UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

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FORM 10-Q

|QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|---------------------------------------------------------------------------------------
|For the Quarterly Period Ended September 30, 2007                                      

Commission file numbers

333-33540333-33540-1


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INSIGHT MIDWEST, L.P.
INSIGHT CAPITAL, INC.(Exact name of registrants as specified in their charters)

|Delaware
Delaware(State or other jurisdiction of
incorporation or organization) |  | 13-4079232
13-4079679(I.R.S. Employer
Identification No.)
|------------------------------------------------------------------------------- |  | ---------------------------------------------------------
|810 7th Avenue
New York, New York(Address of principal executive offices)       |  | 10019(Zip code)                                          

Registrants'
telephone number, including area code:917-286-2300

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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) have been subject to such filing requirements for the past
90 days.    Yes o No ý

(Note: As voluntary filers, not subject to the filing requirements, the registrants filed all reports under Section 13 or 15(d) of the Exchange Act during
the preceding 12 months.)

Indicate
by check mark whether each registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large
accelerated filer" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filero

Accelerated filer o

Non-accelerated filer ý


Indicate
by check mark whether the registrants are a shell company (as defined in Exchange Act
Rule 12b-2).    Yes o No ý

Indicate the number of shares outstanding of each of the registrants' classes of common stock, as of the latest practicable date.

Insight Midwest, L.P.



Not ApplicableInsight Capital, Inc.



Not Applicable




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INSIGHT MIDWEST, LP        CONSOLIDATED BALANCE SHEETS        (dollars in thousands)

PART I.    FINANCIAL INFORMATION

Item 1.    Financial Statements

September 30,
2007

December 31,
2006(unaudited)AssetsCash and cash equivalents

$
37,040

$
39,235Trade accounts receivable, net of allowance for doubtful accounts of $1,211 and $1,148 as of September 30, 2007 and December 31, 2006


31,957


31,060Prepaid expenses and other current assets


8,676


8,103Total current assets


77,673


78,398Fixed assets, net


1,134,041


1,138,186Goodwill


14,684


14,684Franchise costs


2,357,535


2,357,535Deferred financing costs, net of accumulated amortization of $26,173 and $24,129 as of September 30, 2007 and December 31, 2006


13,922


15,554Investments


1,936


5,800Other non-current assets


1,891


2,265Total assets

$
3,601,682

$
3,612,422Liabilities and partners' capitalAccounts payable

$
46,966

$
43,484Accrued expenses and other current liabilities


47,479


40,101Accrued property taxes


19,928


13,446Accrued programming costs (inclusive of $37,323 and $30,677 due to related parties as of September 30, 2007 and December 31, 2006)


54,651


45,880Deferred revenue


1,303


2,076Interest payable


48,094


33,440Due to affiliates


34,641


47,412Total current liabilities


253,062


225,839Deferred revenue


196


683Debt


2,493,878


2,555,722Other non-current liabilities


874


Partners' capital:Accumulated other comprehensive income





306Partners' accumulated capital


853,672


829,872Total partners' capital


853,672


830,178Total liabilities and partners' capital

$
3,601,682

$
3,612,422


See
accompanying notes

1

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INSIGHT MIDWEST, L.P        CONSOLIDATED STATEMENTS OF OPERATIONS        (unaudited)  (dollars in thousands)

|                                   |                                                                                                                                                                                                                                                                          | Three months ended September 30, |         | Nine months ended September 30, |  
|---------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -------------------------------- | ------- | ------------------------------- | -
|
|Revenue                            |                                                                                                                                                                                                                                                                          | $                                | 362,335 |                                 | $
|Operating costs and expenses:      |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|                                   | Programming and other operating costs (exclusive of depreciation and amortization) (inclusive of $52,256 and $155,182, and $47,772 and $135,110 of programming expense incurred through related parties for the three and
nine months ended September 30, 2007 and 2006) |                                  |         | 124,004                         |  
|                                   | Selling, general and administrative (inclusive of $165 and $263 and $39 and $115 of stock-based compensation for the three and nine months ended September 30, 2007 and 2006)                                                                                            |                                  |         | 89,454                          |  
|                                   | Management fees                                                                                                                                                                                                                                                          |                                  |         | 11,280                          |  
|                                   | Depreciation and amortization                                                                                                                                                                                                                                            |                                  |         | 72,853                          |  
|                                   |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|Total operating costs and expenses |                                                                                                                                                                                                                                                                          |                                  | 297,591 |                                 |  
|                                   |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|Operating income                   |                                                                                                                                                                                                                                                                          |                                  | 64,744  |                                 |  
|Other income (expense):            |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|                                   | Interest expense                                                                                                                                                                                                                                                         |                                  |         | (51,025                         | )
|                                   | Interest income                                                                                                                                                                                                                                                          |                                  |         | 309                             |  
|                                   | Other income (expense)                                                                                                                                                                                                                                                   |                                  |         | (5,956                          | )
|                                   |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|Total other expense, net           |                                                                                                                                                                                                                                                                          |                                  | (56,672 | )                               |  
|                                   |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  
|Net income (loss)                  |                                                                                                                                                                                                                                                                          | $                                | 8,072   |                                 | $
|                                   |                                                                                                                                                                                                                                                                          |                                  |         |                                 |  

See
accompanying notes

2

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INSIGHT MIDWEST, LP        CONSOLIDATED STATEMENTS OF CASH FLOWS        (unaudited)  (dollars in thousands)

|                                               |                                                                                          | Nine Months Ended September 30,                   |                                       
|---------------------------------------------- | ---------------------------------------------------------------------------------------- | ------------------------------------------------- | --------------------------------------
|
|Operating activities:                          |                                                                                          |                                                   |                                       
|                                               | Net income (loss)                                                                        |                                                   | $                                     
|                                               | Adjustments to reconcile net income (loss) to net cash provided by operating activities: |                                                   |                                       
|                                               |                                                                                          | Depreciation and amortization                     |                                       
|                                               |                                                                                          | Stock-based compensation                          |                                       
|                                               |                                                                                          | Provision for losses on trade accounts receivable |                                       
|                                               |                                                                                          | Amortization of note discount                     |                                       
|                                               |                                                                                          | Impairment of investment                          |                                       
|                                               |                                                                                          | Loss on disposal of fixed assets                  |                                       
|                                               |                                                                                          | Changes in operating assets and liabilities:      |                                       
|                                               |                                                                                          |                                                   | Trade accounts receivable             
|                                               |                                                                                          |                                                   | Prepaid expenses and other assets     
|                                               |                                                                                          |                                                   | Accounts payable                      
|                                               |                                                                                          |                                                   | Interest payable                      
|                                               |                                                                                          |                                                   | Accrued expenses and other liabilities
|                                               |                                                                                          |                                                   |                                       
|                                               | Net cash provided by operating activities                                                |                                                   |                                       
|                                               |                                                                                          |                                                   |                                       
|Investing activities:                          |                                                                                          |                                                   |                                       
|                                               | Purchase of fixed assets                                                                 |                                                   |                                       
|                                               | Sale of fixed assets                                                                     |                                                   |                                       
|                                               | Purchase of investments                                                                  |                                                   |                                       
|                                               |                                                                                          |                                                   |                                       
|                                               | Net cash used in investing activities                                                    |                                                   |                                       
|                                               |                                                                                          |                                                   |                                       
|Financing activities:                          |                                                                                          |                                                   |                                       
|                                               | Repayment of credit facilities                                                           |                                                   |                                       
|                                               | Net proceeds from borrowings under credit facilities                                     |                                                   |                                       
|                                               | Debt issuance costs                                                                      |                                                   |                                       
|                                               | Other                                                                                    |                                                   |                                       
|                                               |                                                                                          |                                                   |                                       
|                                               | Net cash (used in) provided by financing activities                                      |                                                   |                                       
|                                               |                                                                                          |                                                   |                                       
|Net decrease in cash and cash equivalents      |                                                                                          |                                                   | (2,195                                
|Cash and cash equivalents, beginning of period |                                                                                          |                                                   | 39,235                                
|                                               |                                                                                          |                                                   |                                       
|Cash and cash equivalents, end of period       |                                                                                          | $                                                 | 37,040                                
|                                               |                                                                                          |                                                   |                                       

See
accompanying notes

3

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INSIGHT MIDWEST, LP        NOTES TO CONSOLIDATED STATEMENTS

1. Organization and Basis of Presentation

We were formed in September 1999 to serve as the holding company and a financing vehicle for Insight Communications Company, Inc.'s
("Insight Inc.") cable television system joint venture with AT&T Broadband, LLC (now known as Comcast Cable Holdings, LLC ("Comcast Cable")). We are owned 50% by Insight Communications Company,
L.P. ("Insight LP"), which is wholly owned by Insight Inc., and 50% by an indirect subsidiary of Comcast Cable. Insight LP serves as our general partner and manages and operates our systems.

Through
our wholly owned operating subsidiaries, Insight Communications Midwest, LLC ("Insight Communications Midwest"), Insight Communications of Central Ohio, LLC ("Insight Ohio") and
Insight Kentucky Partners II, L.P. ("Insight Kentucky"), we own and operate cable television systems in Illinois, Indiana, Kentucky and Ohio which passed approximately 2.5 million homes and had
approximately 1.4 million customer relationships as of September 30, 2007.

The
accompanying consolidated financial statements include the accounts of Insight Midwest Holdings, LLC, our wholly-owned subsidiary which owns 100% of the outstanding equity of our
operating subsidiaries, and Insight Capital, Inc., our wholly-owned subsidiary formed for the sole purpose of being the co-issuer of our senior notes, which allows certain investors
the ability to be holders of the debt.

On
April 1, 2007, our partnership agreement was amended, and Insight LP agreed with Comcast Cable on a division of our assets and liabilities. Upon completion of the transaction,
we will own 100% of the cable systems serving customers in Louisville, Lexington, Bowling Green and Covington, Kentucky, in Evansville, Indiana, and in Columbus, Ohio, (the "Insight Systems Group")
and Comcast Cable will own 100% of the cable systems serving customers in Rockford/Dixon, Quincy/Macomb, Springfield,
Peoria and Champaign/Urbana, Illinois and in Bloomington, Anderson, Lafayette and Kokomo, Indiana (the "Comcast Systems Group"). Pending completion of the transaction, Insight LP will continue to
serve as our general partner and control and manage all of our cable systems. Insight LP will continue to include the results of our operations in its consolidated financial statements. In conjunction
with the division of assets and liabilities, the Insight Systems Group was initially allocated approximately $1,259.6 billion of our debt and the Comcast Systems Group was initially allocated
approximately $1,335.4 billion of our debt. The closing is subject to closing conditions, including local governmental approvals and regulatory approvals, and is expected to be completed by the
end of 2007. Subsequent to April 1, 2007, earnings and losses accrue to the respective partner's based on the actual results of the Insight Systems Group and the Comcast Systems Group.

2. Responsibility for Interim Financial Statements

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnote disclosures required by accounting principles generally accepted in the United States for complete financial statements.

In
management's opinion, the consolidated financial statements reflect all adjustments considered necessary for a fair presentation of the consolidated results of operations and
financial position for the interim periods presented. All such adjustments are of a normal recurring nature. These unaudited interim consolidated financial statements should be read in conjunction
with the audited consolidated financial statements and notes to consolidated financial statements contained in our Annual Report on Form 10-K for the year ended December 31,
2006.

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The
preparation of financial statements in conformity with accounting principles generally accepted in the United States requires us 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. The results of operations for the three and nine months ended September 30, 2007 are not necessarily indicative of the
results to be expected for the year ending December 31, 2007 or any other interim period.

3. Recent Accounting Pronouncements

In September 2006, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards ("SFAS") No. 157, Fair Value
Measurements("SFAS No. 157"). SFAS No. 157 defines fair value, establishing a framework for measuring fair value and expands
disclosure about fair value measurements. This statement is effective for us beginning January 1, 2008. We do not expect SFAS No. 157 to have a material impact on our consolidated
financial statements.

In
February 2007, FASB issued SFAS No. 159,The Fair Value Option for Financial Assets and Liabilities("SFAS
No. 159"). SFAS No. 159 provides the option to report certain financial assets and liabilities at fair value, with the intent to mitigate volatility in financial reporting that can occur
when related assets and liabilities are recorded on different bases. This statement is effective for us beginning January 1, 2008. We do not expect SFAS No. 159 to have a material impact
on our consolidated financial statements.

4. Investments

Oxygen Cable, LLC

Oxygen Cable, LLC ("Oxygen") is an independent cable television network with programming tailored to the interests of women. On July 9, 2002, we entered
into a carriage agreement with Oxygen, whereby we agreed to carry programming content from Oxygen. In October 2006, we agreed to extend the term of the carriage agreement through
December 31, 2008. Concurrently with the carriage agreement, we entered into an equity issuance agreement with Oxygen. Pursuant to the equity issuance agreement, a portion of the monthly
programming fees paid to Oxygen through December 31, 2006 represented our equity investment in Oxygen. The Chairman and CEO of Oxygen is a member of our Board of Directors.

In
October 2007, Oxygen announced that it has entered into a merger agreement with NBC Universal, Inc. under which Oxygen's stockholders will receive cash in exchange for
their shares. Oxygen has provided us with an Information Statement which sets forth the value of our equity, and we have recorded a $3.9 million impairment on this investment in other income
(expense) in the accompanying consolidated statements of operations as of September 30, 2007. We are accounting for our investment in Oxygen under the cost method. As of September 30,
2007 and December 31, 2006, our carrying value in this investment was $1.9 and $5.8 million, respectively.

5

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5. Fixed Assets

Fixed assets consisted of (in thousands):

September 30,
2007

December 31,
2006(unaudited)Land, buildings and improvements

$
43,420

$
42,058Cable system equipment


2,853,032


2,654,416Furniture, fixtures and office equipment


21,572


20,9902,918,024


2,717,464Less: accumulated depreciation and amortization


(1,783,983
)

(1,579,278
)Total fixed assets, net

$
1,134,041

$
1,138,186


We
recorded depreciation expense of $72.1 million and $218.0 million for the three and nine months ended September 30, 2007 and $66.2 million and
$192.7 million for the three and nine months ended September 30, 2006.

6. Debt

Debt consisted of (in thousands):

September 30,
2007

December 31,
2006(unaudited)Note payable to Insight Inc.

$
100,000

$
100,000Insight Midwest Holdings Credit Facility


2,221,000


2,286,000Insight Midwest 93/4% Senior Notes


200,000


200,0002,521,000


2,586,000Net unamortized discount


(27,122
)

(30,278
)Total debt

$
2,493,878

$
2,555,722


Insight Midwest Holdings $2.445 Billion Credit Facility

Our wholly owned subsidiary, Insight Midwest Holdings, LLC, serves as borrower under a $2.445 billion senior secured credit facility. Obligations under
this credit facility are secured by a pledge of the outstanding equity interests of Insight Midwest Holdings and its subsidiaries. The facility is comprised of a $385.0 million A Term Loan
scheduled to mature on October 6, 2013, a $1.8 billion B Term Loan scheduled to mature on April 6, 2014 and $260.0 million in revolving commitments scheduled to terminate
on October 6, 2012. Insight Midwest Holdings used the proceeds to refinance the existing senior credit facility and to redeem a portion of the outstanding Senior Notes. The weighted average
interest rate for debt outstanding under the credit facility was 7.0% at September 30, 2007. As of September 30, 2007 we were in compliance with the credit facility's covenant
requirements.

On
March 28, 2002, we borrowed $100.0 million from Insight Inc. The loan bears annual interest of 9%, compounded semi-annually, has a scheduled maturity
date of January 31, 2011 and permits prepayments. Insight Midwest Holdings is permitted under the credit facility to make distributions to us for the purpose of repaying this loan, including
accrued interest, provided that there are no defaults

6

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existing
under the credit facility. During the three and nine months ended September 30, 2007, we repaid a total of $10.5 and $15.0 million of the loan balance. As of
September 30, 2007 and December 31, 2006, the balance of the $100.0 million loan, including accrued interest, was $130.1 million and $136.1 million.

Debt Principal Payments

As of September 30, 2007, the remaining principal payments required on our debt were as follows (in thousands):

2007

$
2008


9,3122009


242,0632010


61,3132011


180,562Thereafter


2,027,750Total

$
2,521,000


7. Derivative Instruments

We enter into derivative instruments, typically interest-rate swap agreements, to modify the interest characteristics of our outstanding debt to
either a floating or fixed rate basis. These agreements involve fixed rate interest payments in exchange for floating rate interest receipts, known as cash flow hedges, and floating rate interest
payments in exchange for fixed rate interest receipts, known as fair value hedges, over the life of the agreement without an exchange of the underlying principal amount. The differential to be paid or
received is accrued during each period based on expected payments and/or receipts and is recognized as an adjustment to interest expense related to the debt. The estimated fair value is included in
other current or non-current liabilities or assets.

Gains
and losses related to cash flow hedges that are determined to be effective hedges are recorded as accumulated other comprehensive income or loss in the accompanying consolidated
balance sheets. Gains and losses related to fair value hedges that are determined to be effective hedges are recorded in the consolidated statements of operations as an adjustment to the swap
instrument and an equal and offsetting adjustment to the carrying value of the underlying debt. Gains and losses related to interest rate swaps that are determined not to be effective hedges and do
not qualify for hedge accounting are recorded in our consolidated statements of operations as other income or expense and as an adjustment to the underlying swap instrument.

Cash Flow Hedges

In October 2006, we entered into two interest rate swap agreements to hedge our exposure to fluctuations in the base rate for our Term Loan B whereby we
swapped floating rates for:



7

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In
the third quarter these swaps offset movements in the base rate for our Term Loan B by 101.1% and 101.7%, respectively. During the second quarter of 2007, these swap agreements were
determined to be ineffective cash flow hedges for the purposes of SFAS No. 133,Accounting for Derivative Instruments and Hedging Activities. At
September 30, 2007 and December 31, 2006, the estimated (cost if terminated) fair value of these interest rate swap agreements was approximately ($923,000) million and $306,000 and were
recorded in other current or non-current (liabilities) or assets on the accompanying consolidated balance sheets depending on the expiration date of the underlying swap agreement.

8. Related Party Transactions

Programming

We purchase the majority of our programming through affiliates of Comcast Cable. Charges for such programming, including a 11/2% administrative
fee, were $52.3 million and $155.2 million for the three and
nine months ended September 30, 2007 and $47.8 million and $135.1 million for the three and nine months ended September 30, 2006. As of September 30, 2007 and
December 31, 2006, $37.3 million and $30.7 million of accrued programming costs were due to affiliates of Comcast Cable. We believe that the programming rates charged through
these affiliates are lower than those available from independent parties. Upon the completion of the division of assets and liabilities described in Note 1, we will no longer have the right to
purchase programming services for our systems through this affiliate arrangement.

Insight Interactive

Effective November 17, 1999, Insight Cable Services entered into a Contribution Agreement with Source Media, Inc., providing for the creation of a
joint venture, Insight Interactive LLC. Under the terms of the Contribution Agreement, Source Media contributed its Virtual Modem 2.5 software and the Interactive Channel products and services,
including SourceGuide and LocalSource television content. On March 14, 2002, Insight Cable Services purchased the remaining 50% equity interest in Insight Interactive that it did not already
own from Source Media. We are currently providing Insight Interactive's services to customers in some of our systems. Fees for such services totaled $512,000 and $1.6 million for the three and
nine months ended September 30, 2007 and $874,000 and $2.6 million for the three and nine months ended September 30, 2006.

Due To Affiliates

As of September 30, 2007 and December 31, 2006, we had amounts owed to Insight LP, our manager, primarily comprised of accrued interest related to
our $100.0 million note payable to Insight Inc., incurred but unpaid management fees, calculated as approximately 3% of revenues, capital expenditures and other operational expenses.

8

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9. Partnership Split-Up Costs

During the three and nine months ended September 30, 2007, we recorded $0 and $2.5 million in employee retention benefits, in accordance with SFAS
No. 146,Accounting for Costs Associated with Exit or Disposal Activities,and $112,000 and $609,000 in legal fees in connection with matters
related to our agreement with Comcast to divide our assets and liabilities. The closing of the partnership
split-up is subject to closing conditions, including local governmental approvals and regulatory approvals, and is expected to be completed by the end of 2007.

The
Company has a plan to provide one-time retention benefits for certain employees related to the partnership split-up. During the third quarter of 2007, the
total amount expected to be paid in connection with the plan was adjusted to $4.0 million, of which the balance in excess of the amount expensed through September 30, 2007, will be
recognized over the remaining period that the employees are expected to provide services under the plan. These one-time retention benefits and legal fees are included in selling, general
and administrative expenses in the accompanying consolidated statements of operations.

10. Commitments and Contingencies

Programming Contracts

We enter into long-term contracts with third parties who provide us with programming for distribution over our cable television systems. These
programming contracts are a significant part of our business and represent a substantial portion of our operating costs. Since future fees under such contracts are based on numerous variables,
including number and type of customers, we have not recorded any liabilities with respect to such contracts.

Litigation

In April 2005, Acacia Media Technologies Corporation filed a lawsuit against us and others in the United States District Court for the Southern District of
New York. The complaint alleges, among other things, infringement of certain United States patents that allegedly relate to systems and methods for transmitting and/or receiving digital audio and
video content. The complaint seeks injunctive relief and damages in an unspecified amount. In the event that a Court ultimately determines that we infringe on any of the patents, we may be subject to
substantial damages, which may include treble damages and/or an injunction that could require us to materially modify certain products and services that we currently offer to subscribers. We believe
that the claims are without merit and intend to defend the action vigorously. The final disposition of this claim is not expected to have a material adverse effect on our consolidated financial
position but could possibly be material to our consolidated results of operations of any one period. Further, at this time the outcome of the litigation is impossible to predict, and no assurance can
be given that any adverse outcome would not be material to our consolidated financial position.

We
are subject to various legal proceedings that arise in the ordinary course of business. While it is impossible to determine with certainty the ultimate outcome of these matters, it is
our opinion that the resolution of these matters will not have a material adverse affect on our consolidated financial condition.

9

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INSIGHT CAPITAL, INC.    BALANCE SHEETS    (dollars in thousands, except share and per share amounts)

September 30,
2007

December 31,
2006unauditedAssetsCash

$
1

$
1Deferred financing costs, net of accumulated amortization of $15,439 and $14,149 as of September 30, 2007 and December 31, 2006


7,347


8,637Total assets

$
7,348

$
8,638Liabilities and shareholder's deficitAccrued interest

$
9,750

$
4,875Total current liabilities


9,750


4,875Senior notes, to be paid by Insight Midwest, LP


178,825


175,675Total liabilities


188,575


180,550Shareholder's deficit:Common stock; $.01 par value; 1,000 shares authorized, issued and outstanding





Paid-in-capital


1


1In-substance allocation of proceeds related to senior notes to be paid by Insight Midwest


437,381


427,631Accumulated deficit


(618,609
)

(599,544
)Total shareholder's deficit


(181,227
)

(171,912
)Total liabilities and shareholder's deficit

$
7,348

$
8,638


See
accompanying notes

10

---



INSIGHT CAPITAL, INC.    STATEMENTS OF OPERATIONS    (unaudited)    (dollars in thousands)

Three Months
Ended September 30,

Nine Months
Ended September 30,2007

2006

2007

2006Expenses:Amortization

$
(430
)
$
(652
)
$
(1,290
)
$
(1,956
)Interest


(5,925
)

(26,014
)

(17,775
)

(78,036
)Net loss

$
(6,355
)
$
(26,666
)
$
(19,065
)
$
(79,992
)


See
accompanying notes

11

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INSIGHT CAPITAL, INC.    STATEMENTS OF CASH FLOWS    (unaudited)    (dollars in thousands)

Nine Months Ended
September 30,2007

2006Cash flows from operating activities:Net loss

$
(19,065
)
$
(79,992
)Adjustments to reconcile net loss to net cash provided by operating activities:Accretion of discount on notes


3,150


270Amortization


1,290


1,956Interest expense assumed by affiliate


14,625


77,766Net cash provided by operating activities





Net increase in cash





Cash, beginning of period


1


1Cash, end of period

$
1

$
1


See
accompanying notes

12

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INSIGHT CAPITAL, INC.    NOTES TO FINANCIAL STATEMENTS

1.    Nature of Business

Insight Capital, Inc. (the "Company"), a Delaware corporation, was formed on September 23, 1999, for the sole purpose of being a
co-issuer with Insight Midwest, L.P. ("Insight Midwest") of senior notes which allows certain investors the ability to be holders of the debt. The Company has no operations. The
outstanding shares of the Company are owned by Insight Midwest.

2.    Responsibility for Interim Financial Statements

The accompanying unaudited financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States
for interim financial information and with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the
information and footnote disclosures required by accounting principles generally accepted in the United States for complete financial statements.

In
management's opinion, the financial statements reflect all adjustments considered necessary for a fair presentation of the statement of financial position as of the interim dates
presented. These unaudited interim financial statements should be read in conjunction with the audited financial statements and notes to financial statements contained in the Company's Annual Report
on Form 10-K for the year ended December 31, 2006.

The
preparation of financial statements in conformity with accounting principles generally accepted in the United States requires the Company 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. Actual results could differ from those estimates.

13

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Item 2.    Management's Discussion and Analysis of Financial Condition and Results of Operations

Cautionary Statement Regarding Forward-Looking Information

This quarterly report on Form 10-Q contains certain forward-looking statements with respect to the financial condition, results of operations,
plans, objectives, future performance and business of our company, including, without limitation, statements preceded by, followed by or that include the words "believes," "expects," "anticipates,"
"estimates" or similar expressions. We believe it is important to communicate management's expectations. However, there may be events in the future that we are not able to accurately predict or over
which we have no control. The risk factors listed in our Annual Report on Form 10-K for the year ended December 31, 2006, as well as any other cautionary language in this
quarterly report, provide examples of risks, uncertainties and events that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements. You
should be aware that the occurrence of the events described in these risk factors and elsewhere in this quarterly report could have a material adverse effect on our business, operating results and
financial condition. Examples of these risks include:



We
do not undertake any obligation to publicly update or release any revisions to these forward-looking statements to reflect events or circumstances after the date that this report is
filed with the SEC or to reflect the occurrence of unanticipated events, except as required by law.

Overview

Our revenues are earned from customer fees for cable television video services including basic, classic, digital, premium, video-on-demand
and ancillary services, such as rental of converters, remote control devices and installations. In addition, we earn revenues from providing high-speed Internet services, selling
advertising, providing telephone services, and commissions for products sold through home shopping networks.

14

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The
following table is derived from our consolidated financial statements that are included in this report and sets forth certain statement of operations data for our consolidated
operations:

|                                                    |                                       | Three Months
Ended September 30, |         | Nine Months
Ended September 30, |  
|--------------------------------------------------- | ------------------------------------- | -------------------------------- | ------- | ------------------------------- | -
|
|
|Revenue                                             |                                       | $                                | 362,335 |                                 | $
|Operating costs and expenses:                       |                                       |                                  |         |                                 |  
|                                                    | Programming and other operating costs |                                  |         | 124,004                         |  
|                                                    | Selling, general and administrative   |                                  |         | 89,454                          |  
|                                                    | Management fees                       |                                  |         | 11,280                          |  
|                                                    | Depreciation and amortization         |                                  |         | 72,853                          |  
|                                                    |                                       |                                  |         |                                 |  
|Total operating costs and expenses                  |                                       |                                  | 297,591 |                                 |  
|                                                    |                                       |                                  |         |                                 |  
|Operating income                                    |                                       |                                  | 64,744  |                                 |  
|Interest expense                                    |                                       |                                  | 51,025  |                                 |  
|Net income (loss)                                   |                                       |                                  | 8,072   |                                 |  
|Net cash provided by operating activities           |                                       |                                  | 96,336  |                                 |  
|Net cash used in investing activities               |                                       |                                  | 76,231  |                                 |  
|Net cash (used in) provided by financing activities |                                       |                                  | (19,999 | )                               |  
|Capital expenditures                                |                                       |                                  | 76,195  |                                 |  

Use of Adjusted Operating Income before Depreciation and Amortization and Free Cash Flow

We utilize Adjusted Operating Income before Depreciation and Amortization, (defined as operating income before depreciation, amortization, non-cash
stock-based compensation and partnership dissolution costs) among other measures, to evaluate the performance of our businesses. Adjusted Operating Income before Depreciation and Amortization is
considered an important indicator of the operational strength of our businesses and is a component of our annual compensation programs. In addition, our debt agreements use Adjusted Operating Income
before Depreciation and Amortization, adjusted for certain non-recurring items, in our leverage and other covenant calculations. We also use this measure to determine how we will allocate
resources and capital. Our management finds this measure helpful because it captures all of the revenue and ongoing operating expenses of our businesses and therefore provides a means to directly
evaluate the ability of our business operations to generate returns and to compare operating capabilities across our businesses. This measure is also used by equity and fixed income research analysts
in their reports to investors evaluating our businesses and other companies in the cable television industry. We believe Adjusted Operating Income before Depreciation and Amortization is useful to
investors and bondholders because it enables them to assess our performance in a manner similar to the methods used by our management and provides a measure that can be used to analyze, value and
compare
companies in the cable television industry, which may have different depreciation, amortization and stock-based compensation policies.

A
limitation of Adjusted Operating Income before Depreciation and Amortization, however, is that it does not reflect the periodic costs of certain capitalized tangible and intangible
assets used in generating revenues in our businesses. Management evaluates the costs of such tangible and intangible assets through other financial measures such as capital expenditures, investment
spending and Free Cash Flow. Management also evaluates the costs of capitalized tangible and intangible assets by analyzing returns provided on the capital dollars deployed. Another limitation of
Adjusted Operating Income before Depreciation and Amortization is that it does not reflect income net of interest expense, which is a significant expense for us because of the substantial debt we
incurred to acquire cable television systems and finance capital expenditures to upgrade our cable network. Management

15

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evaluates
the impact of interest expense through measures including interest expense, Free Cash Flow, the returns analysis discussed above and debt service covenant ratios under our credit facility.

Free
Cash Flow is net cash provided by operating activities (as defined by accounting principles generally accepted in the United States) less capital expenditures. Free Cash Flow is
considered to be an important indicator of our liquidity, including our ability to repay indebtedness. We believe Free Cash Flow is useful for investors and bondholders because it enables them to
assess our ability to service our debt and to fund continued growth with internally generated funds in a manner similar to the methods used by our management, and provides a measure that can be used
to analyze, value and compare companies in the cable television industry.

Both
Adjusted Operating Income before Depreciation and Amortization and Free Cash Flow should be considered in addition to, not as a substitute for, Operating Income, Net Income and
various cash flow measures (e.g., Net Cash Provided by Operating Activities), as well as other measures of financial performance and liquidity reported in accordance with accounting principles
generally accepted in the United States.

Reconciliation of Net Income (Loss) to Adjusted Operating Income before Depreciation and Amortization

The following table reconciles Net Income (Loss) to Adjusted Operating Income before Depreciation and Amortization. In addition, the table provides the components
from Net Income (Loss) to Operating Income for purposes of the discussions that follow.

|                                                               |                        | Three Months
Ended September 30, |         | Nine Months
Ended September 30, |  
|-------------------------------------------------------------- | ---------------------- | -------------------------------- | ------- | ------------------------------- | -
|
|
|Net income (loss)                                              |                        | $                                | 8,072   |                                 | $
|Other (income) expense:                                        |                        |                                  |         |                                 |  
|                                                               | Other (income) expense |                                  |         | 5,956                           |  
|                                                               | Interest income        |                                  |         | (309                            | )
|                                                               | Interest expense       |                                  |         | 51,025                          |  
|                                                               |                        |                                  |         |                                 |  
|Total other expense, net                                       |                        |                                  | 56,672  |                                 |  
|                                                               |                        |                                  |         |                                 |  
|Operating income                                               |                        |                                  | 64,744  |                                 |  
|Depreciation and amortization                                  |                        |                                  | 72,853  |                                 |  
|Partnership dissolution costs                                  |                        |                                  | 112     |                                 |  
|Stock-based compensation                                       |                        |                                  | 165     |                                 |  
|                                                               |                        |                                  |         |                                 |  
|Adjusted Operating Income before Depreciation and Amortization |                        | $                                | 137,874 |                                 | $
|                                                               |                        |                                  |         |                                 |  

16

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Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow

The following table provides a reconciliation from net cash provided by operating activities to Free Cash Flow. In addition, the table provides the components
from net cash provided by operating activities to operating income for purposes of the discussions that follow.

|                                                               |                                        | Three Months
Ended September 30, |         | Nine Months
Ended September 30, |  
|-------------------------------------------------------------- | -------------------------------------- | -------------------------------- | ------- | ------------------------------- | -
|
|
|Operating income                                               |                                        | $                                | 64,744  |                                 | $
|                                                               | Depreciation and amortization          |                                  |         | 72,853                          |  
|                                                               | Partnership dissolution costs          |                                  |         | 112                             |  
|                                                               | Stock-based compensation               |                                  |         | 165                             |  
|                                                               |                                        |                                  |         |                                 |  
|Adjusted Operating Income before Depreciation and Amortization |                                        |                                  | 137,874 |                                 |  
|                                                               | Changes in working capital accounts(1) |                                  |         | (797                            | )
|                                                               | Cash paid for interest                 |                                  |         | (40,741                         | )
|                                                               |                                        |                                  |         |                                 |  
|Net cash provided by operating activities                      |                                        |                                  | 96,336  |                                 |  
|                                                               | Capital expenditures                   |                                  |         | (76,195                         | )
|                                                               |                                        |                                  |         |                                 |  
|Free Cash Flow                                                 |                                        | $                                | 20,141  |                                 | $
|                                                               |                                        |                                  |         |                                 |  

---

Results of Operations

Three Months Ended September 30, 2007 Compared to Three Months Ended September 30, 2006

Revenue for the three months ended September 30, 2007 totaled $362.3 million, an increase of 14% over the prior year, due primarily to Revenue
Generating Unit ("RGU") growth across all of our services, as well as video rate increases. High-speed Internet service revenue increased 28% over the prior year, which was primarily
attributable to an increased customer base. We added a net 47,900 high-speed Internet customers during the quarter to end at 722,800 customers.

Basic
cable service revenue increased 6% due to an increased customer base and video rate increases, partially offset by promotional discounts. In addition, digital service revenue
increased 22% over the prior year due to an increased customer base and a $1.23 increase in digital average revenue per customer ("ARPU"). We added a net 26,100 digital customers during the quarter to
end at 687,600 customers.

We
have been increasing our customer growth and retention efforts by increasing spending on sales and marketing efforts, emphasizing bundling and enhancing and differentiating our video
services with video-on-demand, high definition television and digital video recorders. We are also continuing to focus on improving customer satisfaction through higher service
levels and increased customer education of our product offerings.

17

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To increase our bundling opportunities and extend our growth potential in future years, during the second half of 2006 and in January 2007, we successfully rolled out our
telephone product in eight previously unserved districts. As a result, we added a net 44,000 telephone customers during the quarter to end at 221,200 customers.

Revenue
by service offering was as follows for the three months ended September 30 (dollars in thousands):

|                    |  | Revenue by Service Offering |         |  |      
|------------------- |  | --------------------------- | ------- |  | -----
|
|Basic               |  | $                           | 169,510 |  | 46.8 
|High-Speed Internet |  |                             | 76,994  |  | 21.2 
|Digital             |  |                             | 42,818  |  | 11.8 
|Telephone           |  |                             | 24,631  |  | 6.8  
|Advertising         |  |                             | 21,133  |  | 5.8  
|Premium             |  |                             | 13,841  |  | 3.8  
|Franchise fees      |  |                             | 8,081   |  | 2.2  
|Other               |  |                             | 5,327   |  | 1.6  
|                    |  |                             |         |  |      
|Total               |  | $                           | 362,335 |  | 100.0
|                    |  |                             |         |  |      

Total
Customer Relationships were 1,449,400 as of September 30, 2007, an increase of 54,000 from 1,395,400 as of September 30, 2006. Total Customer Relationships represent
the number of customers who receive one or more of our products (i.e., basic cable, high-speed Internet or telephone) without regard to which product they purchase.

In
the quarter ended September 30, 2007, we added 139,100 RGUs which represent the sum of basic, digital, high-speed Internet and telephone customers, and as of
September 30, 2007 had
2,993,700 RGUs, an increase of 15% from September 30, 2006. RGUs by product category were as follows (in thousands):

September 30, 2007

September 30, 2006Basic

1,362.1

1,318.8High-speed Internet

722.8

579.3Digital

687.6

597.7Telephone

221.2

112.9Total RGUs

2,993.7

2,608.7


Average
monthly revenue per basic customer was $89.36 for the three months ended September 30, 2007, compared to $80.90 for the three months ended September 30, 2006. This
primarily reflects the continued growth of high-speed Internet, digital video and telephone product offerings in all markets, as well as video rate increases.

Programming
and other operating costs increased $14.1 million, or 13%. Increases in programming rates, customers and the addition of new programming content were significant
drivers of the cost increase for the quarter ended September 30, 2007. Other direct operating costs increased due to the increase in telephone cost of service as we successfully rolled out this
product in eight previously unserved districts during the second half of 2006 and in January 2007 and an increase in high-speed Internet service costs due to the increased customer
base. Other operating costs increased primarily as a result of an increase in installation labor due to increased customer activity.

18

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Selling,
general and administrative expenses increased $12.3 million, or 16%, primarily due to increased payroll, payroll-related costs and temporary help associated with an
increase in the number of employees and salary increases for existing employees. The increase in the number of employees represents investments in sales and marketing, customer care and network
operations personnel to continue to upgrade and enhance our product offerings, manage our increasingly complex network and increase customer satisfaction. A portion of the network operations personnel
increases were in support of our recent telephone product launches. Partnership dissolution costs of $112,000 recorded in the third quarter of 2007 that primarily related to the planned division of
the partnership with Comcast significantly contributed to the increase in selling, general and administrative expenses. Franchise fees, customer billing and collection fees increased primarily due to
the increase in our revenues and our customer base. Marketing expenses increased over the prior year to support the continued rollout of high-speed Internet, digital and telephone
products, and to grow our core video customer base.

Management
fees increased $1.7 million or 18% to $11.3 million for the three months ended September 30, 2007 from $9.6 million for the three months ended
September 30, 2006. Management fees, equal to approximately 3% of revenues, are paid to Insight LP.

Depreciation
and amortization expense increased $5.5 million or 8% primarily as a result of a continued high level of capital expenditures through September 30, 2007. These
expenditures were primarily for purchases of customer premise equipment, installation labor and materials, capitalized labor, headend equipment, network extensions and network capacity and bandwidth
increases, all of which we consider necessary in order to continue to maintain and grow our customer base and expand our service offerings. Partially offsetting this increase was a decrease in
depreciation expense related to certain assets that have become fully depreciated since September 30, 2006.

As
a result of the factors discussed above, Adjusted Operating Income before Depreciation and Amortization increased $16.3 million to $137.9 million, an increase of 13%
over the prior year's quarter.

Interest
expense decreased $7.2 million, or 12%. In October, 2006, Insight Midwest Holdings entered into a new $2.445 billion senior secured credit facility, using the
proceeds to refinance our existing senior credit facility and to redeem a portion of the outstanding 93/4% Senior Notes and all of the outstanding 101/2% Senior Notes of
Insight Midwest. Because of this refinancing, lower borrowing base rates and lower costs of borrowing as a result of improved leverage ratios, our interest rate averaged 7.6% for the three months
ended September 30, 2007, as compared to 8.8% for the three months ended September 30, 2006.

Other
expense was $6.0 million for the three months ended September 30, 2007 and primarily reflected the $3.9 million impairment loss on our investment in Oxygen and
$2.1 million from losses on the sale of fixed assets.

Nine Months Ended September 30, 2007 Compared to Nine Months Ended September 30, 2006

Revenue for the nine months ended September 30, 2007, totaled $1,057.3 million, an increase of 14% over the prior year, due primarily to RGU growth
across all of our services, as well as video rate increases. High-speed Internet service revenue increased 25% over the prior year, which was attributable to an increased customer base and
was partially offset by lower ARPU due to promotional discounts. We added a net 111,600 high-speed Internet customers during the nine months to end at 722,800 customers.

Basic
cable service revenue increased 6% due to an increased customer base and video rate increases, partially offset by promotional discounts. We added a net 39,300 basic customers
during the nine months to end at 1,362,100 customers. In addition, digital service revenue increased 25% over the prior year due to an increased customer base and a $1.43 increase in digital ARPU. We
added a net 66,000 digital customers during the nine months to end at 687,000 customers.

19

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To
increase our bundling opportunities and extend our growth potential in future years, during the second half of 2006 and in January 2007, we successfully rolled out our
telephone product in eight previously unserved districts. As a result, we added a net 97,800 telephone customers during the nine months to end at 221,200 customers.

Revenue
by service offering was as follows for the nine months ended September 30 (dollars in thousands):

|                    |  | Revenue by Service Offering |           |  |      
|------------------- |  | --------------------------- | --------- |  | -----
|
|Basic               |  | $                           | 507,552   |  | 48.0 
|High-Speed Internet |  |                             | 219,785   |  | 20.8 
|Digital             |  |                             | 126,312   |  | 11.9 
|Telephone           |  |                             | 60,517    |  | 5.7  
|Advertising         |  |                             | 60,192    |  | 5.7  
|Premium             |  |                             | 41,989    |  | 4.0  
|Franchise fees      |  |                             | 24,193    |  | 2.3  
|Other               |  |                             | 16,767    |  | 1.6  
|                    |  |                             |           |  |      
|Total               |  | $                           | 1,057,307 |  | 100.0
|                    |  |                             |           |  |      

Average
monthly revenue per basic customer was $87.51 for the nine months ended September 30, 2007, compared to $79.43 for the nine months ended
September 30, 2006. This primarily reflects the continued growth of high-speed Internet, digital video and telephone product offerings in all markets, as well as video rate
increases.

Programming
and other operating costs increased $31.1 million, or 9%. Increases in programming rates, customers and the addition of new programming content were significant
drivers of the cost increase for the nine months ended September 30, 2007. For the nine months ended September 30, 2006, programming costs reflected certain programming credits resulting
from favorable resolution of pricing negotiations related to certain prior period programming costs that were accrued at a higher rate than the amount actually paid. Programming credits for the nine
months ended September 30, 2007 were significantly lower, causing overall programming cost increases to be greater.

Other
direct operating costs increased due to the increase telephone cost of service as we successfully rolled out this product in eight previously unserved districts during the second
half of 2006 and in January 2007. This increase was partially offset by decreases in our high-speed Internet service costs as the company, in 2006, transitioned its Internet
services in-house and realized both costs savings and operational benefits from this investment even while increasing our customer base.

Selling,
general and administrative expenses increased $39.1 million, or 18%, primarily due to increased payroll, payroll-related costs and temporary help associated with an
increase in the number of employees and salary increases for existing employees. The increase in the number of employees represents investments in sales and marketing, customer care and network
operations personnel to
continue to upgrade and enhance our product offerings, manage our increasingly complex network and increase customer satisfaction. A portion of the network operations personnel increases were in
support of our recent telephone product launches. Partnership dissolution costs of $3.2 million recorded in the nine months ended September 30, 2007 that primarily related to the planned
division of the partnership with Comcast significantly contributed to the increase in selling, general and administrative expenses. Marketing expenses increased over the prior year to support the
continued rollout of high-speed Internet, digital and telephone products, and to grow our core video customer base. Franchise fees, customer billing and collection fees increased primarily
due to the increase in our revenues and our customer base.

20

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Management fees increased $4.1 million or 15% to $32.1 million for the nine months ended September 30, 2007 from $28.0 million for the nine months ended
September 30, 2006. Management fees, equal to approximately 3% of revenues, are paid to Insight LP.

Depreciation
and amortization expense increased $23.8 million, or 12%, primarily as a result of a continued high level of capital expenditures through September 30, 2007.
These expenditures were primarily for purchases of customer premise equipment, installation labor and materials, capitalized labor, headend equipment, network extensions and network capacity and
bandwidth increases, all of which we consider necessary in order to continue to maintain and grow our customer base and expand our service offerings. Partially offsetting this increase was a decrease
in depreciation expense related to certain assets that have become fully depreciated since September 30, 2006.

As
a result of the factors discussed above, Adjusted Operating Income before Depreciation and Amortization increased $55.2 million to $401.9 million, an increase of 16%.

Interest
expense decreased $14.3 million, or 9%. In October, 2006, Insight Midwest Holdings entered into a new $2.445 billion senior secured credit facility, using the
proceeds to refinance our existing senior credit facility and to redeem a portion of the outstanding 93/4% Senior Notes and all of the outstanding 101/2% Senior Notes of
Insight Midwest. Because of this refinancing, lower borrowing base rates and lower costs of borrowing as a result of improved leverage ratios, our interest rate averaged 7.6% for the nine months ended
September 30, 2007, as compared to 8.5% for the nine months ended September 30, 2006.

Other
expense was $5.5 million for the nine months ended September 30, 2007 and primarily reflected the $3.9 million impairment loss on our investment in Oxygen and
$1.6 million from losses on the sale of fixed assets.

Liquidity and Capital Resources

Our business requires cash for operations, debt service and capital expenditures. The cable television business has substantial ongoing capital requirements for
the provision of new services and the construction, expansion and maintenance of its broadband networks. In the past, expenditures have been made for various purposes including the upgrade of the
existing cable network, and will continue
to be made for customer premise equipment (e.g., set-top boxes), installation and deployment of new product and service offerings, capitalized payroll, network capacity, bandwidth
increases, network extensions, and, to a lesser extent, network upgrades. Historically, we have been able to meet our cash requirements with cash flow from operations, borrowings under our credit
facilities and issuances of private and public debt and equity.

Cash
provided by operations for the nine months ended September 30, 2007 and 2006 was $271.5 million and $200.6 million. The increase was primarily attributable to
the decrease in our net loss and an increase in non-cash items, specifically depreciation and amortization.

Cash
used in investing activities for the nine months ended September 30, 2007 and 2006 was $208.3 million and $212.0 million and was primarily for capital
expenditures. These expenditures principally constituted purchases of customer premise equipment, installation labor and materials and capitalized labor, all of which are necessary to grow our
customer base and expand our service offerings.

Cash
used in financing activities for the nine months ended September 30, 2007 and 2006 was $65.4 million compared to $2.4 million of cash provided by financing
activities for the nine months ended September 30, 2006. The uses of cash in 2007 were primarily for the repayment of our credit facility and, in 2006 cash was provided by net proceeds from
borrowings under the credit facility.

Free
Cash Flow for the nine months ended September 30, 2007 totaled $63.2 million, compared to ($11.2) million for the nine months ended September 30, 2006. This
increase in Free Cash Flow from September 30, 2006 to September 30, 2007 of $74.4 million was primarily driven by the following:



21

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We
have a substantial amount of debt. Our high level of debt could have important consequences. Our principal source of cash we need to pay our obligations and to repay the principal
amount of our debt obligations is the cash that our subsidiaries generate from their operations and their borrowings. We believe that the Insight Midwest Holdings credit facility, cash
on-hand and our cash flow from operations are sufficient to support our current operating plan. As of September 30, 2007 we had the ability to draw upon $214.3 million of
unused availability under the Insight Midwest Holdings credit facility to fund any shortfall resulting from the inability of our cash from operations to fund our capital expenditures, meet our debt
service requirements or otherwise fund our operations. As of September 30, 2007 we were in compliance with all covenants under our credit agreement.

On
April 1, 2007, our partnership agreement was amended, and our manager agreed with Comcast on a division of our assets and liabilities. Upon completion of the transaction, we
will own 100% of the cable systems serving customers in Louisville, Lexington, Bowling Green and Covington, Kentucky, in Evansville, Indiana, and in Columbus, Ohio, and Comcast will own 100% of the
cable systems serving customers in Rockford/Dixon, Quincy/Macomb, Springfield, Peoria and Champaign/Urbana, Illinois and in Bloomington, Anderson, Lafayette and Kokomo, Indiana. Pending completion of
the transaction, our manager will continue to serve as our general partner and control and manage all of our cable systems. Our manager will continue to include the results of our operations in its
consolidated financial statements. In conjunction with the division of assets and liabilities, the Insight Systems Group was initially allocated approximately $1,259.6 billion of our debt and
the Comcast Systems Group was initially allocated approximately $1,335.4 billion of our debt. The closing is subject to closing conditions, including local governmental approvals and regulatory
approvals, and is expected to be completed by the end of 2007.

The
credit facility has been structured to survive the division, subject to certain conditions, including:



Subject
to pro forma financial covenant compliance, any cash received as a result of the division may be applied, at our manager's option, to: (a) repay the remaining
93/4% senior notes, (b) repay the Insight Inc. 121/4% senior discount notes, (c) repay the $100.0 million intercompany note, (d) prepay
the Term Loans on a pro rata basis, (e) repay other debt and/or (f) for general corporate purposes. After the occurrence of the division, the margin with respect to the Term Loan B will
increase by 50 basis points, or 0.50%, if and for so long as the Insight Midwest Holdings' leverage ratio exceeds 6.50:1.00. Upon the occurrence of the division, the maximum leverage permitted will
increase by 0.50:1.00.

22

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The
following table summarizes our contractual obligations and commitments, excluding interest and commitments for programming, as of September 30, 2007, including periods in
which the related payments due (unaudited, in thousands):

Contractual ObligationsLong-Term
Debt

Operating
Leases

Total2007

$


$
900

$
9002008


9,312


2,375


11,6872009


242,063


1,937


244,0002010


61,313


1,271


62,5842011


180,562


729


181,291Thereafter


2,027,750


2,953


2,030,703Total cash obligations

$
2,521,000

$
10,165

$
2,531,165


Item 3.    Quantitative and Qualitative Disclosures About Market Risk

Our revolving credit and term loan agreements bear interest at floating rates. Accordingly, we are exposed to risks related to adverse changes in interest rates.
In order to manage our exposure to interest rate risk, we enter into derivative financial instruments, typically interest rate swaps. The counter-parties to our swap agreements are major financial
institutions. We do not enter into derivatives or other financial instruments for trading or speculative purposes.

The
aggregate fair market value and aggregate carrying value of our 93/4% senior notes was $200.0 million as of September 30, 2007. The fair market value of
our credit facility borrowings approximates its carrying value as the credit facility borrowings bear interest at floating rates of interest. As of September 30, 2007, the cost, if terminated,
of our interest rate swap agreements was $923,000 and is reflected in our financial statements as other current or non-current liabilities. Changes in the fair value of our interest rate
derivative financial instruments are either recognized in income or in stockholders' equity as a component of other comprehensive income depending on whether the derivative financial instruments
qualify for hedge accounting.

Item 4.    Controls and Procedures

Under the supervision and with the participation of Insight Midwest's management, including its Chief Executive Officer and Chief Financial Officer, Insight
Midwest evaluated the effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of
September 30, 2007. Based upon that evaluation, its Chief Executive Officer and Chief Financial Officer concluded that its disclosure controls and procedures were effective.

There
has not been any change in Insight Midwest's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act) during the quarter ended September 30, 2007 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

Under
the supervision and with the participation of Insight Capital's management, including its Chief Executive Officer and Chief Financial Officer, Insight Capital evaluated the
effectiveness of its disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934) as of September 30,
2007. Based upon that evaluation, its Chief Executive Officer and Chief Financial Officer concluded that its disclosure controls and procedures were effective.

There
has not been any change in Insight Capital's internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f) under the
Exchange Act) during the quarter ended September 30, 2007 that has materially affected, or is reasonably likely to materially affect, its internal control over financial reporting.

23

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PART II. OTHER INFORMATION

Item 1A.    Risk Factors

There have been no material changes in our risk factors from those disclosed in our annual report on Form 10-K for the year ended
December 31, 2006.

Item 6.    Exhibits

|Exhibits: |  |                                                                                                                
|--------- |  | ---------------------------------------------------------------------------------------------------------------
|31.1      |  | Rule 13a-14(a)/15d-14(a) Certifications of the Chief Executive Officer of Insight Midwest, L.P.                
|31.2      |  | Rule 13a-14(a)/15d-14(a) Certifications of the Chief Financial Officer of Insight Midwest, L.P.                
|31.3      |  | Rule 13a-14(a)/15d-14(a) Certifications of the Chief Executive Officer of Insight Capital, Inc.                
|31.4      |  | Rule 13a-14(a)/15d-14(a) Certifications of the Chief Financial Officer of Insight Capital, Inc.                
|32.1      |  | Section 1350 Certifications of the Chief Executive Officer and Chief Financial Officer of Insight Midwest, L.P.
|32.2      |  | Section 1350 Certifications of the Chief Executive Officer and Chief Financial Officer of Insight Capital, Inc.

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SIGNATURES

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

|Date: November 14, 2007 |  | INSIGHT MIDWEST, L.P.
|----------------------- |  | ---------------------
|                        |  | By:                  

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

|Date: November 14, 2007 |  | INSIGHT CAPITAL, INC.
|----------------------- |  | ---------------------
|                        |  | By:                  

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