported amounts of assets
and liabilities, the disclosure of contingent assets and liabilities at the
date of the financial statements and the reported amount of revenues and
expenses during the reporting period. Actual results could differ from those
estimates. The following critical accounting policies, which have been chosen
among alternatives, require a more significant amount of management judgment
than other accounting policies the Partnership employs.

Revenue Recognition- Cable television service revenue, including service and
maintenance, is recognized in the month service is provided to customers.
Advance payments on cable services to be rendered are recorded as subscriber
prepayments. Revenues resulting from the sale of local spot advertising are
recognized when the related advertisements or commercials appear before the
public.

Property and Equipment- Property and equipment are recorded at cost. Costs of
additions and substantial improvements, which include materials, labor, and
other indirect costs associated with the construction of cable transmission and
distribution facilities, are capitalized. Indirect costs include employee
salaries and benefits, travel and other costs. These costs are estimated based
on historical information and analysis. The Partnership periodically performs
evaluations of these estimates as warranted by events or changes in
circumstances.

In accordance with SFAS No. 51, Financial Reporting by Cable Television
Companies, the Partnership also capitalizes costs associated with initial
customer installations. The costs of disconnecting service or reconnecting
service to previously installed locations is expensed in the period incurred.
Costs for repairs and maintenance are also charged to operating expense, while
equipment replacements, including the replacement of drops, are capitalized.

Intangible Assets- In accordance with the provisions of SFAS No. 142,
Goodwill and Other Intangible Assets, the Partnership does not amortize
goodwill or any other intangible assets determined to have indefinite lives.
The Partnership has determined that its franchises meet the definition of
indefinite lived assets. The Partnership tests these assets for impairment on
an annual basis during the fourth quarter, or on an interim basis if an event
occurs or circumstances change that would reduce the fair value of a reporting
unit below its carrying value.

Management believes the franchises have indefinite lives because the franchises
are expected to be used by the Partnership for the foreseeable future and
effects of obsolescence, competition and other factors are minimal. In
addition, the level of maintenance expenditures required to obtain the future
cash flows expected from the franchises are not material in relation to the
carrying value of the franchises. While the franchises have defined lives
based on the franchising authority, renewals are routinely granted, and
management expects them to continue to be granted. This expectation is
supported by managements experience with the Partnerships franchising
authorities and the franchising authorities of the Partnerships affiliates.





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ITEM 3. Quantitative and Qualitative Disclosures About Market Risk

The Partnership is subject to market risks arising from changes in interest
rates. The Partnerships primary interest rate exposure results from changes in
LIBOR or the prime rate, which are used to determine the interest rate
applicable to the Partnerships debt facilities. The Partnership has from time
to time entered into interest rate swap agreements to partially hedge interest
rate exposure. Interest rate swaps have the effect of converting the
applicable variable rate obligations to fixed or other variable rate
obligations. As of the date of this filing, the Partnership is not involved in
any interest rate swap agreements. The potential loss over one year that would
result from a hypothetical, instantaneous and unfavorable change of 100 basis
points in the interest rate of all of the Partnerships variable rate
obligations would be approximately $197,000.

Cautionary statement for purposes of the Safe Harbor provisions of the
Private Litigation Reform Act of 1995. Statements contained or incorporated by
reference in this document that are not based on historical fact are
forward-looking statements within the meaning of the Private Securities
Reform Act of 1995. Forward-looking statements may be identified by use of
forward-looking terminology such as believe, intends, may, will,
expect, estimate, anticipate, continue, or similar terms, variations of
those terms or the negative of those terms.




ITEM 4. Controls and procedures

Based on their evaluation as of the end of the period covered by this report,
the General Partners Chief Executive Officer and President (Principal
Financial and Accounting Officer) have concluded that the Partnerships
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934 (the Exchange Act)) are effective
to ensure that information required to be disclosed by the Partnership in
reports that it files or submits under the Exchange Act is recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms.

There were no significant changes in the Partnerships internal controls or in
other factors that could significantly affect these controls subsequent to the
date of their evaluation, including any corrective actions with regard to
significant deficiencies and material weaknesses.





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##### Table of Contents






PART II - OTHER INFORMATION




ITEM 1 Legal proceedings
     None




ITEM 2 Changes in securities
     None




ITEM 3 Defaults upon senior securities
     None




ITEM 4 Submission of matters to a vote of security holders
     None




ITEM 5 Other information
     None




ITEM 6 Exhibits and Reports on Form 8-K

(a)      Exhibit Index

|       |  |                                                                                                                                                                                                                         
|------ |  | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|10.39. |  | Term Loan Agreement between Northland Cable Properties
Seven Limited Partnership and CIT Lending Services
Corporation dated November 5, 2003                                                                            
|       |  |                                                                                                                                                                                                                         
|31(a). |  | Certification of Chief Executive Officer of
Northland Communications Corporation, the Managing General
Partner, dated November 14, 2003 pursuant to section 302 of
the Sarbanes-Oxley Act                               
|       |  |                                                                                                                                                                                                                         
|31(b). |  | Certification of President (Principal
Financial and Accounting Officer) of Northland Communications
Corporation, the Managing General Partner, dated November 14,
2003 pursuant to section 302 of the Sarbanes-Oxley Act
|       |  |                                                                                                                                                                                                                         
|32(a). |  | Certification of Chief Executive Officer of
Northland Communications Corporation, the Managing General
Partner, dated November 14, 2003 pursuant to section 906 of
the Sarbanes-Oxley Act                               
|       |  |                                                                                                                                                                                                                         
|32(b). |  | Certification of President (Principal
Financial and Accounting Officer) of Northland Communications
Corporation, the Managing General Partner, dated November 14,
2003 pursuant to section 906 of the Sarbanes-Oxley Act

|    |                     | 
|--- | ------------------- | 
|(b) | Reports on
Form 8-K
|   
|    | None               





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##### Table of Contents






SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
registrant and in the capacities and on the dates indicated.

NORTHLAND CABLE PROPERTIES SEVEN LIMITED PARTNERSHIP

BY: Northland Communications Corporation,
General Partner

|                     |  |                                         |  |         
|-------------------- |  | --------------------------------------- |  | --------
|SIGNATURES           |  | CAPACITIES                              |  | DATE    
|                     |  |                                         |  |         
|/s/ RICHARD I. CLARK |  | Executive Vice President, Treasurer and |  | 11-14-03
|                     |  | Assistant Secretary                     |  |         
|Richard I. Clark     |  |                                         |  |         
|                     |  |                                         |  |         
|/s/ GARY S. JONES    |  | President                               |  | 11-14-03
|                     |  |                                         |  |         
|Gary S. Jones        |  |                                         |  |