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

                                  FORM 10-QSB/A

                                   (Mark one)
           [X] Quarterly Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

                 FOR THE FISCAL QUARTER ENDED DECEMBER 31, 2003

                         Commission file Number 0-28416
                                       or
          [  ] Transition Report Pursuant to Section 13 or 15(d) of the
                         Securities Exchange Act of 1934

==============================================================================
                              VALCOM,  INC.
       (Name  of  small  business  issuer  specified  in  its  charter)
==============================================================================
         Delaware                                  58-1700840
         --------                                  ----------
(State  or  other  jurisdiction  of                   (IRS  Employer
incorporation  or  organization)                  Identification  Number)



            26030 Avenue Hall - Studio #5, Valencia, California 91355
            ---------------------------------------------------------
               (Address of Principal executive offices) (Zip code)

     (661)  257-8000
     ---------------
                            Issuer's telephone number

            Securities registered pursuant to 12(b) of the Act: None
        Securities to be registered pursuant to Section 12(g) of the Act:

                          COMMON STOCK $0.001 PAR VALUE
                          -----------------------------
                                (Title of Class)
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days.  YES  [  X  ]  NO  [  ]

As of December 31, 2003 the issuer had 15,292,166 shares of its $0.001 par value
common  stock  outstanding.



<PAGE>
                                  VALCOM, INC.

                                   FORM 10-QSB
                                      INDEX
                                                                        Page
PART  I.    FINANCIAL  INFORMATION

Item  1.    Condensed  Consolidated  Financial  Statements:
            Condensed  Consolidated  Balance  Sheet  as  of
             December  31,  2003  (unaudited)
                                                                          3

           Condensed  Consolidated  Statements  of  Operations
             for  the  three  months  ended  December  31,  2003
             and  2002  (unaudited)
                                                                          5

           Condensed  Consolidated  Statements  of  Cash  Flows
             for  the  three  months  ended  December  31,  2003  and
             2002  (unaudited)                                            6

           Notes  to  Condensed  Consolidated  Financial  State-
             ments  (unaudited)                                           7

Item  2.    Management's  Discussion  and  Analysis  of  Financial
             Condition  and  Results  of  Operations                     16

Item  3.    Disclosure  Controls  and  Procedures                        18

Part  II.   OTHER  INFORMATION

Item  1.    Legal  Proceedings                                           19

Item  2.    Changes  in  Securities                                      19

Item  3.    Defaults  Upon  Senior  Securities                           20

Item  4.    Submission  of  Matters  to  a  Vote  of  Security  Holders  20

Item  5.    Other  Information                                           20

Item  6.    Exhibits  and  Reports  on  Form  8-K                        20

SIGNATURES                                                               21

Part  III.  EXHIBITS


                                       -2-

<PAGE>

PART  I.  FINANCIAL  INFORMATION

ITEM  1.  FINANCIAL  STATEMENTS
                          VALCOM, INC. AND SUBSIDIARIES
                      CONDENSED CONSOLIDATED BALANCE SHEET
                                   (UNAUDITED)

                                                   December  31,
                                                       2003
                                                      ------
                                      ASSETS
                                     ------
Current  Assets:
Cash  &  Cash  equivalents                          $   234,990
Accounts  receivable  -  net                             41,131
Note  receivable,  current                               35,179
                                                    -----------
Total  Current  Assets                                  311,300

Property  and  equipment  -  net                     11,586,309
Deferred  Compensation                                  242,169
Prepaid  development  costs                             340,767
Deposits  and  other  assets                            140,402
                                                   ------------
Total  Assets                                     $  12,620,947
                                                   ============


    See accompanying notes to the condensed consolidated financial statements
                                       -3-

<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
                CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
                                  (UNAUDITED)
                                  -----------
                                                    December 31,
                                                        2003
                                                      -------

                      LIABILITIES AND STOCKHOLDERS' EQUITY
                      ------------------------------------
Liabilities  Not  Subject  To  Compromise
Current  liabilities:
Accounts  payable                                  $   316,521
Accrued  interest                                      749,053
Accrued  expenses                                      381,889
Notes  payable                                       7,854,545
Due to related parties                                  50,000
Other Investor's contribution
  towards Joint Venture                                 50,000
                                                   -----------
Total  Current  Liabilities                          9,402,008

Liabilities  Subject  To  Compromise
Prepetition  trade  accounts  payable                  206,249
Prepetition  Payables  due  to  related  parties        95,000
Prepetition  accrued  expenses                         131,902

                                                   -----------
Total  Liabilities                                   9,835,159
                                                   -----------

Commitments  and  contingencies

Stockholders'  equity:
Convertible  preferred  stock:  all  with  par  value
$0.001;
Series  B,  1,000,000  shares  authorized;  38,000
shares  issued  and  outstanding                            38
Series  C,  5,000,000  shares  authorized;  1,480,000
shares  issued  and  outstanding                         1,480
Series  D,  1,250,000  shares  authorized; 1,250,000
shares  issued  and  outstanding                         1,250
Common  stock,  par  value  $.001;  100,000,000  shares
authorized;  15,292,166
shares  issued  and  outstanding                        15,293
Common stock to be issued                               50,000
Additional  Paid-in  capital                        13,920,810

Accumulated  deficit                               (11,203,083)
                                                   -----------
Total  Stockholders'  Equity                         2,785,788
                                                   -----------
Total  Liabilities  and  Stockholders'  Equity     $12,620,947
                                                   ===========


    See accompanying notes to the condensed consolidated financial statements
                                       -4-

<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                   (UNAUDITED)


<TABLE>
<CAPTION>

                                            For the three        For the three
                                             months ended         months ended
                                          December 31, 2003    December 31, 2002
<S>                                               <C>
Revenue:
Rental . . . . . . . . . . . . . . . . . . .  .$531,571           $563,655
Production . . . . . . . . . . . . . . . . . . . 30,237            122,892
Other. . . . . . . . . . . . . . . . . . . . . . .2,340             78,382
                                             -----------------------------
Total Revenue. . . . . . . . . . . . . . . . . .564,148            764,929
                                             -----------------------------
Cost and Expenses:
Production . . . . . . . . . . . . . . . . . . . 10,942            191,023
Selling and promotion. . . . . . . . . . . . . . 13,972             12,417
Depreciation and amortization. . . . . . . . . .210,360             87,740
General and administrative . . . . . . . . . . .612,717            848,143
Consulting and professional fees . . . . . . . .142,569            235,494
                                             -----------------------------
Total Cost and Expenses. . . . . . . . . . . . .990,560          1,374,817
                                             -----------------------------

Operating loss . . . . . . . . . . . . . . . . (426,412)          (609,888)

Other Income (Expense):
    Interest expense . . . . . . . . . . . . . (267,592)          (174,838)
       Gain on sale of assets. . . . . . . . . . 53,950                  -
   Miscellenous. . . . . . . . . . . (6,679)             8,000
                                             -----------------------------
Total Other Income (Expense) . . . . . . . . . (220,321)          (166,838)

                                             -----------------------------
Net loss . . . . . . . . . . . . . . . . . .  $(646,733)         $(776,726)
                                             ==============================

    Basic and diluted loss per share
    from continuing operations . . . . . . . . .  (0.04)             (0.07)

    Weighted average shares outstanding:
    Basic and diluted.                       15,213,818         11,165,249

</TABLE>

    See accompanying notes to the condensed consolidated financial statements
                                       -5-


<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

                                  (UNAUDITED)

<TABLE>
<CAPTION>

                                                                                    For the three         For the three
                                                                                    months ended           months ended
                                                                                  December 31, 2003     December 31, 2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Net (Loss)                                                                            $(646,733)           $(776,726)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization                                                           210,360               87,740
Bad debt expense                                                                              -               24,000
Gain on sale of fixed assets                                                            (53,950)              (8,000)
Options issued for compensation                                                         232,000              142,836
Stock issued for debt retirement                                                         57,959                    -
Stock issued for compensation                                                            82,000               24,075
Stock issued for services                                                                94,000               56,500
Changes in operating assets and liabilities:
Receivables                                                                              30,776              (27,635)
Prepaid development costs                                                              (125,767)                   -
Related party receivables                                                               (14,220)                   -
Deferred Compensation                                                                    16,511              (38,039)
Deposits                                                                                (24,864)                (875)
Accounts payable and accrued expenses                                                    35,886               95,018
Other assets                                                                                  -               74,592
                                                                                      ---------       --------------
  Net cash used in operating activities                                                (106,042)            (376,342)
                                                                                      ---------       --------------

CASH FLOWS FROM INVESTING ACTIVITIES
Capital expenditures                                                                    (46,556)                   -
Notes receivable payments                                                                17,589                    -
Proceeds from sale of fixed assets                                                       57,200                8,000
                                                                                      ---------        -------------
  Net cash provided by investing activities                                              28,233               34,668
                                                                                      ---------        -------------
<S>                                                                                      <C>                   <C>
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal repayment of notes. . . . . . . . . . . . . . . . . . . . . . . .             (48,883)            (192,773)
Principal borrowings on notes . . . . . . . . . . . . . . . . . . . . . . .             100,000              185,000
Joint Venture contribution                                                               50,000                    -
Due to related parties. . . . . . . . . . . . . . . . . . . . . . . . . . .                   -               59,750
                                                                                     ----------          -----------
  Net cash provided by financing activities . . . . .         . . . . . . .             101,117               51,977
                                                                                     ----------          -----------

NET INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS.. . . . . . . . . . .. .              23,308             (289,697)

CASH & CASH EQUIVALENTS AT BEGINNING OF PERIOD . . . . . . . . . . . . . ..             211,682              343,374
                                                                                     ----------         -------------
CASH & CASH EQUIVALENTS AT END OF PERIOD. . . . . . . . . .  .  . . . . . .  $          234,990   $           53,677
                                                                              =================   ==================

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
---------------------------------------------------------------------------
Interest paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $          191,116   $          108,201
                                                                             ==================   ==================
Income taxes paid . . . . . . . . . . . . . . . . . . . . . . . . . . . . .  $                0   $                0
                                                                             =================    ==================
</TABLE>


    See accompanying notes to the condensed consolidated financial statements
                                       -6-

<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)

NOTE  1  DESCRIPTION  OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
--------------------------------------------------------------------------------
Following  is  a  summary of the significant accounting policies followed in the
preparation  of  these  consolidated financial statements, which policies are in
accordance with accounting principles generally accepted in the United States of
America.

On April 7, 2003, the Company filed on an emergency basis a voluntary Chapter 11
bankruptcy petition.  The case is pending in the United States Bankruptcy Court,
Central  District  of  California,  San  Fernando  Valley  Division

The  Company  requires  the  use  of  its  secured creditor's cash collateral to
operate.  Throughout  the pendency of this case, the Company has worked with its
two  real estate secured lenders, Finance Unlimited, LLC and Laurus Master Fund,
Limited  on  the  details  of  cash collateral stipulation. An order approving a
global interim cash collateral stipulation with Finance Unlimited and Laurus was
entered  on August 26, 2003. This stipulation permitted the Company's use of the
lenders'  cash  collateral  through  December  31,  2003.

On  January  15,  2004,  the  Court  approved  two  additional  cash  collateral
stipulations,  one  each  with  Finance  Unlimited  and  Laurus, authorizing the
Company's  continued  use  of  cash  collateral  through  March 31, 2004 (Second
Interim  Stipulation).  The  Second  Interim Stipulation generally grant Finance
Unlimited  and  Laurus relief from the automatic bankruptcy stay effective March
31,  2004,  and  the right to hold foreclosures sales on their real and personal
property  collateral  as  early  as  April  1,  2004.

DESCRIPTION  OF  BUSINESS
-------------------------
ValCom,  Inc.  and  subsidiaries  (the  "Company"), formerly SBI Communications,
Inc., was originally organized in the State of Utah on September 23, 1983, under
the  corporate name of Alpine Survival Products, Inc.  Its name was subsequently
changed  to  Supermin,  Inc.  on  November  20,  1985.  On  September  29, 1986,
Satellite  Bingo,  Inc.  became  the  surviving  corporate entity in a statutory
merger  with  Supermin,  Inc.  In  connection  with the above merger, the former
shareholders  of Satellite Bingo, Inc. acquired control of the merged entity and
changed  the  corporate  name  to Satellite Bingo, Inc.  On January 1, 1993, the
Company  executed  a plan of merger that effectively changed the Company's state
of  domicile from Utah to Delaware. Through shareholder approval dated March 10,
1998,  the  name  was  changed  to  SBI  Communications,  Inc.

In  October 2000, the Company was issued 7,570,997 shares by SBI for 100% of the
shares  outstanding  in  Valencia  Entertainment  International,  LLC ("VEI"), a
California limited liability company. This acquisition has been accounted for as
a  reverse  acquisition  merger  with VEI as the surviving entity. The corporate
name  was  changed  to  ValCom,  Inc.  effective  March  21,  2001.

The  Company is a diversified entertainment company with the following operating
activities:

a)  Studio  rental  -  the  Company  leases eight sound and production stages to
production  companies. Six of the eight sound and production stages are owned by
the  Company, while the remaining two stages are leased from a third party under
an  operating  lease  agreement.

b)  Studio equipment and rental - operating under the name Half Day Video, Inc.,
the Company supplies and rents personnel, cameras and other production equipment
to  various  production  companies  on  a  short-term  or  long-term  basis.

c)  Film  and  TV  production  -The  Company,  in  addition to producing its own
television  and  motion  picture
programming,  has  an exclusive facilities agreement in place for productions in
Los  Angeles  County  for  a  three-year  term  with  Woody  Fraser/Woody Fraser
Productions.
d)  Broadcast  Television  -  The  Company  owns a 45% equity interest in ValCom
Broadcasting,  LLC,  a  New  York limited liability company, which operates KVPS
(Channel  8),  an  independent  television  broadcaster  in  the  Palm  Springs,
California  market,  which  is strategically located in the middle of four major
markets  including  Los  Angeles,  Phoenix,  Las  Vegas  and  San  Diego.


    See accompanying notes to the condensed consolidated financial statements
                                       -7-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (UNAUDITED)


BASIS  OF  PRESENTATION
-----------------------
The  accompanying unaudited consolidated financial statements have been prepared
in  accordance  with  generally  accepted  accounting  principles  for  interim
financial  information  and  with the instructions to Form 10-QSB.  Accordingly,
they  do  not include all of the information and footnotes required by generally
accepted  accounting  principles  for  complete financial statements and related
notes  included  in  the  Company's  Form  10-KSB.

The  audited consolidated financial statements of the Company for the year ended
September  30,  2003  were  filed  on  February 13, 2004 with the Securities and
Exchange  Commission  and  are hereby referenced.  In the opinion of management,
the  accompanying  unaudited  consolidated  financial  statements  contain  all
adjustments  (consisting only of normal recurring accruals) considered necessary
for fair presentation has been included. The results of operations for the three
months  ended December 31, 2003 are not necessarily indicative of the results to
be  expected  for  the  entire  year.

PRINCIPLES  OF  CONSOLIDATION
-----------------------------
The  consolidated  financial statements include the accounts of ValCom, Inc. and
two  wholly-owned subsidiaries, Valencia Entertainment International, LLC, which
was  acquired  effective  February  2001  and  Half  Day  Video, Inc., which was
acquired  effective  March  2001.

Investments  in  affiliated  companies  over which the Company has a significant
influence  or  ownership  of  more  than  20%  but less than or equal to 50% are
accounted  for  under  the  equity  method.

USE  OF  ESTIMATES
------------------
The  preparation  of  consolidated  financial  statements  in  conformity  with
accounting  principles  generally  accepted  in  the  United  States  of America
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  consolidated  financial  statements and the
reported  amounts  of  revenue  and expenses during the reporting period. Actual
results  could  materially  differ  form  those  estimates.

CONCENTRATIONS  AND  CREDIT  RISK
---------------------------------
The  Company  has  two  customers  who  accounted for approximately 99% of total
rental  revenues  for  the  three  months  ended  December  31,  2003  and 2002,
respectively.  As  of  December  31, 2003, all eight sound and production stages
were  under  non-cancelable  operating  leases  for  one  year  from  two  major
production  companies.

Financial  instruments that potentially subject the Company to concentrations of
risk  consist  of trade receivables principally arising from monthly leases from
television  producers.  The  Company continuously monitors the credit-worthiness
of  its  customers  to  minimize  its  credit  risk.

FAIR  VALUE  OF  FINANCIAL  INSTRUMENTS
---------------------------------------
Statement of financial accounting standard No. 107, Disclosures about fair value
of  financial  instruments,  requires  that  the Company disclose estimated fair
values of financial instruments. The carrying amounts reported in the statements
of  financial  position for current assets and current liabilities qualifying as
financial  instruments  are  a  reasonable  estimate  of  fair  value.


    See accompanying notes to the condensed consolidated financial statements
                                       -8-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


IMPAIRMENT  OF  LONG-LIVED  ASSETS
----------------------------------
Effective January 1, 2002, the Company adopted Statement of Financial Accounting
Standards  No.  144,  "Accounting  for  the Impairment or Disposal of Long-Lived
Assets" ("SFAS 144"), which addresses financial accounting and reporting for the
impairment  or  disposal  of  long-lived  assets  and  supersedes  SFAS No. 121,
"Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
be  Disposed Of," and the accounting and reporting provisions of APB Opinion No.
30,  "Reporting  the  Results  of  Operations  for  a Disposal of a Segment of a
Business."  The  Company periodically evaluates the carrying value of long-lived
assets  to  be  held  and  used  in accordance with SFAS 144.  SFAS 144 requires
impairment  losses  to  be recorded on long-lived assets used in operations when
indicators  of  impairment are present and the undiscounted cash flows estimated
to  be generated by those assets are less than the assets' carrying amounts.  In
that  event,  a  loss  is  recognized  based on the amount by which the carrying
amount  exceeds  the  fair  market  value  of  the  long-lived  assets.  Loss on
long-lived  assets  to  be disposed of is determined in a similar manner, except
that  fair  market  values  are  reduced for the cost of disposal.  Based on its
review,  the Company  believes  that,  as  of  September 30,  2003,  there  were
no  significant  impairments  of  its  long-lived  assets.

REVENUE  RECOGNITION
--------------------
Revenues  from  studio  and  equipment  rentals  are recognized ratably over the
contract  terms.  Revenues  from  the  production  and  licensing  of television
programming  are  recognized when the films or series are available for telecast
and certain contractual terms of the related production and licensing agreements
have  been  met.  Advertising revenues are recognized in the period during which
the  advertising is published in the Company's magazine, Brentwood Magazine.  In
January  2003,  the Company entered into a Memorandum of Understanding to cancel
the Agreement and Plan of Reorganization dated August 2, 2002, pursuant to which
the  Company  acquired  PTL  Productions  (dba  Brentwood Magazine) and sell PTL
Productions,  Inc.  (dba  Brentwood  Magazine)  back  to  the  seller.

EQUITY  INVESTMENT
------------------
The Company accounts for its investments in companies over which the Company has
significant  influence  or  ownership of more than 20% but less than or equal to
50%  under  the  equity  method.  The  Company's  45%  investment  in a recently
acquired  television  station  has been accounted for as an investment under the
equity  method  (See  Note  15)

INTERIM  CONDENSED  CONSOLIDATED  FINANCIAL  STATEMENTS
-------------------------------------------------------

The condensed consolidated financials statements as of December 31, 2003 and for
the  three months ended December 31, 2003 and 2002 are unaudited. In the opinion
of  management,  such  condensed  consolidated  financial statements include all
adjustments  (consisting  only  of  normal recurring accruals) necessary for the
fair  presentation  of  the consolidated financial position and the consolidated
results  of  operations.  The  consolidated  results of operations for the three
months  ended  December  31, 2003 and 2002 are not necessarily indicative of the
results  to  be  expected  for  the  full  year.

The  accompanying  consolidated financial statements have been prepared assuming
that  the  Company will continue as a going concern.  The Company has a net loss
of  $646,733  and a negative cash flow from operations of $106,042 for the three
months  ended  December 31, 2003, and a working capital deficiency of $9,090,708
and an accumulated deficit of $11,203,083 at December 31, 2003.  The Company had
a  net  loss of $776,726 and a negative cash flow from operations of 376,342 for
the  three months ended December 31, 2002. Valencia Entertainment International,
LLC,  a  California  limited  liability  company and the Registrant's subsidiary
filed  on  April  7, 2003, a voluntary petition in bankruptcy for reorganization
under  Chapter  11  of  the U.S. Bankruptcy Code in the United States Bankruptcy
Court  for  the Southern District of California (note 8). The main income of the
Registrant is from the operations of Valencia Entertainment International. These
conditions  raise  doubt  about  the  Company's  ability  to continue as a going
concern  if  suitable  remedies  are  not  undertaken.


                                       -9-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)
                                   -----------

GOING  CONCERN
--------------
The  accompanying  consolidated financial statements have been prepared assuming
that  the  Company will continue as a going concern.  The Company has a net loss
of  $646,733  and a negative cash flow from operations of $106,042 for the three
months  ended  December 31, 2003, and a working capital deficiency of $9,090,708
and an accumulated deficit of $11,203,083 at December 31, 2003.  The Company had
a  net  loss of $776,726 and a negative cash flow from operations of 376,342 for
the  three months ended December 31, 2002. Valencia Entertainment International,
LLC,  a  California  limited  liability  company and the Registrant's subsidiary
filed  on  April  7, 2003, a voluntary petition in bankruptcy for reorganization
under  Chapter  11  of  the U.S. Bankruptcy Code in the United States Bankruptcy
Court  for  the Southern District of California (note 8). The main income of the
Registrant is from the operations of Valencia Entertainment International. These
conditions  raise  doubt  about  the  Company's  ability  to continue as a going
concern  if  suitable  remedies  are  not  undertaken.

In  view of this, the Company is actively pursuing a re-organization plan, which
includes  cost  reductions  in  various  fronts,  refinancing  of property, debt
restructuring,  issuing  equity  securities in exchange for services and selling
additional equity or debt securities.  All of the above measures will enable the
Company  to  overcome  its  financial  difficulties.

LOSS  PER  COMMON  SHARE
------------------------
Basic loss per common share is based on net loss divided by the weighted average
number of common shares outstanding.  Common stock equivalents were not included
in  the  calculation  of  diluted  loss  per  share  as  their  effect  would be
anti-dilutive.

DEPRECIATION  AND  AMORTIZATION
-------------------------------
For  financial  and  reporting  purposes,  the  Company  follows  the  policy of
providing  depreciation  and  amortization  on the straight-line method over the
estimated  useful  lives  of  the  assets,  which  are  as  follows:

Building                        39  years
Building  Improvements          39  years
Production  Equipment            5  years
Office Furniture and Equipment   5  to 7 years
Leasehold  Improvements          5  years
Autos  and  Trucks               5  years


NEW  ACCOUNTING  PRONOUNCEMENTS
-------------------------------



                                      -11-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


On  April  30,  2003,  the  FASB  issued  FASB  Statement  No. 149 ("SFAS 149"),
"Amendment  of  Statement 133 on Derivative Instruments and Hedging Activities".
FAS  149  amends  and  clarifies  the  accounting  guidance  on  (1)  derivative
instruments  (including  certain  derivative  instruments  embedded  in  other
contracts)  and  (2)  hedging  activities  that  fall  within  the scope of FASB
Statement  No.  133  ("SFAS  133"),  Accounting  for  Derivative Instruments and
Hedging  Activities. SFAS 149 also amends certain other existing pronouncements,
which will result in more consistent reporting of contracts that are derivatives
in  their  entirety  or  that contain embedded derivatives that warrant separate
accounting.  SFAS  149  is  effective (1) for contracts entered into or modified
after  June 30, 2003, with certain exceptions, and (2) for hedging relationships
designated after June 30, 2003. The guidance is to be applied prospectively. The
adoption  of  SFAS  No.  149  does  not  have a material impact on the Company's
financial  position  or  results  of  operations  or  cash  flows.

On  May 15 2003, the FASB issued FASB Statement No. 150 ("SFAS 150"), Accounting
for  Certain  Financial Instruments with Characteristics of both Liabilities and
Equity.  SFAS 150 changes the accounting for certain financial instruments that,
under previous guidance, could be classified as equity or "mezzanine" equity, by
now  requiring  those  instruments to be classified as liabilities (or assets in
some  circumstances)  in  the statement of financial position. Further, SFAS 150
requires  disclosure  regarding  the  terms  of those instruments and settlement
alternatives.  SFAS  150  affects  an  entity's  classification of the following
freestanding  instruments:  a)  Mandatorily  redeemable instruments b) Financial
instruments  to  repurchase  an  entity's  own  equity  instruments c) Financial
instruments embodying obligations that the issuer must or could choose to settle
by  issuing  a  variable  number of its shares or other equity instruments based
solely on (i) a fixed monetary amount known at inception or (ii) something other
than  changes  in  its  own  equity  instruments  d)  SFAS 150 does not apply to
features  embedded  in  a  financial  instrument that is not a derivative in its
entirety.  The  guidance  in  SFAS  150 is generally effective for all financial
instruments  entered  into  or  modified  after  May  31, 2003, and is otherwise
effective  at the beginning of the first interim period beginning after June 15,
2003.  For  private  companies, mandatorily redeemable financial instruments are
subject  to  the  provisions  of  SFAS 150 for the fiscal period beginning after
December  15, 2003. The adoption of SFAS No. 150 Does not have a material impact
on  the  Company's  financial  position  or results of operations or cash flows.

In  December  2003,  the  Financial  Accounting  Standards Board (FASB) issued a
revised  Interpretation  No.  46,  "Consolidation of Variable Interest Entities"
(FIN  46R).  FIN 46R addresses consolidation by business enterprises of variable
interest  entities  and  significantly  changes the consolidation application of
consolidation  policies  to  variable  interest  entities  and,  thus  improves
comparability  between  enterprises  engaged  in  similar  activities when those
activities  are  conducted  through variable interest entities. The Company does
not  hold  any  variable  interest  entities.


                                      -11a-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

RECLASSIFICATION
----------------

Certain  prior  period  amounts have been reclassified to conform to the current
period's  presentation.


NOTE  2  NET  INCOME  (LOSS)  PER  SHARE
----------------------------------------

The  Company's  net  loss per share was calculated using weighted average shares
outstanding  of  15,213,818  for  the  three  months ended December 31, 2003 and
11,165,249 for the three months ended December 31, 2002, respectively.  Although
convertible  preferred  stock,  convertible  debt, and warrants are common stock
equivalents,  they  are  not included in the calculation of diluted earnings per
share  as  their  effect  would  be  anti-dilutive or their conversion price was
greater  than  the  average  market  price  of  the  Company's  common  stock.

NOTE  3  SEGMENT  INFORMATION
-----------------------------
                               Studio    Studio Equip   Film & TV
                               Rental      Rental      Production      Total
                             ---------  -------------  ------------  ----------
As of and for the three months ended December 31,

2003
----
Revenues                      $  511,449   $  22,462   $  30,237    $  564,148
Operating (Loss) Income         (423,118)    (22,589)     19,295      (426,412)
Total  Assets                 12,523,785      97,162           0    12,620,947
Depreciation and Amortization    198,160      12,200           0       210,360

2002
----
Revenues                      $  634,843   $   7,194   $ 122,892    $  764,929
Operating loss                  (509,374)    (32,383)    (68,131)     (609,888)
Total  Assets                 12,814,730     281,837      36,430    13,132,997
Depreciation and Amortization     75,540      12,200           0        87,740


                                      -12-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

NOTE 4 LITIGATION
-----------------

On April 7, 2003, the Company filed on an emergency basis a voluntary Chapter 11
bankruptcy petition.  The case is pending in the United States Bankruptcy Court,
Central  District  of  California,  San Fernando Valley Division, as Case No. SV
03-12998-GM.  .

The  Company  requires  the  use  of  its  secured creditor's cash collateral to
operate.  Throughout  the pendency of this case, the Company has worked with its
two  real estate secured lenders, Finance Unlimited, LLC and Laurus Master Fund,
Limited  on  the  details  of  cash collateral stipulation. An order approving a
global interim cash collateral stipulation with Finance Unlimited and Laurus was
entered  on August 26, 2003. This stipulation permitted the Company's use of the
lenders'  cash  collateral  through  December  31,  2003.

On  January  15,  2004,  the  Court  approved  two  additional  cash  collateral
stipulations,  one  each  with  Finance  Unlimited  and  Laurus, authorizing the
Company's  continued  use  of  cash  collateral  through  March 31, 2004 (Second
Interim  Stipulation).  The  Second  Interim Stipulation generally grant Finance
Unlimited  and  Laurus relief from the automatic bankruptcy stay effective March
31,  2004,  and  the right to hold foreclosures sales on their real and personal
property  collateral  as  early  as  April  1,  2004.

On  June  26,  2003,  the  Company filed within its bankruptcy case an adversary
complaint  against  six  creditors  for  injunctive  relief  and  to  extend the
protections  of the automatic stay arising under section 362 of Bankruptcy Code.
Through  this  action,  the  Company  seeks  to  bar  temporarily  the defendant
creditors  from attempting to collect on their allowed claims from the Company's
key  personnel.

In  September  2001,  a  complaint  was filed in the Los Angeles County Superior
Court,  Russomano  et  al.  v.  VEI et al., BC 257989.  The plaintiffs are Diane
Russomano  and  Knowledge  Booster, Inc. and the defendants include Valcom, Inc.
and  Valencia  Entertainment International ("Valencia"), the Company's president
and  others.  The  complaint  revolves  around  prior  litigation  in  which the
plaintiffs  alleged,  among  other things, that the show "A.J.'s Time Travelers"
violated  plaintiffs'  rights  in  a  children's  television show called "Rickey
Rocket".

That  case  went to trial, and plaintiffs obtained judgments against a number of
defendants,  including  a  judgment  in  the amount of $3 million against Rickey
Rocket Enterprises ("RREI") and a judgment in the amount of $1.2 million against
Time  Travelers,  Inc.  ("TTI").


                                      -13-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)

The  complaint  asserted  two causes of action against the Company, Valencia and
other  defendants.  The first cause of action alleges the Company was the "alter
ego"  of RREI and/or TTI and is therefore liable for the judgments against those
entities.  The  second  cause  of action was for malicious prosecution; and both
causes  have  been dismissed with prejudice against the Company, where as VEI is
in  a  stay  until Chapter 11 is lifted.  VEI became a distributor for A.J. Time
Travelers, Inc., but not until four years after the alleged wrongdoing occurred.

Clay Harrison v. SBI Communications, Inc. and Valcom, Inc. (Los Angeles Superior
----------------------------------------------------------
Court  Case  No.  BC  035014)
 On December 9, 2002, a complaint was filed by Clay Harrison against the Company
and  SBI  Communications,  Inc.  seeking  damages  for  breach  of  his  alleged
employment  contract.  The  dispute  involves  Mr. Harrison's termination as the
President  of  Half  Day  Video, Inc., a wholly owned subsidiary of the Company.
The  Parties  entered  into  a  settlement  agreement  in  November,  2003.

Euromerica  Capital  Group  v.  Valcom,  Inc.  and  Valencia  Entertainment
---------------------------------------------------------------------------
International.
--------------

Euromerica  Capital  Group  filed  a  lawsuit  against ValCom, Inc. and Valencia
Entertainment  International  on  August  26,  2002  based  on alleged breach of
contract.  The  Plaintiff is seeking monetary damages of $47,556. ValCom filed a
cross-complaint  for  breach  of  contract,  intentional  misrepresentation  and
concealment.  ValCom  asked  for  monetary damages in the amount of $45,000 plus
punitive  damages.  Valencia  Entertainment  subsequently filed bankruptcy under
Chapter 11 and the automatic stay has prevented the case from moving forward. It
is  expected  that  the  case  will be settled upon completion of the bankruptcy
proceeding.

The  Company  is involved from time to time in legal proceedings incident to the
normal  course  of  business.  Management  believes  that  the ultimate outcome,
except  the cases mentioned above, of any pending or threatened litigation would
not  have  a  material  adverse  effect  on the Company's consolidated financial
position,  results  of  operations  or  cash  flows.

NOTE5  STOCKHOLDERS'  EQUITY
----------------------------
(A)  CONVERTIBLE  PREFERRED  STOCK
----------------------------------
At  September  30,  2002,  the Company had three series of convertible Preferred
Stock:  B,  C and D.  Series B Preferred Stock has no voting rights, is entitled
to  receive  cumulative  dividends  in  preference to any dividend on the common
stock at a rate of 10% per share, per year, to be issued if and when declared by
the Board of Directors and can be converted at any time into common stock on a 1
for 5 basis.  In the event of any liquidation, the holders of shares of Series B
Preferred Stock then outstanding shall be entitled to receive an amount equal to
the  purchase  price  per  share,  plus  an  amount equal to declared but unpaid
dividends thereon, if any, to the date of payment.  Series C Preferred Stock has
no  voting  rights, is entitled to receive cumulative dividends in preference to
any  dividend  on  the  common stock at a rate of 10% per share, per year, to be
issued  if  and  when declared by the Board of Directors and can be converted at
any time into common stock on a 1 for 1 basis.  In the event of any liquidation,
the  holders  of  shares  of  Series C Preferred Stock then outstanding shall be
entitled  to  receive  an  amount equal to the purchase price per share, plus an
amount  equal  to  declared but unpaid dividends thereon, if any, to the date of
payment.  Series D Preferred Stock has no voting rights, no dividends and can be
converted  at  any time to common stock on a 1 for 1 basis.  In the event of any
liquidation,  the holders of shares of Series C Preferred Stock then outstanding
shall  be  entitled  to receive an amount equal to the purchase price per share.

With  respect  to rights on liquidation, Series B, C and D Preferred Stock shall
rank  senior to the common stock but Series C Preferred Stock shall be senior to
both  Series  B  and  D  Preferred Stock while Series D Preferred Stock shall be
junior  to both Series B and C Preferred Stock.  No dividends have been declared
by  the  Board of Directors for any of the Series of convertible Preferred Stock
for  the  fiscal  year  ended  September  30,  2002.

On  June  6,  2002,  the  Company  received  $930,000,  net  for the issuance of
1,250,000  shares  of  Series  D  Convertible  Preferred  Stock to an accredited
investor.  In  connection with the transaction, the Company also issued warrants
to the preferred stockholder to purchase an aggregate of 1,300,000 shares of the
Company's  common stock at an exercise price of $.80 per share, expiring on June
18,  2007.  The Company allocated the net proceeds received from the sale of the
preferred  stock  to  the  warrants  using the Black-Scholes pricing model.  The
allocation  of  the  net  proceeds  to  the warrants amounted to $466,908 and is
included  in  additional  paid-in  capital  in  the  accompanying  condensed
consolidated  balance  sheet at September 30, 2002.  Also in connection with the
sale  of  the  Series  D  Convertible Preferred Stock, the Company incurred a 7%
placement  agent  fee and also issued the placement agents 125,000 "VACM Units",
each  unit  comprised of one share of common stock and a warrant to purchase one
share  of  common  stock  at  an  exercise price of $.80 per share.  The Company
recorded  the  $70,000  placement  agent  fee  as  a  reduction  of the proceeds
received,  thereby  reducing  additional paid-in capital by $70,000 at September
30,  2002.  Each  VACM Unit is exercisable at $.80 per unit and the unit and the
underlying  warrant  expire  June 18, 2007.  The Company valued the VACM Unit by
apportioning  value  to  the  underlying  warrant  and  common  stock  using the
Black-Scholes  pricing model, and by measuring the intrinsic value of the common
stock.  The value of the 125,000 VACM Units amounted to $60,745 and was recorded
as  an  increase  in  additional  paid-in  capital  at  September  30,  2002.


                                      -14-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES
        NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)
                                   (UNAUDITED)


In  connection with the Series D Preferred Stock financing, the Company has also
issued  2,800,000 shares of its common stock to be held in escrow based upon the
terms  of the financing agreement.  The financing agreement requires the Company
to  hold in escrow 1,250,000 shares of common stock as a deposit in anticipation
of  the  preferred  stockholder's  conversion  of  1,250,000  shares of Series D
Preferred  Stock, an additional 1,300,000 shares of common stock as a deposit in
anticipation  of  the  preferred  stockholder's exercise of warrants to purchase
1,300,000  shares  of  common  stock, and an additional 250,000 shares of common
stock as a deposit in anticipation of the placement agents' exercise of its VACM
Units.  As discussed above, the Series D Preferred Stock can be converted at any
time  to  common  stock  on a 1 for 1 basis.  At September 30, 2002, none of the
2,800,000  common  shares  have been released from escrow and are not considered
outstanding  for  purposes  of  computing  weighted  average shares outstanding.

(B)  COMMON  STOCK
------------------
During  the  three  months  ended  December 31, 2003, the Company issued 538,333
shares  of  common  stock  in  lieu  of  debt retirement.  The value of the debt
retired  totaled  approximately  $57,959.

During  the  three  months  ended  December 31, 2003, the Company issued 500,000
shares  of  common stock in lieu of prepaid development costs.  The value of the
development  costs totaled approximately $215,000, which was computed based upon
the  market  prices  of  the  common  stock  on  the  applicable  payment dates.

During  the  three  months  ended  December 31, 2003, the Company issued 200,000
shares  of  common stock in lieu of compensation consultancy services performed.
The  value  of the consultancy services performed totaled approximately $94,000,
which  was  computed  based  upon  the  market prices of the common stock on the
applicable  payment  dates.

During  the  three  months  ended  December 31, 2003, the Company issued 200,000
shares  of  common  stock  in  lieu  of  compensation,  salaries  and bonuses to
employees.  Total  value  of  the  compensation,  salaries  and  bonuses  was
approximately  $82,000,  which  was computed based upon the market prices of the
common  stock  on  the  applicable  payment  dates.

(C)  WARRANTS
-------------
During  the fiscal year ended September 30, 2003, the Company issued warrants to
purchase  2,083,334  shares  of  the  Company's  common  stock  to a director in
connection  with  services  provided  and  to  be  provided  to the company. The
weighted  average  exercise  price for the warrants issued was $0.12, and all of
the  warrants  begin  to  expire  in September 2005.  The director has exercised
558,333  warrants  up  to  December  31,  2003.

During  the fiscal year ended September 30, 2002, the Company issued warrants to
purchase  2,075,000  shares of the Company's common stock to certain individuals
and  companies  in connection with the issuance of Series D Preferred Stock (see
Note  13(A))  and consulting agreements. The weighted average exercise price for
the warrants issued was $0.75, and all of the warrants begin to expire in fiscal
year  2007.  There  were  no  warrants  outstanding  prior  to fiscal year 2002.
Additionally,  the Company recorded consulting expense of $271,651 in connection
with warrants issued to consultants.  These warrants were valued using the Black
Scholes  pricing  model.  The  Company  also  recorded  $324,724  of  deferred
compensation  in  connection  with the consulting agreements in the accompanying
consolidated  balance  sheet  at  September  30,  2002.

In  connection  with  the  acquisition  of  PTL Productions, Inc. (dba Brentwood
Magazine),  the Company was to issue 400,000 shares of Series C preferred stock,
convertible  1  for  1 into common shares.  The Value of the preferred stock was
$252,000  or  $.63 per share based on the value of the Company's common stock on
the  date of acquisition.  On December 6, 2002 the Company issued 380,000 shares
of  Series  C  Preferred Stock valued at $239,400.  The par value of the 380,000
shares  of  Series C Preferred Stock ($380) is included in preferred stock while
the  remaining value ($239,020) is included in additional paid-in-capital.   The
value  of  the remaining 20,000 shares of $12,600 still to be issued is included
in  preferred stock payable in the accompanying balance sheet.  In January 2003,
the  Company  entered into a Memorandum of Understanding to cancel the Agreement
and  Plan  of Reorganization dated August 2, 2002, pursuant to which the Company
acquired  PTL  Productions,  Inc.  (dba  Brentwood  Magazine)  and  sell  PTL
Productions,  Inc. back to the seller.  In connection with the sale, the Company
will receive back 200,000 shares of its Series C Preferred Stock and $300,000 of
trade  credit  (See  Note  8).

NOTE  6  SUBSEQUENT  EVENTS
---------------------------
Subsequent  to  December  31,2003,  the  Company issued 274,000 shares of common
stock  at  $0.25 amounting to $68,500 through private placements. In addition to
this the Company also issued 650,000 shares for $0.41 per share against services
rendered  and  115,750  shares  to  employees  per  the  terms of the employment
agreements  and  for  bonuses


                                      -15-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES

ITEM  2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF  OPERATIONS

INTRODUCTION

 PLAN  OF  OPERATION

As  of  December  31,  2003,  ValCom,  Inc.  operations  were  comprised of four
divisions:  (1)  Studio  Rental,  (2) Studio Equipment and Personnel Rental, (3)
Broadcast  Television  and  (4)  Film  and  Television  Production.

STUDIO  RENTAL
--------------

The  Company  and  its  subsidiary,  Valencia  Entertainment International, LLC,
operates  eight  sound  stages  in Valencia, California.  Valencia Entertainment
International,  LLC owns six improved acres on which six of the sound stages are
located.  The  Company  leases the other two sound stages.  Beginning June 2003,
the  Company  and  its  subsidiary  has  a newly signed one-year lease with five
one-year  options  for  all  eight  sound stages, which will generate $2,100,000
annually  with  cost-of-living  increases.

STUDIO  EQUIPMENT  RENTAL
-------------------------

The  Company's subsidiary, Half Day Video, Inc., supplies personnel, cameras and
other  production  equipment  to  various  production  companies on a short-term
basis.  As  a  result  of additional equipment purchases and increased activity,
from  both  internal  and  external  sources, we anticipate that Half Day Video,
Inc.'s  revenues  should  increase  significantly.

TELEVISION  AND  FILM  PRODUCTION
---------------------------------

The  Company,  in  addition  to  producing its own television and motion picture
programming,  has  an exclusive facilities agreement in place for productions in
Los  Angeles  County  for  a  three-year  term  with  Woody  Fraser/Woody Fraser
Productions  (See  Note  5).

CHANNEL  8  IN  PALM  SPRINGS,  CALIFORNIA
------------------------------------------
In  connection  with its joint venture with New Global Communications, Inc., the
Company  owns  a  45%  equity  interest  in ValCom Broadcasting, LLC, a New York
limited  liability  company,  which  operates  KVPS  (Channel 8), an independent
television  broadcaster  in  the  Palm  Springs,  California  market,  which  is
strategically located in the middle of four major markets including Los Angeles,
Phoenix,  Las  Vegas  and  San  Diego.

RESULTS  OF  OPERATIONS

THREE  MONTHS  ENDED  DECEMBER  31,  2003  VS.  DECEMBER  31,  2002
-------------------------------------------------------------------

Revenues  for  the three months December 31, 2003 decreased by $132,714 or 17.3%
from  $764,929  for the three months ended December 31, 2002 to $632,215 for the
same  period  in 2003.  The decrease in revenue was principally due to decreased
production  revenues  associated  with  the  joint  venture  with  Woody  Fraser
Productions.

Production  costs  for  the  three  months  ended December 31, 2003 decreased by
$180,081  or 94.3% from $191,023 for the three months ended December 31, 2002 to
$10,942  for  the  same  period  in  2003.  The decrease in production costs was
principally due to decreased production associated with Woody Fraser Productions
as  described  above.

Selling and promotion costs for the three months ended December 31, increased by
$1,555  or  12.5%  from  $12,417 for the three months ended December 31, 2002 to
$13,972  for  the  same  period in 2003.  The increase was due principally to an
increase  in  travel  and  public  relations  expenses.


                                      -16-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES

Depreciation  and  amortization  expense for the three months ended December 31,
2003  increased  by  $100 or 0% from $87,740 for the three months ended December
31,  2002  to  $87,840  for  the  same  period  in  2003.

General and administrative expenses for the three months ended December 31, 2003
decreased by $167,359 or 19.7% form $848,143 for the three months ended December
31,  2002  to  $680,784  for  the  same  period  in  2003.  the decrease was due
principally  to  decreased  personnel  costs,  insurance, printing, and bad debt
expense.

Consulting  and  professional  fees for the three months ended December 31, 2003
decreased  by  $92,925  or  by  39.5%  from  $235,494 for the three months ended
December  31,  2002  to  $142,569  for the same period in 2003.  the decrease in
consulting  and  professional  fees  was  principally due to decreased legal and
accounting  costs.

Interest  expense  for  the  three  months  ended December 31, 2003 increased by
$92,754  or  53.1% from $174,838 for the three months ended December 31, 2002 to
$267,592  for  the same period in 2003.  The increase was due principally to the
increase  in  interest  rates  associated  with  the  company's  mortgage loans.

Other  income  for the three months ended December 31, 2003 increased by $39,271
from $8,000 for the three months ended December 31, 2002 to $47,271 for the same
period  in  2003.  The  increase  was  due to a gain recognized from the sale of
fixed  assets  offset  by  the  loss  recorded  on  equity  investment of ValCom
Broadcasting,  LLC.

Due to the factors described above, the Company's net loss decreased by $252,513
from  $776,726  for the three months ended December 31, 2002 to $524,213 for the
same  period  in  2003.

FUTURE  OUTLOOK

The Company has entered into a joint venture agreement with O. Atlas Enterprises
to  produce an animation movie and an animation TV series called "New Zoo Revue"
based on an American Classic of the same name, which was highly successful.  The
Company  has  already  incurred  startup costs, which have been reflected in the
financial  statements  for  the  three  months  ended  December  31,  2003.

The  Company  is  in  the  process  of  closing  on additional studio facilities
comprising  7.5  acres  of land and 160,000 sq. ft. of buildings in Las Vegas as
part  of  its  expansion  plans.  Upon closing, the Company will undergo a three
phase  renovation,  which  will ensure additional rental revenues to the Company
with  revenue  opportunities for the Company's other related businesses to begin
almost  immediately.

LIQUIDITY  AND  CAPITAL  RESOURCES

The  Company's  condensed  consolidated  financial statements have been prepared
assuming  that  the Company will continue as a going concern.  The Company has a
net loss of $524,213 and a negative cash flow from operations of $56,043 for the
three  months  ended  December  31,  2003,  and  a working capital deficiency of
$9,090,708  and  an  accumulated  deficit  of  $11,080,563 at December 31, 2003.
These conditions raise substantial doubt about the Company's ability to continue
as  a  going  concern.

Cash  totaled  $316,521  on December 31, 2003, compared to $211,682 at September
30,  2003.  During  the  three  months ended December 31, 2003, net cash used by
operating  activities  totaled  $56,043  compared to $376,342 for the comparable
three  month  period  in  2002.  A  significant  portion of operating activities
included  payments  for  accounting  and  legal  fees,  salaries  and  rent.

Net  cash  provided  by financing activities for the three months ended December
31,  2003  totaled  $51,117  compared  to $51,977 for the comparable three-month
period  in  2002.  Net  cash  provided  by investing activities during the three
months  ended  December  31, 2003 totaled $28,233 compared to $34,668 during the
comparable  prior  year  period  due  principally  to decreased notes receivable
payments.

The above cash flow activities yielded a net cash increase of $23,308 during the
three  months  ended December 31, 2003 compared to a decrease of $289,697 during
the  comparable  prior  year  period.

Net  working  capital  (current  assets less current liabilities) was a negative
$9,090,708  as  of  December  31,  2003.  The  Company  will need to raise funds
through  various  financings  to maintain its operations until such time as cash
generated  by  operations  is  sufficient  to  meet  its  operating  and capital
requirements.  There  can be no assurance that the Company will be able to raise
such  capital  on  terms  acceptable  to  the  Company,  if  at  all.


                                      -17-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES

ITEM  3.  DISCLOSURE  CONTROLS  AND  PROCEDURES
-----------------------------------------------

Evaluation  of  Disclosure  Controls  and  Procedures
-----------------------------------------------------

Disclosure  controls  and  procedures  are  designed  to ensure that information
required  to  be  disclosed  in  the  Company's  periodic reports filed with the
Securities  and Exchange Commission under the Securities Exchange Act of 1934 is
recorded,  processed, summarized and reported, within the time periods specified
in  the  rules  and forms of the Securities and Exchange Commission.  Disclosure
controls  and  procedures  include,  without limitation, controls and procedures
designed  to  ensure  that  information required to be disclosed in the periodic
reports  filed  under  the  Securities  Exchange  Act of 1934 is accumulated and
communicated  to management, including the Chief Executive Officer and Principal
Financial  Officer, as appropriate, to allow timely decisions regarding required
disclosure.

Within  the  90  days  prior  to  the  filing  date  of this Report, the Company
conducted  an evaluation of the effectiveness of the design and operation of its
disclosure  controls  and  procedures  pursuant  to Securities Exchange Act Rule
13a-14.  This  evaluation  was  conducted  under  the  supervision  and with the
participation  of  the Company's Chief Executive Officer and Principal Financial
Officer.

     Effective  Disclosure  Controls
     -------------------------------

Based  upon  that  evaluation, the Company's officers concluded that many of the
Company's  disclosure  controls  and  procedures  are  effective  in  gathering,
analyzing  and disclosing information needed to satisfy the Company's disclosure
obligations  under  the  Securities  Exchange  Act  of  1934.  For  example, the
Company's  internal controls, particularly the areas of payroll, control of cash
and  accounts  payable,  are  effective.  In addition, the Audit Committee meets
with  the principal accounting officer on a regular basis to review and evaluate
the Company's financial position.  The Audit Committee also reports to the Board
of  Directors  on  the  accounting  and  finance  functions  on a regular basis.

     Weaknesses  in  Disclosure  Controls
     ------------------------------------

The  Company's  officers  also  identified  several  weaknesses in the Company's
disclosure  controls.  Such  weaknesses, and the steps the Company plans to take
to  remedy  the  weaknesses,  are  discussed  below.

1.     The  Company's  records of stock and equity related transactions were not
updated  on  a  timely  basis  and  do  not reflect the current ownership of the
Company  as  accurately as they might.  Remedy:  The Company intends to engage a
stock  transfer  agent  to handle issuances and conversions of all series of its
preferred stock. In addition, the Company will maintain more accurate records of
all  equity  transactions  during  the  year.

The  Board  of  Directors will ensure that it authorizes all stock, warrants and
options  granted  in  accordance  with applicable agreements and/or compensation
plans  to avoid the possibility of unauthorized issuances of stock, warrants and
options.

2.     The Company recorded a significant number of audit adjustments during the
fourth  quarter,  which  were required to properly state the account balances at
September  30,  2002.  Remedy:  The Company will implement comprehensive closing
procedures,  including an analysis of all balance sheet accounts and significant
income  statement  accounts.

3.     The  minutes  of  the Board of Directors' and stockholders' meetings were
not  always complete.  Remedy:  The Company will implement procedures to be more
comprehensive in the preparation of its minutes to include all important matters
that  affect  the Company's operations.  The Company will take appropriate steps
to  ensure  that  all minutes are properly approved and signed by the applicable
parties.

4.     The  Company  drafted  several  agreements  without  consulting its legal
counsel.  Therefore, some of the agreements had terms and provisions that either
changed  the  purpose  of  the  agreement or undermined the purpose or intent of
management.  Remedy:  The  Company  will  consult  its  legal  counsel as to the
legality  of  future  agreements  and  consult its auditors regarding the proper
accounting  treatment of such agreements in order to preserve the purpose of the
agreements  and  the  intent  of  management.

Changes  in  Internal  Controls
-------------------------------

There were no significant changes in the Company's internal controls or in other
factors  that  could  significantly  affect those controls since the most recent
evaluation  of  such  controls.  The  Company  intends  to  make  extensive
improvements,  as  outlined  above,  to  its  disclosure  controls.


                                      -18-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES


PART  II--OTHER  INFORMATION

ITEM  1.  LEGAL  PROCEEDINGS
----------------------------

In  September  2001,  a  complaint  was filed in the Los Angeles County Superior
Court,  Russomano  et  al.  v.  VEI et al., BC 257989.  The plaintiffs are Diane
Russomano  and  Knowledge  Booster, Inc. and the defendants include Valcom, Inc.
and  Valencia  Entertainment  International ("VEI"), the Company's president and
others.  The  complaint revolves around prior litigation in which the plaintiffs
alleged,  among  other  things,  that  the  show  "A.J.'s  Time
Travelers"  violated  plaintiffs'  rights in a children's television show called
"Rickey  Rocket".

That  case  went to trial, and plaintiffs obtained judgments against a number of
defendants,  including  a  judgment  in  the amount of $3 million against Rickey
Rocket Enterprises ("RREI") and a judgment in the amount of $1.2 million against
Time  Travelers,  Inc.  ("TTI").

The  complaint  asserted  two causes of action against the Company, Valencia and
other  defendants.  The first cause of action alleges the Company was the "alter
ego"  of RREI and/or TTI and is therefore liable for the judgments against those
entities.  The  second  cause  of action was for malicious prosecution; and both
causes  have  been dismissed with prejudice against the Company, where as VEI is
in  a  stay  until Chapter 11 is lifted.  VEI became a distributor for A.J. Time
Travelers, Inc., but not until four years after the alleged wrongdoing occurred.

Clay Harrison v. SBI Communications, Inc. and Valcom, Inc. (Los Angeles Superior
----------------------------------------------------------
Court  Case  No.  BC  035014)

On  December 9, 2002, a complaint was filed by Clay Harrison against the Company
and  SBI  Communications,  Inc.  seeking  damages  for  breach  of  his  alleged
employment  contract.  The  dispute  involves  Mr. Harrison's termination as the
President  of  Half  Day  Video, Inc., a wholly owned subsidiary of the Company.
The  Parties  entered  into  a  settlement  agreement  in  November,  2003.

Euromerica  Capital  Group  v.  Valcom,  Inc.  and  Valencia  Entertainment
---------------------------------------------------------------------------
International.
--------------

Euromerica  Capital  Group  filed  a  lawsuit  against ValCom, Inc. and Valencia
Entertainment  International  on  August  26,  2002  based  on alleged breach of
contract.  The  Plaintiff is seeking monetary damages of $47,556. ValCom filed a
cross-complaint  for  breach  of  contract,  intentional  misrepresentation  and
concealment.  ValCom  asked  for  monetary damages in the amount of $45,000 plus
punitive  damages.  Valencia  Entertainment  subsequently filed bankruptcy under
Chapter 11 and the automatic stay has prevented the case from moving forward. It
is  expected  that  the  case  will be settled upon completion of the bankruptcy
proceeding.

The  Company  is involved from time to time in legal proceedings incident to the
normal  course  of  business.  Management  believes  that  the ultimate outcome,
except  the cases mentioned above, of any pending or threatened litigation would
not  have  a  material  adverse  effect  on the Company's consolidated financial
position,  results  of  operations  or  cash  flows.

ITEM  2.  CHANGES  IN  SECURITIES
---------------------------------

During  the  three  months  ended  December  1, 2003, the Company issued 538,333
shares  of  common  stock  in  lieu  of  debt retirement.  The value of the debt
retired  totaled approximately $57,959.  This issuance of shares was exempt from
registration pursuant to Section 4(2) of the Securities Act of 1933, as amended.

During  the  three  months  ended  December 31, 2003, the Company issued 500,000
shares  of  common stock in lieu of prepaid development costs.  The value of the
development  costs totaled approximately $215,000, which was computed based upon
the  market  prices  of  the common stock on the applicable payment dates.  This
issuance  of shares was exempt from registration pursuant to Section 4(2) of the
Securities  Act  of  1933,  as  amended.

During  the  three  months  ended  December 31, 2003, the Company issued 200,000
shares  of  common stock in lieu of compensation consultancy services performed.
The  value  of the consultancy services performed totaled approximately $94,000,
which  was  computed  based  upon  the  market prices of the common stock on the
applicable  payment dates.  This issuance of shares was exempt from registration
pursuant  to  Section  4(2)  of  the  Securities  Act  of  1933,  as  amended.

During  the  three  months  ended  December 31, 2003, the Company issued 200,000
shares  of  common  stock  in  lieu  of  compensation,  salaries  and bonuses to
employees.  Total  value  of  the  compensation,  salaries  and  bonuses  was
approximately  $82,000,  which  was computed based upon the market prices of the
common stock on the applicable payment dates. This issuance of shares was exempt
from  registration  pursuant  to  Section 4(2) of the Securities Act of 1933, as
amended.


                                      -19-
<PAGE>

                          VALCOM, INC. AND SUBSIDIARIES


ITEM  3.  DEFAULTS  UPON  SENIOR  SECURITIES
--------------------------------------------

Not  applicable

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

Not  applicable

ITEM  5.  OTHER  INFORMATION
----------------------------

None

ITEM  6.  EXHIBITS  AND  REPORTS  ON  FORM  8-K
-----------------------------------------------

(A)  EXHIBITS:

Exhibit  Number     Description
---------------     -----------

99.1 Certification of the Chief Executive Officer of ValCom, Inc. Pursuant to 18
     U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the
     Sarbanes-Oxley Act of 2002.

     Certification of the Chief Financial Officer of ValCom, Inc. Pursuant to 18
     U.S.C. Section 1350, As Adopted Pursuant to Section 906 of the
     Sarbanes-Oxley Act of 2002.

99.2 Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

(B)  REPORTS  ON  FORM  8-K
              None


                                      -20-
<PAGE>

                                   SIGNATURES
                                   ----------

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

                                  VALCOM, INC.



Date:  February  24,  2004           By:  /s/Vince  Vellardita
                                     -------------------------------------
                                     Vince  Vellardita  Chairman  of  the
                                     Board  and  Chief  Executive  Officer
                                     (Principal  executive  officer)




In  accordance  with  the  Securities  Exchange Act, this report has been signed
below by the following persons on behalf of the registrant and in the capacities
and  on  the  date  indicated.

 Signature   Title  Date
 ---------   -----  ----


BY:  /s/Vince  Vellardita   CEO/President                    February  24, 2004
     --------------------                                    ------------------
     Vince Vellardita       Chairman of the Board

BY:  /s/Don Magier          Controller                       February 24, 2004
     ----------------       (Principal accounting officer)   -----------------
     Don Magier


                                      -21-

<PAGE>

EXHIBIT  99.1

          CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
          ------------------------------------------------------------
            PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I,  Vince  Vellardita,  the  Chief  Executive  Officer  of  ValCom,  Inc.  (the
"Company"),  certify, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002,
18  U.S.C.  Section  1350,  that  to  the  best  of  my  knowledge:

(1)  the  Quarterly  Report on Form 10-QSB of the Company for the fiscal quarter
ended  December  31, 2003 (the "Report") fully complies with the requirements of
Section  13  (a) or 15 (d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m
or  78o(d));  and

(2)  the  information  contained  in the Report fairly presents, in all material
respects,  the  financial  condition  and  results of operations of the Company.



Dated:  February  24,  2004
        -------------------



                                   /s/  Vince  Vellardita
                                   ----------------------
                                   Name:  Vince  Vellardita
                                   Title:  Chief  Executive  Officer



          CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED
          ------------------------------------------------------------
            PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

I,  Don  Magier,  the  Controller (principal accounting officer) of ValCom, Inc.
(the  "Company"),  certify, pursuant to Section 906 of the Sarbanes-Oxley Act of
2002,  18  U.S.C.  Section  1350,  that  to  the  best  of  my  knowledge:

(1)  the Quarterly Report on Form 10-QSB of the Company for the fiscal quarter
     ended December 31, 2003 (the "Report") fully complies with the requirements
     of Section 13 (a) or 15 (d) of the Securities Exchange Act of 1934 (15
     U.S.C. 78m or 78o(d)); and

(2)  the information contained in the Report fairly presents, in all material
     respects, the financial condition and results of operations of the Company.


Dated:  February  24,  2004
        -------------------



                                   /s/Don  Magier
                                   --------------
                                   Name:  Don  Magier
                                   Title: Controller
                                   (principal accounting officer)


                                      -22-

<PAGE>

EXHIBIT  99.2


                           CERTIFICATIONS PURSUANT TO
                         RULES 13A-14 AND 15D-14 OF THE
                  SECURITIES EXCHANGE ACT OF 1934, AS AMENDED,
                             AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


     In  connection  with  amendment number 1 of the Quarterly Report of ValCom,
Inc.,  a  Delaware  corporation  (the  "Company"), on Form 10-QSB for the period
ending  December  31, 2002, as filed with the Securities and Exchange Commission
on  the  date  hereof  (the  "Report"), I, Vince Vellardita, the Company's Chief
Executive Officer (the "Officer"), certify, pursuant to Rule 13a-14 or 15d-14 of
the  Securities  Exchange  Act  of  1934,  as  amended,  that:

(1)  The Officer has reviewed the Report.

(2)  Based on the Officer's knowledge, the Report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     the Report.

(3)  Based on the Officer's knowledge, the financial statements and other
     financial information included in the Report fairly present in all material
     respects the Company's financial condition and results of operations as of,
     and for, the periods presented in the Report.

(4)  The Officer and the other certifying officer:

     (a)  Are responsible for establishing and maintaining "disclosure controls
          and procedures," as that term is defined by the Securities and
          Exchange Commission, for the Company.

     (b)  Have designed such disclosure controls and procedures to ensure that
          material information relating to the Company is made known to them,
          particularly during the period in which the periodic Report is being
          prepared.

     (c)  Have evaluated the effectiveness of the Company's disclosure controls
          and procedures within 90 days prior to the filing date of the Report.

     (d)  Have presented in the Report their conclusions about the effectiveness
          of the disclosure controls and procedures based on the required
          evaluation as of that date.

(5)  The Officer and the other certifying officer have disclosed to the
     Company's auditors and audit committee of the board of directors (or
     persons fulfilling the equivalent function):

     (a)  All significant deficiencies in the design or operation of internal
          controls, as that term is defined by the Securities and Exchange
          Commission, which could adversely affect the Company's ability to
          record, process, summarize and report financial data and have
          identified for the Company's auditors any material weaknesses in
          internal controls; and

     (b)  Any fraud, whether or not material, that involves management or other
          employees who have a significant role in the Company's internal
          controls.

                                      -23-
<PAGE>

(6)  The Officer and the other certifying officer have indicated in the Report
     whether or not there were significant changes in internal controls or in
     other factors that could significantly affect internal controls subsequent
     to the date of their evaluation, including any corrective actions with
     regard to significant deficiencies and material weaknesses.

Dated:  February  24,  2004



                         By:     /s/  Vince  Vellardita
                                 ----------------------
                                 Vince  Vellardita
                                 Chief  Executive  Officer


     In  connection  with  amendment number 1 of the Quarterly Report of ValCom,
Inc.,  a  Delaware  corporation  (the  "Company"), on Form 10-QSB for the period
ending  December  31, 2003, as filed with the Securities and Exchange Commission
on  the  date  hereof (the "Report"), I, Donald Magier, the Company's Treasurer,
Controller  and  principal accounting officer (the "Officer"), certify, pursuant
to  Rule  13a-14  or  15d-14 of the Securities Exchange Act of 1934, as amended,
that:

(1)  The Officer has reviewed the Report.

(2)  Based on the Officer's knowledge, the Report does not contain any untrue
     statement of a material fact or omit to state a material fact necessary to
     make the statements made, in light of the circumstances under which such
     statements were made, not misleading with respect to the period covered by
     the Report.

(3)  Based on the Officer's knowledge, the financial statements and other
     financial information included in the Report fairly present in all material
     respects the Company's financial condition and results of operations as of,
     and for, the periods presented in the Report.

(4)  The Officer and the other certifying officer:

     (a)  Are responsible for establishing and maintaining "disclosure controls
          and procedures," as that term is defined by the Securities and
          Exchange Commission, for the Company.

     (b)  Have designed such disclosure controls and procedures to ensure that
          material information relating to the Company is made known to them,
          particularly during the period in which the periodic Report is being
          prepared.

     (c)  Have evaluated the effectiveness of the Company's disclosure controls
          and procedures within 90 days prior to the filing date of the Report.

     (d)  Have presented in the Report their conclusions about the effectiveness
          of the disclosure controls and procedures based on the required
          evaluation as of that date.

(5)  The Officer and the other certifying officer have disclosed to the
     Company's auditors and audit committee of the board of directors (or
     persons fulfilling the equivalent function):

     (a)  All significant deficiencies in the design or operation of internal
          controls, as that term is defined by the Securities and Exchange
          Commission, which could adversely affect the Company's ability to
          record, process, summarize and report financial data and have
          identified for the Company's auditors any material weaknesses in
          internal controls; and

                                      -24-

<PAGE>

     (b)  Any fraud, whether or not material, that involves management or other
          employees who have a significant role in the Company's internal
          controls.
(6)  The Officer and the other certifying officer have indicated in the Report
     whether or not there were significant changes in internal controls or in
     other factors that could significantly affect internal controls subsequent
     to the date of their evaluation, including any corrective actions with
     regard to significant deficiencies and material weaknesses.


Dated:  February  24,  2004



                         By:     /s/  Donald  P.  Magier
                                 -----------------------
                                 Donald  P.  Magier
                                 Treasurer,  Controller  and
                                 principal  accounting  officer

                                      -25-
<PAGE>