UNITED STATES
               SECURITIES AND EXCHANGE COMMISSION
                    WASHINGTON, D.C.  20549


                           FORM 10-K

[X]  ANNUAL  REPORT  PURSUANT  TO SECTION  13  OR  15(d)  OF  THE
     SECURITIES EXCHANGE ACT OF 1934

          For the fiscal year ended December 31, 1997
                               OR

[  ] TRANSITION  REPORT PURSUANT TO SECTION 13 OR  15(d)  OF  THE
     SECURITIES EXCHANGE ACT OF 1934 [NO FEE REQUIRED]

For the transition period from                  to

Commission File Numbers: 33-67390 & 33-81088 & 33-93808, 33-81088-01,
            33-67390-01, 33-81088-02 and 33-93808-01

                   MARCUS CABLE COMPANY, L.P.
              MARCUS CABLE OPERATING COMPANY, L.P.
                MARCUS CABLE CAPITAL CORPORATION
               MARCUS CABLE CAPITAL CORPORATION II
              MARCUS CABLE CAPITAL CORPORATION III

  (Exact names of registrants as specified in their charters)

          DELAWARE                               75-2337471
          DELAWARE                               75-2546077
          DELAWARE                               75-2495706
          DELAWARE                               75-2546713
          DELAWARE                               75-2599586
 (State or other jurisdiction of               (I.R.S. Employer
  incorporation or organization)               Identification No.)

2911 TURTLE CREEK BOULEVARD, SUITE 1300
       DALLAS, TEXAS                                   75219
(Address of principal executive offices)            (Zip Code)
                            (214) 521-7898
      (Registrant's telephone number, including area code)


Securities Registered Pursuant to Section 12(b) of the Act:  None
Securities Registered Pursuant to Section 12(g) of the Act:  None

     Indicate  by  check  mark whether the registrants  (1)  have
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  registrants  were
required to file such reports), and (2) has been subject to  such
filing requirements for the past 90 days.  Yes   X        No

     Indicate  by  check  mark if disclosure of dilenquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of the registrants knowledge,
in definitive proxy or information statements incorporated by
reference in Part III or any amendment to this Form 10-K.  X

     There  is  no  established trading market  for  any  of  the
registrants'  voting securities.  As of the date of this  report,
there  were 1,000 shares of common stock of Marcus Cable  Capital
Corporation  and  1,000 shares of common stock  of  Marcus  Cable
Capital  Corporation III outstanding, all of which are  owned  by
Marcus  Cable Company, L.P., and 1,000 shares of common stock  of
Marcus  Cable  Capital Corporation II outstanding, all  of  which
were owned by Marcus Cable Operating Company, L.P.

Documents incorporated by reference:  NONE

<PAGE>

                   MARCUS CABLE COMPANY, L.P.
              MARCUS CABLE OPERATING COMPANY, L.P.
                MARCUS CABLE CAPITAL CORPORATION
               MARCUS CABLE CAPITAL CORPORATION II
              MARCUS CABLE CAPITAL CORPORATION III

                1997 ANNUAL REPORT ON FORM 10-K

                       Table of Contents
<TABLE>
<CAPTION>
                                                               Page
<S>       <C>                                                  <C>
          Definitions                                               3

                              Part I

Item 1.   Description of Business                                   6

Item 2.   Properties                                               25

Item 3.   Legal Proceedings                                        26

Item 4.   Submission of Matters to a Vote of Security Holders      26

                              Part II

Item 5.   Market for Registrants' Common Equity and
             Related Stockholder Matters                           27

Item 6.   Selected Financial Data                                  27

Item 7.   Management's Discussion and Analysis of Financial
             Condition and Results of Operations                   28

Item 8.   Financial Statements and Supplementary Data              35

Item 9.   Changes in and Disagreements with Accountants on
            Accounting and Financial Disclosure                    35

                              Part III

Item 10.  Directors and Executive Officers of the Registrants      36

Item 11.  Executive Compensation                                   40

Item 12.  Security Ownership of Certain Beneficial Owners
             and Management                                        42

Item 13.  Certain Relationships and Related Transactions           44

                              Part IV

Item 14.   Exhibits, Financial Statement Schedules and
             Reports on Form 8-K                                   45
</TABLE>

                                2
<PAGE>

The Private Securities Litigation Reform Act of 1995 provides a "safe
harbor" for forward looking statements.  Certain information included
in  this Form 10-K contains statements that are forward looking, such
as  statements  relating to the effects of future regulation,  future
capital  commitments  and future acquisitions.  Such  forward-looking
information  involves  important risks and uncertainties  that  could
significantly  affect  expected results  in  the  future  from  those
expressed in any forward-looking statements made by, or on behalf  of
the  Company.   These risks and uncertainties include,  but  are  not
limited   to,   uncertainties  relating   to   economic   conditions,
acquisitions  and  divestitures, government and regulatory  policies,
the pricing and availability of equipment, materials, inventories and
programming,   technological  developments   and   changes   in   the
competitive environment in which the Company operates.  Investors are
cautioned  that  all  forward-looking statements  involve  risks  and
uncertainties.

<TABLE>
                             DEFINITIONS

When used herein, the following terms will have the meaning
indicated.

<CAPTION>
   Term                                   Definition
<S>                        <C>
11 7/8% Debentures         11 7/8%Senior Debentures, due October 1, 2005,
                           which are obligations of MCC and Capital
13 1/2% Notes              13 1/2% Senior Subordinated Guaranteed Discount
                           Notes, due August 1, 2004, which are obligations
                           of Operating and Capital II that are guaranteed
                           by MCC
14 1/4% Notes              14 1/4% Senior Discount Notes, due December 15, 2005,
                           which are obligations of MCC and Capital III
1984 Cable Act             Cable Communications Policy Act of 1984
1992 Cable Act             Cable Television Consumer
                           Protection and Competition Act of 1992
1996 Telecom Act           Telecommunications Act of 1996
ASCAP                      American Society of Composers, Authors and Publishers
ATM                        Asynchronous Transport Mode
BMI                        Broadcast Music, Inc.
BST                        Basic Service Tier
Cable Acts                 The 1984 Cable Act and the 1992 Cable Act
Cable System Cash Flow     System cash flow before corporate expenses and
                           depreciation and amortization
CALP                       Cencom of Alabama, L.P.
CALP Acquisition           The August 31, 1995
                           acquisition of remaining CALP ordinary
                           limited partnership interests, redemption
                           of all CALP special limited partnership
                           interests and retirement of CALP's senior
                           bank debt
CALP Agreement             The management agreement
                           between Operating and CALP, which
                           terminated on August 31, 1995
CALP Systems               Certain cable systems in
                           areas surrounding Birmingham, Alabama
                           which were purchased in the CALP
                           Acquisition
Capital                    Marcus Cable Capital Corporation
Capital II                 Marcus Cable Capital Corporation II
Capital III                Marcus Cable Capital Corporation III
Communications Act         Communications Act of 1934
Company                    Marcus Cable Company, L.P. and subsidiaries
CPST                       Cable Programming Service Tier
Crown                      Crown Media, Inc.
Crown Acquisition          The January 18, 1995 purchase of the Crown Systems
Crown Systems              Certain cable television systems in Wisconsin and
                           Minnesota purchased from Crown
DBS                        Direct Broadcast Satellites
Delaware/Maryland Systems  Certain cable television systems
                           located in and around Harrington,
                           Delaware and Cambridge, Maryland which
                           were purchased in 1992
</TABLE>
                                   3
<PAGE>

<TABLE>
<CAPTION>

    Term                                    Definition
<S>                        <C>
EBITDA                     Earnings Before
                           Interest, Taxes, Depreciation and
                           Amortization
FCC                        Federal Communications Commission
Fiberlink                  Marcus Fiberlink, L.L.C.
Frankfort Acquisition      The July 31, 1996 purchase of the Frankfort System
Frankfort System           Certain cable television
                           system in and around Frankfort, Indiana
                           purchased from Frankfort Cable
                           Communications, Inc.
Futurevision Acquisition   The July 8, 1996 purchase of the
                           Futurevision System
Futurevision System        Certain cable television
                           system in and around Brookhaven,
                           Mississippi purchased from Futurevision
                           Cable Systems of Brookhaven
General Partner            Marcus Cable Properties, L.P.
Goldman Sachs              Goldman, Sachs & Co.
Harron                     Harron Communications, Corp. and certain of its
                           subsidiaries
Harron Systems             Certain cable television
                           systems purchased from Harron
HFC                        Hybrid Fiber Coax
HSD                        Home Satellite Dish
JEDI                       Jefferson Eastern-Dane Interactive
KSCADE                     K-12 School/College
                           Alliance for Distance Education
LEC                        Local Exchange Carrier
LFA                        Local Franchising Authorities
LIBOR                      London InterBank Offered Rate
LMDS                       Local Multipoint Distribution Services
Management Company         Marcus Cable Management, Inc.
Maryland Cable             Maryland Cable Partners, L.P.
Maryland Cable Agreement   The management agreement
                           between Operating and Maryland Cable
Maryland Cable System      Cable system owned by
                           Maryland Cable (also the "Managed
                           System")
MCC                        Marcus Cable Company, L.P.
MCA                        Marcus Cable Associates, L.P.
MCALP                      Marcus Cable of Alabama, L.P. (formerly "CALP")
MCDM                       Marcus Cable of Delaware and Maryland, L.P.
MCP                        Marcus Cable Partners, L.P.
MCPI                       Marcus Cable Properties, Inc.
MDU                        Multiple Dwelling Unit
MMDS                       Multichannel, Multipoint Distribution Service
Moses Lake System          Certain cable system in
                           the state of Washington which was sold on
                           October 11, 1996
Mountain Brook             Mountain Brook Cablevision, Inc.
Mountain Brook and         Pending acquisition of the assets of Mountain Brook
 Shelby Cable Acquisition  and Shelby Cable
Mountain Brook and         Cable television system
    Shelby Cable System    serving the Mountain Brook and Shelby
                           County area in and around Birmingham,
                           Alabama to be purchased from Mountain
                           Brook and Shelby Cable
MSO                        Multiple System Operator
MPEG                       Motion Picture Expert Group
MPTC                       Morain Park Technical College
MVPD                       Multichannel Video Programming Distributors
NPT                        New Product Tier
NVOD                       Near Video On Demand
Operating                  Marcus Cable Operating Company, L.P.
Operating Partnerships     MCP, MCDM, MCALP and MCA
OVS                        Open Video System
PCS                        Personal Communications Services
RBOC's                     Regional Bell Operating Companies

</TABLE>
                                   4
<PAGE>

<TABLE>
<CAPTION>

     Term                                   Definition
<S>                        <C>
Sammons                    Sammons Communications, Inc. and certain of its
                           subsidiaries
Sammons Acquisition        The November 1, 1995 purchase of the Sammons
                           Systems
Sammons Systems            Certain cable television systems purchased from
                           Sammons
San Angelo Systems         Certain cable television
                           systems in and around San Angelo, Texas
                           which were divested on June 30, 1995
Senior Credit Facility     $1,150,000,000 Credit
                           Agreement among Operating, MCC, Banque
                           Paribas, Chase Manhattan Bank, Citibank,
                           N.A., The First National Bank of Boston,
                           Goldman Sachs, Union Bank and certain
                           other lenders referred to therein, dated
                           as of August 31, 1995 and as amended on
                           March 14, 1997
SFAS                       Statement of Financial Accounting Standard
Shelby Cable               Shelby Cable, Inc.
SMATV                      Satellite Master Antenna Television
Star Acquisition           The July 29, 1994 purchase of the Star Systems
Star                       Star Cablevision Group
Star Systems               Certain cable television systems purchased from Star
Systems                    Cable television systems owned by the Company
Time Warner                Time Warner Entertainment Company, L.P. and certain
                           of its subsidiaries
Time Warner Systems        Certain cable television systems received in trade
                           with Time Warner
Weatherford Acquisition    The January 11, 1996 purchase of the Weatherford System
Weatherford System         Certain cable television
                           system in Weatherford, Texas purchased
                           from C & R Investments Corporation
</TABLE>
                                   5
<PAGE>

PART I

ITEM 1.   DESCRIPTION OF BUSINESS

a)   General Development of Business

General

     MCC is a Delaware limited partnership formed for the purpose  of
acquiring,  operating and developing cable television systems  within
suburban  and  exurban  markets.  MCC  derives  its  main  source  of
revenues   from   providing  various  levels  of   cable   television
programming and services to residential and business customers. Other
revenues, during the three years ended December 31, 1997,  were  also
derived from providing management services to cable systems owned  by
third  parties.   Since its formation in 1990, MCC has  increased  in
size  through internal growth and acquisitions, and is now the  tenth
largest  cable  system  operator in the United States,  with  Systems
serving  approximately 1,232,300 basic customers in 18 states  as  of
December 31, 1997.

     MCC's  operations are conducted through Operating, an  operating
holding company in which it serves as a general partner and in  which
it owns a greater than 99.00% interest.  Operating, in turn, conducts
its  operations  through  the Operating Partnerships,  in  which  it,
directly  or  indirectly,  serves as a general  partner  and  owns  a
greater than 99.00% interest.

Owned Systems

     The  Company  began acquiring cable television systems  in  1990
primarily  in the state of Wisconsin.  Since such time,  the  Company
has  continued to expand through additional acquisitions.   In  1995,
the  Company  expanded in size four-fold through  the  completion  of
several  acquisitions  of  cable  television  system  assets  serving
approximately  950,000  customers.  The  Company's  cable  television
systems are operated in 18 states and organized into six geographical
regions.   As  of December 31, 1997, its Systems passed approximately
1,950,300  homes and served approximately 1,232,300 basic  customers,
who subscribed for approximately 583,600 premium units.

Managed System

     Affiliates of Goldman Sachs own limited partnership interests in
MCC.   Maryland Cable, which is controlled by an affiliate of Goldman
Sachs, owned the Maryland Cable System which served customers in  and
around  Prince  Georges  County,  Maryland.   Operating  managed  the
Maryland  Cable System under the Maryland Cable Agreement, which  was
entered  into  in September of 1994.  Operating earned  a  management
fee,  payable  monthly,  equal to 4.7% of the  revenues  of  Maryland
Cable, and was reimbursed for certain expenses.

     Effective January 31, 1997, the Maryland Cable System  was  sold
to  Jones  Communications of Maryland, Inc.  Pursuant to the Maryland
Cable  Agreement, Operating recognized incentive management  fees  of
$5,069,000  during  1997 in conjunction with  the  sale.   Additional
incentive  management  fees  may be recognized  upon  dissolution  of
Maryland  Cable,  anticipated to occur  during  1998.   There  is  no
assurance that any of such fees will be realized.  Although Operating
is  no  longer  involved  in  the active management  of  those  cable
television  systems,  Operating has entered into  an  agreement  with
Maryland  Cable to oversee the activities, if any, of Maryland  Cable
through  the  liquidation  of  the  partnership.   Pursuant  to  such
agreement, Operating will earn a nominal monthly fee.  Including  the
incentive  management  fees  noted  above,  Operating  earned   total
management fees of $5,614,200 during 1997.

Marcus Fiberlink

     Fiberlink,  a  wholly-owned subsidiary of  the  Company,  is  an
entity  formed  for  the  purpose  of developing  the  infrastructure
necessary  to foster distance education networks and other  forms  of
point-to-point transmission services in the Company's service  areas.
Fiberlink currently has three distance education networks in  various
stages  of  operation:  MPTC, JEDI and  KSCADE.   The  MPTC  Distance
Education Network is a two-way fully interactive system which  allows
students and educators to interact from three separate campuses.  The
JEDI  Distance  Education Network provides a network  which  delivers
voice,  video and data transmission to nine high schools in Jefferson
and  Dane  Counties, Wisconsin and to three campuses of  the  Madison
Area  Technical College system.  The KSCADE network, when  completed,
will  utilize a switched ATM fiber optic network to carry

                                6
<PAGE>

MPEG2 video
and  high  speed data communications between 28 educational sites  in
east  central Wisconsin.  Upon the completion of the KSCADE  network,
the  three  networks will collectively include 460 fiber route  miles
serving  50  educational sites.  The Company  is  currently  pursuing
similar  arrangements  with other educational bodies  throughout  the
state.

Recent Developments

General

Ownership

     On  March  3,1998, the Company announced that  it  has  retained
Goldman  Sachs to advise the Company as it explores various strategic
alternatives   involving  the  ownership  of  the  Company.   Several
alternatives are being reviewed, however, no decision has  been  made
and  the outcome of the Company's review cannot be predicted at  this
time.

Exchanges

Time Warner Exchange

     On  December  1,  1997,  the Company completed  an  exchange  of
certain  cable  television systems with Time  Warner.   The  exchange
involved  approximately 128,000 customers located in  communities  in
Wisconsin and Indiana.  According to the terms of the agreement, Time
Warner received systems serving approximately 57,000 customers, while
the  Company received systems serving approximately 71,000  customers
located in communities contiguous to the Company's existing clusters.
In  addition  to  the contribution of its systems, the  Company  paid
$17,807,000 to Time Warner which was funded with borrowings under the
Senior  Credit  Facility.  Operating results of the acquired  systems
are  included in the accompanying financial statements from the  date
of exchange.

Acquisitions

Pending Acquisition

     On  October  28,  1997, the Company entered  into  a  definitive
agreement to purchase a cable television system serving approximately
23,000  customers  in Alabama from Mountain Brook and  Shelby  Cable.
The  communities served by this system are adjacent to the  Company's
existing  systems  in the suburban Birmingham,  Alabama  area.   This
transaction  is  subject  to  certain closing  conditions,  including
governmental and regulatory approval, and is expected to occur during
the second quarter of 1998.

Harron Acquisition

     On  July 1, 1997, the Company purchased cable television systems
from  Harron  serving  approximately 22,000  customers  located  near
Dallas-Fort  Worth,  Texas  for  an  aggregate  purchase   price   of
$34,500,000.   The purchase was financed with funds  available  under
the  Senior  Credit  Facility.  Operating  results  of  the  acquired
systems  are  included in the accompanying financial statements  from
the date of acquisition.

Frankfort Acquisition

     On  July  31, 1996, the Company acquired the assets of Frankfort
Cable  Communications,  Inc.  for  an  aggregate  purchase  price  of
approximately $6,700,000.  The Frankfort System provides  service  to
approximately 5,300 basic customers in and around Frankfort, Indiana,
located  near  the Company's other operations in Indiana.   Operating
results  of  the  acquired system are included  in  the  accompanying
financial statements from the date of acquisition.

Futurevision Acquisition

     On July 8, 1996, the Company acquired the assets of Futurevision
Cable  Systems  of  Brookhaven  for an aggregate  purchase  price  of
approximately $2,600,000.  The communities served by the Futurevision
System  are  located  in  and  around  the  Company's  operations  in
Mississippi.    The   Futurevision   System   provides   service   to
approximately  2,400  basic  customers.   Operating  results  of  the
acquired system are included in the accompanying financial statements
from the date of acquisition.

                                  7
<PAGE>

Weatherford Acquisition

     On  January  11, 1996, the Company acquired the  assets  of  the
Weatherford  System for an aggregate purchase price of  approximately
$875,000.   The  Weatherford System provides service to approximately
700  basic  customers contiguous to the Company's existing system  in
Weatherford,  Texas.   Operating results of the acquired  system  are
included  in the accompanying financial statements from the  date  of
acquisition.

Divestitures

Pending Divestitures

     On  October  7, 1997, the Company announced that it  intends  to
offer  for sale certain cable television systems that are not  within
the  Company's six strategic operating groups.  Systems  to  be  sold
serve   approximately   195,000  customers  in  Delaware,   Maryland,
Virginia, Connecticut, Mississippi, Louisiana, Illinois, Oklahoma and
the  Texas panhandle.  The solicitation has thus far resulted in  the
following two agreements.

     On March 4,1998, the Company entered into a definitive agreement
with  TMC  Holdings,  Inc., an affiliate of  Adelphia  Communications
Corporation,  to sell cable television assets located in  Connecticut
and  Virginia  for a sales price of approximately $150,000,000.   The
systems serve approximately 46,000 customers and 17,000 customers  in
Connecticut and Virginia, respectively.  The transaction  is  subject
to  regulatory  approval and is expected to be finalized  during  the
third quarter of 1998.

     On  December  4,  1997, the Company entered  into  a  definitive
agreement  with  an  affiliate of Comcast  Corporation  to  sell  its
Delaware/Maryland  Systems  for  a  sales  price   of   approximately
$65,500,000.   The  systems serve approximately 26,500  customers  in
Delaware  and  Maryland.  The transaction is  subject  to  regulatory
approval and is expected to be finalized during the second quarter of
1998.

     The Company is currently marketing the remaining systems serving
approximately   105,500  customers  in  Illinois,  Oklahoma,   Texas,
Mississippi and Louisiana.  Although the Company has entered into the
above  agreements,  there can be no assurance that  the  transactions
will  be  approved or finalized on the terms presently  contemplated.
Additionally,  although  the  Company  is  currently  marketing   the
remaining  systems  noted above, there can be no assurance  that  the
Company will be successful in completing sales of those systems.

Moses Lake Divestiture

     On October 11, 1996, the Company completed the sale of its cable
television  systems  serving approximately 12,700  customers  in  the
state  of  Washington for a sales price of approximately $20,638,000,
net of selling costs of $310,000.  The sales price resulted in a gain
on the sale of approximately $6,442,000.

                                 8
<PAGE>

<TABLE>

The  following table illustrates the Company's growth over  the  last
five years:

<CAPTION>
               Homes       Basic         Basic         Premium       Premium
              Passed     Customers    Penetration       Units      Penetration
<S>           <C>        <C>          <C>              <C>         <C>
December 31:                              (1)                            (2)

   1993          09,549       141,323        67.4%       97,944         69.3%
   1994         178,961       142,172        79.4%       78,088         54.9%
   1995       1,833,401     1,154,718        63.0%      651,121         56.4%
   1996       1,863,299     1,181,293        63.4%      666,702         56.4%
   1997       1,950,345     1,232,287        63.2%      583,603         47.4%

<FN>
(1)  Basic service customers as a percentage of homes passed.
(2)  Premium   service  units  as  a  percentage  of  basic   service
     customers.   A  customer  may purchase  more  than  one  premium
     service, each of which is counted as a separate premium  service
     unit.   This  ratio  may be greater than  100%  if  the  average
     customer subscribes for more than one premium service.
</FN>
</TABLE>

b)   Financial Information About Industry Segments

     The Company operates solely in the cable television industry and
all revenues are derived from that industry.

c)   Narrative Description of Business

The Cable Television Industry

     A  cable  television system receives television, radio and  data
signals that are transmitted to the system's headend site by means of
off-air  antennae,  microwave  relay  systems  and  satellite   earth
stations.    These   signals  are  then  modulated,   amplified   and
distributed,  primarily through coaxial and  fiber  optic  cable,  to
customers  who  pay a fee for this service.  Cable systems  may  also
originate  their  own  television programming and  other  information
services  for  distribution  through the  system.   Cable  television
systems   generally   are  constructed  and  operated   pursuant   to
nonexclusive  franchises  or  similar  licenses  granted   by   local
governmental authorities for a specified term of years.

     Cable  television  systems offer customers  various  levels  (or
"tiers")  of  basic  cable services consisting of off-air  television
signals  of  local network, independent and educational  stations,  a
limited  number  of  television signals from so-called  superstations
originating   from   distant  cities,  various   satellite-delivered,
nonbroadcast  channels (such as CNN, MTV, USA,  ESPN  and  TNT),  and
certain  programming originated locally by the cable system (such  as
public,   governmental   and   educational   access   programs)   and
informational  displays  featuring news, weather,  stock  market  and
financial  reports and public service announcements.   Cable  systems
also  typically offer premium television services to their  customers
for  an extra monthly charge.  These services (such as HBO, Showtime,
The  Disney  Channel  and  regional sports networks)  are  satellite-
delivered  channels  consisting principally of  feature  films,  live
sports  events,  concerts  and other special entertainment  features,
usually presented without commercial interruption.

     A  customer  generally pays an initial installation  charge  and
fixed monthly fees for basic and premium television services and  for
other  services (such as the rental of home terminal devices).   Such
monthly  service fees constitute the primary source of  revenues  for
cable  television  systems.  In addition to  customer  revenues  from
these services, cable systems generate revenues from additional  fees
paid  by customers for pay-per-view programming of movies and special
events and from the sale of available advertising spots on advertiser-
supported  programming.   Cable  systems  also  offer  home  shopping
services to their customers, a service which pays the systems a share
of  revenues  from sales of products in the systems'  service  areas.
The  cable  television  industry  is  changing  rapidly  due  to  new
technology.  Distributing traditional cable television programming is
only one aspect of the industry, as potential opportunities to expand
into   Internet  access,  telephone,  educational  and

                                 9
<PAGE>

entertainment services on an interactive basis continue to develop.

Business Strategy

Operating Overview

     The  Company's  cable  television systems are  operated  in  six
geographic  areas  as  follows:  (1)  North  Central  (Wisconsin  and
Minnesota);   (2)   Southeast  (Alabama,  Georgia,  North   Carolina,
Tennessee, Kentucky, Louisiana and Mississippi); (3) Southwest (Texas
and   Oklahoma);  (4)  Midwest  (Indiana  and  Illinois);  (5)   West
(California);  and  (6)  East  (Delaware,  Maryland,   Virginia   and
Connecticut).    The   table  below  sets  forth  certain   operating
statistics for these six regions as of December 31, 1997:

<TABLE>
                           OPERATING DATA
<CAPTION>
                   Homes        Basic      Basic       Premium     Premium
Region             Passed     Customers  Penetration    Units    Penetration
                    (1)          (2)        (3)          (4)         (5)
<S>              <C>          <C>        <C>           <C>       <C>
North Central      604,121      397,979     65.9%       192,086      48.3%
Southeast          365,336      254,720     69.7%        93,587      36.7%
Southwest          468,501      215,726     46.0%       130,791      60.6%
Midwest            193,194      145,254     75.2%        63,782      43.9%
West               187,917      129,364     68.8%        57,457      44.4%
East               131,276       89,244     68.0%        45,900      51.4%
                 ---------    ---------                 -------
Total            1,950,345    1,232,287     63.2%       583,603      47.4%
                 =========    =========                 =======
<FN>
(1)  Homes  passed  refers  to  estimates  by  the  Company  of   the
     approximate  number of dwelling units in a particular  community
     that   can  be  connected  to  the  Company's  cable  television
     distribution  system without any further extension of  principal
     transmission lines.
(2)  A  home  with one or more television sets connected to  a  cable
     system  is  counted  as one basic customer.  Bulk  accounts  are
     included  on  a "basic customer equivalent" basis in  which  the
     total  monthly  bill  for the account is divided  by  the  basic
     monthly charge for a single outlet in the area.
(3)  Basic customers as a percentage of homes passed.
(4)  Premium  units  include single channel services  offered  for  a
     monthly fee per channel.  A customer may purchase more than  one
     premium  service, each of which is counted as a separate premium
     service unit.
(5)  Premium  units as a percentage of basic customers.   A  customer
     may  purchase more than one premium service, each  of  which  is
     counted as a separate premium service unit.  This ratio  may  be
     greater  than 100% if the average customer subscribes  for  more
     than one premium service.
</FN>
</TABLE>

General Strategy

     The Company's business strategy focuses on three principles: (i)
forming   regional  clusters  of  cable  television  systems  through
strategic  acquisitions,  internal growth and  divestitures  of  non-
strategic  assets,  (ii)  promoting  internal  growth  and   enhanced
operating  and  financial performance by streamlining  operations  in
clustered  systems and applying innovative marketing  techniques  and
(iii) upgrading systems and employing state-of-the-art technology  to
enhance  existing service and to develop, on a cost-effective  basis,
ancillary  revenue  streams.  This strategy  was  first  employed  by
expanding  the  originally  acquired  cable  television  systems   in
Wisconsin  through strategic acquisitions and internal growth.   Upon
completion  of  the  Star and Crown Acquisitions and  the  successful
integration  of  their operations, the Company's operations  in  that
state  more  than  tripled in size and the Company  now  serves  more
locations in Wisconsin than any other MSO.

     The  November 1995 purchase of the Sammons Systems elevated  the
Company's  standing  to one of the ten largest  MSOs  in  the  United
States.   The  purchase expanded the Company's operations  from  five
states to nineteen states (eighteen, subsequent to the divestiture of
systems  located in Washington).  The Company developed an  operating
strategy   to   facilitate  this  integration,  which  included   (i)
establishing  a high-performance sales and customer service  culture;
(ii)  consolidating  regional operations; (iii) launching  innovative
programming  packages  and  sales and marketing  programs;  and  (iv)
investing  in  and  deploying HFC plant  with  advanced  analog

                                10

<PAGE>

home terminal devices.  The successful integration of the Sammons  Systems
has  allowed the Company to continue to take advantage of operational
synergies due to its increased size and visibility in the industry.

     In  continuing to implement the Company's acquisition  strategy,
the Company acquired the Harron Systems in July of 1997, which are in
geographic  proximity to other systems owned by the  Company  in  the
Dallas/Ft.  Worth  Metroplex.   The Company's  basic  customer  count
increased  by  approximately 22,000 as a result of this  acquisition.
Funding  for  the $34.5 million purchase was provided  by  borrowings
under the Senior Credit Facility.  The Company has also entered  into
a  definitive  agreement to purchase the Mountain  Brook  and  Shelby
Cable System.  This cable television system, which features a 550 MHz
technical  platform,  serves approximately 23,000  customers  in  the
Mountain  Brook  and  Shelby  County areas  of  suburban  Birmingham,
adjacent to the Company's existing systems in the Birmingham  market.
The  transaction  is subject to certain regulatory approval  and  the
closing is expected to occur during the second quarter of 1998.   The
acquisition  will be financed with funds available under  the  Senior
Credit Facility.

     In  addition, the Company completed an exchange of certain cable
systems  with  Time Warner.  The exchange involved  cable  television
systems  in  the  states of Wisconsin and Indiana  serving  in  total
approximately  128,000  customers.   The  Company  exchanged  systems
serving  approximately 57,000 customers in municipalities surrounding
the  metropolitan  areas of Milwaukee and Green Bay,  Wisconsin,  for
systems serving approximately 71,000 customers in the communities  of
Eau  Claire,  Beloit,  Ripon, Marshfield and Merrill,  Wisconsin  and
Warsaw, Indiana.  In addition to the contribution of its systems, the
Company  paid  an  additional $17,807,000 to Time  Warner  which  was
funded with borrowings under the Senior Credit Facility.

     The  Company's  managerial  responsibilities  are  divided  into
regional  system  groups  in  order  to  efficiently  assimilate  and
integrate  acquisitions and modifications in the  Company's  business
plans.  At the corporate level and within each of the regional system
groups,  several  initiatives to grow revenues and  reduce  operating
expenses  have  been  undertaken which  have  improved  the  acquired
systems  operating  performance.   The  Company's  objective  is   to
increase  the value of its systems and to increase system  cash  flow
through the following business strategies.

     Emphasis  on  Regional Clusters and Growth Through Acquisitions.
The   Company  has  followed  a  systematic  approach  in  acquiring,
operating  and  developing  cable television  systems  based  on  the
principle of increasing operating cash flow while maintaining a  high
quality standard of service.  A key element of the Company's strategy
is   building  regional  clusters  of  cable  television  systems  in
proximity to its existing systems or of sufficient size to  serve  as
cores for new operating regions.

     The   Company's  historical  growth  pattern  illustrates   this
strategy.  In 1990, the Company acquired cable television systems  in
the Wisconsin area and in 1992, purchased systems in Texas and in the
Delaware/Maryland area.  In 1994, the Company added to its systems in
Wisconsin  through the acquisition of the Star Systems  in  Wisconsin
and  Minnesota.   The  Crown Acquisition, in  January  1995,  further
strengthened  the  Company's position, making it  the  largest  cable
television operator in Wisconsin.  The November 1995 purchase of  the
Sammons  Systems  more  that doubled the  size  of  the  Company  and
significantly  expanded the areas served by the  Company.   The  1997
acquisition  of  the  Harron Systems and the exchange  for  the  Time
Warner   Systems  has  provided  additional  customers  and  expanded
existing clusters operated by the Company.

     Each  of  these acquisitions involved selected groups  of  cable
television  systems which the Company believed had the potential  for
customer  growth and increases in operating cash flow  and  operating
margins.   The  Company believes that increasing its operating  scale
through  strategic acquisitions, as well as through internal  growth,
enhances  its  ability to reduce its programming costs,  develop  new
technologies, offer new services and improve operating  margins,  and
thus improve its long-term competitiveness.

     In addition, the Company's specific focus on Wisconsin provided
it  with  further opportunities to improve operating performance  by
eliminating  duplicative  positions  and  excess  office  locations,
creating  regional customer service centers and centralizing  signal
distribution   facilities   and  consolidating   corporate   support
functions,  including accounting, billing, marketing, technical  and
administration  services.   The  Sammons  Acquisition  offered   the
Company  an  opportunity to increase system cash  flow  through  the
introduction  of  value-added programming  packages  and  additional
channel  launches in systems which had been previously undermarketed

                                 11
<PAGE>

and underdeveloped.

     The  Company  believes  that, as a  result  of  its  clustering
strategy, it has recognized and will continue to recognize  benefits
through  reduced operating costs as a result of economies of  scale.
The  Company has also recognized economies of scale as a  result  of
its increased size, including programming cost savings and increased
discounts on equipment purchases.

     Future expansion efforts are expected to focus on acquiring  or
exchanging  systems in geographic proximity to existing  operations,
with  the strategic goal of forming or expanding clusters of systems
to  permit the operating efficiencies and economies of scale similar
to  those  achieved  by  the  Company in  Wisconsin.   Opportunistic
divestitures,  in  areas where consolidation  opportunities  do  not
exist, are also considered.

     In  implementing  this divestiture strategy,  the  Company  has
recently  identified  certain non-strategic cable  systems,  serving
approximately 195,000 customers, which are being offered  for  sale.
Upon  completion  of  the sale of these non-strategic  systems,  the
Company  will focus on six strategic operating groups, each  serving
approximately 100,000 to 400,000 customers.

     System  Operations.   Upon completion of  an  acquisition,  the
Company  generally implements extensive management, operational  and
organizational changes designed to enhance operating cash  flow  and
operating  margins,  while promoting superior customer  service  and
strong  community  relations.  After consolidating acquired  systems
with existing ones, the Company selectively upgrades the cable plant
to  allow  for the offering of additional programming and  services.
The  Company  then seeks to add customers and increase  revenue  per
customer  by  aggressively  marketing  innovative  basic,  tier  and
premium  service  packages and by developing  ancillary  sources  of
revenue,   such   as   local  spot  advertising   and   pay-per-view
programming.  The Company has been successful in increasing revenues
in its acquired systems through the introduction of multiple premium
service  packages  that  emphasize customer  value  and  enable  the
Company  to  take  advantage of the programming agreements  offering
cost  incentives based on premium service unit growth.  The  Company
has  increased  operating  cash flow and operating  margins  of  its
existing systems through customer and revenue growth, in combination
with economies of scale and other operating synergies realized as  a
result  of system clustering.  At the same time, the Company  has  a
decentralized  and  locally  responsive management  structure  which
provides significant management experience and stability and  allows
the Company to respond more effectively to the specific needs of the
communities it serves.

     Locally  Responsive Management.  The Company's  operations  are
grouped on a regional basis into geographic areas in order to  allow
the  flexibility and response of decentralized management.   At  the
same  time,  the systems are combined to benefit from the  Company's
critical  mass  and economies of scale in such areas as  programming
and  marketing.  The combined operations are grouped into  operating
regions  consisting  of six geographic areas as follows:  (1)  North
Central  (Wisconsin and Minnesota); (2) Southeast (Alabama, Georgia,
North Carolina, Tennessee, Kentucky, Louisiana and Mississippi); (3)
Southwest  (Texas and Oklahoma); (4) Midwest (Indiana and Illinois);
(5)  West  (California); and (6) East (Delaware, Maryland,  Virginia
and Connecticut).

     Innovative  Marketing.  The Company seeks to add customers  and
increase   its  revenue  per  customer  by  aggressively   marketing
innovative  basic, tier and premium cable service  packages  and  by
developing   ancillary  sources  of  revenue  through   local   spot
advertising   sales  and  pay-per-view  programming.   The   Company
believes  that it has benefitted and will continue to  benefit  from
its  aggressive marketing strategy.  The Company's systems typically
offer  a  choice of two tiers of basic cable television  programming
service: a broadcast basic programming tier (consisting generally of
network and public television signals available over-the-air in  the
franchise  community  and "superstation" signals)  and  a  satellite
programming   tier   (consisting  primarily  of  satellite-delivered
programming such as CNN, USA, ESPN and TNT).  Approximately  94%  of
the Company's customers subscribed to both tiers of basic service as
of December 31, 1997.

     The  Company also offers premium programming services, both  on
an  a  la carte basis and as part of premium service packages.   The
former  service is designed to increase consumer options  while  the
latter  is designed to enhance customer value and enable the Company
to take advantage of programming agreements offering cost incentives
based  on premium service unit growth.  The Company has successfully
promoted

                                12
<PAGE>

innovative premium service packages, such as  its  Maximum
Value  Package  program where customers are offered combinations  of
premium television services such as HBO, Cinemax and Showtime  as  a
package for a discounted price, throughout all of its systems.

     While  the Company has added substantial bandwidth capacity  to
its  Systems,  it has yet to aggressively utilize a portion  of  the
bandwidth through the offering of incremental unregulated NPTs.   As
of  December  31, 1997, only 25,000 of the Company's  customers,  or
approximately 2.0% were purchasing NPTs.  As customers  continue  to
demand  more  choice and variety of services, the  Company's  robust
bandwidth capacity should provide an opportunity for the Company  to
pursue   more  aggressively  these  incremental  service   offerings
throughout the Systems.

     The  substantial investment the Company has made in  increasing
its  video  bandwidth has allowed the Company to introduce thousands
of  new  channels  on its expanded basic tiers.   Additionally,  the
added  bandwidth  is  being utilized to offer "multiplexed"  premium
services  (e.g., multiple screens of pay services) and  the  Company
has   recently  made  this  feature  available  across  all  premium
customers in an effort to build value in the premium category.

     The  Company has been and expects to continue to be  successful
by actively marketing its services through direct mail, advertising,
telemarketing and door-to-door selling campaigns.  The Company  also
seeks  to add customers by extending its cable plant to new  housing
developments once a potential for a significant number of additional
customers is exhibited.  Through its marketing efforts, the  Company
strives  to  attract and retain customers in order to  increase  its
market penetration.

     Customer  Service  and  Community Relations.   The  Company  is
dedicated  to  providing  superior customer  service  and  fostering
strong  community relations in the towns and cities  served  by  its
cable  television  systems.  As part of  this  effort,  the  Company
places  special emphasis on the personal and professional growth  of
its employees, which includes a strong commitment to, and investment
in,  training.   All  of the Company's employees  receive  extensive
training in customer service, sales and customer retention skills on
a  regular basis from outside professionals and qualified management
personnel.  Technical employees are encouraged to enroll in  courses
available  from the National Cable Television Institute  and  attend
regularly   scheduled  on-site  seminars  conducted   by   equipment
manufacturers   to   keep   pace  with  the   latest   technological
developments in the cable television industry.  The Company believes
that  all of these training programs improve the overall quality  of
employee workmanship in the field, resulting in fewer service  calls
from  customers,  improved  cable  television  picture  and  product
quality  and greater system reliability.  The Company also  utilizes
surveys,  focus groups and other research tools as another  part  of
its effort to determine and respond to the needs of its customers.

     During  1997  and  continuing in 1998,  the  Company  has  been
establishing four major call centers which, by the end of 1998, will
handle customer call volume for more than 60% of the customer  base.
These  call  centers  are located in Glendale, CA;  Ft.  Worth,  TX;
Birmingham,  AL;  and Fond du Lac, WI.  Each of the centers  utilize
between  three  and six communication trunks with 46  to  138  voice
lines  per  center, as dictated by call volume.  The Ft.  Worth  and
Fond  du  Lac call centers are, or will be,  staffed seven days  per
week  and  24  hours per day while the call centers in Glendale  and
Birmingham are operated six to seven days per week and an average of
approximately  13.5  hours  per  day.   The  Company  has   invested
significantly in both personnel and hardware/software to insure that
these  customer call centers are professionally managed and  utilize
state-of-the-art communication equipment.

     As   a   result  of  the  Company's  rapid  expansion   through
acquisition,  the  Company inherited several different  billing  and
customer  care  platforms.  Recognizing the  benefits  of  having  a
common customer care and billing platform across all of its Systems,
during  the last several years the Company has converted all of  its
Systems  to  a  common  platform.  The hardware  for  the  Company's
customer  care  and  billing platform is located  in  the  corporate
office  in  Dallas.  Each of the approximately 440 customer  service
representatives located in the four call centers and in the  various
other  field  offices have "real time" dedicated access to  customer
information and records through uninterrupted connectivity  to  this
equipment.

     Complementing the Company's significant investment in its  call
centers  and  common  customer  care and  billing  platform  is  the
Company's commitment to, and investment in, the development  of  its
work force.  The

                                13

<PAGE>

Company has established a training program known as
P.A.C.E. (Pursuing a Commitment to Excellence) by which each of  its
employees  receives extensive training to develop  customer  contact
skills  and  product knowledge, while learning sales techniques  and
successful customer retention methods.

     Additionally,  as  part of the Company's continued  efforts  to
create  positive customer perception, the Company offers an  on-time
service  guarantee  to  its customers.  This  program  requires  the
Company's technical workforce to perform customer installations  and
service calls within a two to four hour appointment window.  If  the
Company  does not meet this standard, the customer is issued  a  $20
credit.

     The Company seeks to further develop its community relations by
participating  in charitable activities and other community  affairs
in  the towns and cities served by its cable television systems.  In
addition  to the Company's commitment to training its own employees,
the   Company  places  a  special  emphasis  on  education  in   the
communities it serves and regularly awards scholarships to customers
who  intend to pursue courses of study related to the communications
field.   The  Company has demonstrated its commitment  to  education
through  its  active  involvement in  the  Cable  in  the  Classroom
program,  where  cable  television companies throughout  the  United
States provide schools with cable television service free of charge.
The  Company  also supports numerous local charities  and  community
causes through marketing promotions to raise money and supplies  for
persons   in  need.   Recent  charity  affiliations  have   included
campaigns for Toys for Tots, local food banks and volunteer fire and
ambulance corps.

     Technology.  The Company strives to maintain high technological
standards in its cable television systems on a cost-effective  basis
and  is  constantly upgrading its cable plant to achieve this  goal.
Subsequent   to  acquiring  systems,  in  addition  to  implementing
extensive   management,   operational  and  organizational   changes
designed to enhance operating cash flow and promote customer service
and  community relations, the Company selectively upgrades the cable
plant  of  such systems to increase channel capacity and expand  the
number  and  variety  of services available to its  customers.   The
Company  may  also seek to deploy fiber optic technology,  which  is
capable  of carrying hundreds of video, data and voice channels,  in
its   systems  during  the  system  upgrade  process.   The  Company
continually monitors and evaluates new technological developments on
the  basis of its ability to make optimal use of its existing assets
and  to  anticipate  the introduction of new  services  and  program
delivery capabilities.  Currently, the Company is in the process  of
systematically rebuilding its cable systems so that within the  next
three years substantially all existing systems will have a bandwidth
of  between  450  MHz and 862 MHz.  This program should  enable  the
Company  to  deliver technological innovations to its  customers  as
such services become commercially viable.

     For  fiscal  year 1998, the Company is projecting approximately
$214,300,000  of  capital  expenditures, of  which  $152,000,000  is
directly  committed  to system rebuilds and upgrades.   The  capital
expenditures projected for 1998 will provide, among other  benefits,
a  substantial increase in channel capacity.  This will  permit  the
Company  to  offer additional programming through the  expansion  of
existing  product tiers, the introduction of new product tiers,  the
multiplexing of premium services and the offering of additional pay-
per-view channels.

     As  part of its upgrade program, certain systems, such as those
serving  the  areas in and around Ft. Worth/Tarrant County  (Texas),
Glendale/Burbank  (California)  and  suburban  Birmingham  (Alabama)
together with selected systems in Wisconsin, Indiana, Tennessee  and
other states in which the Company operates cable systems, are being,
or  have  been,   upgraded  to  750 MHz  or  860  MHz  with  two-way
communication  capabilities.  As part of the  rebuild  program,  the
Company has deployed approximately 4,800 miles of fiber optic  cable
and  upgraded  approximately 15,500 miles  of  coaxial  cable.   The
Company's  network  architecture combines two design  criteria:  (1)
copper  reach  of the coaxial cable portion of the  plant  which  is
defined as delivering a carrier to noise specification of 48 dB  and
is  generally  limited to less than an 8,500  foot  radius  from  an
optical  node and (2) an optical node limited to serving no  greater
than  1,200  homes with excess fiber capacity to allow  for  further
reducing  the  number  of customers served  from  each  node.   This
architecture  insures a highly reliable network that,  when  coupled
with an active return path, is capable of supporting both analog and
digital  interactive  services, including the  deployment  of  cable
modems.

     In  addition  to  expanding  revenue  opportunities,  upgrading
network  architecture serves to enhance picture quality  and  system
reliability,  reduce  operating costs and improve  overall  customer
satisfaction.  As of December 31, 1997, the average channel capacity
of   the   Systems   is  approximately  77  analog   channels   with
approximately

                                 14
<PAGE>

42% of the homes passed served by systems with 550 MHz
or  greater  bandwidth capacity and approximately 83% of  the  homes
passed  served by systems that utilize addressable technology.   The
Company's  current plan contemplates that by the end  of  1998,  its
systems  will  have an average capacity of approximately  89  analog
channels with approximately 66% of the homes passed being served  by
systems  with 550 MHz or greater bandwidth capacity, including  more
than 50% at 750 MHz or greater, warehoused digital spectrum of up to
200  MHz in systems serving approximately 52% of the Company's homes
passed  and approximately 84% of  the homes passed served by systems
that  utilize addressable technology.  In addition, as part  of  the
upgrade  process, two-way communication capability will be activated
past  approximately 1,000,000 homes by the end of 1998,  which  will
support  enhanced digital video, high speed data services and  other
advanced applications.

     During  the  second and third quarters of 1998, the Company  is
planning   to  install  digital  video  equipment  in  its   headend
facilities in Glendale, CA; Ft. Worth, TX; and Birmingham, AL.   The
Company  intends  to  offer digital tiers of  programming  in  these
markets,  offering  an on-screen navigator, 40 channels  of  digital
audio,  20-30  channels of multiplexed premium television,  multiple
channels   of   NVOD  pay-per-view  and  other  new   product   tier
programming.  The service will utilize Scientific Atlanta's Explorer
2000 Home Terminal Device.  These digital home terminal devices  are
real-time,  two-way  interactive,  offering  fully-programmable  VCR
functionality  and  backwards  compatibility  to  the  "Open  Cable"
industry  standards.  The markets in which these services are  being
offered serve almost one-quarter of the Company's customers.

     Through   the  upgrade  of  its  cable  plant,  including   the
utilization  of  addressable technology and fiber optic  cable,  the
Company  seeks  to  position  itself to  benefit  from  the  further
development of advertising, pay-per-view and home shopping services,
as  well as anticipated future services such as video-on-demand  and
other  interactive  applications.  This advanced broadband  platform
has  allowed the Company to enter into arrangements to provide video
and  data  transmission services to various educational institutions
and  to  pursue  similar arrangements with utility  providers.   For
example,  in  March  1995,  the Company,  through  its'  subsidiary,
Fiberlink,  together  with a neighboring cable television  operator,
was  selected to create a two-way broadband fiber network to connect
12  school  districts  in  south central  Wisconsin  as  part  of  a
"distance  education"  project.   The  fiber  network  allows   live
interaction  among classrooms in various locations.   In  1996,  the
Company was also awarded a contract to connect the main campus of  a
technical  college in the Fond du Lac, Wisconsin area to two  remote
campuses  in  West  Bend  and Beaver Dam.   Finally,  in  1997,  the
Company,  again  through its' subsidiary Fiberlink,  was  awarded  a
distance education contract to build a switched ATM network to carry
MPEG2  video  between  28  sites in east central  Wisconsin.   These
projects  will accelerate the rate at which the Company is  able  to
build  a  technologically  advanced  fiber  network  through  shared
funding with various third parties.

     In  addition  to  allowing  increased  channel  offerings,  the
expanded  bandwidth  of  the upgraded systems  creates  the  optimal
medium  for transmitting vast amounts of information at high  speed.
Cable  modem technology enables data traffic to be carried at  rates
up  to  100 times faster than current telephone modems. Most current
Internet  users  are  accessing  the  network  through  narrow  band
telephony technology.  This telephony technology severely limits the
types of content and services that can be effectively utilized.  The
high  speed capabilities of cable modems eliminate the current  data
bottle  necks  and will "free up" users.   The Company has  recently
successfully concluded a test of cable modems on its HFC network  in
one  of its Dallas area systems.  The test utilized a 750 MHz system
to  provide  high  speed Internet access to several  customers.   In
addition  to  implementing the technical and  operational  steps  in
deploying  high speed data modems utilizing HFC plant,  the  Company
explored various products and services that can be offered utilizing
the  high speed data modems.  The Company has entered into a revenue
sharing agreement with @Home in exchange for @Home internet service.
The Company is now deploying cable modems using the @Home service in
its  Fort  Worth, Texas system and in its system serving  University
Park  and Highland Park, Texas.  The @Home Network provides a  high-
speed, fully integrated multimedia service to the home by using  the
cable  television infrastructure and its own architecture.   In  the
home,  a  high-speed  cable  modem connects  to  a  user's  personal
computer,  providing speeds hundreds of times faster than  telephone
modems.  Through the introduction of this service, the Company  will
be   delivering  high-speed  interactive  content   over   its   HFC
distribution architecture to an estimated 160,000 homes by  the  end
of  1998.   Upon completion of the current rebuild in the Dallas/Ft.
Worth  Metroplex area, scheduled for the end of 1999, @Home will  be
offered  to  more than 300,000 homes.  The Company is  also  pursing
additional deployment of internet access via the Company's HFC plant
in systems located in certain of its other operating groups.

                                 15
<PAGE>

Competition

     Cable  television  systems  face competition  from  alternative
methods of receiving and distributing television signals such as DBS
and  from other sources of news, information and entertainment  such
as  off-air  television  broadcast  programming,  newspapers,  movie
theaters,  live sporting events, interactive computer  services  and
home  video  products, including videotape cassette recorders.   The
extent  to  which  a  cable  communications  system  is  competitive
depends, in part, upon the cable system's ability to provide,  at  a
reasonable price to customers, a greater variety of programming  and
other communications services than those which are available off-air
or  through  other alternative delivery sources.  See  -"Legislation
and Regulation in the Cable Television Industry."

     Competition  for  the Company's customers  will  increase  from
medium  power  and higher power DBS that use higher  frequencies  to
transmit signals that can be received by dish antennas much  smaller
in  size  than  traditional HSDs.  Primestar  distributes  a  multi-
channel  programming  service  via  a  medium  power  communications
satellite  to  HSDs  of approximately 3 feet in diameter.   DirecTv,
Inc.,  United States Satellite Broadcasting Corporation and EchoStar
Communication  Corporation transmit from high power  satellites  and
generally  use  smaller  dishes  to  receive  their  signals.    DBS
operators  have  the right to distribute substantially  all  of  the
significant cable television programming services currently  carried
by  cable television systems.  Further, DBS has obtained significant
sports  programming  packages  that  are  not  available  to   cable
operators.   The  Company  expects that competition  from  DBS  will
continue to grow.

     DBS  has  advantages  as an alternative means  of  distributing
video  signals  to  the  home.  Among the advantages  are  that  the
capital  investment (although initially high) for the satellite  and
uplinking  segment  of a DBS system is fixed and does  not  increase
with the number of customers receiving satellite transmissions; that
DBS  is  not  currently subject to local regulation of  service  and
prices or required to pay franchise fees; and that the capital costs
for the ground segment of a DBS system (the reception equipment) are
directly  related  to,  and  limited  by,  the  number  of   service
customers.  The  primary disadvantage of DBS  is  its  inability  to
provide  local broadcast television stations to customers  in  their
local  market.  However, EchoStar and other potential DBS  providers
have   announced  their  intention  to  retransmit  local  broadcast
television  stations  back  into a customer's  local  market.   Both
Congress  and  the  U.S.  Copyright Office are  currently  reviewing
proposals to allow such transmission and it is possible that in  the
near  future,  DBS  systems will be retransmitting local  television
signals   back  into  local  television  markets.   Additional   DBS
disadvantages  presently include a limited  ability  to  tailor  the
programming  package  to  the  interests  of  different   geographic
markets; signal reception being subject to line of sight angles; and
technology  which require a customer to rent or own one set-top  box
(which  is significantly more expensive than a cable converter)  for
each television on which the customer wants to view DBS programming.

     Although  the  effect of competition from  these  DBS  services
cannot  be  specifically  predicted, it  is  clear  there  has  been
significant  growth  in DBS customers and the Company  assumes  that
such  DBS  competition will continue as developments  in  technology
continue  to  increase satellite transmitter power and decrease  the
cost and size of equipment needed to receive these transmissions.

     The  1996  Telecom  Act enables local telephone  companies  and
others to provide a wide variety of video services competitive  with
services  provided  by cable systems and to provide  cable  services
directly  to customers.  Various local telephone companies currently
are  seeking  to  provide video programming  services  within  their
telephone  service areas through a variety of distribution  methods.
Federal  law  ensures that telephone companies will have  access  to
acquire  all significant cable programming.  Cable systems could  be
placed  at  a  competitive disadvantage if  the  delivery  of  video
programming services by local telephone companies becomes widespread
since  telephone  companies  may  not  be  required,  under  certain
circumstances,  to  obtain local franchises to  deliver  such  video
services  or to comply with the variety of obligations imposed  upon
cable  systems under such franchises.  Issues of cross-subsidization
by  local  telephone companies of video and telephony services  also
pose  strategic disadvantages for cable operators seeking to compete
with  local  telephone companies who provide  video  services.   The
Company cannot predict at this time the likelihood of success of any
video  programming  ventures  by local telephone  companies  or  the
impact on the Company of such competitive ventures.

     Cable  systems generally operate pursuant to franchises granted
on a nonexclusive basis.  The 1992 Cable Act gives local franchising
authorities  jurisdiction  over  basic  cable  service   rates   and
equipment  in  the  absence

                                 16
<PAGE>

of "effective  competition",  prohibits
franchising  authorities  from  unreasonably  denying  requests  for
additional franchises and permits franchising authorities to operate
cable  systems.   It is possible that a franchising authority  might
grant  a  second franchise to another company containing  terms  and
conditions  more favorable than those afforded the  Company.   Well-
financed  businesses from outside the cable industry  (such  as  the
public utilities that own the poles on which cable is attached)  may
become   competitors  for  franchises  or  providers  of   competing
services.   Additionally, during 1997, there has been a  significant
increase  in  the number of cities that have constructed  their  own
cable  television  systems  in  a manner  similar  to  city-provided
utility  services.   These systems typically will  compete  directly
with  the  existing cable operator without the burdens of  franchise
fees  or  other  local  regulation.  Although the  total  number  of
municipal overbuild cable systems remains small, events during  1997
would indicate an increasing trend in cities authorizing such direct
municipal  competition with cable operators.  The costs of operating
a   cable   system  where  a  competing  service  exists   will   be
substantially  greater  than if there were no  competition  present.
Although  the potential for competition exists, there are  presently
only  three  competing systems located in each of the East,  Midwest
and North Central operating regions, which represent an aggregate of
approximately  2,840 of the homes in the Company's franchise  areas.
The  Company  is  only aware of one other company that  is  actively
seeking local governmental franchises for areas presently served  by
the  Company.   These franchises are located in  the  North  Central
region  and  in aggregate potentially represent an additional  6,000
homes.

     Cable  operators face additional competition from private SMATV
systems that serve condominiums, apartment and office complexes  and
private  residential  developments.  The operators  of  these  SMATV
systems often enter into exclusive agreements with  building  owners
or  homeowners' associations.  Due to the widespread availability of
reasonably  priced  earth stations, SMATV  systems  now  offer  both
improved reception of local television stations and many of the same
satellite-delivered  program services offered  by  franchised  cable
systems.   Various  states have enacted laws to  provide  franchised
cable  systems  access to private complexes.  These laws  have  been
challenged  in  the courts with varying results.  Additionally,  the
1984  Cable Act gives a franchised cable operator the right  to  use
existing  compatible easements within its franchise  area;  however,
there  have  been  conflicting judicial decisions  interpreting  the
scope  of this right, particularly with respect to easements located
entirely on private property.  The ability of the Company to compete
for  customers in residential and commercial developments served  by
SMATV  operators  is uncertain.  The 1996 Telecom Act  broadens  the
definition  of  SMATV  systems  not  subject  to  local  franchising
regulation and gives cable operators greater flexibility in  pricing
cable services provided to customers in condominiums, apartment  and
office  complexes  and  private  residential  developments.   See  -
"Legislation and Regulation in the Cable Television Industry."

     Another  alternative method of distribution are  MMDS  systems,
which  deliver programming services over microwave channels received
by  customers with special antennas.  MMDS systems are less  capital
intensive,  are  not  required to obtain  local  franchises  or  pay
franchise fees and are subject to fewer regulatory requirements than
cable television systems.  The 1992 Cable Act also ensures that MMDS
systems  have  access  to acquire all significant  cable  television
programming  services.   Although  there  are  relatively  few  MMDS
systems  in the United States currently in operation, virtually  all
markets  have been licensed or tentatively licensed.   The  FCC  has
taken a series of actions intended to facilitate the development  of
wireless cable systems as an alternative means of distributing video
programming,  including reallocating the use of certain  frequencies
to  these  services  and expanding the permissible  use  of  certain
frequencies to these services and expanding the permissible  use  of
certain  channels  reserved  for educational  purposes.   The  FCC's
actions  enable  a single entity to develop an MMDS  system  with  a
potential  of  up  to  35  analog channels, and  thus  compete  more
effectively   with  cable  television.   Developments   in   digital
compression  technology will significantly increase  the  number  of
channels that can be made available from MMDS.  Finally, an emerging
technology,  LMDS, could also pose a threat to the cable  television
industry,  if  and  when  it becomes established.   LMDS,  sometimes
referred  to  as cellular television, could have the  capability  of
delivering  more  than  100  channels  of  video  programming  to  a
customer's  home.   The  potential impact of LMDS  is  difficult  to
assess  due to the newness of the technology and the absence of  any
current fully operational LMDS systems.

     Although  long  distance  telephone  companies  have  no  legal
prohibition   on  the  provision  of  video  services,   they   have
historically not been providers of such services in competition with
cable systems.  However, such companies may prove to be a source  of
competition in the future.  The long distance companies are expected
to  expand  into  local  markets  with  local  telephone  and  other
offerings (including video services) in competition with the RBOCs.

                                   17
<PAGE>

     Cable-like  programming can also be delivered  through  on-line
computer services on the Internet such as CompuServe.  However,  due
to  its  substandard  picture quality and  transmission  speed,  the
technology  of these services presently is not comparable  to  cable
television service.  The Company is unable to predict the effect  of
competition from on-line services on its future operations.

     Other   new   technologies   may   become   competitive    with
nonentertainment services that cable television systems  can  offer.
The  FCC  has  authorized television broadcast stations to  transmit
textual  and  graphic  information  useful  both  to  consumers  and
businesses.   The  FCC also permits commercial and noncommercial  FM
stations to use their subcarrier frequencies to provide nonbroadcast
services including data transmissions.  The FCC established an over-
the-air  Interactive Video and Data Service that will permit two-way
interaction with commercial and educational programming  along  with
informational  and  data  services.  The expansion  of  fiber  optic
systems  by  telephone  companies  and  other  common  carriers  are
providing facilities for the transmission and distribution to  homes
and  businesses  of video services, including interactive  computer-
based  services like the Internet, data and other nonvideo services.
The FCC has held spectrum auctions for licenses to provide PCS.  PCS
will  enable license holders, including cable operators, to  provide
voice and data services as well as video programming.

     Advances in communications technology as well as changes in the
marketplace  and  the  regulatory and legislative  environments  are
constantly  occurring.   Thus, it is not  possible  to  predict  the
effect  that ongoing or future developments might have on the  cable
industry or on the operations of the Company.

Legislation and Regulation in the Cable Television Industry

     The  operation  of  cable  television  systems  is  extensively
regulated  by  the  FCC,  some  state  governments  and  most  local
governments.  On February 8, 1996, the President signed into law the
1996   Telecom  Act.   This  law  alters  the  regulatory  structure
governing  the  nation's telecommunications providers.   It  removes
barriers to competition in both the cable television market and  the
local telephone market.  Among other things, it reduces the scope of
cable rate regulation.

     The  1996 Telecom Act required the FCC to undertake a  host  of
implementing rulemakings, the final outcome of which cannot  yet  be
determined.    Moreover,  Congress  and  the  FCC  have   frequently
revisited the subject of cable television regulation and may  do  so
again.   Future  legislative and regulatory changes could  adversely
affect  the  Company's operations.  This section briefly  summarizes
key   laws  and  regulation  currently  affecting  the  growth   and
operations of the Company's cable systems.

     Cable Rate Regulation.  The 1992 Cable Act imposed an extensive
rate regulation regime on the cable television industry.  Under that
regime,  all  cable  systems are subject to rate regulation,  unless
they  face  "effective competition" in their local  franchise  area.
Under  the  1992  Cable  Act,  the  incumbent  cable  operator   can
demonstrate   "effective  competition"   by   showing   either   low
penetration (less than 30% of the local population) or the  presence
(measured   collectively   as   50%   availability,   15%   customer
penetration)  of  other  MVPDs.  The 1996 Telecom  Act  expands  the
existing  definition of "effective competition" to create a  special
test  for a competing MVPD (other than a DBS distributor) affiliated
with a LEC.  There is no penetration minimum for a LEC affiliate  to
qualify  as  an  effective competitor, but it must offer  comparable
programming services in the franchise area.

     Although  the  FCC  establishes all  cable  rate  rules,  local
government  units  (commonly referred  to  as  LFAs)  are  primarily
responsible for administering the regulation of the lowest level  of
cable  -  the BST, which typically contains local broadcast stations
and public, educational, and government access channels.  Before  an
LFA  begins BST rate regulation, it must certify to the FCC that  it
will follow applicable federal rules, and many LFAs have voluntarily
declined  to  exercise  this  authority.   LFAs  also  have  primary
responsibility for regulating cable equipment rates.  Under  federal
law,  charges for various types of cable equipment must be unbundled
from  each  other and from monthly charges for programming services.
The  1996 Telecom Act allows operators to aggregate costs for  broad
categories  of  equipment across geographic  and  functional  lines.
This change should facilitate the introduction of new technology  to
a broader customer base.

     The  FCC  itself  directly administers rate regulation  of  any
CPST,  which  typically  contains  satellite-

                               18
<PAGE>

Delivered  programming.
Under the 1996 Telecom Act, the FCC can regulate CPST rates only  if
an  LFA  first  receives multiple complaints  from  local  customers
within  90  days  of a CPST rate increase and then  files  a  formal
complaint  with the FCC within 180 days of the rate increase.   When
new  CPST  rate  complaints are filed, the FCC  now  considers  only
whether  the incremental increase is justified and will  not  reduce
the previously established CPST rate.

     Under  the FCC's rate regulations, the Company was required  to
reduce  its BST and CPST rates in 1993 and 1994, and has  since  had
its  rate increases governed by a complicated price cap scheme  that
allows for the recovery of inflation and certain increased costs, as
well  as  providing  some incentive for expanding channel  carriage.
The  FCC  has modified its rate adjustment regulations to allow  for
annual  rate increases and to minimize previous problems encountered
with  timing lags associated with the quarterly compliance  systems.
Operators  also  have the opportunity of bypassing this  "benchmark"
scheme  in favor of traditional cost-of-service regulation in  cases
where  the latter methodology appears favorable.  However,  the  FCC
significantly limited the inclusion in the rate base of  acquisition
costs  in excess of the book value of tangible assets.  As a result,
the  Company pursued cost-of-service justifications in  only  a  few
cases.   The  FCC  has also provided operators with a  mechanism  to
recover  costs associated with a system rebuild.  Using  a  cost-of-
service approach, the amounts produced by the FCC's calculation  are
added  to the BST & CPST rates discussed above and recovered over  a
10  year period.  Premium cable service offered on a per channel  or
per  program basis remain unregulated, as do affirmatively  marketed
packages consisting entirely of new programming product.

     The  Company  believes  that it has  materially  complied  with
provisions  of  the  Cable Acts, including rate  setting  provisions
promulgated  by the FCC on April 1, 1993.  However, in jurisdictions
which have chosen not to certify, refunds covering a one-year period
on  basic  service may be ordered if the Company is regulated  at  a
later date and is unable to justify its rates through a benchmark or
cost-of-service filing.  The amount of refunds, if any, which may be
payable  by the Company in the event that these systems'  rates  are
successfully challenged by franchising authorities is not  currently
estimable.  During 1995, a total of approximately $25,000  was  paid
for  rate  refunds.  There were no refunds issued  during  1996  and
1997.

     The  Company currently has rate filings pending review  at  the
FCC  pertaining  to the CPST level of service.  For  the  regulation
period  from  September 1, 1993 through May 15, 1994, there  is  one
cost-of-service  filing  pending review at  the  FCC  affecting  394
customers.  For the re-regulation time period from May 1994  to  the
present, there are filings for 29 franchises under review at the FCC
affecting  approximately 205,000 customers.  The majority  of  these
filings  have  been  waiting to be reviewed for  over  three  years.
Until  the  FCC rules on the complaints, the Company is required  to
refresh  its  filings annually.  During 1997, the  Company  received
favorable  rulings (i.e., the FCC confirmed the Company's rates  and
denied the complaint) for 22 filings affecting approximately 130,000
customers.  The FCC also issued several decisions reducing rates for
certain   of  the  Company  systems  serving  approximately   43,000
customers, which the Company has asked to be reconsidered.   If  the
FCC  determines  that  the Company's CPST  rates  for  those  43,000
customers  are  unreasonable, it has  the  authority  to  order  the
Company  to  reduce such rates and to refund to those customers  any
overcharges with interest occurring from the filing date of the rate
complaint at the FCC.  The amount of refunds, if any, which  may  be
required by the FCC in the event the Company's CPST rates are  found
to be unreasonable for those customers is estimated at approximately
$600,000.

     The  1996 Telecom Act sunsets FCC regulation of CPST rates  for
all  systems  (regardless  of size) on  March  31,  1999.   However,
certain  members of Congress and FCC officials have called  for  the
delay of this regulatory sunset and further have urged more rigorous
rate  regulation (including limits on programming cost pass-throughs
to  cable  customers)  until  a greater  degree  of  competition  to
incumbent cable operators has developed.  The 1996 Telecom Act  also
relaxes  existing  uniform  rate  requirements  by  specifying  that
uniform  rate  requirements do not apply where  the  operator  faces
"effective competition," and by exempting bulk discounts to multiple
dwelling  units, although complaints about predatory  pricing  still
may be made to the FCC.

     Cable  Entry  Into  Telecommunications.  The 1996  Telecom  Act
provides that no state or local laws or regulations may prohibit  or
have  the  effect  of  prohibiting any  entity  from  providing  any
interstate  or intrastate telecommunications services.   States  are
authorized,  however, to impose "competitively neutral" requirements
regarding  universal  service, public safety  and  welfare,  service
quality  and consumer protection.  State and local governments  also
retain their authority to manage the public rights-of-way.  Although
the 1996 Telecom Act
                                19
<PAGE>

clarifies that traditional cable franchise fees
may  be  based  only on revenues related to the provision  of  cable
television  services,  it  also  provides  that  LFAs  may   require
reasonable, competitively neutral compensation for management of the
public rights-of-way when cable operators provide telecommunications
service.   The 1996 Telecom Act prohibits LFAs from requiring  cable
operators to provide telecommunications service or facilities  as  a
condition  of  a franchise grant, renewal or transfer,  except  that
LFAs  can  seek  "institutional networks" as part of such  franchise
negotiations.   The favorable pole attachment rates  afforded  cable
operators  under  federal law can be increased by utility  companies
owning  the  poles during a five year phase in period  beginning  in
2001, if the cable operator provides telecommunications services, as
well as cable service over its plant.

     Cable  entry  into telecommunications will be affected  by  the
regulatory  landscape  now being fashioned  by  the  FCC  and  state
regulators.   One  critical component of the  1996  Telecom  Act  to
facilitate  the entry of new telecommunications providers (including
cable  operators) is the interconnection obligation imposed  on  all
telecommunications carriers. In July 1997, the Eighth Circuit  Court
of   Appeals   vacated  certain  aspects  of   the   FCC's   initial
interconnection  order and that decision is now pending  before  the
Supreme  Court.   However,  the underlying statutory  obligation  of
local  telephone companies to interconnect with competitors  remains
in place.

     Telephone  Company  Entry  Into  Cable  Television.   The  1996
Telecom  Act  allows  telephone companies to compete  directly  with
cable  operators  by repealing the historic telephone  company/cable
cross-ownership ban and the FCC's video dialtone regulations.   This
will  allow  LECs,  including  the  RBOCs,  to  compete  with  cable
operators  both  inside and outside their telephone  service  areas.
Because of their resources, LECs could be formidable competitors  to
traditional  cable operators, and certain LECs have  begun  offering
cable service to a very limited number of households.

     Under  the  1996 Telecom Act, a LEC providing video programming
to  customers  will  be  regulated as a traditional  cable  operator
(subject  to local franchising and federal regulatory requirements),
unless  the LEC elects to provide its programming via an OVS.   LECs
providing  service through an OVS can proceed without a  traditional
cable franchise, although an OVS operator will be subject to general
rights-of-way  management regulations and can  be  required  to  pay
franchise fees to the extent it provides cable services.   In  order
to  be  eligible for OVS status, the LEC itself cannot  occupy  more
than  one-third of the system's activated channels when  demand  for
channels  exceeds  supply.   Nor  can  the  LEC  discriminate  among
programmers or establish unreasonable rates, terms or conditions for
service.

     Although  LECs  and  cable  operators  can  now  expand   their
offerings   across  traditional  service  boundaries,  the   general
prohibitions  remain  on LEC buyouts (i.e., any  ownership  interest
exceeding  10  percent) of co-located cable systems, cable  operator
buyouts of co-located LEC systems, and joint ventures between  cable
operators  and  LECs  in  the same market.   The  1996  Telecom  Act
provides  a few limited exceptions to this buyout prohibition.   The
"rural  exemption" permits buyouts where the purchased system serves
an  area  with fewer than 35,000 inhabitants outside an urban  area,
and  the  cable system plus any other system in which  the  LEC  has
interest do not represent 10% or more of the LECs telephone  service
area.  The 1996 Telecom Act also provides the FCC with the power  to
grant  waivers  of the buyout prohibition in cases  where:  (1)  the
cable  operator or LEC would be subject to undue economic  distress;
(2)  the  system or facilities would not be economically viable;  or
(3)  the  anticompetitive  effects of the proposed  transaction  are
clearly  outweighed  by  the effect of the  transaction  in  meeting
community needs.  The LFA must approve any such waiver.

     Electric    Utility    Entry    Into   Telecommunications/Cable
Television.   The 1996 Telecom Act provides that registered  utility
holding  companies  and subsidiaries may provide  telecommunications
services  (including  cable television) notwithstanding  the  Public
Utilities  Holding Company Act.  Electric utilities  must  establish
separate   subsidiaries,   known   as   "exempt   telecommunications
companies"  and  must  apply  to the FCC  for  operating  authority.
Again,  because  of  their resources, electric  utilities  could  be
formidable competitors to traditional cable systems.

     Additional  Ownership  Restrictions.   The  1996  Telecom   Act
eliminates statutory restrictions on broadcast/cable cross-ownership
(including  broadcast  network/cable restrictions),  but  leaves  in
place  existing  FCC  regulations prohibiting local  cross-ownership
between television stations and cable systems.  The 1996 Telecom Act
also  eliminates  the three year holding period required  under  the
1992 Cable Act's "anti-trafficking" provision.  The 1996 Telecom Act
leaves in place existing restrictions on cable cross-ownership  with
SMATV

                                 20
<PAGE>

and  MMDS facilities, but lifts those restrictions where  the
cable  operator  is  subject to effective competition.   In  January
1995,  however,  the  FCC adopted a regulation which  permits  cable
operators  to  own and operate SMATV systems within their  franchise
area,  provided that such operation is consistent with  local  cable
franchise   requirements.   The  FCC  is  currently   conducting   a
reconsideration of its national customer ownership rules and  it  is
possible  the  FCC  will  revise both the  national  customer  cable
operator  ownership limitation and the manner in which it attributes
ownership to a cable operator.

     Must Carry/Retransmission Consent.  The 1992 Cable Act contains
broadcast  signal carriage requirements that allow local  commercial
television  broadcast stations to elect once every  three  years  to
require  a  cable  system  to carry the station  ("must  carry")  or
negotiate for payments for granting permission to the cable operator
to  carry  the  station  ("retransmission consent").   Less  popular
stations  typically  elect "must carry," and more  popular  stations
typically  elect "retransmission consent."  Must carry requests  can
dilute  the  appeal of a cable system's programming  offerings,  and
retransmission  consents may require substantial payments  or  other
concessions.  Either option has a potentially adverse affect on  the
Company's   business.   The  burden  associated  with   must   carry
obligations  could  dramatically increase  if  television  broadcast
stations  proceed with planned conversions to digital  transmissions
and  if  the FCC determines that cable systems must carry all analog
and   digital  signals  transmitted  by  the  television   stations.
Additionally,  cable  systems are required to obtain  retransmission
consent for all "distant" commercial television stations (except for
commercial satellite-delivered independent "superstations"  such  as
WGN).

     Access   Channels.   LFAs  can  include  franchise   provisions
requiring cable operators to set aside certain channels for  public,
educational and governmental access programming.  Federal  law  also
requires  a  cable system with 36 or more channels  to  designate  a
portion  of  its channel capacity (either 10% or 15%) for commercial
leased  access by unaffiliated third parties.  The FCC  has  adopted
rules  regulating the terms, conditions and maximum  rates  a  cable
operator  may  charge for use of these designated channel  capacity,
but  use  of  commercial leased access channels has been  relatively
limited.  In February of 1997, the FCC released revised rules  which
mandated  a  modest rate reduction which has made commercial  leased
access  a  more  attractive  option  for  third  party  programmers,
particularly  for part-time leased access carriage.  Furthermore,  a
group  of  commercial leased access users has challenged  the  FCC's
February  1997  Order as failing to reduce commercial leased  access
rates by an appropriate amount.  If this pending court challenge  is
successful, the FCC will be forced to undertake a further rulemaking
which could result in significantly reduced commercial leased access
rates,  thereby encouraging a much more significant increase in  the
use of commercial leased access channels.

     "Anti-Buy Through" Provisions.  Federal law requires each cable
system to permit customers to purchase video programming offered  by
the  operator  on a per-channel or a per-program basis  without  the
necessity  of  subscribing to any tier of service  (other  than  the
basic  service  tier) unless the system's lack of  addressable  home
terminal devices or other technological limitations does not  permit
it  to do so.  The statutory exemption for cable systems that do not
have  the  technological capability to comply  expires  in  December
2002, but the FCC may extend that period if deemed necessary.

     Access  to  Programming.  In order to spur the  development  of
independent  cable  programmers and competition to  incumbent  cable
operators,  the 1992 Cable Act imposed restrictions on the  dealings
between   cable  operators  and  cable  programmers.    Of   special
significance  from  a  competitive business posture,  the  1992  Act
precludes  video  programmers affiliated with cable  companies  from
favoring   cable  operators  over  competitors  and  requires   such
programmers  to  sell their programming to other multichannel  video
distributors  (such  as DBS and MMDS).  This  provision  limits  the
ability   of  vertically  integrated  cable  programmers  to   offer
exclusive  programming arrangements to affiliated  cable  companies.
Recently,  both Congress and the FCC have considered proposals  that
would  expand  the  program access rights  of  cable's  competitors,
including  the possibility of subjecting video programmers  who  are
not   affiliated   with  cable  operators  to  all  program   access
requirements.

     Inside Wiring.  In a 1997 Order, the FCC established rules that
require  an incumbent cable operator, upon expiration or termination
of  an  MDU service contract to sell, abandon, or remove "home  run"
wiring  that was installed by the cable operator in a MDU  building.
These  inside  wiring  rules will encourage and facilitate  building
owners  in  their attempts to replace existing cable operators  with
new  video programming providers who are willing to pay the building
owner  a  higher fee.  Additionally, the FCC has proposed abrogating
all exclusive MDU contracts held by cable operators, but at the same
time  allowing  competitors to cable to  enter  into  exclusive

                                  21
<PAGE>

MDU service contracts.

     Other  FCC  Regulations.  In addition to  the  FCC  regulations
noted above, there are other FCC regulations covering such areas  as
equal   employment   opportunity,  customer   privacy,   programming
practices   (including,  among  other  things,  syndicated   program
exclusivity, network program nonduplication, local sports blackouts,
indecent  programming,  lottery programming, political  programming,
sponsorship     identification,    and    children's     programming
advertisements),  registration  of  cable  systems  and   facilities
licensing,  maintenance  of various records  and  public  inspection
files,   frequency  usage, lockbox availability,  antenna  structure
notification,  tower marking and lighting, consumer  protection  and
customer   service  standards,  technical  standards  and   consumer
electronics  equipment compatibility.  FCC requirements  imposed  in
1997  for Emergency Alert Systems and for providing hearing impaired
Closed  Captioning on programming will result in new and potentially
significant  costs for the Company.  The FCC has  the  authority  to
enforce its regulations through the imposition of substantial fines,
the  issuance  of cease and desist orders and/or the  imposition  of
other  administrative  sanctions, such  as  the  revocation  of  FCC
licenses needed to operate certain transmission facilities  used  in
connection with cable operations.

     The FCC is currently considering whether cable customers should
be  permitted to purchase cable converters from third party vendors.
If  the  FCC concludes that such distribution is required, and  does
not  make appropriate allowances for signal piracy concerns, it  may
become  more  difficult  for  cable operators  to  combat  theft  of
service.

     Internet Service Regulation.  The Company began offering  high-
speed internet service to customers in 1997.  At this time, there is
no  significant federal or local regulation of cable system delivery
of  internet services.  However, as the cable industry's delivery of
internet  services  develops, it is possible  that  greater  federal
and/or local regulation could be imposed.

     Copyright.   Cable  television systems are subject  to  federal
copyright  licensing  covering  carriage  of  television  and  radio
broadcast  signals.   In  exchange for filing  certain  reports  and
contributing  a percentage of their revenues to a federal  copyright
royalty  pool (that varies depending on the size of the  system  and
the  number of distant broadcast television signals carried),  cable
operators  can  obtain blanket permission to retransmit  copyrighted
material  on  broadcast  signals.   The  possible  modification   or
elimination  of  this  compulsory copyright license  is  subject  to
continuing  review and could adversely affect the Company's  ability
to  obtain  desired broadcast programming.  In addition,  the  cable
industry  pays  music  licensing fees to BMI and  is  negotiating  a
similar   arrangement   with   ASCAP.   Copyright   clearances   for
nonbroadcast  programming  services  are  arranged  through  private
negotiations.

     State and Local Regulation.  Cable television systems generally
are  operated  pursuant  to nonexclusive  franchises  granted  by  a
municipality  or  other state or local government entity.  The  1996
Telecom  Act  clarified that the need for an entity providing  cable
services  to obtain a local franchise depends solely on whether  the
entity  crosses  public rights of way.   Federal law  now  prohibits
franchise  authorities from granting exclusive  franchises  or  from
unreasonably  refusing  to award additional franchises  covering  an
existing  cable  system's service area.  Cable franchises  generally
are  granted for fixed terms and in many cases are terminable if the
franchisee fails to comply with material provisions.  Non-compliance
by  the cable operator with franchise provisions may also result  in
monetary penalties.

     The  terms  and  conditions of franchises vary materially  from
jurisdiction  to  jurisdiction.  Each franchise  generally  contains
provisions  governing  cable operations,  service  rates,  franchise
fees,   system  construction  and  maintenance  obligations,  system
channel capacity, design and technical performance, customer service
standards  and  indemnification protections.   A  number  of  states
subject  cable television systems to the jurisdiction of centralized
state  governmental agencies, some of which impose regulation  of  a
character  similar to that of a public utility.  Although LFAs  have
considerable discretion in establishing franchise terms,  there  are
certain  federal  limitations.  For example, LFAs cannot  insist  on
franchise  fees exceeding 5% of the system's gross revenues,  cannot
dictate  the  particular technology used by the system,  and  cannot
specify video programming other than identifying broad categories of
programming.

     Federal  law  contains renewal procedures designed  to  protect
incumbent franchisees against arbitrary

                                  22
<PAGE>

denials of renewal.  Even if
a  franchise is renewed, the franchise authority may seek to  impose
new  and  more onerous requirements such as significant upgrades  in
facilities and services or increased franchise fees (limited  to  5%
of  revenue) and funding for PEG channels as a condition of renewal.
Similarly,  if a franchise authority's consent is required  for  the
purchase or sale of a cable system or franchise, such authority  may
attempt  to impose more burdensome or onerous franchise requirements
in  connection with a request for consent.  Historically, franchises
have   been   renewed  for  cable  operators  that   have   provided
satisfactory  services and have complied with  the  terms  of  their
franchises.

     Proposed  Changes  in  Regulation.   The  regulation  of  cable
television systems at the federal, state and local levels is subject
to the political process and has been in constant flux over the past
decade.   Material  changes in the law and  regulatory  requirements
must be anticipated and there can be no assurance that the Company's
business  will not be affected adversely by future legislation,  new
regulation or deregulation.

Technology

     At  December  31,  1997, approximately  83%  of  the  Company's
customers are served by systems which utilize addressable technology
(i.e., systems having the capacity to offer addressable services  if
addressable   converters  are  present  in  customer   homes),   and
approximately  27%  of  the  Company's  customers  have  addressable
converters.   Addressable  technology  enables  a  cable  television
system  operator  to  activate, from the  headend  site  or  another
central  location, the cable television services delivered  to  each
customer   having   an  addressable  converter.   With   addressable
technology,  the  Company  can upgrade or downgrade  services  to  a
customer  immediately, without the delay or expense associated  with
dispatching  a technician to the home.  Addressable technology  also
allows  the Company to offer pay-per-view services, reduces  premium
service  theft,  and  through  the  ability  to  deactivate  service
automatically,  to  disconnect  delinquent  customer  accounts.   In
certain of its systems, the Company has taken active steps to remove
from  service older addressable converter equipment which was costly
to  maintain.  Through this equipment replacement, the  Company  has
enhanced  customer convenience and revenue growth through  increased
pay-per-view  orders  and  simultaneously has  achieved  significant
reductions   in   service   costs.   The  Company's   current   plan
contemplates  that  by  the end of 1998, its systems  will  have  an
average   capacity   of  approximately  89  analog   channels   with
approximately 66% of the homes passed being served by  systems  with
550  MHz or greater bandwidth capacity, including more than  50%  at
750 MHz or greater, warehoused digital spectrum of up to 200 MHz  in
systems serving approximately 52% of the Company's homes passed  and
approximately  84%  of   the homes passed  served  by  systems  that
utilize addressable technology.  In addition, as part of the upgrade
process,  two-way  communication capability will be  activated  past
approximately 1,000,000 homes by the end of 1998, which will support
enhanced  digital video, high speed data services and other advanced
applications.

     The    Company   continually   monitors   and   evaluates   new
technological  developments on the basis  of  its  ability  to  make
optimal   use   of  its  existing  assets  and  to  anticipate   the
introduction of new services and program delivery capabilities.  The
use  of  fiber  optic cable as an enhancement to  coaxial  cable  is
playing a major role in expanding channel capacity and improving the
performance  of  cable  television systems.  Fiber  optic  cable  is
capable of carrying hundreds of video, data and voice channels.   To
date, the Company has sought to implement fiber optic technology  in
portions  of its systems, primarily by undertaking fiber-to-the-node
upgrades.  Such upgrades use fiber optic cable to carry signals from
a  systems's  headend  to  multiple  locations  within  the  system,
reducing the need to deploy amplifiers and thereby enhancing  signal
quality  and reducing service interruptions.  The Company  plans  to
continue  to deploy fiber-to-the-node to upgrade and expand  channel
capacity, using both analog and digital transmission techniques,  to
interconnect systems and groups of systems into regional networks.

     New   technological  advances  that  are  anticipated   to   be
commercially   viable  in  the  next  few  years   include   digital
compression  and  expanded bandwidth amplifiers, which  offer  cable
operators  the  potential  for  a  dramatic  expansion  of   channel
capacity,  along  with alternative communications delivery  systems.
As  this  new technology and related services become available,  the
Company  intends to carefully assess the economic return and  market
demand for such technology and services in order for the Company  to
prudently  implement additional services in the most  cost-effective
manner.

                                 23
<PAGE>

Programming

     The  Company has various contracts to obtain basic and  premium
programming   for   its   systems  from  program   suppliers   whose
compensation  is typically based on a fixed fee per  customer.   The
Company's programming contracts are generally for a fixed period  of
time  and are subject to negotiated renewal.  Some program suppliers
provide  volume  or  channel discount pricing  structures  or  offer
marketing  support to the Company.  In particular, the  Company  has
negotiated  programming  agreements with premium  service  suppliers
that  offer  cost  incentives  to the Company  under  which  premium
service  unit  prices  decline  as certain  premium  service  growth
thresholds are met.  The Company's successful marketing of  multiple
premium service packages emphasizing customer value has enabled  the
Company to take advantage of such cost incentives.

     The  Company's cable programming costs have increased in recent
years  and  are  expected  to continue to  increase  due  to  system
acquisitions,  additional programming being provided  to  customers,
increased   cost   to   produce  or  purchase   cable   programming,
inflationary  increases and other factors.   Program  suppliers  may
continue  to increase rates.  However, under the new FCC rules,  the
cable  operator may have the ability to mark up these  increases  by
7.5%  and  pass the increase on to customers.  In lieu of  the  7.5%
markup,  the  Company  has  the right to recover  up  to  $1.20  per
customer  between  January 1, 1995 and 1997 for additional  channels
added  to CPST's (not to exceed $0.20 per added channel) and  up  to
$0.30 per customer over that same period for aggregate license fees.
Beginning  January  1,  1997, the cap for additional  channels  will
increase  to  $1.40 and the license fee reserve will also  increase.
After  January  1, 1998, the optional rate increase  for  additional
channels  will  lapse.   Although there can be  no  assurances,  the
Company   believes  it  will  continue  to  have  access  to   cable
programming services at reasonable prices.

     Effective  April  1,  1996,  the Company  became  a  member  of
TeleSynergy,   a   cable  television  cooperative   buying   venture
representing over 5,000,000 customers.  Members of this  cooperative
benefit   from   lower  programming  costs  per   customer   through
consolidated   buying  efforts.   The  TeleSynergy  membership   has
partially offset the increased programming costs noted above.

                                   24
<PAGE>

Franchises

     Cable television systems are generally constructed and operated
under   nonexclusive   franchises  granted  by  local   governmental
authorities.   These franchises typically contain  many  conditions,
such   as  time  limitations  on  commencement  and  completion   of
construction; conditions of service, including the provision of free
service  to schools and certain other public institutions;  and  the
maintenance  of  insurance,  indemnity bonds  and  customer  service
standards.   The  provisions  of local  franchises  are  subject  to
federal regulation under the 1984 Cable Act and the 1992 Cable  Act,
now consolidated under the 1996 Telecom Act.

     As  of December 31, 1997, the Company operated pursuant to  780
franchises.   These nonexclusive franchises provide for the  payment
of  fees to the issuing authority.  Annual franchise fees imposed on
the  systems  range  up  to a 5% federally  mandated  cap  on  gross
revenues  generated  by  a  system.  In  substantially  all  of  the
Systems,  such  franchise fees are passed through to  the  customers
directly as an addition to the rates for cable television service.
     The  table below illustrates the grouping of the franchises  by
date   of  expiration  and  presents  the  approximate  number   and
percentage  of basic service customers for each as of  December  31,
1997.

<TABLE>
<CAPTION>

 Year of                                                     Percentage
Franchise                        Number of      Number of     of Total
Expiration                      Communities     Customers     Customers
----------                      -----------     ---------    ----------
<S>                             <C>            <C>           <C>
Prior to 1998 (1)                       63        79,316         6.44%
1998-2001                              189       319,295        25.91%
2002 and after                         488       800,033        64.92%
Other (2)                               40        33,643         2.73%
                                -----------     ---------    ----------
Total                                  780     1,232,287       100.00%
                                ===========     =========    ==========
------------------
<FN>
(1)  All   expired   franchises   have   open   extensions   pending
     renegotiation of long-term renewals.
(2)  The  Company  operates a number of systems that serve  multiple
     communities  and, in some instances, portions of  such  systems
     extend  into  jurisdictions for which the Company  believes  no
     franchise is necessary.
</FN>
------------------
</TABLE>

     The 1984 Cable Act provides, among other things, for an orderly
franchise  renewal  process  where franchise  renewal  will  not  be
unreasonably  withheld  or, if renewal is  withheld,  the  franchise
authority  must  pay the operator the "fair market  value"  for  the
system  covered by such franchise.  In addition, the 1984 Cable  Act
establishes  comprehensive renewal procedures that require  that  an
incumbent  franchisee's renewal application be assessed on  its  own
merit  and  not  as  part  of a comparative process  with  competing
applications.

Employees

     At December 31, 1997, the Company had 2,048 full-time employees
and  84 part-time employees.  Approximately 180 of the employees are
members  of  one of seven unions and are represented by a designated
collective   bargaining  representative  or  under   various   labor
agreements.  The Company considers its relations with its  employees
to be good.

(d)  Financial Information About Foreign and Domestic Operations and
Export Sales

     MCC has neither foreign operations nor export sales.

ITEM 2.   PROPERTIES

      The  Company currently operates in 780 communities in Alabama,
California,  Connecticut,  Delaware,  Georgia,  Indiana,   Illinois,
Kentucky,   Louisiana,  Maryland,  Minnesota,   Mississippi,   North
Carolina,  Oklahoma, Tennessee, Texas, Wisconsin and  Virginia.   In
connection  with its operation of the Systems, the Company  owns  or

                               25
<PAGE>

leases  parcels of real property for signal reception sites (antenna
towers and headends), microwave facilities and business offices, and
owns  most of its service vehicles.  The Company believes  that  its
properties,  both  owned and leased, are in good condition  and  are
suitable and adequate for the Company's business operations.

     Cable  television systems generally consist of  four  principal
operating  components.  The first component, known  as  the  headend
facility,   receives  television  and  radio   signals   and   other
programming and information by means of special antennae,  microwave
relays  and  satellite  earth stations.  The second  component,  the
distribution  network, which originates at the headend  and  extends
throughout the system's service area, typically consists of  coaxial
or fiber optic cables placed on utility poles or buried underground,
and  associated  electronic equipment.  The third component  of  the
system  is a drop cable, which extends from the distribution network
into  each  customer's home and connects the distribution system  to
the  customer's television set.  The fourth component, a  converter,
is  the home terminal device that expands channel capacity to permit
reception  of  more than 12 channels of programming.   Some  systems
utilize home terminal devices that can be addressed by sending coded
signals from the headend over the cable network.

     The  Company's  cables generally are attached to utility  poles
under  pole rental agreements with local public utilities,  although
in  some areas the distribution cable is buried in underground ducts
or  trenches.   The  physical  components  of  the  systems  require
maintenance  and periodic upgrading to keep pace with  technological
advances.

ITEM 3.   LEGAL PROCEEDINGS

     There are no material pending legal proceedings to which MCC or
any  of  its  subsidiaries are a party or  to  which  any  of  their
respective properties are subject.

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

     None.
                                26
<PAGE>


                              PART II

ITEM 5.   MARKET   FOR   REGISTRANTS'  COMMON  EQUITY  AND   RELATED
          STOCKHOLDER MATTERS

     There  is no established public trading market for any  of  the
registrants'  equity  securities.  As of March  26,  1998,  28,335.2
Employee Units were outstanding.

ITEM 6.   SELECTED FINANCIAL DATA

     The  selected  financial data presented below are derived  from
the  audited  historical financial statements of the  Company.   The
Company's  acquisitions  of  cable  television  systems  during  the
periods  for which the selected data are presented below  materially
affect  the  comparability of such data from one period to  another.
The  data  presented  below should be read in conjunction  with  the
Company's  historical  financial statements and  the  related  notes
thereto.

<TABLE>
                            FINANCIAL DATA
                            (in thousands)
<CAPTION>
                           1997       1996      1995      1994     1993
<S>                    <C>        <C>        <C>        <C>       <C>
Statement of
Operations Data: (1)
Revenues                 $479,315   $434,507   $198,294  $64,747   $52,307
Costs and expenses        248,866    230,214    102,024   31,453    21,849
Management fees
  and expenses (2)            ---        ---        ---    2,165     3,617
Depreciation
  and amortization        188,471    166,429     83,723   37,412    28,633
Operating income (loss)    41,978     37,864     12,547  (6,283)   (1,792)
Interest expense          151,207    144,681     82,911   28,105    13,443
Net loss                 (109,229)  (100,070)   (52,816) (30,610)   (9,643)


Balance Sheet Data:
Total assets           $1,750,468 $1,687,550 $1,760,054 $315,217   $195,148
Total debt
 (including
  current maturities)   1,601,933  1,438,471  1,407,890  327,264    195,000
Subsidiary limited
  partner interests          (246)      (246)     (246)    (246)     5,788
Partners'
  capital (deficit)        80,027    189,256    289,326 (21,290)   (11,670)

Other Data:
EBITDA (3)                230,449    204,293     96,270  31,129     26,841
___________________________
<FN>
(1)  All   statement  of  operations  data  reflect  the  following
     acquisitions and divestitures by the Company from the date  of
     acquisition or sale: (i) the July 29, 1994 acquisition of  the
     Star  Systems,  (ii)  the acquisition  of  the  Crown  Systems
     effective January 1, 1995, (iii) the June 30, 1995 divestiture
     of   the  San  Angelo  Systems,  (iv)  the  August  31,   1995
     acquisition  of  the CALP Systems, (v) the  November  1,  1995
     acquisition of the Sammons Systems, (vi) the January 11,  1996
     acquisition of the Weatherford System, (vii) the July 8,  1996
     acquisition  of the Futurevision System, (viii) the  July  31,
     1996 acquisition of the Frankfort System, (ix) the October 11,
     1996  divestiture of the Moses Lake System, (x)  the  July  1,
     1997 acquisition of the Harron System and (xi) the December 1,
     1997 exchange of the Time Warner Systems.
(2)  Each  of  the  then  existing Operating Partnerships  formerly
     entered  into  management agreements, pursuant to  which  each
     then   existing  Operating  Partnership  paid  the  Management
     Company  a  specified  percentage of  the  revenues  from  the
     systems  owned  and  operated by such Operating  Partnerships,
     plus   certain   reimbursable  expenses.    These   agreements
     terminated  July 29, 1994, in connection with the  acquisition
     and financing of the Star Systems.
(3)  EBITDA  is  equal to operating income (loss) plus depreciation
     and  amortization.   The Company believes  that  EBITDA  is  a

                                 27
 <PAGE>

     meaningful measure of performance because it is commonly  used
     in  the cable television industry to analyze and compare cable
     television  companies  on the basis of operating  performance,
     leverage and liquidity.  In addition, the indentures governing
     the 14 1/4% Notes, the 11 7/8% Debentures and the 13 1/2% Notes and the
     Senior  Credit Facility contain certain covenants measured  by
     computations   substantially  similar   to   those   used   in
     determining EBITDA.  However, EBITDA is not intended to  be  a
     performance  measure that should be regarded as an alternative
     either  to  operating income or net income as an indicator  of
     operating  performance  or  to cash  flows  as  a  measure  of
     liquidity, as determined in accordance with generally accepted
     accounting principles.
</FN>
</TABLE>


ITEM 7.   MANAGEMENT'S   DISCUSSION  AND  ANALYSIS   OF   FINANCIAL
          CONDITION AND RESULTS OF OPERATIONS

Results of Operations

     In  each  of  the past three years, the Company has  generated
substantially  all of its revenues from monthly customer  fees  for
basic,  premium  and  other services (such as the  rental  of  home
terminal  devices and remote control devices) and from installation
income.   Additional  revenues  were  generated  from  pay-per-view
programming,  the  sale of advertising and sales  commissions  from
home  shopping networks.  Beginning in September of 1994,  revenues
were also generated from management fees earned in conjunction with
two managed systems.  On August 31, 1995, the Company purchased one
of  the  managed systems and thus terminated the related management
agreement.   Effective  January 31,  1997,  the  remaining  managed
system  was  sold.   As  a  result of these two  transactions,  the
Company  is  no longer involved in the active management  of  cable
systems  for  third  parties.  However, the  Company  does  earn  a
nominal  monthly oversight fee for Maryland Cable and in  1997  the
Company  recognized incentive management fee revenue from the  sale
of the Maryland Cable System.

     The  Company has experienced significant increases in revenues
and EBITDA in each of the past three fiscal years.  This growth was
accomplished  primarily through acquisitions and  through  internal
customer growth.  During 1997, the Company acquired systems serving
approximately  22,000  basic customers in  Texas  with  the  Harron
Acquisition (completed July 1, 1997) and added approximately 13,800
basic customers in Wisconsin and Indiana through the exchange  with
Time Warner (completed December 1, 1997).  During 1996, the Company
acquired  systems  serving approximately  700  basic  customers  in
Weatherford,  Texas on January 11, 1996; 2,600 basic  customers  in
Mississippi  with the Futurevision Acquisition in  July,  1996  and
5,400 basic customers in Indiana with the Frankfort Acquisition  on
July  31,  1996.   Also  during 1996, the Company  sold  its  cable
television  system serving approximately 12,600  customers  in  the
state  of  Washington.  The significant increases in  revenues  and
EBITDA  during  1995 are primarily the result of the   acquisitions
which  increased MCC's basic customer base by approximately 950,000
basic  customers  with  the significant portions  of  the  increase
resulting  from the Crown Acquisition (193,300 customers) effective
January 1, 1995, the CALP Acquisition (85,000 customers) on  August
31,  1995  and  the  Sammons  Acquisition  (664,700  customers)  on
November 1, 1995.

     Additionally,  the Company conformed the method of  accounting
for  franchise  fees  in the former Sammons  Systems  during  1997.
Local governmental authorities impose franchise fees on the Systems
ranging  up  to  a  federally mandated maximum  of  5.0%  of  gross
revenues.   On  a monthly basis, such fees are collected  from  the
Systems'   customers.   Historically,  franchise  fees   were   not
separately itemized on customers' bills.  Such fees were considered
part  of  the monthly charge for basic services and equipment,  and
therefore  were  reported as revenue and expense in  the  Company's
financial results.  The Company began the process of itemizing such
fees on all customers' bills to conform with the collection of, and
accounting for, franchise fees in the remaining Systems in November
1996  and  completed the process during the first quarter of  1997.
In  conjunction  with itemizing these charges,  the  Company  began
collecting the franchise fee on all taxable revenues.  As a result,
beginning  in  the first quarter of 1997, such fees are  no  longer
included as revenue or as general and administrative expenses.  The
net  accounting  effect of this change is an  annual  reduction  in
revenue  of  approximately $6,800,000 and a reduction of $9,300,000
in general and administrative expenses.

     The  comparability of operating results, as  discussed  below,
between  the  year  ended December 31, 1997 and  the  corresponding
period  for  1996 are affected by the above discussed acquisitions,
exchange,
                              28
<PAGE>

divestiture and franchise fee adjustment which  occurred
during  1997 and 1996 (collectively referred to as the  "Pro  Forma
Adjustments").

     Total  selling,  service and system management  expenses,  and
general   and   administrative   expenses   have   also   increased
significantly  due  to  the acquisitions  mentioned  above,  growth
within  the Company's existing systems, increased marketing efforts
and  the continued development of advertising sales efforts.  Until
July  29,  1994, certain general and administrative  services  were
performed  on behalf of the Company by the Management Company,  for
which  the  Operating  Partnerships,  then  in  existence,  paid  a
management  fee  of 5.5% of gross revenues.  After that  date,  the
employees and related expenses of the Management Company  became  a
part  of Operating, and Operating now records all overhead expenses
relating  to  the  Dallas  home office and the  Wisconsin  regional
office  within selling, service and system management  and  general
and administrative expenses, instead of management fees.

     Programming expenses have increased both in dollars and  as  a
percentage  of  revenue  for the past three  years  due  to  system
acquisitions,  additional programming being provided  to  customers
and   increased   costs  to  produce  or  purchase  certain   cable
programming services.  However, the increase in the Company's  size
has  allowed  the  Company to recognize certain  volume  discounts.
Effective   April  1,  1996,  the  Company  became  a   member   of
TeleSynergy,   a   cable  television  cooperative  buying   venture
representing over 5,000,000 customers.  Members of this cooperative
benefit   from   lower  programming  costs  per  customer   through
consolidated  buying  efforts.   The  TeleSynergy  membership   has
partially offset the increased programming costs noted above.

     The  significant  increases in charges  for  depreciation  and
amortization  are  due  to  acquisitions and  capital  expenditures
related  to  continued construction and upgrading of  the  systems.
Similarly,  interest  expense has increased  significantly  due  to
additional  amounts outstanding under long-term  obligations  which
were necessary to finance the acquisitions.  The Company expects to
continue to report net losses due to the high levels of charges for
depreciation and amortization and interest expense.

The  following table sets forth for the periods indicated,  certain
income statement items as a percentage of total revenues.
<TABLE>
                                    Percentage of Revenue for
                                           Periods Ended
                                            December 31, (1)
<CAPTION>
                               1997        1996        1995
<S>                           <C>         <C>         <C>
Revenues                      100.0%      100.0%      100.0%
Selling, service and           36.8        36.2        34.7
system management
General and                    15.1        16.8        16.8
administrative
Management fees and             0.0         0.0         0.0
expenses
Depreciation and               39.3        38.3        42.2
amortization
                               ----        ----        ----
Operating income                8.8         8.7         6.3
Interest                       31.6        33.2        41.4
Other (income) expense          0.0        (1.5)      (12.7)
                               ----        ----        ----
Net loss before
extraordinary items          (22.8%)      (23.0%)     (22.4%)
                               ====        ====        ====

EBITDA (2)                     48.1%        47.0%      48.5%
                               ====        ====        ====
<FN>
(1)  Reflects  results of operations of the following  acquisitions
     and  divestitures by the Company from the date of  acquisition
     or through the date of sale: (i) the July 29, 1994 acquisition
     of the Star Systems, (ii) the acquisition of the Crown Systems
     effective January 1, 1995, (iii) the June 30, 1995 divestiture
     of   the  San  Angelo  Systems,  (iv)  the  August  31,   1995
     acquisition  of  the CALP Systems, (v) the  November  1,  1995
     acquisition of the Sammons Systems, (vi) the January 11,  1996
     acquisition of the Weatherford System, (vii) the July 8,  1996
     acquisition  of the Futurevision System, (viii) the  July  31,
     1996 acquisition of the Frankfort System, (ix) the October 11,
     1996  divestiture of the Moses Lake System, (x)  the  July  1,
     1997 acquisition of the Harron
                                  29
<PAGE>

     System and (xi) the December 1,
     1997 exchange of the Time Warner Systems.
(2)  EBITDA  is  equal  to operating income plus  depreciation  and
     amortization.   The  Company  believes  that   EBITDA   is   a
     meaningful measure of performance because it is commonly  used
     in  the cable television industry to analyze and compare cable
     television  companies  on the basis of operating  performance,
     leverage and liquidity.  In addition, the indentures governing
     the 14 1/4% Notes, the 11 7/8% Debentures and the 13 1/2% Notes and the
     Senior  Credit Facility contain certain covenants measured  by
     computations   substantially  similar   to   those   used   in
     determining EBITDA.  However, EBITDA is not intended to  be  a
     performance  measure that should be regarded as an alternative
     either  to  operating income or net income as an indicator  of
     operating  performance  or  to cash  flows  as  a  measure  of
     liquidity, as determined in accordance with generally accepted
     accounting  principles.  The Company has  substantial  noncash
     charges  to  earnings  from  depreciation,  amortization   and
     interest.
</FN>
</TABLE>

Fiscal 1997 Compared to Fiscal 1996

     Revenues  increased  from  $434,507,000  for  the  year  ended
December  31, 1996 to $479,315,000 for the year ended December  31,
1996.    Basic   service   revenue   increased   by   approximately
$35,800,000,  of which approximately $11,100,000 of  such  increase
was  the  result  of  the Harron acquisition  and  the  incremental
revenue  as a result of the Time Warner exchange.  The increase  in
revenue was offset by a decrease of approximately $6,800,000  as  a
result of the conforming change regarding franchise fee itemization
in  the  former Sammons Systems.  Monthly management fees decreased
by approximately $1,790,000 in 1997 compared to 1996 as a result of
the  sale  of the Maryland Cable System on January 31, 1997.   This
decrease  was offset by the recognition of an incentive  management
fee of approximately $5,069,000 in conjunction with the sale of the
Maryland  Cable  System.  Approximately $2,300,000 of  the  overall
revenue  increase  was attributable to increased advertising  sales
revenue.    Revenue   from  pay-per-view  increased   approximately
$2,360,000  in 1997 in comparison to 1996.  The revenues  generated
from  internal  and  continued  customer  growth  account  for  the
remaining  increase.   Normalizing the effects  of  the  Pro  Forma
Adjustments, pro forma revenue increased $46,927,000, or 10.7%, for
the year ended December 31, 1997.

     The  Company's  basic customers increased  from  1,181,293  at
December 31, 1996, to 1,232,287 at December 31, 1997.  During 1997,
the  Company added approximately 51,000 basic customers,  of  which
approximately 35,500 were from the Harron acquisition and the  Time
Warner  exchange.  The remaining 15,500 were added through internal
growth,  representing an annualized customer growth rate  of  1.3%.
This  basic customer growth was developed through the extension  of
existing  plant  infrastructure to pass additional dwelling  units,
marketing  promotions  and  continued  implementation  of   premium
packaging.   The  company's  pay units decreased  from  666,702  at
December  31,  1996 to 583,603 at December 31,  1997.   The  Harron
acquisition  and  the Time Warner exchange had a net  effect  of  a
1,700  unit  decrease as the systems acquired in  the  Time  Warner
exchange  had  a  lower  pay  unit  penetration  than  the  systems
relinquished in the exchange.  Through the third quarter  of  1997,
the  Company was experiencing annualized customer growth  of  2.0%.
However,  in  the  latter  half of 1997, two  non-recurring  events
transpired,  each  of  which  affected  a  significant  number   of
customers,  and  negatively impacted the Company's customer  growth
for  the  year.  In early fall, the Company halted certain  of  its
marketing  sales initiatives and converted its billing  systems  in
several  of  its  largest service areas.   As  a  result  of  these
actions,  the  Company's customer connect activity slowed,  causing
customer growth to decline during the fourth quarter.  The  Company
continues to evaluate the effectiveness of its redirected marketing
strategy  and  has  recently  introduced  new  value  based   sales
initiatives and programming packages.

     Selling, service and system management expenses increased from
$157,197,000  for the year ended December 31, 1996 to  $176,515,000
for  the  year  ended December 31, 1997.  The main  factor  of  the
increase  noted resulted from an increase in programming  costs  of
$12,681,000.   Substantially all of this programming cost  increase
is  attributable  to  increases in  the  cost  of  basic  satellite
programing as a result of annual cost increases, incremental  basic
customer  growth and the addition of satellite programming channels
to  certain  of  the  Company's  rebuilt  systems.  Another  factor
contributing  to  the increase resulted from an increase  in  plant
expense  of $6,256,000.  The majority of the plant expense increase
resulted  from extensions and rebuilds of certain of  the  Company'
systems.  Offsetting the increases in programming and plant expense
was  a  decrease  in marketing costs of $1,140,000,  primarily  the
result   of  channel  launch  support  received  from  programmers.
Normalizing  the  effects of the Pro Forma Adjustments,  pro  forma
selling,   service   and  system  management   expenses   increased
$18,560,000, or 11.4%, for the year ended December 31, 1997.

                                 30
<PAGE>

     General and administrative expenses decreased from $73,017,000
for  the  year ended December 31, 1996 to $72,351,000 for the  year
ended  December 31, 1997.  The Company experienced increased  labor
costs  of  approximately $5,275,000 and increased billing costs  of
approximately  $852,000  as  a result of  upgrading  the  Company's
customer  care platform, and increased customer receivable reserves
of  approximately  $932,000.   These increases  were  offset  by  a
decrease  of  approximately $9,300,000, due  to  the  reduction  in
franchise fee expense, as a result of the conforming itemization of
such  costs on customers' bills.  The remaining increase is due  to
normal inflationary increases.  Normalizing the effects of the  Pro
Forma  Adjustments,  pro forma general and administrative  expenses
increased  $5,329,000,  or 7.8%, for the year  ended  December  31,
1997.

     Depreciation   and   amortization   expense   increased   from
$166,429,000  for the year ended December 31, 1996 to  $188,471,000
for  the  year  ended  December 31, 1997  due  principally  to  the
additional capital expenditures incurred to rebuild and upgrade the
broadband  network  and  equipment  of  certain  of  the   Systems.
Interest  expense increased from $144,376,000 for  the  year  ended
December  31,  1996  to $151,207,000 for the comparable  period  in
1997, primarily due to the scheduled increase in the accretion  for
the  13 1/2% Notes and the 14 1/4% Notes of $8,720,000.  This accretion
increase  was  offset by a decrease in the average borrowing  costs
under  the  Senior Credit Facility.  Borrowings, excluding  capital
leases,  increased  to  $1,599,426,000 at December  31,  1997  from
1,436,269,000 at December 31, 1996.  The weighted average  interest
rate  on  all outstanding indebtedness was 9.92% and 9.97% for  the
twelve  months  ended  December 31, 1997  and  December  31,  1996,
respectively.

     The  difference between the loss before extraordinary item  of
$109,229,000 and $100,070,000 for the year ended December 31,  1997
and  1996,  respectively resulted from the increases in operations,
depreciation, amortization and interest expense as discussed above.

     No  losses  were  allocated to the subsidiary limited  partner
interests for the year ended December 31, 1997 or 1996.

     As  a  result  of  the  changes  explained  in  the  foregoing
paragraphs, EBITDA increased from $204,293,000 for the  year  ended
December  31, 1996 to $230,449,000 for the year ended December  31,
1997.


Fiscal 1996 Compared to Fiscal 1995

     Revenues  increased  from  $198,294,000  for  the  year  ended
December  31, 1995 to $434,507,000 for the year ended December  31,
1996.   Approximately $231,916,000 of such increase was the  result
of   the  CALP  and  Sammons  Acquisitions.   This  increase   from
acquisitions  was partially offset by the divestiture  of  the  San
Angelo  Systems on June 30, 1995.  The San Angelo Systems generated
reported  revenues  of $6,022,000 for the year ended  December  31,
1995.   Management fees earned by Operating decreased by  $955,000.
Eight  and  twelve months of such fees pursuant  to  the  CALP  and
Maryland  Cable  Agreements, respectively, were recorded  in  1995,
compared  to  a  full  year of fees earned  pursuant  to  only  the
Maryland  Cable  Agreement in 1996. The CALP  Agreement  terminated
upon  the  completion of the CALP Acquisition on August  31,  1995.
The  revenues generated from internal and continued customer growth
account for the remaining increase.

     The  Company's basic customers and pay units for  its  Systems
increased from 1,154,718 and 651,121, respectively, at December 31,
1995, to 1,181,293 and 666,702, respectively, at December 31, 1996.
This  customer and unit growth was developed through the  extension
of existing plant infrastructure to pass additional dwelling units,
marketing  promotions  and  continued  implementation  of   premium
packaging,  and was negatively affected by the net  affect  of  the
Weatherford, Frankfort and Futurevision Acquisitions and Moses Lake
divestiture (a net reduction in basic customers of 4,300).

     Selling, service and system management expenses increased from
$68,753,000  for  the year ended December 31, 1995 to  $157,197,000
for  the  year  ended  December  31,  1996,  primarily  due  to  an
$86,284,000   increase  from  the CALP  and  Sammons  Acquisitions,
offset  by  a $2,238,000 decrease from the divestiture of  the  San
Angelo  Systems.   The remaining increase resulted  primarily  from
growth  within the Company's

                                31
<PAGE>

existing systems, increased  marketing
efforts, the continued development of advertising sales efforts and
increased  costs of certain programming services.  Effective  April
1,  1996,  the  Company  became a member of  TeleSynergy,  a  cable
television  cooperative buying venture representing over  5,000,000
customers.    Members  of  this  cooperative  benefit  from   lower
programming costs per customer through consolidated buying efforts.
The  TeleSynergy  membership  has partially  offset  the  increased
programming costs.

     General and administrative expenses increased from $33,271,000
for  the  year ended December 31, 1995 to $73,017,000 for the  year
ended   December  31,  1996.   Approximately  $35,468,000  of   the
increase, from the CALP and Sammons Acquisitions, was offset  by  a
$718,000  decrease from the divestiture of the San Angelo  Systems.
The  remaining  increase  resulted  primarily  from  the  necessary
expansion  of  the home office operations in order  to  manage  the
increased size of the business and increases in operating costs due
the growth experienced in other of the Systems.

     Depreciation   and   amortization   expense   increased   from
$83,723,000  for  the year ended December 31, 1995 to  $166,429,000
for  the year ended December 31, 1996 due primarily to the CALP and
Sammons  Acquisitions  offset  by a $4,078,000  decrease  from  the
divestiture of the San Angelo Systems.  Interest expense  increased
from   $82,143,000  for  the  year  ended  December  31,  1995   to
$144,376,000  for  the  comparable  period  in  1996,  due  to  the
inclusion  of interest expense related to the borrowings under  the
14 1/4%  Notes and the Senior Credit Facility, which became  effective
on June 9, 1995 and August 31, 1995, respectively (borrowings under
the Senior Credit Facility were substantially increased on November
1,  1995).   Borrowings, excluding capital leases,  increased  from
$1,406,006,000 at December 31, 1995 to $1,436,269,000  at  December
31,  1996.   The weighted average interest rate on all  outstanding
indebtedness  was  11.6%  and 9.97% for  the  twelve  months  ended
December 31, 1995 and December 31, 1996, respectively.

     The  difference between the loss before extraordinary item  of
$44,421,000 and $100,070,000 for the year ended December  31,  1995
and   1996,  respectively  was  due  to  the  net  effects  of  the
$26,394,000 gain and the $6,442,000 gain from the sales of the  San
Angelo  and Moses Lake cable television systems in 1995  and  1996,
respectively.   The remaining increase resulted from the  increases
in  operations, depreciation, amortization and interest expense  as
discussed above.

     No  losses  were  allocated to the subsidiary limited  partner
interests  for  the  year ended December 31,  1996  or  1995.   The
Company recognized a loss of $8,395,000 from the write-off of  debt
issuance costs from the early retirement of the outstanding balance
under  its  previous credit agreements for the year ended  December
31, 1995.

     As  a  result  of  the  changes  explained  in  the  foregoing
paragraphs,  EBITDA increased from $96,270,000 for the  year  ended
December  31, 1995 to $204,293,000 for the year ended December  31,
1996.


Liquidity and Capital Resources

     On  October 7, 1997, the Company announced that it intends  to
offer for sale certain cable television systems that are not within
the  Company's six strategic operating groups.  Systems to be  sold
serve   approximately  195,000  customers  in  Delaware,  Maryland,
Virginia,  Connecticut, Mississippi, Louisiana, Illinois,  Oklahoma
and the Texas panhandle.  The solicitation has thus far resulted in
the following two agreements.

     On  December  4, 1997, the Company entered into  a  definitive
agreement  with  an affiliate of Comcast Corporation  to  sell  its
Delaware/Maryland  Systems  for  a  sales  price  of  approximately
$65,500,000.   The systems serve approximately 26,500 customers  in
the  Delmarva peninsula.  The transaction is subject to  regulatory
approval and is expected to be finalized by June 30, 1998.

     On  March  4,1998,  the  Company  entered  into  a  definitive
agreement  with TMC Holdings, Inc. to sell cable television  assets
located   in  Connecticut  and  Virginia  for  a  sales  price   of
approximately $150,000,000.  The systems serve approximately 46,000
customers   and  17,000  customers  in  Connecticut  and  Virginia,
respectively.   The  transaction is subject to regulatory  approval
and is expected to be finalized during the third

                                 32
<PAGE>

quarter of 1998.

     The  Company  is  currently marketing  the  remaining  systems
serving  approximately  105,500 customers  in  Illinois,  Oklahoma,
Texas, Mississippi and Louisiana.  Although the Company has entered
into  the  above  agreements, there can be no  assurance  that  the
transactions  will be approved or finalized on the terms  presently
contemplated.   Additionally, although  the  Company  is  currently
marketing  the  remaining systems noted  above,  there  can  be  no
assurance  that the Company will be successful in completing  sales
of those systems.  The Company intends to use the proceeds from the
sale   of   these  non-strategic  assets  to  reduce  the   current
outstanding balance under its Senior Credit Facility.

     On  March  3, 1998, the Company announced that it has retained
Goldman  Sachs  to  advise  the  Company  as  it  explores  various
strategic  alternatives  involving the ownership  of  the  Company.
Several  alternatives are being reviewed, however, no decision  has
been  made  and  the  outcome  of the Company's  review  cannot  be
predicted at this time.

     The  Company  plans to continue to explore  and  consider  new
commitments,  arrangements or transactions  to  refinance  existing
debt,  increase the Company's liquidity or decrease  the  Company's
leverage.   These  could include, among other  things,  the  future
issuance by the Company, or its subsidiaries, of public or  private
equity  or  debt  and  the negotiation of  new  or  amended  credit
facilities.

     The  Company  has  grown significantly over the  past  several
years  through acquisitions as well as through upgrading, extending
and  rebuilding  its  existing  cable  television  systems.   Since
expansion  by  means  of  these methods is capital  intensive,  the
Company  has relied upon various sources of financing to  meet  its
funding  needs.   These  sources have included  contributions  from
equity  investors,  borrowings under various debt  instruments  and
positive cash flows from operations.

     As of December 31, 1997, unreturned capital contributions from
equity investors totaled approximately $493,327,000.  There was  no
capital contributed from equity investors during 1997.  The Company
has  an aggregate of $1,601,933,000 of indebtedness outstanding  in
the form of the 11 7/8% Debentures, 13 1/2% Notes, 14 1/4% Notes, borrowings
under its Senior Credit Facility and note payable and capital lease
obligations.   The  Company  has  an  additional  $155,059,000   of
borrowing  capacity  under  its  Revolving  Credit  Facility  after
considering  committed lines of credit of $3,941,000.   Cash  flows
generated  from  operating activities have been positive  over  the
past three years and increased from $86,030,000 and $118,986,000 in
1995 and 1996, respectively, to $154,302,000 in 1997.  Funding from
equity  contributions,  borrowings and  positive  cash  flows  from
operations have been sufficient to meet the Company's debt service,
working capital and capital expenditure requirements including  the
purchase  costs  incurred in connection with all of  the  completed
acquisitions and the exchange.

     Acquiring and upgrading cable television systems is contingent
upon  the  availability of cash provided by operations,  borrowings
from  the  Company's existing credit facilities and  the  Company's
ability to obtain additional debt or equity financing.  Although in
the  past  the  Company has been able to obtain  financing  through
equity  investments, debt issuances and bank borrowings, there  can
be  no assurance that the capital resources necessary to accomplish
the  Company's  business strategy will be available,  or  that  the
terms will be favorable to the Company.

     Cash  interest is payable monthly, quarterly and  semiannually
on   borrowings  outstanding  under  the  Company's  Senior  Credit
Facility  and the 11 7/8% Debentures.  No cash interest is payable  on
the  13 1/2%  Notes  until February 1, 2000 and no  cash  interest  is
payable  on the 14 1/4% Notes until December 15, 2000.  Maturities  of
all  long-term debt total approximately $856,006,000 over the  next
five  years.   The  Company  expects to  cover  both  interest  and
principal  payments on its long-term obligations through internally
generated  funds, borrowings under the Senior Credit  Facility  and
with certain proceeds from the sale of non-strategic cable systems.

     The  Company's most significant need for capital in  the  next
year  will be to finance the planned system upgrades, rebuilds  and
extensions and the purchase of modems and home terminal devices for
use  in customers' homes.  Currently, the Company is systematically
rebuilding and upgrading its cable systems so

                                33
<PAGE>

that within the  next
three  years  substantially  all  existing  systems  will  have   a
bandwidth  of  between 450 MHz and 862 MHz.   This  program  should
enable  the  Company  to deliver technological innovations  to  its
customers as such services become commercially viable.  As part  of
this  program, certain systems, such as those serving the areas  in
and  around  Ft.  Worth/Tarrant  County  (Texas),  Glendale/Burbank
(California)  and  suburban  Birmingham  (Alabama)  together   with
selected systems in Wisconsin, Indiana, Tennessee and other  states
in  which the Company operates cable systems, are being upgraded to
750 MHz or 862 MHz with two-way communication capabilities. Capital
expenditures are expected to approximate $214,300,000 (or $171  per
customer) in 1998.  Ongoing capital expenditures, other than  these
rebuild  amounts, are consistent with current costs to  extend  and
maintain the existing networks.  The Company expects to fund  these
capital  expenditures through cash generated  from  operations  and
available borrowings under the Revolving Credit Facility.


Recent Accounting Pronouncements

     In  February  1997, the financial Accounting  Standards  Board
issued  SFAS No. 128, "Earnings per Share" ("SFAS 128").  SFAS  128
established simplified accounting standards for computing  earnings
per  share and makes them comparable to international earnings  per
share   standards.   The  provisions  of  SFAS  128  are  generally
effective  for  transactions occurring  after  December  15,  1997,
however,  SFAS  128  will  not  have an  impact  on  the  Company's
financial statements.

     In  February  1997, the Financial Accounting  Standards  Board
issued  SFAS  No.  129,  "Disclosure of Information  about  Capital
Structure"  ("SFAS 129").  SFAS 129 is applicable to  all  entities
and  requires that disclosure about any entity's capital  structure
include  a brief discussion of rights and privileges for securities
outstanding.   SFAS  129 is effective for financial  statement  for
period  ending after December 15, 1997.  The effective adoption  of
SFAS  No.  129  is not expected to have a material  impact  on  the
Company's financial statements and related disclosures.

     In  June 1997, the Financial Accounting Standards Board issued
SFAS  No. 130, "Reporting Comprehensive Income" ("SFAS 130").  SFAS
130  is  effective  for fiscal years beginning after  December  15,
1997.   This  statement  establishes standards  for  reporting  and
display  of comprehensive income and its components.  The effective
adoption of SFAS No. 130 is not expected to have a material  impact
on the Company's financial statements and related disclosures.

     In  June 1997, the Financial Accounting Standards Board issued
SFAS  No.  131,  "Disclosure about Segments of  an  Enterprise  and
Related  Information"  ("SFAS 131").  SFAS  131  is  effective  for
fiscal  years  beginning after December 15, 1997.   This  statement
establishes  standards  for the way that  public  companies  report
information   about  segments  in  annual  and  interim   financial
statements.  The effective adoption of SFAS No. 131 is not expected
to have a material impact on the Company's financial statements and
related disclosures.

Year 2000 Impact

     During  the  fiscal year ended December 31, 1997, the  Company
began a process to identify and address issues surrounding the Year
2000  and  its  impact on the Company's computer  operations.   The
issue  surrounding the Year 2000 is whether the Company's  computer
systems will properly recognize data sensitive information when the
year  changes  to  2000, or "00."  Systems  that  do  not  properly
recognize such information could generate erroneous data or cause a
system  to fail.  As the Company has not completed their assessment
of  the impact the Year 2000 may have on their computer operations,
management can not estimate the costs associated with ensuring  the
Company's  systems  are  Year  2000 compliant.   There  can  be  no
assurance  that the Company's systems nor the computer  systems  of
other  companies  with whom the Company conducts business  will  be
Year   2000  compliant  prior  to  December  31,  1999.   If   such
modifications  and conversions are not completed timely,  the  Year
2000  problem may have a material impact on the operations  of  the
Company.

Inflation

     Based  on  the  FCC's  current rate regulation  standards,  an
inflation   factor  is  included  in  the  benchmark

                                34
<PAGE>

formula   in
establishing   the   initial   permitted   rate.    Subsequent   to
establishing  the  initial rate, an annual rate increase  based  on
the  year-end  inflation  factor  is  permitted.   In  addition  to
annual   rate   increases,  certain  costs  over   the   prescribed
inflation factors, defined by the FCC as "external costs",  may  be
passed through to customers.

     Certain  of  the Company's expenses, such as those  for  wages
and  benefits,  equipment repair and replacement, and  billing  and
marketing   generally  increase  with  inflation.    However,   the
Company  does  not  believe that its financial  results  have  been
adversely  affected by inflation.  Periods of high inflation  could
have  an  adverse  effect  to the extent that  increased  borrowing
costs  for  floating rate debt may not be offset  by  increases  in
revenues.   As  of December 31, 1997, the Company had  $949,750,000
of  outstanding  borrowings under its Senior Credit Facility  which
are  subject  to floating interest rates.  The rates are  based  on
either  the  Eurodollar rate, prime rate or CD base  rate,  plus  a
margin  of up to 2.25% subject to certain adjustments based on  the
ratio  of  Operating's  total  debt to  annualized  operating  cash
flow.

     To  reduce  the  impact of changes in interest  rates  on  its
floating  rate  long-term debt, the Company  entered  into  certain
interest  rate  swap agreements with certain of  the  participating
banks  under  the  Senior Credit Facility.  At December  31,  1997,
interest  rate  swap  agreements covering  a  notional  balance  of
$400,000,000  were  outstanding which require the  Company  to  pay
fixed  rates  ranging  from  5.75% to 5.77%,  plus  the  applicable
interest  rate  margin.  These agreements mature  during  1998  and
1999,  and  allow  for the optional extension by  the  counterparty
for  additional  periods  and certain of these  agreements  provide
for  the  automatic termination in the event that one  month  LIBOR
exceeds  6.75%  on  any monthly reset date.  The Company  has  also
entered   into  an  interest  rate  swap  agreement   covering   an
aggregate   notional   principal  balance  of  $100,000,000   which
matures  in  the year 2000 whereby the Company receives  one  month
LIBOR  plus  0.07% and is required to pay the higher of  one  month
LIBOR  at either the beginning or end of the interest period,  plus
the applicable interest rate margin.

     As   interest  rates  change  under  the  interest  rate  swap
agreements,  the differential to be paid or received is  recognized
as  an  adjustment  to  interest expense.  During  the  year  ended
December  31,  1997,  the  Company recognized  additional  interest
expense of $322,000 under its interest rate swap agreements.

ITEM 8.   FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The   consolidated  financial  statements   of   the   Company
required  under Regulation S-X are set forth herein  commencing  on
page F-1.

ITEM 9.   CHANGES   IN   AND  DISAGREEMENTS  WITH  ACCOUNTANTS   ON
          ACCOUNTING AND FINANCIAL DISCLOSURE

     None.

                                  35
<PAGE>

                             PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANTS

Director and Executive Officers of Marcus Cable Properties, Inc.

     The sole director and executive officers of MCPI, which as the
sole general partner of the General Partner is responsible for  the
overall  management of the business and operations of the  Company,
are:
<TABLE>
     Name                           Age       Position
     ----                           ---       --------
     <S>                            <C>       <C>
     Jeffrey  A. Marcus              51       President  and  Chief Executive Officer

     Louis  A.  Borrelli, Jr.        42       Executive  Vice President and Chief
                                              Operating Officer

     Thomas P. McMillin              36       Executive   Vice  President
                                              and Chief Financial Officer

     Richard A. B. Gleiner           45       Senior Vice  President,  Secretary
                                              and General Counsel

     John C. Pietri                  48       Senior Vice  President  and  Chief
                                              Technical Officer

     Cynthia J. Mannes               39       Senior Vice   President  of  Human
                                              Resources

     John  P.  Klingstedt,  Jr.      35        Senior  Vice President and Controller

     Daniel J. Wilson                33       Senior Vice  President of  Finance
                                              and  Development

     David L. Hanson                 49       Senior Vice President of Operations

     Edwin  F.  Comstock, III        45       Vice  President of Operations

     J.  Christian  Fenger           43       Vice  President of Operations

     Alan  D.  Collins               42       Vice  President of Operations

     Steven  P.  Brockett            47       Vice  President of Operations - Administration

     David  M.  Intrator             42       Vice  President of Marketing and Programming

     Susan C. Holliday               32       Vice  President   of   Regulatory
                                              Compliance and Planning
</TABLE>
                                  36

<PAGE>

     The following sets forth certain biographical information with
respect to the director and executive officers of MCPI:

     Jeffrey A. Marcus, is President and Chief Executive Officer of
MCPI, a cable television industry executive with more than 28 years
of  experience in system operations and ownership, who founded  the
Company  in  1990.   Mr.  Marcus  had  previously  founded   Marcus
Communications,  Inc.  in  1982, a cable  television  company  that
ultimately served and managed over 160,000 customers by the time of
its  1988  merger  into  publicly held Western Tele-Communications,
Inc.   The combined companies were renamed WestMarc Communications,
Inc.  ("WestMarc"), and grew to serve over 550,000 customers during
the  period when Mr. Marcus served as WestMarc's Chairman and Chief
Executive  Officer.  Mr. Marcus exchanged his interest in  WestMarc
at  the end of 1988 for cable television systems in Wisconsin which
were operated from 1989 until August 1990 by Marcus Communications,
Inc.  These Systems were subsequently contributed to the Company as
part of the acquisition of the Wisconsin Systems.  Prior to forming
the  original Marcus Communications, Inc. in 1982, Mr.  Marcus  co-
founded Communications Equity Associates ("CEA") in 1975.  From its
inception  until  1982, when Mr. Marcus sold his  interest  in  the
company,  CEA grew to become the second-largest brokerage  firm  in
the  cable television industry.  Mr. Marcus also served as Director
of  Sales for Teleprompter Corporation from 1973 to 1975,  as  Vice
President  of Marketing for Sammons Communications, Inc. from  1971
to  1973  and as the owner of Markit Communications, Inc., a  cable
marketing and installation company, from 1969 to 1971.

     Long  active  in state and national cable television  industry
matters and community affairs, Mr. Marcus serves as a member of the
board  of  directors for the National Cable Television  Association
("NCTA"),  the  Cable  Television Association ("CATA"),  the  Cable
Television  Advertising  Bureau, Cable in  the  Classroom,   CSPAN,
Chancellor  Broadcasting and Brinker International.   He  has  also
served  as Executive Director of the Minnesota and Wisconsin  Cable
Television Associations, as a Director of Daniels & Associates, one
of the cable television industry's largest brokerage and investment
services  companies,  and as Director of  TCI  Northeast,  Inc.,  a
subsidiary of TeleCommunications, Inc.

     Louis  A. Borrelli, Jr. is Executive Vice President and  Chief
Operating  Officer of MCPI, with responsibility for  the  Company's
general  operations  as well as strategic planning.   From  October
1989 to March 1994, Mr. Borrelli served as Senior Vice President of
MCPI.   Mr.  Borrelli has had an extensive 18 year  career  in  the
cable   television  industry,  with  specific  expertise   in   the
marketing,  programming and operations areas.  Mr. Borrelli  joined
Marcus Communications, Inc. in 1986 as Director of Operations.   In
connection  with the 1988 WestMarc merger, he was  appointed  as  a
Vice President - Operations for WestMarc, with responsibility for a
division  of cable systems serving 200,000 customers.   In  October
1989 Mr. Borrelli returned to Marcus Communications, Inc. as Senior
Vice President.

     From  1978  to 1986, Mr. Borrelli served in various capacities
for  the predecessor company to United Artists Cable Systems Corp.,
including  service  as  the Director of Programming/Marketing  from
1984  to  1986. There he coordinated all programming and  marketing
activities and the development of new revenue opportunities such as
advertising  sales  and pay-per-view.  Long  active  in  the  cable
television  industry,  Mr.  Borrelli  is  a  member  of  the  Cable
Television Administration and Marketing Society ("CTAM"),  and  has
served  as  President of CTAM's South Central region,  Director  of
CTAM's  National Board and Chairman of CTAM's National Pay-Per-View
and  Interactive Media Conference and as Chairman of  the  Planning
and  Development  Committee  of the Metro  Cable  Marketing  Co-Op,
representing  over 3 million cable customers in the New  York  tri-
state  area.   He  is also a member of the Board  of  Directors  of
TeleSynergy, Women in Telecommunications and the Mentor Program  of
the National Association of Minorities in Cable.

     Thomas  P.  McMillin  is Executive Vice  President  and  Chief
Financial Officer of MCPI with responsibility for overseeing all of
the   financing,  corporate  development,  accounting,  regulatory,
planning  and information system aspects of the Company.  He joined
the  Company  in September 1994, as Vice President of  Finance  and
Development.  Prior to joining the Company, Mr. McMillin served for
three  years as Vice President - Cable Development for Crown Media,
a cable television subsidiary of Hallmark Cards, Inc.  Prior to his
position  with  Crown, Mr. McMillin served five  years  in  various
positions   for  Cencom  Cable  Associates,  Inc.("Cencom"),   most
recently  as Vice President - Finance and Acquisitions.   Prior  to
joining Cencom in 1987, Mr. McMillin served four years with  Arthur
Andersen   &  Co.,  certified  public  accountants.   Mr.  McMillin
received  his  Bachelor of Science Degree in Accountancy  from  the
University of Missouri -

                                 37
<PAGE>

Columbia.

     Richard A. B. Gleiner is  Senior Vice President, Secretary and
General Counsel of MCPI, with responsibility for overseeing all  of
the legal affairs of the Company.  Prior to joining the Company  in
1994,  Mr.  Gleiner had been of counsel to Dow, Lohnes & Albertson,
New  York, New York from 1988 until 1991, where he was the  primary
outside  counsel  to the Company and its predecessors.   From  1991
until joining Marcus Cable, Mr. Gleiner was in private practice  in
Northampton, Massachusetts.  Mr. Gleiner received his  A.B.  Degree
from  Vassar  College  in  1974, and his J.D.  Degree  from  Boston
University in 1977.

     John  C.  Pietri is Senior Vice President and Chief  Technical
Officer  of  MCPI, with responsibility for the technical operations
and  standards of the Company's cable television systems including:
new  business  development  and technology;  new  construction  and
rebuild  projects; routine maintenance and installation  practices;
capital  control  and  purchasing; and  regulatory  compliance  and
reporting.   Mr. Pietri has spent the past 21 years  in  the  cable
television industry in a variety of technical management positions.
Prior to joining the Company, Mr. Pietri was Regional Plant Manager
for  WestMarc,  managing  all technical operations,  budgeting  and
purchasing.   Mr. Pietri also held positions as Operations  Manager
of  Minnesota  Utility Contracting, General Manager of  Double  "A"
Enterprises  and  President  of the Milwaukee  Division  of  Mullen
Communications  Construction  Company.  Mr.  Pietri  attended   the
University of Wisconsin.

     Cynthia  J. Mannes is Senior Vice President of Human Resources
of   MCPI,   with  responsibility  for  human  resources,  employee
benefits, general administration and insurance matters.  Ms. Mannes
began  her  cable television career in 1984 as a receptionist  with
Marcus Communications, Inc., expanding her role with the Company in
later   years   by  becoming  Assistant  to  the  President,   with
responsibility for corporate administration.  Upon  the  merger  of
Marcus  Communications, Inc. with WestMarc in 1988, Ms. Mannes  was
named  Assistant to the Chairman.  At the end of 1988,  Ms.  Mannes
left  WestMarc  to  become Vice President of Corporate  Affairs  at
Marcus  Communications,  Inc., with responsibility  for  day-to-day
operations and administration.  Ms. Mannes is an active  member  of
Women   in   Cable  &  Telecommunications,  Dallas  Human  Resource
Management  Association,  and the Cable Television  Human  Resource
Association.   Ms.  Mannes is also a charter fellow  of  The  Betsy
Magness Leadership Institute.

     John   P.  Klingstedt,  Jr.  is  Senior  Vice  President   and
Controller  of  MCPI, with responsibility for  the  accounting  and
financial  reporting of the Company.  Mr. Klingstedt joined  Marcus
Communications, Inc. in 1987 and became Controller in 1989.  He was
named  Vice  President in 1994 with the promotion  to  Senior  Vice
President  following in 1997.  Mr. Klingstedt holds a Bachelors  of
Science Degree in Accountancy from Oklahoma State University and is
a  member  of the Cable Television Tax Professionals Institute  and
the National Cable Television Association Accounting Committee.

     Daniel  J.  Wilson  is Senior Vice President  of  Finance  and
Development  with  responsibility for  the  treasury,  finance  and
acquisition and divestiture activities of the Company.  Mr.  Wilson
joined  MCPI  in March 1995 as Director of Finance and  Development
and  was  promoted to Vice President of Finance and Development  in
June  1995  and to Senior Vice President of Finance and Development
in  December 1997.  Prior to joining the Company, Mr. Wilson served
for  three  years  in  various positions  at  Crown,  including  as
Director  of  Regulatory  Affairs  and  Director  of  Finance   and
Development.  Prior thereto, Mr. Wilson served for three  years  in
various  positions with Cencom, most recently as  Senior  Financial
Analyst.   Prior to joining Cencom in 1989, Mr. Wilson  served  for
four   years   with   Arthur  Andersen  &  Co.,  certified   public
accountants.   Mr.  Wilson  received his  Bachelor  of  Science  in
Business Administration with majors in Finance and Accounting  from
Saint Louis University.

     David  L.  Hanson  is Senior Vice President of  Operations  of
MCPI,  with  responsibility for the daily operations of  the  North
Central Region.  Mr. Hanson is a native of Wisconsin and has  spent
more  than  25  years  in  the  state's cable  television  industry
designing, building and managing systems.  Mr. Hanson held a number
of technical and management positions with Badger CATV in Wisconsin
from  1973  through 1982, when Badger CATV was acquired  by  Marcus
Communications,  Inc., after which Mr. Hanson was  named  Wisconsin
Regional  Manager of Marcus Communications, Inc.   After  the  1988
WestMarc  merger,  Mr.  Hanson was named a Vice  President/Regional
Manager  of  WestMarc,  and he became a Vice  President  of  Marcus
Communications,  Inc.  in  1989  when  Mr.  Marcus  exchanged   his
ownership  position in WestMarc for

                                   38
<PAGE>

the original Wisconsin  systems
previously  owned by Badger CATV.  Mr. Hanson is a  longtime  board
member  and  past  President  of  both  the  North  Central   Cable
Television  Association  (serving Minnesota,  Wisconsin,  Michigan,
Iowa,  North  Dakota  and  South Dakota) and  the  Wisconsin  Cable
Communications Association.  He also has served as a regional Vice-
Director  on the national board of the Community Antenna Television
Association.

     Edwin F. Comstock, III is Vice President of Operations of MCPI
with  responsibility for the daily operations of the Southeast  and
East  Regions.  Mr. Comstock brings 20 years of experience  in  the
cable  television industry to MCPI.  Prior to joining the  Company,
he  spent his cable career with Sammons.  Most recently he was  the
Vice  President of Business Development.  From 1986  to  1993,  Mr.
Comstock  was Vice President of Regional Operations overseeing  all
aspects of operations and management of ten cable systems.  He also
served  as  Director  of  Operations, in  1986,  Manager  of  Plant
Development,   from  1982  to  1986,  and  Director   of   Security
Operations, in 1982.  Mr. Comstock holds a Bachelor of Arts  degree
from Alfred University, Alfred, New York.

     J.  Christian Fenger is Vice President of Operations  of  MCPI
with  responsibility  for the daily operations  of  the  Southwest,
Midwest  and  West  Regions.  Mr. Fenger brings over  16  years  of
diverse  operating  experience in the  cable  television  business.
Prior  to  joining the Company in the Fall of 1992,  he  served  as
Regional  Manager  for Simmons Cable TV for its systems  throughout
Maryland and Delaware since 1986 (including those systems that  now
comprise the Company's Delaware/Maryland systems).  Previously,  he
served  from  1985 to 1986 as General Manager for the  Warner  Amex
cable system in Nashua, New Hampshire, where he was responsible for
upgrading  system operations, and from 1980 to 1985, he  served  as
Marketing  Manager for Rogers Cablesystems in Syracuse,  New  York.
He    has    held    various   volunteer   positions    with    the
Delaware/Maryland/DC Cable Associations and is a past President  of
the  Board of Directors of Easton Community Television.  Mr. Fenger
earned  his  undergraduate  and Masters  Degree  in  Communications
Management from Syracuse University.

     Alan  D. Collins is Vice President of Operations of MCPI  with
responsibility  for the daily operations of the  Metroplex  Region.
Mr.  Collins brings 16 years of experience in the cable  television
industry.   Prior to joining the Company in February  of  1997,  he
spent 15 years with Cox Communications in several capacities,  most
notably as Vice President and General Manager of the cable property
in Spokane, Washington.  During his tenure in Washington state, Mr.
Collins   served  on  the  Washington  State  Cable  Communications
Association   Board  of  Directors  ans  was   President   of   the
organization in 1991 and 1992.  Mr. Collins holds a Bachelor of the
Arts  and  a  Master  of  the Arts degree from  the  University  of
Florida.

     Steven   P.  Brockett  is  Vice  President  of  Operations   -
Administration,   with  responsibility  for  the  coordination   of
operating  activities common to all operating  regions.   Prior  to
joining  the Company in February of 1995, Mr. Brockett  worked  for
two  years as Vice President - Administration and one year as  Vice
President  -  Controller for Crown.  Mr. Brockett began  his  cable
career  in 1978 with Heritage Communications, Inc., where he gained
experience  in  both  Accounting (Cable  Division  Controller)  and
Operations  (Director of System Training).  Mr. Brockett  has  held
various  positions  at the cable system operating  level  including
System   Controller   in  New  Castle  County,  Delaware   (125,000
customers).   Mr. Brockett holds a Bachelors of Science  Degree  in
Accountancy  from the University of South Dakota and is  an  active
member  of  the  Cable Television Administration Marketing  Society
(National and Texas).

     David   M.  Intrator  is  Vice  President  of  Marketing   and
Programming  with  responsibility for  the  Company's  programming,
marketing, advertising sales and ancillary revenue business.  Prior
to  joining the Company in October of 1994, Mr. Intrator has had  a
diverse  15 year career in the cable television industry,  managing
systems  for  Acton, Capital Cities, Post-Newsweek and Centel,  and
working  in cable programming with Home Shopping Network, where  he
was  Director,  Affiliate Relations from  1986  to  1990  and  with
Viewer's Choice Pay-Per-View where he was Vice President, Affiliate
Relations from 1990 to 1994. Mr. Intrator is a member of the  Cable
Television Administration and Marketing Society ("CTAM") and  is  a
Board  member of the CTAM Texas chapter. Mr. Intrator is a graduate
of  the  University  of Connecticut and holds a Masters  Degree  in
Public   Administration   from  the  Maxwell   School   of   Public
Administration of Syracuse University.

     Susan  C.  Holliday is Vice President of Regulatory Compliance
and  Planning  of  MCPI,  with

                                 39
<PAGE>

responsibility  for  all  FCC  rate
regulatory  compliance  and procedures; the budgeting  process  and
operational  audit  procedures.  Prior to joining  the  Company  in
1993,  Ms.  Holliday  had  been an audit  manager  with  KPMG  Peat
Marwick.   Ms.  Holliday  holds  a  Bachelors  Degree  in  Business
Administration with concentration in Accounting from the College of
William and Mary, and is a Certified Public Accountant (CPA).


     ITEM 11. EXECUTIVE COMPENSATION

     MCPI  presently does not pay any compensation to its  director
or  officers.   The  executives of MCPI are  compensated  in  their
capacity  as officers of Operating.  The following table summarizes
the  compensation paid by Operating to its Chief Executive  Officer
and  to  each  of its four other most highly compensated  executive
officers  receiving compensation in excess of $100,000 for services
rendered during the fiscal years ended December 31, 1995, 1996, and
1997.
<TABLE>
                  SUMMARY COMPENSATION TABLE (1)
<CAPTION>
                                             Annual    Compensation      All Other
Name   and  Principal  Position     Year     Salary       Bonus        Compensation
-------------------------------     ----     ------    ------------    ------------
<S>                                 <C>  <C>           <C>             <C>
Jeffrey A. Marcus                   1995   $583,196           -              -
 President and                      1996   $980,781       $500,000        $38,186(2)
 Chief Executive Officer            1997 $1,250,002       $160,000        $41,900(2)

Louis A. Borrelli, Jr.              1995   $276,235       $185,000         $6,464(2)
 Executive  Vice  President and     1996   $353,099        $52,000        $15,377(2)
 Chief Operating Officer            1997   $432,016        $38,800        $15,898(2)

Thomas P. McMillin                  1995   $172,680       $200,000         $6,214(2)
 Executive  Vice  President and     1996   $255,000        $32,000        $15,244(2)
 Chief Financial Officer            1997   $312,000        $49,000        $15,782(2)

Richard A.B. Gleiner                1995   $170,816       $200,000         $6,526(2)
 Senior Vice President, Secretary   1996   $220,673        $32,000        $16,662(2)
   and General Counsel              1997   $231,750        $28,000        $16,372(2)

Cynthia J. Mannes                   1995   $153,460        $32,500         $4,620(2)
 Senior  Vice  President of         1996   $170,000        $30,000         $3,689(2)
 Human Resources                    1997   $175,100        $35,500         $3,948(2)

---------------
<FN>
(1)  Pursuant to the Employee Unit Plan: (a) Mr. Marcus was  issued
     16,600   Employee  Units  with  a  Strike  Price  (hereinafter
     defined)  of $1,750 per Unit (the "Series II Employee Units");
     (b)  Mr.  Borrelli was issued 1,235 Series II Employee  Units;
     (c) Mr. McMillin was issued 973.7 Employee Units with a Strike
     Price  of $1,600 per Unit (the "Series I Employee Units")  and
     1,035  Series  II Employee Units; (d) Mr. Gleiner  was  issued
     973.7  Series  I  Employee Units and 300  Series  II  Employee
     Units;  and  (e) Ms. Mannes was issued 120 Series II  Employee
     Units.   Mr.  Marcus' Employee Units are  fully  vested.   The
     Series I Employee Units vested 20% on the date of issuance and
     the  remaining  80% will vest in equal amounts  on  the  first
     through  fourth anniversaries of the date of issuance thereof.
     The  Series  II Employee Units (other than those held  by  Mr.
     Marcus)  vest 10%, 10%, 20%, 30% and 30% on November 1,  1996,
     1997,  1998, 1999 and 2000, respectively.  The first  year  in
     which  Employee  Units were issued was 1995.   See  "Incentive
     Performance Plans-Employee Unit Plan" and "Security  Ownership
     of Certain Beneficial Owners and Management-Principal Security
     Holders."
(2)  Represents  the  employer  matching  contribution  under   the
     Company's  401(k)  matched savings plan, vehicle  expense  for
     each  of the executive officers other than Mr. Marcus and  Ms.
     Mannes  and the value of term life insurance premiums paid  by
     the  Company  for  the  benefit of the named  executive.   See
     "Management-Pension   and  Profit   Sharing   Plans".    Other
     compensation for Mr. Marcus also includes amounts paid by  the
     Company  for  airplane  usage.   Other  compensation  for  Mr.
     Gleiner  also  includes  amounts  paid  by  the  Company   for
     relocation expenses incurred in 1996.
</FN>
</TABLE>
                                40
<PAGE>


Incentive Performance Plans

     Employee Unit Plan.  The General Partner may elect at any time
and  from  time to time to cause MCC to issue a limited  number  of
Class B Units designated "Employee Units" to the General Partner or
to  key  individuals  providing services  to  MCC  or  any  of  its
subsidiaries.   Employee Units will be issued in  series,  as  more
fully  described  in the partnership agreement of  MCC.   A  series
generally will not be entitled to distributions until such time  as
all units (other than Convertible Preference Units and subsequently
issued  Employee  Units)  outstanding  at  the  date  of  a   given
distribution  will  have been distributed an amount  equal  to  the
product  of  all  such units outstanding on the  date  of  a  given
distribution  multiplied by a specified price (the "Strike  Price")
related  to such Employee Units.  The General Partner is authorized
to  issue  (and reissue to the extent forfeited) up to a  total  of
31,517  Employee  Units.   As of March 26,  1998,  MCC  had  issued
5,552.2  Employee  Units with a $1,600 Strike  Price  and  22,783.0
Employee Units with a $1,750 Strike Price.  The General Partner, in
its  sole  discretion, may determine the other terms and conditions
(e.g.,  vesting, forfeiture and restrictions on transfer) governing
grants  of  Employee Units.  The General Partner may,  but  is  not
obligated to, require in connection with the grant of any  Employee
Units  that  the holder thereof grant to the General  Partner,  Mr.
Marcus  or any of their affiliates (i) a right of first refusal  on
such  holder's Employee Units as well as an option to purchase such
holder's  Employee Units upon such holder's termination  (voluntary
or  involuntary) of employment with MCC or any of its  subsidiaries
and  (ii)  a  proxy,  which  is coupled with  an  interest  and  is
irrevocable,  to vote such holder's Employee Units in such  proxy's
sole discretion.

     Limited  Partner  Interests in General Partner.   The  General
Partner has issued certain limited partner interests in the General
Partner  ("LP  Units") to key employees of MCC and its subsidiaries
without  requiring such employees to make capital contributions  to
the   General  Partner.   As  of  the  date  hereof,  most  of  the
outstanding  LP  Units  issued are fully  vested  and  all  of  the
outstanding LP Units will be fully vested by 1999.

     Among  the  executive officers of MCPI named  in  the  Summary
Compensation  Table, Louis A. Borrelli, Jr. and Cynthia  J.  Mannes
hold  13.75  and  7.50  vested LP Units, respectively.   Thomas  P.
McMillin  has  been granted 2.50 LP Units and Richard A.B.  Gleiner
has  been  granted  1.00 LP Unit.  60% of Mr.  McMillin's  and  Mr.
Gleiner's  LP  Units  are vested and the remaining  40%  will  vest
equally on each of April 1, 1998 and 1999.  No LP Units were issued
during the year ended December 31, 1997.  The total number of units
of  general  partner  interest ("GP Units") will  automatically  be
reduced  at  such time as any unvested LP Units vest  in  order  to
ensure  that  the  total number of outstanding GP Units  and  fully
vested  LP  Units (for which no capital contribution was  required)
does not exceed 100%.

Pension and Profit Sharing Plans

     The  Company sponsors a 401(k) plan for its employees that are
age  21 or older and have been employed by the Company for at least
six  months.  Employees of the Company can contribute up to 15%  of
their   salary,  on  a  before-tax  basis,  with  a  maximum   1997
contribution  of  $9,500 (as set by the Internal Revenue  Service).
The Company matches participant contributions up to a maximum of 2%
of  a participant's salary.  All employee-participant contributions
and  earnings  are  fully  vested  upon  contribution  and  Company
contributions and earnings vest 20% per year of employment with the
Company,  becoming  fully vested after five  years.   See  "Summary
Compensation Table."

Compensation of Directors

     Mr.  Jeffrey A. Marcus is not compensated for his  service  as
the sole director of MCPI.

Compensation Committee Interlocks and Insider Participation

     Mr.  Jeffrey A. Marcus, as the president and sole director  of
MCPI,  the ultimate general partner, sets the compensation  of  the
executive  officers  of  MCPI  in their  executive  positions  with
Operating.

                               41
<PAGE>

ITEM 12.  SECURITY  OWNERSHIP  OF  CERTAIN  BENEFICIAL  OWNERS  AND
          MANAGEMENT

                    PRINCIPAL SECURITY HOLDERS
         Security Ownership of Certain Beneficial Owners

          The following table sets forth, as of March 26, 1998, (i)
the  units of general partnership interests and limited partnership
interests of MCC constituting a class of voting security and  which
are  owned by the sole director and executive officers of MCPI  and
each person who is known to MCC to own beneficially more than 5% of
any  class of MCC's partnership interests and (ii) the units of the
equity securities of MCPI and the General Partner owned by the sole
director  and  executive  officers of MCPI  named  in  the  Summary
Compensation  Table  and  by the sole director  and  all  executive
officers of MCPI as a group.

<TABLE>
<CAPTION>
               Name and Address of               # of Equivalent
               Beneficial Owners (1)               Units/Shares     % of Class (2)
               ---------------------             ---------------    --------------
<S>            <C>                               <C>                <C>
MCC (3)        General Partner                      22,029.990(4)         6.24%

               Goldman Sachs & Co.                 125,866.241(6)        35.68
               Affiliates (5)
               85 Broad Street
               New York, New York  10004

               Hicks, Muse, Tate & Furst Equity     65,714.286           18.63
                  Fund II, L.P.
               200 Crescent Court, Suite 1600
               Dallas, Texas  75201

               Freeman Spogli & Co.                 56,428.571           15.99
               Incorporated
                  Affiliates (7)
               11100 Santa Monica
               Boulevard
               Los Angeles, California
               90025

               Greenwich Street Capital             27,053.571            7.67
               Partners,
                  Inc. Affiliates (8)
               388 Greenwich Street
               New York, New York  10013

               Jeffrey A. Marcus (9)                50,365.190           14.28

               Louis A. Borrelli, Jr. (10)           1,235.000            *

               Thomas P. McMillin (10)               2,008.700            *

               Richard A. B. Gleiner (10)            1,273.700            *

               Cynthia J. Mannes (10)                  120.000            *

               Sole Director and                    50,365.190           14.28
               Executive Officers as a
               Group (14 persons)

MCPI           Jeffrey A. Marcus (9)                 1,000.00           100.00%

General        MCPI (9)                                 66.50 (11)       66.50%
Partner
               Jeffrey A. Marcus                        66.50 (11)       66.50

               Louis A. Borrelli, Jr.                   13.75 (12)       13.75

               Thomas P. McMillin                        2.50 (12)        2.50
</TABLE>
                                  42
<PAGE>
<TABLE>
<CAPTION>
               Name and Address of               # of Equivalent
               Beneficial Owners (1)               Units/Shares     % of Class (2)
               ---------------------             ---------------    --------------

<S>            <C>                               <C>                <C>
               Richard A. B. Gleiner                     1.00 (12)        1.00

               Cynthia J. Mannes                         7.50 (12)        7.50

               Sole Director and                        99.38            99.38
               Executive Officers as a
               Group (14 persons)
<FN>
*    Less than 1%.

(1)  The  address for the General Partner, MCPI and Messrs  Marcus,
     Borrelli,  McMillin,  Gleiner and Ms. Mannes  is  2911  Turtle
     Creek Blvd., Dallas, Texas 75219.

(2)  Assumes all 31,517 Employee Units are outstanding.

(3)  As of the date hereof, all partnership interests in MCC, other
     than  Convertible  Preference Units, are  designated  Class  B
     Units.   The  interests  held  by  the  General  Partner   are
     comprised  of  different  types of Class  B  Units  which  are
     entitled  to  different distribution rights  and,  in  certain
     cases,  the Class B Units held by the General Partner  do  not
     have   voting   rights.   MCC  has  issued  7,500  Convertible
     Preference  Units which have a general distribution preference
     over  the  Class B Units and are convertible, initially,  into
     Class  B  Units on a one-for-one basis.  The current ownership
     of  Convertible Preference Units is as follows:  Broad  Street
     Investment  Fund  I,  L.P. (5,003.0831  units);  Broad  Street
     Advancement Corporation (1,260.1681 units); The Goldman  Sachs
     Group,   L.P.   (586.3515  units);   Broad  Street   Strategic
     Corporation  (243.6068 units);  Stone Street Fund  1991,  L.P.
     (233.9071  units);  Bridge  Street Fund  1991,  L.P.  (77.9690
     units);   Stone  Street Fund 1990, L.P. (60.3397  units);  and
     Bridge  Street Fund 1990, L.P. (34.5747 units).   All  of  the
     holders  of  Convertible Preference Units  are  affiliates  of
     Goldman Sachs.

(4)  Reflects  the  General Partner's ownership of 18,848.19  units
     and 3,181.80 unissued Employee Units.

(5)  The  current ownership of affiliates of Goldman Sachs  of  the
     outstanding Class B Units of MCC is as follows:  Broad  Street
     Investment  Fund  I,  L.P. (53,562.116  units);  Broad  Street
     Investment  Fund, L.P. (27,949.580 units); the  Goldman  Sachs
     Group,  L.P. (7,529.855 units); GS Capital Partners  II,  L.P.
     (6,705.000   units);  Broad  Street  Acquisition   Corporation
     (5,028.885  units);   GS Capital Partners II  Offshore  Marcus
     Holding  I,  L.P.  (2,893.000 units); GS Capital  Partners  II
     Marcus  Holding I, L.P. (1,503.000 units); Bridge Street  Fund
     1995, L.P. (1,480.000 units);  Broad Street Income Corporation
     (1,456.490  units);  Stone Street Fund 1992,  L.P.  (1,416.686
     units); Stone Street Fund 1995, L.P. (1,253.100 units);  Broad
     Street  Funding  Corp. (1,026.000 units); Bridge  Street  Fund
     1994,  L.P.  (986.220  units); Stone Street  Fund  1994,  L.P.
     (895.740  units);  Broad  Street  Yield  Corporation  (866.080
     units); Bridge Street Fund 1992, L.P. (831.163 units); Goldman
     Sachs  &  Co. (566.000 units);  Stone Street Fund  1990,  L.P.
     (462.834 units); Broad Street Exploration Corporation (405.405
     units); GS Capital Partners II Offshore, L.P. (370.000 units);
     Bridge  Street  Fund  1990, L.P. (308.272 units);  GS  Capital
     Partners  II  Germany Marcus Holding I, L.P. (303.000  units);
     Stone  Street  Fund 1991, L.P. (257.670 units);  Broad  Street
     Empire   Corporation  (121.618  units);  Broad  Street   Value
     Corporation (79.497 units); Stone Street Marcus Holding,  Inc.
     (49.000  units); Participation Subsidiary Corporation  (46.130
     units);  and  Stone Street 1995 Marcus Holding,  Inc.  (13.900
     units).

(6)   Includes  7,500 Convertible Preference  Units.   See  note  3
      above.

(7)  The  current ownership by affiliates of Freeman Spogli  &  Co.
     Incorporated  of the outstanding Class B Units of  MCC  is  as
     follows:  FS Equity Partners III, L.P. (54,278.285 units)  and
     MCC International Holdings, Ltd. (2,150.286 units).

(8)  The  current  ownership  by  affiliates  of  Greenwich  Street
     Capital Partners, Inc. of the outstanding Class B Units of MCC
     is  as  follows:   Greenwich  Street  Capital  Partners,  L.P.
     (17,146.840  units);   TRV  Employees  Fund,  L.P.  (7,532.012
     units);  GSCP Offshore Holdings, Inc. (1,060.783  units);  The
     Travelers Insurance Company (880.337 units); and The Travelers
     Life and Annuity Company (433.599 units).

(9)  Mr.  and  Mrs.  Marcus  own  all the  issued  and  outstanding
     common  stock  of  MCPI, the general partner  of  the  General
     Partner,  which  stock is subject to a voting trust  agreement
     which  gives  Mr. Marcus the right to vote all of such  stock.
     Accordingly,  the  numbers for Mr. Marcus  reflect  all  units
     held  by  the General Partner.  Additionally, amounts for  MCC
     include  28,335.20 issued Employee Units.  Mr. Marcus has  the
     right   to   issue  additional  authorized  but  unissued   or
     forfeited  Employee  Units  to  employees,  himself   or   the
     General  Partner.   Mr.  Marcus has been  granted  irrevocable
     proxies  to exercise all voting rights with respect to  issued
     Employee  Units.  Mr. Marcus is the record owner of  16,600.00
     Employee  Units.   Mr. Marcus' address is  2911  Turtle  Creek
     Boulevard, Suite 1300, Dallas, Texas 75219.

                                 43
<PAGE>

(10) Reflects   the  executive  officers'  ownership  of   Employee
     Units.   Such  Employee Units are subject to  certain  vesting
     schedules.   The  address for all executive officers  is  2911
     Turtle Creek Boulevard, Suite 1300, Dallas, Texas 75219.

(11) Reflects  the  number  of GP Units currently  owned  by  MCPI,
     assuming full vesting of all LP Units.

(12) Reflects  the  current  ownership of vested  and  unvested  LP
     Units.   Thomas P. McMillin also holds 1.00 unvested LP  Units
     and  Richard A.B. Gleiner also holds 0.40 unvested  LP  Units.
     These  units are currently scheduled to vest equally  on  each
     of April 1, 1998 and 1999.

</FN>
</TABLE>

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS


   There  have been no significant transactions, new relationships
or  indebtedness  between the Company and related  parties  during
1997.

   In January 1998, an agreement was reached between the Company's
equity shareholders and MCPI in which the sole shareholder of MCPI
will  be paid a transaction fee of $10,000,000 in connection  with
the  consummation  of a divestiture transaction  relating  to  the
ownership   of   the   Company,   as   discussed   under   "Recent
Developments".   The  sole  shareholder   of  MCPI  will  only  be
entitled  to such fee if such divestiture transaction  is  entered
into by January, 2000.

      The  Company  has entered into an agreement with Goldman  Sachs
pursuant  to  which Goldman Sachs has agreed to act  as  financial
advisor in connection with any possible sale of the Company.   Goldman
Sachs expects to receive a transaction fee of 0.50% (subject to an
increase in certain limited circumstances) of the aggregate
consideration received in such transaction upon consummation of
such transaction.

   The  Company  has  agreed to reimburse Goldman  Sachs  for  its
reasonable out-of-pocket expenses in connection with its  services
under  such  agreement and will indemnify and hold  Goldman  Sachs
harmless  against  any  losses,  claims,  damages  or  liabilities
incurred  by  Goldman Sachs in the performance of such  agreement,
except to the extent any of the foregoing are incurred as a result
of the gross negligence or bad faith of Goldman Sachs.

Transaction Fees

   Transaction  fees  for services relating to  the  planning  and
negotiation of acquisitions have been paid by the Company upon the
closing of certain transactions.  In January 1995, MCPI received a
transaction  fee  of  $1,250,000  in  connection  with  the  Crown
Acquisition.  In November 1995, MCPI received a transaction fee of
$4,000,000 in connection with the Sammons Acquisition.

   In   addition,   certain  equity  investors   received   equity
commitment  and merger advisory fees, respectively, in  connection
with  the closing of the Sammons Acquisitions as follows:  Goldman
Sachs,   $1,251,000  and  $4,804,000;  Freeman   Spogli   &   Co.,
Incorporated, $1,788,000 and $2,189,000; Greenwich Street  Capital
Partners,  Inc., $650,000 and $1,049,000; First Union Corporation,
$488,000 (merger advisory fee only); Weiss, Peck & Greer, $211,000
and  $508,000;  and State of Wisconsin Investment Board,  $325,000
(equity  commitment fee only).  In addition, Hicks  Muse,  Tate  &
Furst,   Incorporated  will  receive  financial  monitoring   fees
totaling $4,998,000 (payable in six annual installments commencing
with  the  closure of the Sammons Acquisition) and has received  a
merger advisory fee of $5,000,000.

                                  44
<PAGE>

Senior Credit Facility

     Goldman  Sachs  and  Pearl  Street,  L.P.,  ("Pearl  Street")  an
affiliate  of  Goldman Sachs, are part of the lending syndicate  under
the Senior Credit Facility and made an initial aggregate commitment of
$183,333,333.   In connection with this financing, Goldman  Sachs  and
Pearl Street received fees of approximately $3,300,000.

Investment Banking Agreement

     MCC, the General Partner, MCPI, Mr. Marcus and Goldman Sachs have
entered  into an agreement  pursuant to which the parties have  agreed
that,  for  so long as Goldman Sachs holds at least 30% of  the  total
outstanding  partnership interests of MCC, no person or  entity  other
than  Goldman  Sachs  or  its  affiliates are  to  provide  investment
banking,  financial  advisory,  or  underwriting  or  placement  agent
services  on behalf of the Company.  Goldman Sachs received  discounts
and fees aggregating $7,332,000 in connection with the offering of the
14 1/4% Notes.


                               PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON  FORM
          8-K
<TABLE>
<CAPTION>
<S>  <C>                                                         <C>
(a)  (1) Financial Statements

     Included in this Report:                                    Page

          Independent Auditors' Report                            F-1

          Consolidated Balance Sheets
             December 31, 1997 and 1996                           F-2

          Consolidated Statements of Operations
             Years ended December 31, 1997, 1996, and 1995        F-3

          Consolidated Statements of Partners' Capital (Deficit)
             Years ended December 31, 1997, 1996, and 1995        F-4

          Consolidated Statements of Cash Flows
             Years ended December 31, 1997, 1996, and 1995        F-5

          Notes to Consolidated Financial Statements              F-6
</TABLE>

     Separate financial statements of Operating, as issuer of the 13 1/2%
     Notes,  have  not  been presented, as the aggregate  net  assets,
     earnings  and  partners'  capital  (deficit)  of  Operating   are
     substantially  equivalent  to  the  net  assets,   earnings   and
     partners'  capital (deficit) of the Company and its  subsidiaries
     on   a  consolidated  basis.   Additionally,  separate  financial
     statements of Capital, Capital II and Capital III have  not  been
     presented   because  these  entities  have  no   operations   and
     substantially no assets or equity.

     Financial statement schedules have been omitted because they  are
     either inapplicable or the requested information is shown in  the
     financial statements or notes thereto.

     (2) Exhibits
<TABLE>

     Included in this Report:
<CAPTION>
          Exhibit:
          <S>       <C>
           (1)3.1   Fifth   Amended   and   Restated
                    Agreement of Limited Partnership of MCC, dated  as
                    of August 31, 1995. (Exhibit 99.1)

                               45
<PAGE>

             *3.2   Certificate of Limited  Partnership  of
                    MCC.  (Exhibit 3.2)

             +3.3   First Amended and Restated Agreement  of
                    Limited Partnership of Operating, dated as of June
                    9, 1995.  (Exhibit 3.3)

            **3.4   Certificate of Limited Partnership
                    of Operating. (Exhibit 3.20)

             *3.5    Certificate of Incorporation of Capital.
                    (Exhibit 3.16)

             *3.6    Bylaws of Capital.  (Exhibit 3.17)

            **3.7   Certificate of  Incorporation  of
                    Capital II. (Exhibit 3.13)

            **3.8   Bylaws  of Capital  II.  (Exhibit 3.14)

          ****3.9   Certificate of  Incorporation  of
                    Capital III. (Exhibit 3.10)

          ****3.10  Bylaws of Capital  III.  (Exhibit 3.11)

              *4.1  Form  of  Indenture by and  among  MCC,
                    Capital and the U.S. Trust Company of Texas, N.A.,
                    as   Trustee,  related  to  the  11 7/8%  Debentures.
                    (Exhibit 4.1)

            ***4.2  Indenture  by  and  among   MCC,
                    Operating,  Capital II and the U.S. Trust  Company
                    of  Texas, N.A., as Trustee, relating to the  13 1/2%
                    Notes. (Exhibit 4.1)

           ****4.3  Indenture  by  and  among   MCC,
                    Capital  III  and Norwest Bank Minnesota  National
                    Association, relating to the 14 1/4% Notes.

             *10.1  Investment  Banking   Agreement,
                    dated  as  of January 17, 1990, by and among  MCC,
                    MCPI,  Jeffrey  A. Marcus and Goldman  Sachs  (the
                    "Investment Banking Agreement").  (Exhibit 10.8)

             *10.2  Amendment  to   the   Investment
                    Banking  Agreement, dated as of  August  1,  1990.
                    (Exhibit 10.9)

           (1)10.12 Senior Credit Facility.  (Exhibit 99.2)

          ****10.13 1995  Long-Term  Incentive Plan
                     (compensatory plan). (Exhibit 10.20)

            ++10.16 Form  of  Amendment  to  the  Senior  Credit
                    Facility, dated March 14, 1997.  (Exhibit 10.16)

              10.17 Divestiture Transaction Agreement.

              12.1  Computation  of Ratio  of  Earnings  to
                    Fixed Charges.

              21.1  Subsidiaries.
<FN>
*    Incorporated  by  reference to the exhibit shown  in  parenthesis
     contained in the Registrants' Registration Statement on Form  S-1
     (File Nos. 33-67390 and 33-67390-01).

**   Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in the Registrants' Registration Statement on Form  S-1
     (File Nos. 33-74104 and 33-74104-01).

***  Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in the Registrants' Registration Statement on Form  S-1
     (File Nos. 33-81008, 33-81008-01 and 33-81008-02).

                               46
<PAGE>

**** Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in the Registrants' Registration Statement on Form  S-4
     (File Nos. 33-93808 and 33-03808-01).

(1)   Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in Form 8-K
     dated August 31, 1995.

+    Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in Form 10-K
     dated December 31, 1995.

++   Incorporated  by  reference to the exhibit shown  in  parentheses
     contained in Form 10-K
     dated December 31, 1996.

(b)  Reports on Form 8-K:

     The  Company filed reports on Form 8-K reporting Item 5 --  Other
     Events on October 8, 1997 and December 8, 1997.

</FN>
</TABLE>
                                47
<PAGE>

SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED
PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE
NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT


     No annual report or proxy statement has been sent to the security
holders of the Company.


<PAGE>

<TABLE>

INDEX TO EXHIBITS

<CAPTION>
                                                            Sequentially
Exhibit                                                       Numbered
Number                                                          Page

<S>       <C>
  (1)3.1  Fifth  Amended  and   Restated
          Agreement of Limited Partnership  of  MCC,
          dated  as  of  August 31,  1995.  (Exhibit
          99.1)

    *3.2  Certificate  of  Limited  Partnership  of   MCC.
          (Exhibit 3.2)

    +3.3  First  Amended  and  Restated  Agreement  of
          Limited Partnership of
          Operating, dated June 9, 1995.  (Exhibit 3.3)

   **3.4  Certificate  of  Limited  Partnership  of  Operating.
          (Exhibit 3.20)

    *3.5  Certificate   of  Incorporation   of   Capital.
          (Exhibit 3.16)

    *3.6  Bylaws of Capital.  (Exhibit 3.17)

   **3.7  Certificate of Incorporation of Capital II. (Exhibit 3.13)

   **3.8  Bylaws of Capital II. (Exhibit 3.14)

 ****3.9  Certificate of Incorporation of Capital III. (Exhibit 3.10)

****3.10  Bylaws of Capital III. (Exhibit 3.11)

    *4.1  Form of Indenture by and among MCC,
          Capital  and the U.S. Trust  Company  of
          Texas, N.A., as Trustee, related to  the
          11 7/8% Debentures. (Exhibit 4.1)

  ***4.2  Indenture by and  among  MCC,
          Operating, Capital II and the U.S. Trust
          Company  of  Texas,  N.A.,  as  Trustee,
          relating  to  the  13 1/2% Notes.  (Exhibit
          4.1)

  ****4.3 Indenture by and  among  MCC,
          Capital  III and Norwest Bank  Minnesota
          National  Association, relating  to  the
          14 1/4% Notes.

    *10.1 Investment Banking Agreement,
          dated  as  of January 17, 1990,  by  and
          among  MCC, MCPI, Jeffrey A. Marcus  and
          Goldman  Sachs (the "Investment  Banking
          Agreement"). (Exhibit 10.8)

    *10.2 Amendment to  the  Investment
          Banking Agreement, dated as of
          August 1, 1990. (Exhibit 10.9)

</TABLE>
<PAGE>

<TABLE>
<CAPTION>
                                                              Sequentially
Exhibit                                                         Numbered
Number                                                            Page

<S>       <C>                                                 <C>
 (1)10.12 Senior  Credit   Facility.
          (Exhibit 99.2)

****10.13 1995   Long-Term   Incentive    Plan (compensatory
          plan). (Exhibit 10.20)

  ++10.16 Form of Amendment  to  the
          Senior  Credit Facility,  dated  March
          14, 1997.  (Exhibit 10.16)

    10.17 Divestiture Transaction Agreement                       53

    12.1  Computation of Ratio of Earnings to Fixed Charges.      62

    21.1  Subsidiaries                                            63

<FN>

*    Incorporated  by  reference to  the  exhibit  shown  in
     parenthesis   contained  in  the  Registrants'   Registration
     Statement on Form S-1 (File Nos. 33-67390 and 33-67390-01).

**   Incorporated  by  reference to  the  exhibit  shown  in
     parentheses   contained  in  the  Registrants'   Registration
     Statement on Form S-1 (File Nos. 33-74104 and 33-74104-01).

***  Incorporated  by  reference to  the  exhibit  shown  in
     parentheses   contained  in  the  Registrants'   Registration
     Statement on Form S-1 (File Nos. 33-81008, 33-81008-01 and 33-
     81008-02).

**** Incorporated  by  reference to  the  exhibit  shown  in
     parentheses   contained  in  the  Registrants'   Registration
     Statement on Form S-4 (File Nos. 33-93808 and 33-93808-01).

(1)  Incorporated  by  reference to the  exhibit  shown  in
     parentheses contained in Form 8-K dated  August  31, 1995.

 +   Incorporated by reference to the exhibit shown in
     parentheses  contained in Form 10-K dated December  31,
     1995.

++   Incorporated by reference to the exhibit shown in
     parentheses  contained in Form 10-K dated December  31,
     1996.
</FN>
</TABLE>
<PAGE>


                INDEPENDENT AUDITORS' REPORT


The Partners
Marcus Cable Company, L.P.:


We have audited the accompanying consolidated financial
statements of Marcus Cable Company, L.P. as listed in the
index in Item 14(a).  These consolidated financial
statements are the responsibility of the Partnership's
management.  Our responsibility is to express an opinion on
these consolidated financial statements based on our audits.

We conducted our audits in accordance with generally
accepted auditing standards.  Those standards require that
we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material
misstatement.  An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the
financial statements.  An audit also includes assessing the
accounting principles used and significant estimates made by
management, as well as evaluating the overall financial
statement presentation.  We believe that our audits provide
a reasonable basis for our opinion.

In our opinion, the consolidated financial statements
referred to above present fairly, in all material respects,
the financial position of Marcus Cable Company, L.P. and
subsidiaries as of December 31, 1997 and 1996, and the
results of their operations and their cash flows for each of
the years in the three-year period ended December 31, 1997,
in conformity with generally accepted accounting principles.

                              /s/KPMG Peat Marwick

Dallas, Texas
February 20, 1998, except for note 11,
  which is as of March 4, 1998



                              F-1
<PAGE>


<TABLE>

           MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES

                   Consolidated Balance Sheets

                   December 31, 1997 and 1996

                         (in thousands)

<CAPTION>

                    Assets                        1997      1996
<S>                                         <C>        <C>
Current assets:
 Cash and cash equivalents                  $    1,607 $    6,034
 Accounts  receivable,
   net  of  allowance  of $1,904 in 1997
   and $1,900 in 1996                           23,935     17,043
 Prepaid expenses                                2,105      2,432
                                             ---------  ---------
         Total current assets                   27,647     25,509

Property and equipment, net (notes 2 and 3)    706,626    578,507

Other assets, net (notes 2 and 4)            1,016,195  1,083,534
                                             ---------  ---------
                                            $1,750,468 $1,687,550
                                             =========  =========


      Liabilities and Partners' Capital

Current liabilities:
 Current  maturities of long-term
   debt (note 6)                           $   68,288 $   41,819
 Accrued liabilities (note 5)                  60,805     49,405
 Accrued interest                               7,949     10,664
                                             ---------  ---------
        Total current liabilities             137,042    101,888

Long-term debt (note 6)                     1,533,645  1,396,652
Subsidiary limited partner
  interests (note 1)                             (246)      (246)
Partners' capital (note 7)                     80,027    189,256

Commitments and contingencies
  (notes 6, 7  and 10)
                                             ---------  ---------
                                           $1,750,468 $1,687,550
                                             =========  =========

</TABLE>

See accompanying notes to consolidated financial statements.

                                    F-2
<PAGE>

<TABLE>
           MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES

              Consolidated Statements of Operations

          Years ended December 31, 1997, 1996 and 1995

                         (in thousands)
<CAPTION>

                                         1997     1996     1995
<S>                                    <C>       <C>       <C>
Revenues:
 Cable services                        $ 473,701 $ 432,172 $ 195,004
 Management fees (note 8)                  5,614     2,335     3,290
                                       --------- ---------  --------
        Total revenues                   479,315   434,507   198,294
                                       --------- ---------  --------

Operating expenses:
 Selling, service and system management  176,515   157,197    68,753
 General and administrative               72,351    73,017    33,271
 Depreciation and amortization           188,471   166,429    83,723
                                       --------- ---------  --------
        Total operating expenses         437,337   396,643   185,747
                                       --------- ---------  --------
        Operating income                  41,978    37,864    12,547
                                       --------- ---------  --------
Other (income) expense:
 Interest expense, net                   151,207   144,376    82,143
 Gain on sale of cable
    systems(note 2)                            -    (6,442)  (26,409)
 Other, net                                    -         -     1,234
                                       --------- ---------  --------
        Total other (income) expense     151,207   137,934    56,968
                                       --------- ---------  --------
        Loss before extraordinary item  (109,229) (100,070)  (44,421)
                                       --------- ---------  --------

Extraordinary  item - loss  on  early
  retirement of debt                           -         -    (8,395)
                                       --------- ---------  --------
        Net loss                       $(109,229)$(100,070)$ (52,816)
                                       ========= =========  ========
</TABLE>

See accompanying notes to consolidated financial statements.

                                        F-3
<PAGE>

<TABLE>
           MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES

     Consolidated Statements of Partners' Capital (Deficit)

          Years ended December 31, 1997, 1996 and 1995

                         (in thousands)



<CAPTION>
                                              Class B
                                    General   Limited
                                    Partner  Partners    Total
<S>                               <C>       <C>         <C>
Balance at December 31, 1994      $(21,290) $       -   $  (21,290)
 Excess of purchase price over
   carrying value of certain
   CALP assets acquired (note 2)         -    (14,183)     (14,183)
 Issuance of partnership units           -    385,000      385,000
 Syndication costs                       -     (7,385)      (7,385)
 Net loss                             (106)   (52,710)     (52,816)
                                  --------- ---------    ---------
Balance at December 31, 1995       (21,396)   310,722      289,326
 Net loss                             (200)   (99,870)    (100,070)
                                  --------- ---------    ---------
Balance at December 31, 1996       (21,596)   210,852      189,256
 Net loss                             (218)  (109,011)    (109,229)
                                  --------- ---------    ---------
Balance at December 31, 1997      $ 21,814) $ 101,841   $   80,027
                                  ========= =========    =========
</TABLE>
See accompanying notes to consolidated financial statements.

                                       F-4
<PAGE>

<TABLE>
           MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES
              Consolidated Statements of Cash Flows
          Years ended December 31, 1997, 1996 and 1995
                         (in thousands)
<CAPTION>

                                            1997       1996        1995
<S>                                      <C>        <C>        <C>
Cash flows from operating activities:
 Net loss                                $(109,229) $(100,070) $ (52,816)
 Adjustments to reconcile net loss to
    net cash provided by
    operating activities:
    Extraordinary item - loss on early
      retirement of debt                         -          -      8,395
    Gain on sale of assets                       -     (6,442)   (26,409)
    Depreciation and amortization          188,471    166,429     83,723
    Accretion of discount on notes          68,695     59,975     41,922
    Other non cash interest                  3,962      3,303      1,817
    Changes in operating assets and
     liabilities, net of effects
     of acquisitions:
      Accounts receivable                   (6,439)      (70)     (2,610)
      Prepaid expenses                          95      (574)       (474)
      Other assets                            (385)     (502)      1,721
      Accrued liabilities                    9,132    (3,063)     30,761
                                          --------   -------     -------
        Net cash provided by
          operating activities             154,302   118,986      86,030
                                          --------   -------     -------

Cash flows from investing activities:
 Acquisition of cable systems and
  franchises, net of cash acquired         (53,812)  (10,272) (1,455,718)
 Net proceeds from sale of assets                -    20,638      65,037
 Additions to property and equipment      (197,275) (110,639)    (42,219)
                                          --------   -------     -------
        Net cash used in investing
        activities                        (251,087) (100,273) (1,432,900)
                                          --------   -------     -------

Cash flows from financing activities:
 Proceeds from long-term debt              226,000    65,338   1,280,003
 Repayment of long-term debt              (131,359)  (95,052)   (245,000)
 Contributions by limited partners,
  net of syndication costs                       -         -     362,615
 Payment of debt issuance costs             (1,725)        -     (38,307)
 Payments on capital leases                   (558)     (374)       (360)
                                          --------   -------     -------
          Net cash provided by (used in)
            financing activities            92,358   (30,088)  1,358,951
                                          --------   -------     -------

Net(decrease)increase in cash and
   cash  equivalents                        (4,427)  (11,375)     12,081
Cash and cash equivalents at beginning
  of year                                    6,034    17,409       5,328
                                          --------   -------     -------
Cash and cash equivalents at end
  of year                                  $ 1,607   $ 6,034    $ 17,409
                                          ========   =======     =======

Supplemental disclosure of cash flow
  information - interest paid              $81,155   $83,473    $ 27,591
                                          ========   =======     =======
Non-cash investing activities - capital
  lease additions                          $   684   $   694    $  2,067
                                          ========   =======     =======
</TABLE>

See accompanying notes to consolidated financial statements.

                                       F-5
<PAGE>


           MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES

           Notes to Consolidated Financial Statements

                   December 31, 1997 and 1996


(1)Summary of Significant Accounting Policies

   (a)General

       Marcus  Cable  Company, L.P. ("MCC" or the  "Partnership"),
       a   Delaware   limited   partnership,   and   subsidiaries
       (collectively,  the "Company") was formed on  January  17,
       1990   for   the  purpose  of  acquiring,  operating   and
       developing cable television systems.  The Company  derives
       its  primary  source  of  revenues  by  providing  various
       levels  of  cable television programming and  services  to
       residential   and  business  customers.    The   Company's
       operations  are conducted through subsidiary partnerships.
       In  July  1994, the Company formed Marcus Cable  Operating
       Company,  L.P.  ("Operating"), a wholly-owned  subsidiary.
       Operating  acts  as  a  holding  company  and  as  general
       partner for its subsidiary operating partnerships.

   (b)Basis of Presentation

       The   consolidated   financial   statements   include   the
       accounts  of  MCC  and  its  subsidiary  partnerships  and
       corporations.  All significant intercompany  accounts  and
       transactions   have  been  eliminated  in   consolidation.
       Certain  reclassifications have been made to prior  years'
       consolidated  balances  to conform  to  the  current  year
       presentation.

   (c)Franchise Fees

       Local  governmental  authorities impose franchise  fees  on
       the  cable  television systems owned by the  Company  (the
       "Systems")  ranging up to a federally mandated maximum  of
       5.0%  of  gross revenues.  On a monthly basis,  such  fees
       are  collected from the Systems' customers.  Historically,
       franchise  fees  in  certain of  the  Systems  (i.e.,  the
       former  Sammons Systems) were not separately  itemized  on
       customers' bills.  Such fees were considered part  of  the
       monthly  charge  for  basic services  and  equipment,  and
       therefore  were  reported as revenue and  expense  in  the
       Company's  financial  results.   The  Company  began   the
       process of itemizing such fees on all customers' bills  to
       conform  with  the  collection  of,  and  accounting  for,
       franchise  fees in the remaining Systems in November  1996
       and  completed  the process during the  first  quarter  of
       1997.   In conjunction with itemizing these charges, the
       Company began collecting the franchise fee on all taxable
       revenues.  As  a  result, beginning in the first  quarter  of
       1997,  such fees are no longer included as revenue  or  as
       general  and administrative expenses.  The net  effect  of
       this   change   is   a  reduction  in  1997   revenue   of
       approximately $6,800,000 and a reduction of approximately
       $9,300,000 in 1997 general   and   administrative   expenses,
       versus the comparable period in 1996.

   (d)Cash Equivalents

       For  purposes  of the statement of cash flows, the  Company
       considers  all  highly  liquid investments  with  original
       maturities  of  three months or less at  inception  to  be
       cash  equivalents.   At December 31, 1997  and  1996,  the
       Company   had   cash   equivalents  of

                                        F-6
<PAGE>

       $10,944,000   and
       $6,233,000,  respectively, consisting of  certificates  of
       deposit  and  money  market funds.  A  book  overdraft  of
       approximately $9,300,000 existed at December 31, 1997.

   (e)Property and Equipment

       Property  and  equipment are recorded  at  cost,  including
       all  direct  costs  and certain indirect costs  associated
       with  the  construction  of cable television  transmission
       and  distribution systems, and the cost  of  new  customer
       installations.   Maintenance and repairs  are  charged  to
       expense   as  incurred  and  equipment  replacements   and
       betterments are capitalized.

       Property  and equipment are depreciated using the straight-
       line  method  based on estimated useful lives as  follows:
       buildings,   15   years;  cable  systems,  which   include
       converters,  headends, distribution systems and  microwave
       equipment, 3 to 10 years; and vehicles and other, 3 to  10
       years.

   (f)Other Assets

       Franchise  rights  and  going  concern  value  of  acquired
       cable systems are amortized on a straight-line basis  over
       ten   to   fifteen  years.   The  cost  of  noncompetition
       agreements  is  amortized using the  straight-line  method
       over  the  periods of the respective agreements.  Deferred
       debt  issuance  costs  are amortized to  interest  expense
       using  the  interest method over the term of  the  related
       debt.

       The  Company  assesses the recoverability of its intangible
       assets  as  well  as  the  related amortization  lives  by
       determining  whether the carrying value of the  intangible
       assets  can be recovered over the remaining lives  through
       projected  undiscounted future cash flows.  To the  extent
       that  such  projections indicate that undiscounted  future
       cash flows are not expected to be adequate to recover  the
       carrying  amounts of the related intangible  assets,  such
       carrying  amounts are adjusted for impairment to  a  level
       commensurate  with  the  estimated  fair  value   of   the
       underlying assets.

   (g)Revenues

       Revenues  from  basic  and premium service  are  recognized
       when the service is provided.

       Installation  revenues  are recognized  to  the  extent  of
       direct selling costs incurred.  The remainder, if any,  is
       deferred  and  amortized  to  income  over  the  estimated
       average  period  that  customers are  expected  to  remain
       connected to the cable television system.

       Management  fee  revenues are recognized concurrently  with
       the  recognition of revenues by the managed cable  system,
       or  as  a  specified monthly amount as stipulated  in  the
       management  agreement.  Incentive management  fee  revenue
       is  recognized  upon performance of specified  actions  as
       stipulated in the management agreement.

                                       F-7
<PAGE>

   (h)Income Taxes

       The  Company  has  not  provided for federal  income  taxes
       since  such taxes are the responsibility of the individual
       partners.   The  Company's  subsidiary  corporations   are
       subject   to  federal  income  tax  but  either  have   no
       operations  or have experienced net losses and, therefore,
       had no taxable income since their inception.

   (i)Subsidiary Limited Partner Interests

       Limited   partner  interests  of  subsidiary   partnerships
       which  are  not directly held by the Company are accounted
       for  in  a  manner  similar  to minority  interests.   Net
       income  or  loss  and preference returns  related  to  the
       limited  partner interests of subsidiary partnerships  are
       reflected in the accompanying statements of operations  as
       "subsidiary limited partner interests."

       Certain   subsidiary   limited   partner   interests   were
       allocated  losses  in excess of their contributed  capital
       to  the  extent that the fair value of assets  contributed
       by  the  subsidiary  limited partners  exceeded  the  book
       value at the date of contribution.

   (j)Derivative Financial Instruments and Fair Value

       The  Company  has only limited involvement with  derivative
       financial  instruments and does not use them  for  trading
       purposes.  Any derivative financial instruments  are  used
       to  manage well-defined interest rate risk related to  the
       Company's outstanding debt.

       As   interest  rates  change  under  interest   rate   swap
       agreements,  the differential to be paid  or  received  is
       recognized  as  an  adjustment to interest  expense.   The
       Company  is  not  exposed to credit loss as  its  interest
       rate   swap   agreements   are   with   certain   of   the
       participating  banks  under the  Company's  Senior  Credit
       Facility.   The  carrying  value  of  the  interest   rate
       agreements   approximates  fair   value   due   to   their
       maturities.

       The   carrying   amounts  of  cash  equivalents,   accounts
       receivable  and accrued operating liabilities reported  in
       the   accompanying   consolidated   financial   statements
       approximate  fair  value  due to their  short  maturities.
       The  fair  value of long-term debt was $1,700,259,000  and
       $1,511,233,000   at   December   31,   1997   and    1996,
       respectively,  based  on  quoted  market  prices  for  the
       publicly  held  debt.  The carrying amount of  the  Senior
       Credit   Facility   approximates   fair   value   as   the
       outstanding borrowings bear interest at market rates.

   (k)Disclosure of Certain Significant Risks and Uncertainties

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

                                        F-8
<PAGE>

   (l)Impairment  of Long-Lived Assets and Long-Lived  Assets  to
       Be Disposed Of

       The  Company  adopted  the  provisions  of  SFAS  No.  121,
       Accounting  for  the Impairment of Long-Lived  Assets  and
       for  Long-Lived Assets to Be Disposed Of,  on  January  1,
       1996.  This Statement requires that long-lived assets  and
       intangibles be reviewed for impairment whenever events  or
       changes   in  circumstances  indicate  that  the  carrying
       amount    of    an   asset   may   not   be   recoverable.
       Recoverability of assets to be held and used  is  measured
       by  a  comparison of the carrying amount of  an  asset  to
       future  net  cash  flows expected to be generated  by  the
       asset.  If such assets are considered to be impaired,  the
       impairment to be recognized is measured by the  amount  by
       which  the carrying amount of the assets exceeds the  fair
       value  of  the  assets.   Assets to  be  disposed  of  are
       reported  at  the  lower of the carrying  amount  or  fair
       value  less costs to sell.  The adoption of this Statement
       did  not have a material impact on the Company's financial
       position, results of operations, or liquidity.

(2)Acquisitions and Dispositions

   On  July  1,  1997,  the  Company purchased  cable  television
   systems   located  near  Dallas-Fort  Worth,  Texas   for   an
   aggregate purchase price of $34,500,000.  On December  1,  the
   Company  completed an exchange of cable television systems  in
   Wisconsin  and  Indiana.  According to terms of  the  exchange
   agreement,  in  addition to the contribution of  its  systems,
   the Company paid $17,807,000.

   On  January  11, 1996, the Company completed the  purchase  of
   a cable  television system in Texas for $875,000.  On  July  8,
   1996,  the  Company  acquired  a cable  television  system   in
   Mississippi  for  an aggregate purchase price  of  $2,600,000.
   On  July  31,  1996,  the  Company acquired  a cable  television
   system in Indiana for a purchase price of $6,700,000.

   On  January  18,  1995, the Company acquired cable  television
   systems  in  Wisconsin  and Minnesota owned  and  operated  by
   Crown  Media,  Inc.  ("Crown"), and Cencom  of  Alabama,  L.P.
   ("CALP")  limited  partner  units  held  by  Crown,   for   an
   aggregate  purchase  price  of $331,717,000.   On  August  31,
   1995,   the  Company  acquired  all  remaining  CALP  ordinary
   limited  partner interests held by outside parties in exchange
   for  convertible  preference units of MCC with  a  $15,000,000
   distribution  preference  and caused  the  redemption  of  all
   outstanding  CALP  special limited partnership  interests  and
   the  retirement of all outstanding bank indebtedness  of  CALP
   for  $138,280,000 in cash.  On November 1, 1995,  the  Company
   acquired  certain cable television systems owned and  operated
   by  Sammons  Communications, Inc. ("Sammons") for  a  purchase
   price  of  $961,701,000  plus  direct  acquisition  costs   of
   $31,187,000   and  less  assumed  liabilities  of  $4,524,000.
   Other  miscellaneous acquisitions of cable television  systems
   were also completed in 1995 for $2,357,000.

   The  acquisitions  discussed  above  were  accounted  for   as
   purchases   and,   accordingly,  the  purchase   prices   were
   allocated   to  tangible  and  intangible  assets   based   on
   estimated  fair  market  values at the dates  of  acquisition.
   Fair   market   values  were  determined   using   independent
   appraisers,  or  in  the  case of  the  smaller  acquisitions,
   estimated  based on previous acquisitions.  The  cable  system
   exchange  discussed above was accounted for as  a  nonmonetary
   exchange  and,  accordingly, the

                                        F-9
<PAGE>

   additional cash  contribution
   was  allocated  to  tangible and intangible  assets  based  on
   recorded  amounts  of  the  nonmonetary  assets  relinquished.
   Operating  results of the acquired companies and  systems  are
   included  in  the accompanying financial statements  from  the
   dates   of  acquisition  and  exchange  except  for  operating
   results  of  Crown, which are included from January  1,  1995.
   In  connection with the acquisitions and exchange, the Company
   also   assumed   responsibility   for   settling   outstanding
   receivables  and  payables  of the  cable  television  systems
   acquired.   Net  assets acquired as a result of  the  exchange
   and acquisitions are summarized as follows (in thousands):

<TABLE>
<CAPTION>
                                          1997    1996    1995
      <S>                               <C>     <C>     <C>
      Working capital deficit           $     - $     - $  (15,900)
      Property and equipment             26,310   5,004    485,410
      Franchise rights                   27,002   4,861    959,651
      Going concern value                     -       -     33,055
      Noncompetition agreements           1,000     383     12,160
      Other (liabilities) assets           (500)     24      1,342
                                         ------  ------  ---------
           Total purchase price (1995
           includes $5,000 from escrow
           paid in 1994)                $53,812 $10,272 $1,475,718
                                         ======  ======  =========
</TABLE>

   Prior  to the final CALP acquisition, certain partners in  MCC
   who  hold  a controlling interest in MCC also held an interest
   in  CALP.   Because  of  this common ownership  interest,  the
   predecessor cost was used to value the assets acquired to  the
   extent of the investment held in CALP by the partners in  MCC.
   A  charge  of $14,183,000 which was made to partners'  capital
   represents  the  excess  of the consideration  paid  over  the
   carrying  value of the investment in CALP held by partners  in
   MCC.   For accounting purposes, such excess is reflected as  a
   reduction in the partners' capital accounts of MCC.

   On  October  11,  1996, the Company sold the cable  television
   systems operating in Washington for  cash of $20,638,000,  net
   of selling costs.  The sale resulted in a gain of $6,442,000.

   On  June  30,  1995,  the Company sold  the  cable  television
   systems   operating  in  and  around  San  Angelo,  Texas   to
   TeleService  Corporation of America for cash  of  $65,037,000,
   net  of  selling  costs.   The sale  resulted  in  a  gain  of
   $26,409,000.  Net proceeds from the sale were used  to  retire
   outstanding borrowings under Operating's then existing  senior
   credit facility.

   Unaudited pro forma financial information for the years  ended
   December  31,  1997 and 1996 as though the   acquisitions  and
   dispositions discussed above had occurred at January  1,  1996
   follows (in thousands):

<TABLE>
<CAPTION>
                                                1997       1996
        <S>                                   <C>        <C>
        Revenues                              $484,673   $437,746
        Operating income                        40,945     39,950
        Net loss                              (110,263)   (97,983)

</TABLE>
                                       F-10
<PAGE>

   The  pro  forma  financial information has been  prepared  for
   comparative  purposes only and does not  purport  to  indicate
   the  results of operations which would actually have  occurred
   had  the acquisitions, dispositions and exchange been made  at
   the  beginning of the period indicated, or which may occur  in
   the future.


 (3)    Property and Equipment

   Property  and equipment consists of the following at  December
   31, 1997 and 1996 (in thousands):

<TABLE>
<CAPTION>
                                                1997     1996
        <S>                                   <C>       <C>
        Cable systems                         $ 878,721 $ 670,829
        Vehicles and other                       37,943    26,008
        Land and buildings                       17,271    13,256
                                               --------  --------
                                                933,935   710,093
        Accumulated depreciation               (227,309) (131,586)
                                               --------  --------
                                              $ 706,626 $ 578,507
                                               ========  ========
</TABLE>
 (4)    Other Assets

   Other  assets  consist of the following at December  31,  1997
   and 1996 (in thousands):

<TABLE>
<CAPTION>

                                                1997        1996
        <S>                                   <C>        <C>
        Franchise rights                      $1,209,725 $1,175,009
        Debt issuance costs                       45,225     43,500
        Going concern value of acquired
          cable systems                           37,274     45,969
        Noncompetition agreements                 25,914     31,914
        Other                                      1,090      1,069
                                               ---------  ---------
                                               1,319,228  1,297,461
        Accumulated amortization                (303,033)  (213,927)
                                               ---------  ---------
                                              $1,016,195 $1,083,534
                                               =========  =========
</TABLE>

   Effective   December   31,  1997,  the   Company   wrote   off
   approximately  $7,000,000  and  $175,000  of  fully  amortized
   noncompetition    agreements    and    other costs,
   respectively.

                                     F-11
<PAGE>

(5)Accrued Liabilities

   Accrued  liabilities consist of the following at December  31,
   1997 and 1996 (in thousands):

<TABLE>
<CAPTION>
                                                1997    1996
   <S>                                      <C>       <C>
   Accrued operating expenses               $ 27,923  $ 20,377
   Accrued franchise fees                     10,131     9,429
   Accrued programming costs                   9,704     8,301
   Accrued property taxes                      5,125     3,830
   Other accrued liabilities                   5,726     4,630
   Accrued acquisition costs                   2,196     2,838
                                            --------  --------
                                            $ 60,805  $ 49,405
                                            ========  ========
</TABLE>

(6)Long-term Debt

   The  Company  has  outstanding borrowings  on  long-term  debt
   arrangements  at  December 31, 1997 and 1996  as  follows  (in
   thousands):

<TABLE>
<CAPTION>
                                                1997     1996
     <S>                                   <C>         <C>
     Senior Credit Facility                $  949,750  $  855,000
     13 1/2% Senior Subordinated
       Discount Notes                         336,304     295,119
     14 1/4% Senior Discount Notes            213,372     185,862
     11 7/8% Senior Debentures                100,000     100,000
     Capital leases and other notes             2,507       2,490
                                            ---------   ---------
                                            1,601,933   1,438,471
     Less current maturities                   68,288      41,819
                                            ---------   ---------
                                           $1,533,645  $1,396,652
                                            =========   =========
</TABLE>

   On  August  31,  1995,  the Company entered  into  the  Senior
   Credit  Facility, which provides for two term loan facilities,
   one  of  which is in the principal amount of $490,000,000  and
   matures  on December 31, 2002 ("Tranche A") and the  other  of
   which  is in the principal amount of $300,000,000 and  matures
   on  April 30, 2004 ("Tranche B").  The Senior Credit Facility,
   as   amended  on  March  14,  1997,  provides  for   scheduled
   amortization  of the two term loan facilities which  began  in
   September 1997.  The Senior Credit Facility also provides  for
   a  $360,000,000  Revolving Credit Facility,  with  a  maturity
   date  of December 31, 2002.  At December 31, 1997, there  were
   borrowings  of $748,750,000 under the two term loan facilities
   and   $201,000,000   under  the  Revolving  Credit   Facility.
   Amounts  outstanding  under the Senior  Credit  Facility  bear
   interest at either the i) Eurodollar rate, ii) prime  rate  or
   iii)  CD base rate or Federal Funds rate, plus a margin of  up
   to  2.25% subject to certain adjustments based on the ratio of
   Operating's total debt to annualized operating cash  flow,  as
   defined.   At December 31, 1997, borrowings under  the  Senior
   Credit  Facility bore interest at rates ranging from 5.97%  to
   8.00%  under  the  Eurodollar and  prime  rate  options.   The
   Senior  Credit Facility, among other things, provides for  (i)
   a  pledge  by  Operating

                                       F-12
<PAGE>

   of all partnership interests  in  the
   subsidiary  operating  partnerships  and  (ii)  a  pledge   by
   Operating  of  intercompany  notes  payable  to  it   by   the
   subsidiary    operating    partnerships.     All    borrowings
   outstanding  under the Senior Credit Facility  are  guaranteed
   by  MCC  on an unsecured basis.  The Company pays a commitment
   fee  of  0.250% to 0.375% on the unused commitment  under  the
   Senior   Credit  Facility.   Commitment  fees  on  the  unused
   portion  of  credit facilities amounted to $944,000,  $866,000
   and  $788,000 for the years ended December 31, 1997, 1996  and
   1995, respectively.

   On  June  9,  1995, MCC issued $299,228,000 of 14 1/4%  Senior
   Discount  Notes  due December 15, 2005 (the "14  1/4%  Notes")
   for  net  proceeds  of $150,003,000.  The 14  1/4%  Notes  are
   unsecured  and  rank  pari passu to  the  11  7/8%  Debentures
   (defined  below).   The 14 1/4% Notes are  redeemable  at  the
   option of MCC at amounts  decreasing from 107% to 100% of  par
   beginning  on  June 15, 2000.  No interest  is  payable  until
   December  15,  2000.   Thereafter  interest  is  payable  semi
   annually  until maturity.  The discount on the 14  1/4%  Notes
   is  being accreted using the interest method.  The unamortized
   discount  was  $85,856,000 and $113,366,000  at  December  31,
   1997  and 1996, respectively.  Proceeds from the 14 1/4% Notes
   were  used  to retire outstanding borrowings under Operating's
   then existing senior credit facility.

   On  July  29,  1994,  the Company, through  Operating,  issued
   $413,461,000  face  amount  of  13  1/2%  Senior  Subordinated
   Discount  Notes due August 1, 2004 (the "13 1/2%  Notes")  for
   net  proceeds  of  approximately $215,000,000.   The  13  1/2%
   Notes   are   unsecured,  are  guaranteed  by  MCC   and   are
   redeemable, at the option of Operating, at amounts  decreasing
   from  105%  to 100% of par beginning on August  1,  1999.   No
   interest  is  payable on the 13 1/2% Notes until  February  1,
   2000.   Thereafter,  interest  is payable  semiannually  until
   maturity.   The  discount  on  the  13  1/2%  Notes  is  being
   accreted  using the interest method.  The unamortized discount
   was  $77,157,000  and $118,342,000 at December  31,  1997  and
   1996,  respectively.  Proceeds from the  13  1/2%  Notes  were
   used  to  retire  outstanding borrowings under  the  Company's
   then  existing  senior credit facility and to  fund  the  1994
   acquisitions.

   On   October   13,  1993,  the  Company  issued   $100,000,000
   principal  amount of 11 7/8% Senior Debentures due October  1,
   2005  (the "11 7/8% Debentures").  The 11 7/8% Debentures  are
   unsecured  and are redeemable at the option of the Company  on
   or  after October 1, 1998 at amounts decreasing from 105.9% to
   100% of par at October 1, 2002, plus accrued interest, to  the
   date  of  redemption.  Interest on the 11 7/8%  Debentures  is
   payable  semiannually  each  April  1  and  October  1   until
   maturity.   Proceeds  from  the 11 7/8%  Debentures,  together
   with  borrowings  under  the Company's  then  existing  senior
   credit   facility,   were  used  to  repay   indebtedness   of
   subsidiary  operating partnerships and to redeem  certain  MCC
   preference units.

   The  14  1/4%  Notes,  13 1/2% Notes, 11 7/8%  Debentures  and
   Senior  Credit  Facility all require the  Company  and/or  its
   subsidiaries  to  comply  with  various  financial  and  other
   covenants, including the maintenance of certain operating  and
   financial   ratios.   These  debt  instruments  also   contain
   substantial    limitations    on,    or    prohibitions    of,
   distributions,  additional indebtedness,  liens,  asset  sales
   and certain other items.

                                       F-13
<PAGE>

   To  reduce  the  impact of changes in interest  rates  on  its
   floating  rate  long-term debt, the Company has  entered  into
   certain  interest  rate swap agreements with  certain  of  the
   participating  banks  under the Senior  Credit  Facility.   At
   December  31, 1997, interest rate swap agreements  covering  a
   notional  balance  of  $400,000,000  were  outstanding   which
   require  the Company to pay fixed rates ranging from 5.75%  to
   5.77%,  plus  the  applicable  interest  rate  margin.   These
   agreements  mature  during 1998 and 1999, and  allow  for  the
   optional extension by the counterparty for additional  periods
   and  certain  of  the  agreements provide  for  the  automatic
   termination  in the event that one month LIBOR  exceeds  6.75%
   on  any monthly reset date.  The Company has also entered into
   an   interest  rate  swap  agreement  covering  an   aggregate
   notional  principal amount of $100,000,000  which  matures  in
   the  year  2000 whereby the Company receives one  month  LIBOR
   plus  0.07%  and is required to pay the higher  of  one  month
   LIBOR  at either the beginning or end of the interest  period,
   plus the applicable interest rate margin.

   As   interest  rates  change  under  the  interest  rate  swap
   agreements,  the  differential  to  be  paid  or  received  is
   recognized  as an adjustment to interest expense.  During  the
   year   ended   December  31,  1997,  the  Company   recognized
   additional  expenses under its interest rate  swap  agreements
   of  $322,000.   During the year ended December 31,  1996,  the
   Company  recognized  benefits of $130,000 under  its  interest
   rate swap agreements.

   A  summary of the future maturities of long-term debt  follows
   (in thousands):

<TABLE>
            <S>                        <C>
            1998                       $   68,288
            1999                           78,372
            2000                           89,591
            2001                          156,255
            2002                          463,500
            Thereafter                    745,927
                                       ----------
                                       $1,601,933
                                       ==========
</TABLE>

(7)Partners' Capital

   (a)Classes of Partnership Interests

       The    MCC    partnership   agreement   (the   "partnership
       agreement")  requires the dissolution of  the  Partnership
       no  later  than December 31, 2005, unless extended  on  an
       annual basis by the affirmative vote of holders of 51%  or
       more  of  the  outstanding Class B Units and  the  written
       consent of the General Partner.  Class B Units consist  of
       General  Partner  Units ("GP Units") and  Limited  Partner
       Units  ("LP  Units").  GP Units include GP Profits  Units,
       DCA  Class B Units and Class B Units, and LP Units consist
       of  Class  B  LP Units.  To the extent that GP

                                        F-14
<PAGE>

       Units  have
       the  right  to  vote,  GP  Units vote  as  Class  B  Units
       together with Class B LP Units.  Voting rights of Class  B
       LP   Units  are  limited  to  items  specified  under  the
       partnership  agreement  including,  but  not  limited  to,
       certain  amendments  to  the  partnership  agreement,  the
       issuance  of  additional GP Profits Units or  Class  B  LP
       Units,  dissolution of the Partnership or removal  of  the
       General  Partner.  At December 31, 1997, 294,937.67  Class
       B LP Units and 18,848.19 GP Units were outstanding.

       The  partnership agreement also provides for  the  issuance
       of  a  class of Convertible Preference Units.  These units
       are  entitled  to  a general distribution preference  over
       the  Class B LP Units and are convertible into Class B  LP
       Units.   The  Convertible Preference Units  vote  together
       with  Class  B  Units as a single class,  and  the  voting
       percentage  of  each  Convertible Preference  Unit,  at  a
       given  time,  will be based on the number of  Class  B  LP
       Units into which such Convertible Preference Unit is  then
       convertible.  In connection with the acquisition  of  CALP
       in  August  1995, MCC issued 7,500 Convertible  Preference
       Units  with a distribution preference and conversion price
       of $2,000 per unit.

       The  partnership agreement permits the General Partner,  at
       its  sole discretion, to issue up to 31,517 Employee Units
       (classified   as   Class  B  Units)  to  key   individuals
       providing  services  to the Company.  Employee  Units  are
       not  entitled  to  distributions until such  time  as  all
       units   have  received certain distributions as calculated
       under   provisions  of  the  partnership  agreement.    At
       December   31,  1997  and  1996,  28,033.20  and  27,758.2
       Employee  Units,  respectively, were  outstanding  with  a
       subordinated threshold ranging from $1,600 to  $1,750  per
       unit.

   (b)Redemption Rights

       Upon  the  occurrence of certain key events (as defined  in
       the  partnership  agreement), the GP  Units  held  by  the
       General  Partner  shall be immediately converted  into  an
       equivalent  number of Class B LP Units.   The  holders  of
       the converted Class B LP Units, from and after January  1,
       1999,  have the right to cause MCC to purchase  all  units
       held  by  such holders, and MCC has the right to  purchase
       from the General Partner, upon affirmative vote of 51%  or
       more  of the outstanding Class B LP Units, all such  units
       held  by  the General Partner, at a price equal  to  their
       fair  market value, to the extent permitted by the 14 1/4%
       Notes,  11  7/8% Debentures, 13 1/2% Notes and the  Senior
       Credit  Facility.  In addition, in the event  the  General
       Partner   fails   to  timely  dissolve   the   Partnership
       following the vote by holders of 51% or more of the  Class
       B  Units, then the holders of the Class B LP Units  (other
       than  Class  B  Units held by the General  Partner)  shall
       have  the  right  to require MCC to purchase  all  of  the
       Class  B  Units held by such holders at a price  equal  to
       their  fair market value, to the extent permitted  by  the
       14  1/4% Notes, 11 7/8% Debentures, 13 1/2% Notes and  the
       Senior Credit Facility.

                                      F-15
<PAGE>

   (c)Allocation of Income and Loss to Partners

       Income  and  loss  are  allocated in  accordance  with  the
       partnership agreement.  Generally, income is allocated  as
       follows:

       (1)First,  among  the  partners whose  unreturned  capital
           contributions   exceed  their  capital   accounts   in
           proportion  to  such  excesses  until  each  partner's
           capital   account  equals  such  partner's  unreturned
           capital contributions;

       (2)Next,  to  the  holders of Class B Units  in  the  same
           proportions,   and   in   the   same    amounts,    as
           distributions  are  or  would  be  made  as  discussed
           below; and

       (3)Finally,   to   the  holders  of  Class  B   Units   in
           accordance with their Class B percentage interests.

      Generally, losses are allocated as follows:

       (1)If  any  of  the  partners have capital  accounts  that
           exceed  their unreturned capital contributions,  among
           the  partners  whose  capital  accounts  exceed  their
           unreturned  capital  contributions  in  proportion  to
           such   excesses  until  each  such  partner's  capital
           account  equals  its unreturned capital  contribution;
           and

       (2)Next,  to  the  holders of Class B Units in  accordance
           with    their    unreturned    capital    contribution
           percentages.

       The  General Partner is allocated a minimum of  .2%  to  1%
       of  income or loss at all times, depending on the level of
       capital contributions made by the partners.


   (d)Distributions

       The  amount  of distributions is at the discretion  of  the
       General  Partner, subject to the restrictions  in  the  14
       1/4%  Notes, 11 7/8% Debentures, 13 1/2% Notes and  Senior
       Credit  Facility (see note 6).  The manner of distribution
       is as follows:

       (1)First,  to each partner in an amount sufficient to  pay
           income  taxes on net taxable income allocated to  each
           partner;

       (2)Next,  to  the holders of Convertible Preference  Units
           in  accordance  with  their unpaid  preference  amount
           (currently  $15,000,000) until each  partner's  unpaid
           preference amount is reduced to zero;

       (3)Next,  to  the  holders of Class B Units in  accordance
           with    their    unreturned    capital    contribution
           percentages  until  each partner's unreturned  capital
           contribution is reduced to zero;

                                        F-16
<PAGE>

       (4)Next,  to  the  holders of Class B Units (exclusive  of
           all  or  certain  Employee Units), in accordance  with
           their  Class  B percentage interests until  a  defined
           threshold has been met.

       (5)Finally,   to   the  holders  of  Class  B   Units   in
           accordance with the Class B percentage interests.

   (e)Capital Contributions

       The  partnership agreement requires the General Partner  to
       make   such  additional  contributions  to  MCC   as   are
       necessary  to  maintain  at all times  a  minimum  capital
       account  balance  equal  to either  1%  of  the  aggregate
       positive  capital account balances of all the partners  of
       MCC  or $500,000, whichever is less.  The limited partners
       are    not    required   to   make   additional    capital
       contributions,  and no partner has the right  to  withdraw
       its   capital   contribution  during  the  term   of   the
       Partnership.

   (f)Issuance of Partnership Units

       During  the year ended December 31, 1995, MCC issued  Class
       B  LP  Units  for  cash  of $362,615,000,  net  of  equity
       syndication  fees  of $7,385,000 paid to  certain  limited
       partners,   and  Convertible  Preference  Units   with   a
       distribution  preference of $15,000,000 to partially  fund
       the purchases of Sammons, CALP and Crown.

(8)  Related Party Transactions

   Affiliates of Goldman Sachs own limited partnership  interests
   in  MCC.   Maryland Cable, which is controlled by an affiliate
   of  Goldman  Sachs,  owned  the Maryland  Cable  System  which
   served   customers  in  and  around  Prince  Georges   County,
   Maryland.  Operating managed the Maryland Cable Systems  under
   the  Maryland  Cable  Agreement, which  was  entered  into  in
   September  of  1994.   Operating  earned  a  management   fee,
   payable  monthly,  equal to 4.7% of the revenues  of  Maryland
   Cable, and was reimbursed for certain expenses.

   Effective  January  31, 1997, the Maryland  Cable  System  was
   sold  to  Jones Communications of Maryland, Inc.  Pursuant  to
   the  Maryland Cable Agreement, Operating recognized  incentive
   management fees of $5,069,000 during 1997 in conjunction  with
   the  sale.   Additional  incentive  management  fees  may   be
   recognized  upon  dissolution  of  Maryland  Cable,  which  is
   anticipated to occur during 1998.  There is no assurance  that
   any  of such fees will be realized.  Although Operating is  no
   longer  involved  in  the  active management  of  those  cable
   television  systems, Operating has entered into  an  agreement
   with  Maryland  Cable to oversee the activities,  if  any,  of
   Maryland  Cable  through the liquidation of  the  partnership.
   Pursuant  to  such agreement, Operating will  earn  a  nominal
   monthly  fee.  Including the incentive management  fees  noted
   above,  during  the years ended December 31,  1997  and  1996,
   Operating  earned  total  management fees  of  $5,614,000  and
   $2,335,000, respectively.

                                        F-17
<PAGE>

   In   connection  with  the  acquisitions  in  1995,  fees   of
   $5,250,000  were  paid  to Marcus Cable Properties, Inc.
   for  services  directly related  to the Sammons and Crown
   acquisitions.  In  addition, strategic  advisory fees of
   $18,309,000 were paid  to  certain limited  partners  in  connection
   with  the  acquisition   of Sammons  in  1995.  The fees were
   capitalized as part  of  the cost of acquiring the cable television
   systems.

   On  September  1, 1994, the Company acquired  from  Crown  the
   general  partner  interest in CALP,  the  management  contract
   pursuant to which the Company provided management services  to
   CALP,  and accrued and unpaid management fees, for total  cash
   consideration  of $2,878,000.  Management fees earned  by  the
   Company  under the management contract during the  year  ended
   December 31, 1995 were $1,082,000.

(9)Employee Benefit Plan

   The  Company sponsors a 401(k) plan for its employees  whereby
   employees  that qualify for participation under the  plan  can
   contribute  up to 15% of their salary, on a before tax  basis,
   subject to a maximum contribution limit as determined  by  the
   Internal  Revenue  Service.  The Company  matches  participant
   contributions  up  to  a  maximum of  2%  of  a  participant's
   salary.   For  the  years ended December 31,  1997,  1996  and
   1995,   the  Company  made  contributions  to  the   plan   of
   approximately $761,000, $480,000 and $247,000, respectively.

(10)    Commitments and Contingencies

   The  Company  rents  pole space from various  companies  under
   agreements which are generally cancelable on short notice  and
   leases  office space for system and corporate offices.   Lease
   and  rental  costs  charged to expense  for  the  years  ended
   December   31,   1997,   1996  and  1995  were   approximately
   $7,544,000, $6,775,000 and $3,093,000, respectively.

   In   October  1992,  Congress  enacted  the  Cable  Television
   Consumer  Protection and Competition Act of  1992  (the  "1992
   Cable  Act").  During May 1993, pursuant to authority  granted
   to  it  under  the 1992 Cable Act, the Federal  Communications
   Commission  ("FCC")  issued its rate  regulation  rules  which
   became  effective  September 1, 1993.  These  rate  regulation
   rules  required certain cable systems in franchise areas which
   receive   certification  and  are  not  subject  to  effective
   competition,  as  defined, to set rates for  basic  and  cable
   programming  services,  as  well  as  related  equipment   and
   installations,  pursuant to general cost-of-service  standards
   or  FCC  prescribed  benchmarks.  These  FCC  benchmarks  were
   based  on  an  average  10% competitive  differential  between
   competitive and non-competitive systems.  Effective  September
   1,  1993, regulated cable systems not electing cost-of-service
   were  required to reduce rates to the higher of the prescribed
   benchmarks  or rates that were 10% below those  in  effect  on
   September 1, 1992.

   In  February  1994, the FCC announced further changes  in  its
   rate  regulation  rules  and announced  its  interim  cost-of-
   service standards.  In connection with these changes, the  FCC
   issued   revised  benchmark  formulas,  based  on  a   revised
   competitive  differential of 17%, which  became  effective

                                      F-18
<PAGE>

   on
   May  15,  1994 or if certain conditions were met, on July  14,
   1994.   Regulated cable systems were required to reduce  rates
   to  the  higher of the new FCC prescribed benchmarks or  rates
   that were 17% below those in effect on September 1, 1992.

   On    February   1,   1996   Congress   passed   S.652,   "The
   Telecommunications  Act  of  1996"  (the  "Act"),  which   was
   subsequently  signed into law on February 8, 1996.   This  law
   altered  federal,  state and local laws  and  regulations  for
   telecommunications  providers  and  services,  including   the
   Company.   There are numerous rulemakings to be undertaken  by
   the  FCC  which will interpret and implement the Act.   It  is
   not  possible  at  this time to predict the  outcome  of  such
   rulemakings.    Several  aspects  of  the  Act  impact   cable
   television,  including the elimination of  regulation  of  the
   cable programming service tier as of March 31, 1999.

   The  Company believes that it has complied with all provisions
   of  the  1992 Cable Act, including the rate setting provisions
   promulgated by the FCC.  However, in jurisdictions which  have
   chosen  not to certify, refunds covering a one-year period  of
   basic  service  may  be  ordered  upon  certification  if  the
   Company is unable to justify its rates.  The amount of  refund
   liability,  if any, to which the Company could be  subject  in
   the   event   that  these  systems'  rates  are   successfully
   challenged   by  franchising  authorities  is  not   currently
   estimable.

   The  Company is involved in various claims and lawsuits  which
   are  generally  incidental to its business.   The  Company  is
   vigorously  contesting  all  such matters  and  believes  that
   their  ultimate  resolution will not have a  material  adverse
   effect  on  its  consolidated financial position,  results  of
   operations or cash flows.

(11)    Subsequent Events

   On  March  3, 1998, the Company announced that it has retained
   Goldman  Sachs  to  advise the Company as it explores  various
   strategic   alternatives  involving  the  ownership   of   the
   Company. Several alternatives are being reviewed, however,  no
   decision  has  been  made  and the outcome  of  the  Company's
   review cannot be predicted at this time.

   On  March  4,  1998,  the Company entered  into  a  definitive
   agreement  with  TMC  Holdings, Inc. to sell  cable  television
   assets  located in Connecticut and Virginia for a sales  price
   of    approximately   $150,000,000.    The    systems    serve
   approximately  46,000  customers  and  17,000   customers   in
   Connecticut  and Virginia, respectively.  The  transaction  is
   subject  to  regulatory  approval  and  is  expected   to   be
   finalized during the third quarter of 1998.

                                       F-19
<PAGE>

(12)    Financial Information

   The  following  schedules  present  balance  sheet  and  statement   of
   operations  information of the Company as of and  for  the  year  ended
   December 31, 1997:

<TABLE>
                                   MARCUS CABLE COMPANY, L.P.  AND SUBSIDIARIES

                                Consolidating Schedule - Balance Sheet Information

                                                 As of December 31, 1997
                                                     (unaudited)
                                                    (in thousands)

                                                         ASSETS


<CAPTION>
                              Combined
                              Operating Capital             Elimin-     Operating           Capital            Elimin-
                             Partnership  II   Operating    ations    Consolidated Capital    III    Company    ations    Company
<S>                          <C>        <C>    <C>       <C>          <C>          <C>      <C>      <C>       <C>      <C>
Current assets:
   Cash and cash equivalents     8,695      1    (7,902)          0          794        1        1       811         0      1,607
   Accounts receivable, net    132,337      0    80,756    (189,158)      23,935        0        0         0         0     23,935
   Prepaid expenses              1,692      0       413           0        2,105        0        0         0         0      2,105
                            ----------  -----  --------  ----------   ----------   ------   ------   -------  --------  ---------
      Total current assets     142,724      1    73,267    (189,158)      26,834        1        1       811         0     27,647

Property and equipment, net    699,518      0     7,108           0      706,626        0        0         0         0    706,626
Other assets, net            1,016,966      0 1,621,662  (1,599,185)   1,039,443        0        0     8,464   (31,712) 1,016,195
Investment in subsidiaries           0      0    80,054     (80,054)         ---        0        0   412,353  (412,353)       ---
                            ----------  ----- ---------  ----------   ----------   ------   ------   -------  --------  ---------
      Total assets           1,859,208      1 1,782,091  (1,868,397)   1,772,903        1        1   421,628  (444,065) 1,750,468
                            ==========  ===== =========  ==========   ==========   ======   ======   =======  ========  =========





Current liabilities:
   Current maturities of
     long-term debt                194      0    68,094           0       68,288        0        0         0         0     68,288
   Accrued liabilities         173,379      0    76,947    (183,045)      67,281        0        0    25,236   (31,712)    60,805
   Accrued interest              7,925      0     4,956      (7,925)       4,956        0        0     2,993         0      7,949
                            ----------  ----- ---------  ----------   ----------   ------   ------   -------   -------- ---------
      Total current
        liabilities            181,498      0   149,997    (190,970)     140,525        0        0    28,229   (31,712)   137,042

Long-term debt               1,597,657      0 1,219,989  (1,597,373)   1,220,273        0        0   313,372         0  1,533,645
Subsidiary limited partner
  interest                           0      0      (246)          0         (246)       0        0         0         0       (246)
Partners' capital               80,053      1   412,351     (80,054)     412,351        1        1    80,027  (412,353)    80,027
                            ----------  ----- ---------  ----------   ----------   ------   ------   -------   -------- ---------
      Total liabilities and
        parterns' capital    1,859,208      1 1,782,091  (1,868,397)   1,772,903        1        1   421,628  (444,065) 1,750,468
                            ==========  ===== =========  ==========   ==========   ======   ======   =======   ======== =========

</TABLE>
                                                             F-20
<PAGE>


<TABLE>
                                 MARCUS CABLE COMPANY, L.P. AND SUBSIDIARIES

                           Consolidating Schedule - Statement of Operations Information

                                For the twelve months ended December 31, 1997
                                                    (unaudited)
                                                   (in thousands)



 <CAPTION>
                                    Combined                                 Operating
                                    Operating    Capital             Elimin-  Consol-          Capital           Elimin-
                                   Partnerships     II   Operating   ations   idated   Capital   III       MCC    ations  Company
<S>                                <C>           <C>     <C>         <C>     <C>       <C>     <C>       <C>     <C>     <C>
Revenues:
  Cable services                      473,701       ---        ---      ---   473,701      ---    ---      ---     ---   473,701
  Management fees                         ---       ---      5,614      ---     5,614      ---    ---      ---     ---     5,614
                                    ---------    ------  ---------   ------  --------  -------  -----    -----   -----   -------
           Total revenues             473,701       ---      5,614      ---   479,315      ---    ---      ---     ---   479,315
                                    ---------    ------  ---------   ------  --------  -------  -----    -----   -----   -------
Operating expenses:
  Selling, service and
     system management                174,173       ---      2,342      ---   176,515      ---    ---      ---     ---   176,515
  General and administrative           58,127       ---     14,224      ---    72,351      ---    ---      ---     ---    72,351
  Allocated corporate costs            11,552       ---    (11,552)     ---       ---      ---    ---      ---     ---       ---
  Depreciation and amortization       187,105       ---      1,366      ---   188,471      ---    ---      ---     ---   188,471
                                    ---------    ------  ---------   ------  --------  -------  -----    -----   -----   -------
           Total operating expenses   430,957       ---      6,380      ---   437,337      ---    ---      ---     ---   437,337
                                    ---------    ------  ---------   ------  --------  -------  -----    -----   -----   -------
           Operating income (loss)     42,744       ---       (766)     ---    41,978      ---    ---      ---     ---    41,978

Other (income) expense:
  Interest (income) expense, net      152,264       ---    (41,438)     ---   110,826      ---    ---   40,381     ---   151,207
  Equity earnings (loss)
    of subsidiaries                       ---       ---    109,520 (109,520)      ---      ---    ---   68,848 (68,848)      ---
                                    ---------    ------  ---------   ------  --------  -------  -----   ------  ------   -------
           Total other
              (income) expense        152,264       ---     68,082 (109,520)  110,826      ---    ---  109,229 (68,848)  151,207
                                    ---------    ------  ---------   ------  --------  -------  -----   ------  ------   -------
           Net loss                  (109,520)      ---    (68,848) 109,520   (68,848)     ---    --- (109,229) 68,848  (109,229)
                                    =========    ======  =========   ======  ========  =======  =====   ======  ======   ========
</TABLE>

                                                                   F-21
<PAGE>


                              SIGNATURES

     Pursuant  to the requirements of the Securities Exchange  Act  of
1934,  each  of  the registrants have duly caused this  report  to  be
signed on its behalf by the undersigned thereunto duly authorized.


                 MARCUS CABLE COMPANY, L.P.
                 (Registrant)

                 By: Marcus  Cable  Properties,  L.P.,its general partner,

                     By: Marcus Cable Properties, Inc., its general partner,

March 30, 1998            By: /s/ Jeffrey A. Marcus
                              Jeffrey A. Marcus
                         Its: President and Chief Executive Officer

                          By: /s/ Thomas P. McMillin
                              Thomas P. McMillin
                         Its: Executive Vice President and
                              Chief Financial Officer


                          By: /s/ John P. Klingstedt, Jr.
                              John P. Klingstedt, Jr.
                         Its: Senior Vice President and Controller


                   MARCUS CABLE OPERATING COMPANY, L.P.
                   (Registrant)

                   By: Marcus Cable Company, L.P., its general partner,

                       By:  Marcus Cable Properties, L.P., its general partner,

                         By: Marcus Cable Properties, Inc., its general partner,

March 30, 1998                   By: /s/ Jeffrey A. Marcus
                                     Jeffrey A. Marcus
                                Its: President and Chief Executive Officer


                                 By: /s/ Thomas P. McMillin
                                     Thomas P. McMillin
                                Its: Executive Vice President and
                                     Chief Financial Officer


                                 By: /s/ John P. Klingstedt, Jr.
                                     John P. Klingstedt, Jr.
                                Its: Senior Vice President and Controller

<PAGE>

                         MARCUS CABLE CAPITAL CORPORATION
                         (Registrant)

March 30, 1998                  By: /s/ Jeffrey A. Marcus
                                    Jeffrey A. Marcus
                               Its: President  and  Chief  Executive Officer


                                By: /s/ Thomas P. McMillin
                                    Thomas P. McMillin
                               Its: Executive Vice President and
                                    Chief Financial Officer


                                By: /s/ John P. Klingstedt, Jr.
                                    John P. Klingstedt, Jr.
                               Its: Senior Vice President and Controller


                         MARCUS CABLE CAPITAL CORPORATION II
                         (Registrant)

March 30, 1998                  By: /s/ Jeffrey A. Marcus
                                    Jeffrey A. Marcus
                               Its: President and Chief Executive Officer


                                By: /s/ Thomas P. McMillin
                                    Thomas P. McMillin
                               Its: Executive Vice President and
                                    Chief Financial Officer


                                By: /s/ John P. Klingstedt, Jr.
                                    John P. Klingstedt, Jr.
                               Its: Senior Vice President and Controller


                         MARCUS CABLE CAPITAL CORPORATION III
                         (Registrant)

March 30, 1998                  By: /s/ Jeffrey A. Marcus
                                    Jeffrey A. Marcus
                               Its: President and  Chief  Executive Officer


                                By: /s/ Thomas P. McMillin
                                    Thomas P. McMillin
                               Its: Executive Vice President and
                                    Chief Financial Officer


                                By: /s/ John P. Klingstedt, Jr.
                                    John P. Klingstedt, Jr.
                               Its: Senior Vice President and Controller
<PAGE>




                              Exhibit 10.17






<PAGE>

                         January 19, 1998


Mr. Jeffrey A. Marcus
Marcus Cable Company, L.P.
2911 Turtle Creek Boulevard
Suite 1300
Dallas, Texas  75219


Dear Jeff:


          In recognition of your contribution to the success of
Marcus Cable Company, L.P. (the "Company") over the past seven and
one-half years and for your efforts in connection with a successful
completion of a Divestiture Transaction (as defined below), we
hereby agree that upon consummation of a Divestiture Transaction,
the Company will pay you a fee of $10,000,000.

          As used herein, the term "Divestiture Transaction" means
a transaction or series of transactions as a result of which one or
more persons directly or indirectly acquire, by purchase, merger,
consolidation or otherwise, (i) a majority of  the assets of the
Company and its subsidiaries on a consolidated basis or (ii)  a
majority of the limited partner interests in the Company.

          Notwithstanding the foregoing, you will only be entitled
receive the foregoing fee if an agreement is entered into with
respect to a Divestiture Transaction within 24 months after the
date of this letter agreement.

          We are grateful for all that you have done in the
operation of the Company and the enhancement of value thereof.

<PAGE>
                              Sincerely,

                              THE GOLDMAN SACHS GROUP, L.P.
                              BROAD STREET YIELD CORPORATION
                              BROAD STREET INVESTMENT FUND I, L.P.
                              BROAD STREET EMPIRE CORPORATION
                              BROAD STREET ACQUISITION CORPORATION
                              BROAD STREET EXPLORATION CORPORATION
                              BROAD STREET INCOME CORPORATION
                              BROAD STREET VALUE CORPORATION
                              BROAD STREET INVESTMENT FUND, L.P.
                              BROAD STREET ADVANCEMENT
                                   CORPORATION
                              BROAD STREET STRATEGIC CORPORATION
                              BROAD STREET FUNDING CORPORATION
                              BROAD STREET INVESTMENT
                                   CORPORATION I
                              BROAD STREET INVESTMENT
                                   CORPORATION II
                              STONE STREET FUND 1990, L.P.
                              STONE STREET FUND 1991, L.P.
                              STONE STREET FUND 1992, L.P.
                              STONE STREET FUND 1994, L.P.
                              STONE STREET FUND 1995, L.P.
                              STONE STREET 1995 MARCUS HOLDING,INC.
                              GS CAPITAL PARTNERS II OFFSHORE, L.P.
                              GS CAPITAL PARTNERS II OFFSHORE
                                   MARCUS HOLDING I, L.P.
                              GS CAPITAL PARTNERS II GERMANY
                                   MARCUS HOLDING I, L.P.
                              GS CAPITAL PARTNERS II, L.P.
                              GS CAPITAL PARTNERS II MARCUS
                                   HOLDING I, L.P.
                              BRIDGE STREET FUND 1990, L.P.
                              BRIDGE STREET FUND 1991, L.P.
                              BRIDGE STREET FUND 1992, L.P.
                              BRIDGE STREET FUND 1994, L.P.
                              BRIDGE STREET FUND 1995, L.P.
                              PARTICIPATION SUBSIDIARY CORP. II

                              On Behalf of Each of the Foregoing
Entities:



                               --------------------------------
                                   Name:
                                   Title:    Authorized Officer
                                             of Foregoing
                                             Entities or Their
                                             Direct or Indirect
                                             General Partners

<PAGE>



                              HICKS, MUSE, TATE & FURST EQUITY
                                   FUND II, L.P.
                              HM2 CABLE, L.P.

                              On Behalf of Each of the Foregoing
Entities:



                             By:________________________________
                                  Name:
                                   Title:



                              FS EQUITY PARTNERS III, L.P.
                              MCC INTERNATIONAL HOLDINGS, LTD.

                              On Behalf of Each of the Foregoing
Entities:



                             By:________________________________
                                   Name:
                                   Title:



                              WPG CORPORATE DEVELOPMENT
                                   ASSOCIATES IV, L.P.
                              WPG HOLDING, INC.
                              LION INVESTMENTS LIMITED
                              GLENBROOK PARTNERS, L.P.
                              FIRST UNION CAPITAL PARTNERS, L.P.

                              On Behalf of Each of the Foregoing
Entities:



                             By:________________________________
                                   Name:
                                   Title:

<PAGE>

                              GREENWICH STREET CAPITAL PARTNERS,
L.P.
                              TRV EMPLOYEES FUND, L.P.
                              GSCP OFFSHORE HOLDINGS, INC.
                              THE TRAVELERS INSURANCE COMPANY
                              THE TRAVELERS LIFE AND ANNUITY
                                   COMPANY

                              On Behalf of Each of the Foregoing
Entities:



                             By:________________________________
                                   Name:
                                   Title:



                              STATE OF WISCONSIN INVESTMENT BOARD




                                   Name:
                                   Title:

<PAGE>

                                                     Exhibit 12.1


<TABLE>
                                  COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                                                   (IN THOUSANDS)

                                               Year Ended December 31,

<CAPTION>
                                 1997        1996        1995        1994        1993

<S>                         <C>         <C>         <C>         <C>         <C>
Net loss                    $ (109,229) $ (100,070) $  (52,816) $  (30,610) $   (9,643)
Add:
    Fixed charges per (b)
      below                    151,207     144,681      82,911      29,346      16,847
                            ----------   ---------   ---------   ---------   ---------
Earnings for computation
    purposes (a)            $   41,978  $   44,611  $   30,095 $   (1,264)  $    7,204
                            ==========   =========   =========   =========   =========
Fixed Charges:
    Interest Costs          $  147,244  $  141,380  $   81,094  $   27,699 $   12,912
    Amortization of Debt
      issue costs                3,963      3,301       1,817          406         531
    Preference Returns             ---        ---         ---        1,241       3,404
                            ----------   ---------   ---------   ---------   ---------

Total Fixed Charges (b)     $  151,207  $  144,681  $   82,911  $   29,346  $   16,847
                            ==========   =========   =========   =========   =========

Ratio of earnings to
    fixed charges (a)/(b)   $      ---  $      ---  $      ---  $      ---  $      ---
                            ==========   =========   =========   =========   =========
Deficiency of earnings
    to cover fixed charges  $ (109,229) $ (100,070) $  (52,816) $  (30,610) $   (9,643)
                            ==========   =========   =========   =========   =========
</TABLE>
<PAGE>


                              Exhibit 21.1


SUBSIDIARIES OF MCC



     Listed below are the names of certain subsidiaries, at least 50%
owned, directly or indirectly, of MCC as of December 31, 1997.
Indented subsidiaries are direct subsidiaries of the company under
which they are indented.

<TABLE>
<CAPTION>
                                                  Percentage
                                                   Owned by          State of
                                                    Parent           Formation
<S>                                               <C>                <C>
Marcus Cable Company, L.P. (Registrant):                             Delaware

     Marcus Cable Capital Corporation                100.0%          Delaware

     Marcus Cable Capital Corporation III            100.0%          Delaware

     Marcus Cable Operating Company, L.P.             99.8%          Delaware

          Marcus Fiberlink, L.L.C.                    99.0%          Delaware

          Marcus Cable Capital Corporation II        100.0%          Delaware

          Marcus Cable Associates, L.P.               99.8%          Delaware

          Marcus Cable Partners, L.P.                 99.6%          Delaware

               Marcus Cable, Inc.                    100.0%          Delaware

          Marcus Cable of Alabama, Inc. (1)          100.0%          Delaware

          Marcus Cable of Alabama, L.P.               99.0%          Delaware

          Marcus Cable of Delaware and Maryland, L.P. 99.9%          Delaware

<FN>
(1)  Marcus Cable of Alabama, Inc. holds 1% general partner interest in Marcus
     Cable of Alabama, L.P.
</FN>
</TABLE>