<PAGE>
08/12/999:26 AM

                      SECURITIES AND EXCHANGE COMMISSION
                            Washington, D.C. 20549

                                   FORM 10-Q


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

                        For Quarter Ended June 30, 1999

                                      or

            [ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D)
                    OF THE SECURITIES EXCHANGE ACT OF 1934
                   For the transition period from n/a to n/a
                                                  ---    ---

                        Commission File Number 0-27192

                       ASCENT ENTERTAINMENT GROUP, INC.
            (Exact name of registrant as specified in its charter)


          Delaware                                              52-1930707
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                              Identification No.)



                      1225 Seventeenth Street, Suite 1800
                            Denver, Colorado  80202
                    (Address of principal executive office)

                                (303) 308-7000
             (Registrant's telephone number, including area code)

  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 twelve (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
                                                      ----       ----


  The number of shares outstanding of the Registrant's Common Stock as of June
30, 1999 was 29,755,600 shares.

1
<PAGE>

08/12/999:26 AM
PART I.     FINANCIAL INFORMATION
Item 1.     Financial Statements

                       ASCENT ENTERTAINMENT GROUP, INC.
                     Condensed Consolidated Balance Sheets
                                  (Unaudited)
                   (in thousands, except par value amounts)
<TABLE>
<CAPTION>
                                                                  June 30,      December 31,
                                                                   1999            1998
                                                                   ----            ----
<S>                                                               <C>           <C>
               ASSETS
               ------

Current Assets:
   Cash and cash equivalents...............................       $ 69,326        $ 44,576
   Receivables, net........................................         38,208          36,413
   Deferred income taxes...................................          3,684             417
   Prepaid expenses and other current assets (Note 3)......         11,108           2,983
   Net assets of discontinued operations (Note 3)..........         98,217         132,144
                                                                  --------        --------

         Total current assets..............................        220,543         216,533
                                                                  --------        --------

Property and equipment, net................................        291,475         296,513
Goodwill, net..............................................         93,294          96,503
Investments................................................          1,365           1,493
Deferred income taxes......................................          3,866           3,866
Other assets, net..........................................          7,582           8,717
                                                                  --------        --------

Total Assets...............................................       $618,125        $623,625
                                                                  ========        ========

         LIABILITIES AND STOCKHOLDERS' EQUITY
         ------------------------------------

Current liabilities:
   Accounts payable........................................       $ 26,506        $ 23,668
   Deferred income.........................................          2,509           2,412
   Other  taxes payable....................................          6,576           7,480
   Accrued compensation....................................         10,925           7,588
   Income taxes payable....................................          1,636           1,821
   Other accrued liabilities...............................         16,200          14,348
                                                                  --------        --------
         Total current liabilities.........................         64,352          57,317
                                                                  --------        --------

Long-term debt (Note 4)....................................        324,001         305,537
Other long-term liabilities................................          1,783           2,300
                                                                  --------        --------


         Total liabilities.................................        390,136         365,154
                                                                  --------        --------

Minority interest..........................................         76,590          81,945
Commitments and contingencies (Note 5).....................             --              --

Stockholders' equity:
   Preferred stock, par value $.01 per share,
    5,000 shares authorized, none outstanding..............
   Common stock, par value $.01 per share,
    60,000 shares authorized; 29,756
    shares issued and outstanding..........................            297             297
   Additional paid-in capital..............................        307,685         306,358
   Accumulated deficit.....................................       (156,583)       (130,872)
   Accumulated other comprehensive income..................             --             743
                                                                  --------        --------
         Total stockholders' equity........................        151,399         176,526
                                                                  --------        --------

Total Liabilities and Stockholders' Equity.................       $618,125        $623,625
                                                                  ========        ========
</TABLE>
See accompanying notes to these condensed unaudited consolidated financial
statements.


2
<PAGE>
08/12/999:26 AM

                       ASCENT ENTERTAINMENT GROUP, INC.
                Condensed Consolidated Statements of Operations
                                  (Unaudited)
                   (In thousands, except per share amounts)
<TABLE>
<CAPTION>


                                                       Three Months Ended June 30,    Six Months Ended June 30,
                                                          1999            1998           1999           1998
                                                      -------------  --------------  -------------  ------------
<S>                                                   <C>            <C>             <C>            <C>

Revenues............................................      $ 68,268        $ 65,925       $134,596      $126,656
                                                          --------        --------       --------      --------

Operating expenses:
  Cost of services..................................        46,854          46,402         92,032        88,402
  Depreciation and amortization.....................        26,778          24,273         52,028        48,219
  General and administrative........................         4,927           2,497          7,909         4,634
                                                          --------        --------       --------      --------
       Total operating expenses.....................        78,559          73,172        151,969       141,255
                                                          --------        --------       --------      --------

Loss from continuing operations before
       interest, taxes and minority interest........       (10,291)         (7,247)       (17,373)      (14,599)

Interest and other income, net......................         2,670             313          3,479           723
Interest expense....................................        (7,095)         (5,941)       (13,950)      (11,334)
                                                          --------        --------       --------      --------
Loss from continuing operations before taxes
    and minority interest...........................       (14,716)        (12,875)       (27,844)      (25,210)
Income tax benefit..................................           988              76          1,303           102
                                                          --------        --------       --------      --------

Loss from continuing operations before
    minority interest...............................       (13,728)        (12,799)       (26,541)      (25,108)
Minority interest in
    loss of subsidiary, net of taxes................         3,652           3,048          6,612         6,421
                                                          --------        --------       --------      --------
Loss from continuing operations.....................       (10,076)         (9,751)       (19,929)      (18,687)

Income (loss) from discontinued operations, net of
     taxes (Note 3).................................           225          (8,264)        (9,017)      (12,212)
Gain on sale of discontinued operations,
     net of taxes (Note 3)..........................            --              --          3,237            --
                                                          --------        --------       --------      --------
Net loss............................................      $ (9,851)       $(18,015)      $(25,709)     $(30,899)
                                                          ========        ========       ========      ========

Basic and diluted net income (loss) per common share:
     From continuing operations.....................      $   (.34)       $   (.33)      $   (.67)     $   (.63)
     From Discounted operations.....................           .01            (.28)          (.19)         (.41)
                                                          --------        --------       --------      --------
Basic and diluted net
   loss per share...................................      $   (.33)       $   (.61)      $   (.86)     $  (1.04)
                                                          ========        ========       ========      ========

Weighted average number of
     common shares outstanding......................        29,756          29,756         29,756        29,756
                                                          ========        ========       ========      ========
</TABLE>
See accompanying notes to these condensed unaudited consolidated financial
statements.

3
<PAGE>

08/12/999:26 AM

                       ASCENT ENTERTAINMENT GROUP, INC.
                Condensed Consolidated Statements of Cash Flows
                                  (Unaudited)
                                (In thousands)
<TABLE>
<CAPTION>
                                                                           Six Months Ended June 30,
                                                                                 1999     1998
                                                                              --------- ---------
<S>                                                                           <C>        <C>
Operating activities:
      Net loss.............................................                   $(25,709)  $(30,899)
      Adjustments to reconcile net loss to
      net cash provided by continuing operations:
            Loss from discontinued
                operations, net of gain....................                      5,780     12,212
            Depreciation and amortization..................                     52,028     48,219
            Minority interest in losses
                of subsidiary..............................                     (6,612)    (6,421)
            Interest accretion on Senior
                Secured Notes..............................                      8,463      7,591
            Changes in operating assets and
                liabilities................................                     (5,199)    (4,692)
                                                                              --------   --------

      Net cash provided by operating
           activities of continuing operations.............                     28,751     26,010
      Net cash provided by discontinued
           operations......................................                      7,884      2,770
                                                                              --------   --------
      Net cash provided by operating activities............                     36,635     28,780
                                                                              --------   --------

Investing activities:......................................
      Proceeds from sale of Beacon
              Communications, LLC..........................                     15,893         --
      Purchase of property and equipment...................                    (40,858)   (47,250)
      Payments on note receivable..........................                      1,322      1,322
      Proceeds from sale of investments....................                      1,758        264
                                                                              --------   --------

      Net cash used in investing activities................                    (21,885)   (45,664)
                                                                              --------   --------

Financing activities - proceeds from
     borrowings under credit facilities....................                     10,000     21,000
                                                                              --------   --------

Net increase in cash and cash
     equivalents...........................................                     24,750      4,116

Cash and cash equivalents, beginning
     of period.............................................                     44,576     23,598
                                                                              --------   --------

Cash and cash equivalents, end
     of period.............................................                   $ 69,326   $ 27,714
                                                                              ========   ========

Supplemental cash flow information:
     Interest paid, net of interest capitalized............                   $  5,072   $  4,674
                                                                              ========   ========

     Income taxes paid.....................................                   $    308   $     77
                                                                              ========   ========
</TABLE>

              See accompanying notes to these condensed unaudited
                      consolidated financial statements.

4
<PAGE>

08/12/999:26 AM
                       ASCENT ENTERTAINMENT GROUP, INC.
            Condensed Consolidated Statements of Comprehensive Loss
                                  (Unaudited)
                                (In thousands)
<TABLE>
<CAPTION>
                                                              Three Months Ended June 30,  Six Months Ended June 30,
                                                                   1999        1998            1999       1998
                                                                   ----        ----            ----       ----
<S>                                                              <C>         <C>             <C>        <C>
  Net loss.................................                       $(9,851)    $(18,015)       $(25,709)  $(30,899)

  Other comprehensive income (loss):
     Unrealized gain (loss) on securities..                        (1,024)        (684)         (1,143)       513
     Income tax (expense) benefit related
       to other comprehensive income.......                           358          239             400       (180)
                                                                 --------     --------        --------   --------

     Other comprehensive income (loss),
       net of tax..........................                          (666)        (445)           (743)       333
                                                                 --------     --------        --------   --------

  Comprehensive Loss.......................                      $(10,517)    $(18,460)       $(26,452)  $(30,566)
                                                                 ========     ========        ========   ========
</TABLE>

              See accompanying notes to these condensed unaudited
                      consolidated financial statements.

5
<PAGE>

08/12/999:26 AM

                       ASCENT ENTERTAINMENT GROUP, INC.
       Notes to Condensed Consolidated Financial Statements (Unaudited)


1.   General

     The accompanying unaudited condensed consolidated financial statements have
been prepared by Ascent Entertainment Group, Inc. ("Ascent" or the "Company")
pursuant to the rules and regulations of the Securities and Exchange Commission
(the "Commission"). These financial statements should be read in the context of
the financial statements and notes thereto filed with the Commission in the
Company's 1998 Annual Report on Form 10-K. Certain information and footnote
disclosures normally included in financial statements prepared in accordance
with generally accepted accounting principles have been condensed or omitted
pursuant to such regulations. The accompanying unaudited condensed consolidated
financial statements reflect all adjustments and disclosures which are, in the
opinion of management, necessary for a fair presentation. All such adjustments
are of a normal recurring nature. The results of operations for the interim
periods are not necessarily indicative of the results for the entire year.

     Certain amounts in prior periods have been reclassified to conform with the
current periods presentation, most notably the discontinued operations
presentation of the Company's former entertainment segment (see Notes 2 and 3).

2.   Organization and Basis of Presentation

     The accompanying consolidated financial statements include the accounts of
Ascent and its majority-owned subsidiary, On Command Corporation ("OCC"). Ascent
Network Services, Inc. ("ANS"), formerly a wholly owned subsidiary of Ascent,
was merged into Ascent and became an operating division of Ascent on May 30,
1997. Significant intercompany transactions have been eliminated. The Company's
discontinued operations are comprised of the results of the Company's former
entertainment segment, which included the Denver Nuggets, the Colorado Avalanche
and Ascent Arena Company (the "Arena Company"), the owner and manager of the
Pepsi Center, (collectively the "Sports related businesses"), which the Company
has agreed to sell (see Note 3). In addition, discontinued operations include
the results of the Company's former subsidiary, Beacon Communications, LLC
("Beacon"), in which a 90% interest was sold on January 20, 1999. The
accompanying 1998 financial information has been restated to conform to the
discontinued operations presentation of the former entertainment segment and
Beacon.

    Ascent executed an initial public offering (the "Offering") of its common
stock on December 18, 1995.  Prior to the Offering, Ascent was a wholly owned
subsidiary of COMSAT Corporation ("COMSAT").  Until June 27, 1997 COMSAT
continued to own a majority (80.67%) of Ascent's common stock and control
Ascent. On June 27, 1997, COMSAT consummated the distribution of its 80.67%
ownership interest in Ascent to the COMSAT shareholders on a pro-rata basis in a
transaction that was tax-free for federal income tax purposes (the
"Distribution"). As discussed in Note 13 to the Company's 1998 Consolidated
Financial Statements, Ascent and COMSAT entered into a Distribution Agreement
and a Tax Disaffiliation Agreement in connection with the Distribution. In order
to maintain the tax-free status of the Distribution, Ascent was subject to
numerous restrictions under the Distribution Agreement,  most of which have
expired.  The most significant restriction still in place is that Ascent shall
not take any action, nor fail or omit to take any action, that would cause the
Distribution to be taxable or cause any representation made in the tax ruling
documents related to the Distribution to be untrue in a manner which would have
an adverse effect on the tax-free status of the Distribution. Ascent and COMSAT
also terminated the Intercompany Services Agreement and Corporate Agreement
entered into in connection with the Offering resulting in among other things,
the termination of the restriction on Ascent's incurring indebtedness without
the consent of COMSAT.


Note 3 - Discontinued Operations:

Beacon - On January 20, 1999, the Company sold 90% of its interest in Beacon to
------
an investor group controlled by Beacon's management and venture capital
investors (the "Buyers").  The purchase price for the 90% interest was $19.0
million in cash, net of certain adjustments.  The Company received approximately
$15.9 million at closing.  The Company believes it is entitled to receive future
cash consideration of approximately $.8 million.  The Company

6
<PAGE>

08/12.999:26 AM
intends to continue its efforts to collect this amount, and the Company will
report an additional gain from the Beacon sale when these proceeds are received.
After the sale of the 90% interest, the Company has no future obligations to
fund any of Beacon's liabilities or film development or production commitments.
The 10% interest in Beacon retained by the Company is subject to limited
purchase and sale options between the Company and the Buyers at a price
proportionate to the purchase price. The Company's remaining investment in
Beacon will be accounted for using the cost method. In the first quarter of
1999, the Company reported a gain of $3.2 million on the sale of 90% of its
interest in Beacon.

Sports related businesses  - On July 27, 1999, the Company entered into a
-------------------------
definitive agreement to sell its Sports related businesses to a group of
entities controlled by Donald L. Sturm ("The Sturm Group) for $321.0 million in
cash (of which Liberty Denver Arena LLC, an unrelated third party, will receive
up to $20.5 million), subject to further adjustment for cash balances and
receipts received by the Company prior to closing, which relate to the Nuggets
and Avalanche 1999/ 2000 playing seasons. In conjunction with the sale, the
approximate $140.0 million in non-recourse Arena Note obligations will remain
the obligation of an entity to be acquired by the Sturm Group (see Note 6 of the
Company's 1998 Consolidated Financial Statements). Assuming the timely closing,
the Company expects to report a gain, net of transaction costs without giving
effect to taxes, in excess of $150.0 million on the sale of the Sports related
businesses in the third quarter of 1999. Transaction costs, including investment
banker and attorney fees and expenses, fees payable to William and Nancy Laurie
in conjunction with the termination of the previous agreement between Ascent and
the Lauries, which was entered into on April 25, 1999 (see Note 5 of Notes to
Condensed Consolidated Financial Statements), and other associated costs of the
transaction are estimated to be approximately $23.0 million and will be netted
against the proceeds from the transaction for financial reporting purposes. In
conjunction with the pending sale, as of June 30, 1999, the Company has incurred
approximately $9.7 million of such transaction costs. These costs are included
in prepaid expenses and other current assets in the accompanying condensed
consolidated balance sheet at June 30, 1999.

     The Company began accounting for Beacon as a discontinued operation as of
December 31, 1998 and for the Sports related businesses as a discontinued
operation as of March 31, 1999, pursuant to guidance contained in Emerging
Issues Task Force Issue No. 95-18, "Accounting and Reporting for Discontinued
Business Segment when the Measurement Date occurs after the Balance Sheet Date
but before the Issuance of the Financial Statements." Accordingly, the
consolidated financial statements have been restated for all prior periods
presented to reflect the results of operations and net assets of Beacon and the
Sports related businesses as discontinued operations. The loss from discontinued
operations of Beacon and the Sports related businesses, net of taxes, for the
three and six month periods ended June 30, 1999 and 1998 is composed of the
following:
<TABLE>
<CAPTION>
                                              Three Months Ended                        Three Months Ended
                                                June 30, 1999                             June 30, 1998
                                              ------------------                 -------------------------------
                                              Sports                             Sports
                                              Related                            Related
                                              Businesses                         Businesses    Beacon      Total
                                              -----------                        ----------    ------      -----
                                                                                (in thousands)
<S>                                           <C>                                <C>           <C>        <C>
Revenues....................................    $ 26,102                         $15,878       $  (294)   $ 15,584
                                                ========                         =======       =======    ========
Loss from discontinued operations
 before taxes...............................    $   (245)                        $(4,537)      $(3,727)   $ (8,264)
Income tax benefit..........................         470                              --            --          --
                                                --------                         -------       -------    --------
Income (Loss) from discontinued operations..    $    225                         $(4,537)      $(3,727)   $ (8,264)
                                                ========                         =======       =======    ========
<CAPTION>
                                              Six Months Ended                          Six Months Ended
                                               June 30, 1999                             June 30, 1998
                                              ----------------                   -------------------------------
                                              Sports                             Sports
                                              Related                            Related
                                              Businesses                         Businesses    Beacon      Total
                                              -----------                        ----------    ------      -----
                                                                                (in thousands)
<S>                                           <C>                                <C>           <C>        <C>
Revenues....................................    $ 64,713                         $55,951       $16,934    $ 72,885
                                                ========                         =======       =======    ========
Loss from discontinued operations
 before taxes...............................    $(10,509)                        $(9,171)      $(3,041)   $(12,212)
Income tax benefit..........................       1,492                              --            --          --
                                                --------                         -------       -------    --------
Loss from discontinued operations...........    $ (9,017)                        $(9,171)      $(3,041)   $(12,212)
                                                ========                         =======       =======    ========
</TABLE>

7

<PAGE>

08/12/999:26 AM

The net assets of the discontinued operations included in the unaudited
condensed consolidated balance sheets as of June 30, 1999 and December 31, 1998,
consist of the following:

<TABLE>
<CAPTION>
                                                         6/30/99                     12/31/98
                                                         -------      ---------------------------------------
                                                         Sports       Sports
                                                         Related      Related
                                                         Businesses   Businesses        Beacon         Total
                                                         ----------   ----------        ------         -----
                                                                             (in thousands)
<S>                                                      <C>          <C>          <C>             <C>
    Current assets.....................................   $  29,895    $  38,194       $   3,062   $  41,256
    Property and equipment, net........................     138,469       92,249              --      92,249
    Restricted cash held in trust......................      75,604      112,478              --     112,478
    Film inventory.....................................          --           --          48,457      48,457
    Franchise rights, net..............................      90,152       92,559              --      92,559
    Other assets.......................................      25,238       24,453          10,651      35,104
    Current liabilities, including current portion of
         Arena Notes...................................     (79,176)     (70,222)         (5,763)    (75,985)
    Non-recourse Arena Notes...........................    (136,170)    (136,170)        (35,079)   (171,249)
    Other long term liabilities........................     (45,795)     (33,725)         (9,000)    (42,725)
                                                          ---------    ---------       ---------   ---------

    Net assets of discontinued operations..............   $  98,217    $ 119,816       $  12,328   $ 132,144
                                                          =========    =========       =========   =========
</TABLE>

4.  Long-Term Debt

Long-term debt consists of the following at June 30, 1999 and December 31, 1998:

                                                              1999      1998
                                                            --------  --------
                                                              (in thousands)
Senior Secured Discount Notes, 11.875%, due
    2004, net of unamortized discount of
    $73,999 and $82,463.......................              $151,001  $142,537
OCC Credit Facility, variable rate, due 2002..               173,000   163,000
                                                            --------  --------

    Total long term debt......................              $324,001  $305,537
                                                            ========  ========

     Bank Credit Facilities - The Company and OCC have separate bank credit
     ----------------------
facilities.  The Ascent credit facility provides for borrowings up to $50.0
million through March 2000.  The available borrowings will be permanently
reduced thereafter in varying amounts through 2002 when the Ascent credit
facility will terminate.  In connection with the sale of the Sports related
businesses (see Note 3), it is anticipated that the Ascent credit facility will
be terminated or renegotiated.  The OCC credit facility provides for borrowings
up to $200.0 million, matures in 2002 and, subject to certain conditions, can be
renewed for an additional two years.  Based on borrowings outstanding at June
30, 1999, the Company had access to $50.0 million of long-term financing under
the Ascent credit facility and OCC had access to $27.0 million of long-term
financing under the OCC credit facility, in each case, subject to certain
covenant restrictions (see Note 6 of the Company's 1998 Consolidated Financial
Statements).

5.   Contingencies

     Litigation - In September 1998, On Command Video (OCV) filed suit against
     ----------
MagiNet, alleging a breach by MagiNet of a license agreement between OCV and
MagiNet, and terminating the license agreement.  OCV has also demanded the
payment of licensee fees from MagiNet which OCV believes were due and payable
under the license agreement and have not been paid by MagiNet.  MagiNet has
counter-claimed against OCV, alleging that OCV breached the license agreement,
and alleging various torts by OCV in its relationship with MagiNet.

     In June 1999, the Company and certain of its present and former directors
were named as defendants in lawsuits filed by shareholders (the "Shareholder
lawsuits") in June 1999 in the Delaware Court of Chancery.  These

8

<PAGE>

08/12/999:26 AM
proposed class actions asserted that the Company's agreement to sell the
Company's Sports related businesses to entities controlled by William and Nancy
Laurie constituted a sale of substantially all of the assets of the Company,
thereby requiring a shareholder vote, and resulted from breaches of fiduciary
duties by the director defendants (see Note 3 of Notes to Condensed Consolidated
Financial Statements). On June 23, 1999, the Company, the director defendants
and the Laurie - controlled purchasing entities that were also named as
defendants, entered into an agreement with the shareholder plaintiffs to settle
the lawsuits. Under the settlement agreement, the Company, the director
defendants, and the Laurie-controlled entities agreed, among other things, to
amend the terms of the proposed sale to the Laurie entities to permit the
Company to conduct a new auction process in which the Company would solicit
additional offers for the purchase of the Sports related businesses. The Company
and the director defendants also agreed, among other things, to engage an
additional investment banker to assist in the new auction process, and to add
Peter W. May to the Company's Board of Directors. On July 27, 1999, as a result
of the new auction process, the Company entered into a definitive agreement to
sell the sports related businesses to The Sturm Group. The settlement of the
Shareholder lawsuits is subject to the approval of the Delaware Court of
Chancery after a hearing that is anticipated to occur after the closing of the
sale of the Sports related businesses to The Sturm Group. If approved by the
Court, the settlement would result in, among other things, the dismissal with
prejudice of the claims asserted in the Shareholder lawsuits and the payment by
the Company of plaintiff's attorney fees and expenses in an amount to be
determined by the Court. For the six month period ended June 30, 1999, the
Company has incurred and expensed approximately $1.1 million in connection with
the Shareholder lawsuits.

     The Company and its subsidiaries are defendants, and may be potential
defendants, in lawsuits and claims arising in the ordinary course of their
businesses.  While the outcomes of such claims, lawsuits, or other proceedings
cannot be predicted with certainty, management expects that such liability, to
the extent not provided for by insurance or otherwise, will not have a material
adverse effect on the financial condition of the Company.

6.   Segment Operating Results

     As discussed in Note 12 to the Company's 1998 Consolidated Financial
Statements, the Company implemented Statement of Financial Accounting Standards
(SFAS) No. 131, "Disclosures about Segments of an Enterprise and Related
Information," during the fourth quarter of 1998. In accordance with SFAS No.
131, the Company classified its businesses into 3 reporting segments: multimedia
distribution, network services and entertainment. The multimedia distribution
segment includes the video distribution and on-demand video entertainment
services provided by OCC to the lodging industry. The network services segment
includes the results of ANS and the video distribution services it provides to
the NBC television network and other private networks. The Company's former
entertainment segment (see Notes 1 and 3 of Notes to Condensed Consolidated
Financial Statements) included three segments, the Denver Nuggets, the Colorado
Avalanche and the Arena Company. Accordingly, the financial information for the
three and six month periods ended June 30, 1998, have been restated to conform
with the Company's new segment classifications pursuant to SFAS 131 and the
Company's classification of its former entertainment segment and Beacon as
discontinued operations. Results by segment are as follows:

<TABLE>
<CAPTION>
                                         Three Months Ended June 30,    Six Months Ended June 30,
                                            1999            1998           1999          1998
                                         ----------     ------------    ----------   ------------
Income Statement Data:                                          (in millions)
<S>                                      <C>            <C>             <C>          <C>
Revenues:
      Multimedia Distribution.....         $ 62.6         $60.9           $123.8       $116.8
      Network Services............            5.7           5.0             10.8          9.9
                                           ------         -----           ------       ------
           Total..................         $ 68.3         $65.9           $134.6       $126.7
                                           ======         =====           ======       ======
Operating income (loss):
      Multimedia Distribution(2)..         $ (6.5)        $(5.3)          $(11.6)      $(11.4)
      Network Services............            1.2            .6              2.2          1.5
      Corporate...................           (5.0)         (2.5)            (8.0)        (4.7)
                                           ------         -----           ------       ------
           Total..................         $(10.3)        $(7.2)          $(17.4)      $(14.6)
                                           ======         =====           ======       ======
</TABLE>

9

<PAGE>

08/12/999:26 AM


Other Data:

EBITDA (1):
      Multimedia Distribution...............  $ 18.3   $17.1   $ 36.5   $ 33.0
      Network Services......................     3.1     2.5      6.0      5.3
      General & Administrative..............    (4.9)   (2.5)    (7.9)    (4.7)
                                              ------   -----   ------   ------
           Total EBITDA.....................    16.5    17.1     34.6     33.6
                                              ------   -----   ------   ------
      Less reconciling item - depreciation
          and amortization..................    26.8    24.3     52.0     48.2
                                              ------   -----   ------   ------
       Total operating loss.................  $(10.3)  $(7.2)  $(17.4)  $(14.6)
                                              ======   =====   ======   ======


Capital Expenditures:
      Multimedia Distribution...............  $ 20.4   $22.0   $ 40.6   $ 45.2
      Network Services......................      .1      .7       .2      1.0
                                              ------   -----   ------   ------
           Total Capital Expenditures.......  $ 20.5   $22.7   $ 40.8   $ 46.2
                                              ======   =====   ======   ======

(1)  EBITDA represents earnings from continuing operations before interest
     expense, income taxes, depreciation, amortization and non-cash charges
     related to stock based compensation.  The most significant difference
     between EBITDA and cash provided from operating activities are changes in
     working capital and interest expense under the OCC credit facility.  EBITDA
     is presented because it is a widely accepted financial indicator used by
     certain investors and analysts to analyze and compare companies on the
     basis of operating performance.  In addition, management believes EBITDA
     provides an important additional perspective on the Company's operating
     results and the Company's ability to service its long-term debt and fund
     the Company's continuing growth.  EBITDA is not intended to represent cash
     flows for the period, or to depict funds available for dividends,
     reinvestment or other discretionary uses.  EBITDA has not been presented as
     an alternative to operating cash flow or as an indicator of operating
     performance and should not be considered in isolation or as a substitute
     for measures of performance prepared in accordance with generally accepted
     accounting principles, which are presented in the Condensed Consolidated
     Statements of Cash Flows (unaudited) and discussed in Liquidity and Capital
     Resources.

(2)  The Multimedia Distribution segment's operating results reflect the
     allocation of intangible assets amortization incurred by Ascent relating to
     the acquisition of OCV by Ascent.

7.   New Accounting Pronouncements

         In June 1998, the Financial Accounting Standards Board issued SFAS No.
133, "Accounting for Derivative Instruments and Hedging Activities," which
defines derivatives, requires that all derivatives be carried at fair value, and
provides for hedging accounting when certain conditions are met.  SFAS No. 133,
which has been amended by SFAS 137, is effective for all fiscal quarters of
fiscal years beginning after June 15, 2000.  On a forward-looking basis,
although the Company has not fully assessed the implications of SFAS No. 133,
the Company does not believe adoption of SFAS No. 133 will have a material
impact on the Company's financial position or results of operations.

10
<PAGE>

08/12/999:26 AM

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

General:

     Certain of the statements in this report are forward-looking and relate to
anticipated future events and operating results.  Statements which look forward
in time are based on management's current expectations and assumptions, which
may be affected by subsequent developments and business conditions, and
necessarily involve risks and uncertainties.  Therefore, there can be no
assurance that actual future results will not differ materially from anticipated
results.  Although the Company has attempted to identify some of the important
factors that may cause actual results to differ materially from those
anticipated, those factors should not be viewed as the only factors which may
affect future operating results.  Accordingly, the following should be read in
conjunction with the Condensed Consolidated Financial Statements (unaudited)
included in this filing, and with the Consolidated Financial Statements, notes
thereto, and Management's Discussion and Analysis of Financial Condition and
Results of Operations contained in the Company's 1998 Annual Report on Form 10-
K, as previously filed with the Commission.

Seasonality, Variability and Other:

     The Company's businesses are subject to the effects of both seasonality and
variability.  Consequently, the operating results for the quarter and six-months
ended June 30, 1999 for each segment and line of business, and for the Company
as a whole, are not necessarily indicative of the results for the full year.

     In conjunction with the acquisition of Spectra Vision's assets and certain
liabilities in October 1996, OCC acquired, among other assets, video systems and
equipment. These specific assets, which were recorded at their estimated fair
market value of approximately $41,800,000 in October 1996, are being depreciated
over 36 months. Accordingly, OCC's 1999 fourth quarter operating results will be
impacted from a reduction in depreciation and amortization expense charges
relating to these specific assets.

     The Multimedia Distribution segment revenues of OCC are influenced
principally by hotel occupancy rates, the "buy rate" or percentage of occupied
rooms at hotels that buy movies or other services at the property and the price
of the movie or service. Occupancy rates vary by property based on the
property's location, competitive position within its marketplace, seasonal
factors, and general economic conditions. Higher revenues are generally realized
during the summer months and lower revenues realized during the winter months
due to business and vacation travel patterns which impact the lodging industry's
occupancy rates. Buy rates generally reflect the hotel's guest mix profile, the
popularity of the motion picture or services available at the hotel and the
guests' other entertainment alternatives.

ANALYSIS OF OPERATIONS

Three months ended June 30, 1999 compared to three months ended June 30, 1998

Continuing Operations
---------------------

     Revenues for the second quarter of 1999 were $68.3 million, an increase of
$2.4 million or 3.6%, as compared to $65.9 million in revenues for the second
quarter of 1998. This increase is attributable to a $1.7 million increase in
revenues at OCC within the Multimedia Distribution segment and a $.7 million
increase in revenues at ANS within the Network Services segment. The increase in
revenues at OCC is primarily attributable to increased equipment sales,
continued reductions in movie denial rates, an increase in the number of free-
to-guest services being offered per room and an increase in revenues from new
service offerings at OCC. These increases were partially offset by a decrease in
movie revenues per room as compared to the second quarter of 1998 due primarily
to a strong movie line up in 1998. The increase in revenues at ANS is
attributable to an increase in service revenues from NBC and its affiliates and
other private networks.

     Cost of services for the second quarter of 1999 were $46.9 million, an
increase of $.5 million or 1.1% compared to $46.4 million in the second quarter
of 1998. Cost of services at OCC increased by $.5 million.  This increase in
costs at OCC is due to increased direct costs associated with the increase in
movie revenues at OCC (primarily hotel

11
<PAGE>

08/12/999:26 AM
commissions and movie royalties) and increased costs associated with equipment
sales partially offset by reduced operating expenses.

     Depreciation and amortization for the second quarter of 1999 was $26.8
million, an increase of $2.5 million or 10.3% compared to $24.3 million in the
second quarter of 1998.  Depreciation and amortization at OCC increased by $2.5
million.  This increase is primarily attributable to the continuing installation
of on-demand video systems at OCC and the resulting increase in depreciation and
the recognition by OCC of a non-cash expense associated with accounting for
cashless stock options in an executive compensation agreement reflecting the
increased share price of OCC's stock.

     General and administrative expenses, which include only those costs
incurred by the parent company, were $4.9 million for the second quarter of
1999, an increase of $2.4 million or 96.0% compared to $2.5 million in the
second quarter of 1998. This increase primarily reflects the expense recognized
for the Company's stock appreciation rights of $1.9 million as a result of the
increases in the Company's stock price and costs of $1.1 million incurred in
conjunction with the settlement of a shareholder lawsuit (see Note 5 of Notes to
Condensed Consolidated Financial Statements), partially offset by a reduction of
other operating expenses.

     Other income increased by $2.4 million in the second quarter of 1999 as
compared to the second quarter of 1998.  This increase is attributable to the
recognition of a $1.8 million gain by the parent company from the sale of
investment securities and from interest income recognized on the Company's cash
and cash equivalent balances.

     Interest expense increased $1.2 million in the second quarter of 1999 as
compared to the second quarter of 1998.  This increase is attributable to
additional borrowings incurred during 1999 combined with an increase in
borrowing costs at Corporate, primarily those costs related to the interest
accretion on the Company's 11.875% Senior Secured Discount Notes (the "Senior
Notes").

     The Company recorded an income tax benefit from continuing operations of
$1.0 million during the second quarter of 1999 as compared to a minimal income
tax benefit from continuing operations during the second quarter of 1998.

     EBITDA for the second quarter of 1999 was $16.5 million, a decrease of $.6
million or 3.5% compared to $17.1 million in the second quarter of 1998.  This
decrease is attributable to a $2.4 million decrease at Corporate offset by a
$1.2 million increase at OCC and a $.6 million increase at ANS.  The decrease at
Corporate reflects the expense recognized for stock appreciation rights and
costs increased in conjunction with the settlement of a shareholder lawsuit (see
Note 5 of Notes to Condensed Consolidated Financial Statements).  The increase
at OCC reflects the decrease in operating expenses in the second quarter of 1999
as compared to the same period of 1998.  The increase at ANS reflects increased
revenues in the second quarter of 1999 as compared to the same period of 1998.

     Minority interest reflects the losses attributable to the minority interest
in the Company's 57% owned subsidiary, OCC.

Discontinued Operations
-----------------------

     Ascent's discontinued operations are comprised of the results of the
Company's former entertainment segment, which includes the Denver Nuggets, the
Colorado Avalanche and the Arena Company. In addition, discontinued operations
include the results of Beacon, which was sold on January 20, 1999. The combined
income from discontinued operations for these entities totaled $.2 million
during the second quarter of 1999 as compared to a loss of $8.3 million during
the comparable period in 1998. The increased income during the second quarter of
1999 is primarily attributable to the operations of the Colorado Avalanche and
the lack of operating losses from Beacon. During the second quarter of 1999, the
Avalanche participated in three rounds of the NHL playoffs as compared to one
round in 1998. Assuming the timely closing of the pending sale of the Sports
related businesses, the Company expects to report a gain on the sale of its
interests in those businesses during the third quarter of 1999.

12
<PAGE>

08/12/999:26 AM
Six months ended June 30, 1999 compared to six months ended June 30, 1998

Continuing Operations
---------------------

     Revenues for the first half of 1999 were $134.6 million, an increase of
$7.9 million or 6.2%, as compared to $126.7 million in revenues for the first
half of 1998. This increase is attributable to a $7.0 million increase in
revenues at OCC and a $.9 million increase in revenues at ANS. The increase in
revenues at OCC is primarily attributable to new hotel installations, continued
conversions of hotels served by SpectraVision equipment to On Command Video
equipment, an increase in the number of free-to-guest services being offered per
room, increased equipment sales and continued reductions in movie denial rates.
The increase in revenues in the Network Services segment is attributable to an
increase in service revenues from NBC and its affiliates and other private
networks.

     Cost of services for the first half of 1999 were $92.0 million, an increase
of $3.6 million or 4.1% compared to $88.4 million in the first half of 1998.
Cost of services at OCC increased by $3.6 million. This increase in costs at OCC
is due to increased direct costs associated with the increase in movie revenues
at OCC (primarily hotel commissions, movie royalties and free-to-guest expenses)
and increased costs associated with equipment sales partially offset by reduced
operating expenses.

     Depreciation and amortization for the first half of 1999 was $52.0 million,
an increase of $3.8 million or 7.9% compared to $48.2 million in the first
quarter of 1998. Depreciation and amortization at OCC increased by $3.7 million.
This increase is primarily attributable to the continuing installation of on-
demand video systems at OCC and the resulting increase in depreciation and a
non-cash expense associated with accounting for cashless stock options in an
executive compensation agreement at OCC, reflecting the increased share price of
OCC's stock.

     General and administrative expenses, which include only those costs
by the parent company, were $7.9 million for the first half of 1999, an increase
of $ 3.3 million or 71.7% compared to $4.6 million the first half of 1998. This
increase primarily reflects the expense recognized during the first half of 1999
for the Company's stock appreciation rights of $3.0 million due to increases in
the Company's stock price and costs incurred in conjunction with the settlement
of a shareholder lawsuit of approximately $1.1 million (see Note 5 of Notes to
Condensed Consolidated Financial Statements), partially offset by the reduction
of other operating expenses.

     Other income increased by $ 2.8 million in the first half of 1999 as
compared to the same period last year. This increase is primarily attributable
to the recognition of a $1.8 million gain at Corporate from the sale of
investment securities and to an increase in interest income recognized on
Corporate's cash and cash equivalent balances.

     Interest expense increased $2.6 million in the first half of 1999 as
compared to the first half of 1998. This increase is attributable to additional
borrowings incurred during 1999 combined with an increase in borrowing costs at
Corporate, primarily those costs related to the interest accretion on the
Senior Notes.

     The Company recorded an income tax benefit from continuing operations of
$1.3 million during the first quarter of 1999 as compared to a minimal income
tax benefit from continuing operations during the first half of 1998.

     EBITDA for the first half of 1999 was $34.6 million, an increase of $1.0
million or 3.0% compared to $33.6 million in the first half of 1998.  The
increases is attributable to a $3.5 million increase at OCC and a $.7 million
increase at ANS offset by a $3.2 million decrease at Corporate.  The increase at
OCC reflects the decrease in operating expenses in 1999 compared to 1998.  The
increase at ANS reflects increased revenues in 1999 compared to 1998.  The
decrease at Corporate reflects the expense recognized for stock appreciation
rights and costs incurred in conjunction with the settlement of a shareholder
lawsuit (see Note 5 of Notes to Condensed Consolidated Financial Statements).

     Minority interest reflects the losses attributable to the minority interest
in the Company's 57% owned subsidiary, OCC.

13
<PAGE>

08/12/999:26 AM
Discontinued Operations
-----------------------

     The combined loss from discontinued operations totaled $9.0 million during
the first half of 1999 as compared to a loss of $12.2 million during the
comparable period in 1998. The improvement is primarily due to the operations of
the Colorado Avalanche and the lack of operating losses from Beacon partially
offset by the operations of the Denver Nuggets. Specifically, during the second
quarter of 1999, the Avalanche participated in three rounds of the NHL playoffs
as compared to one round in 1998. Offsetting the improvements were the
operations of the Denver Nuggets, which have been impacted by the NBA work
stoppage. Specifically, while revenues for the Nuggets decreased, operating
expenses increased due to a reserve taken on receivables due from NBA
Properties, the merchandising affiliate of the NBA, and an overall increase in
player salaries over the comparable period in 1998.

     The $3.2 million gain from sale of discontinued operations, net of taxes,
during the first half of 1999 reflects the gain from the sale of 90% of the
Company's  interest in Beacon.

LIQUIDITY AND CAPITAL RESOURCES

     Cash and cash equivalents increased by $24.7 million since December 31,
1998 to $69.3 million at June 30, 1999.  The primary sources of cash during the
first half of 1999 were cash from continuing operating activities of $28.8
million, proceeds of $15.9 million from the sale of 90% of the Company's
interest in Beacon and borrowings under the OCC credit facility of $10.0
million.  Cash was expended primarily for property and equipment at OCC,
specifically $40.6 million of capital expenditures, to support OCC's continued
growth.  Included in cash and cash equivalents at June 30, 1999 is $24.0 million
of cash received by the Avalanche and the Nuggets during 1999 relating to ticket
sales and club seat deposits for both the Avalanche and the Nuggets for the
upcoming 1999/2000 playing seasons.  Pursuant to the terms of the definitive
agreement to sell the Company's Sports related businesses (see Note 3 of
Notes to Condensed Consolidated Statements), these cash balances and other cash
receipts received prior to closing relating to the 1999/2000 playing seasons,
will either be used to fund operating expenses of the Sports related businesses
or will be acquired by The Strum Group.

     Long-term debt of the Company at June 30, 1999 consists primarily of the
Company's Senior Secured Discount Notes (the "Senior Notes") totaling $151.0
million, and $173.0 million outstanding under OCC's credit facility. The Arena
Revenue Backed Notes of $139.8 million (the "Arena Notes") which were issued by
the Arena Company's beneficially owned trust are classified in the Company's
condensed consolidated balance sheet in the net assets of discontinued
operations. The Arena Notes are non-recourse to the Arena Company but the Arena
Company is obligated to the noteholders to construct and operate the Pepsi
Center. In connection with the pending sale of the Sports related businesses
(see Note 3 of Notes to Condensed Consolidated Financial Statements), the Arena
Note obligation will remain the obligation of an entity to be acquired by The
Sturm Group. Based on borrowings at June 30, 1999, the Company had access to
$50.0 million of long-term financing under the Ascent credit facility and OCC
had access to $27.0 million of long-term financing under its credit facility,
subject to certain covenant restrictions (see Note 6 of the Company's 1998
Consolidated Financial Statements.)

     The Company's cash requirements through the remainder of 1999 are expected
to include (i) the continuing conversion and installation by OCC of on-demand
in-room video entertainment systems, (ii) funding the operating requirements of
Ascent and its subsidiaries (including the cash to be acquired by the Purchasers
as discussed above), and (iii) the payment of interest under the OCC credit
facility. The Company anticipates capital expenditures in connection with the
continued installation and conversion by OCC of on-demand service will be
approximately $40.0 to $50.0 million during the remainder of 1999. The Company
anticipates that OCC's funding for its operating requirements and capital
expenditures for the continued conversion and installation by OCC of on-demand
services will be funded primarily through cash flows from OCC's operations and
financed under the OCC credit facility.

     Management of the Company believes that the available cash, cash flows from
operating activities, proceeds from the sale of the Company's Sports related
businesses and funds available under the OCC credit facility (see Note 6 of the
Company's 1998 Notes to Consolidated Financial Statements) will be sufficient
for the Company and its subsidiary to satisfy their growth and finance working
capital requirements during 1999.  Assuming the

14
<PAGE>


08/12/999:26 AM
consummation of the sale of the Sports-related businesses, after payments to
Liberty Denver Arena, LLC for its interest in the Arena Company, appropriate
reserves for cash received to-date relating to Nuggets and Avalanche upcoming
1999/2000 playing seasons, the Company anticipates net cash proceeds of
approximately $260.0 million, subject to closing adjustments. Under the terms of
Ascent's outstanding Senior Notes, to the extent that within 1 year of the sale
of the Sports-related businesses, Ascent does not use the net cash proceeds for
certain permitted uses under the Senior Note indenture, Ascent will be required
to use all remaining proceeds to offer to repurchase the Senior Notes at 100% of
their accreted value. In addition, in connection with the sale, it is
anticipated that the Ascent credit facility will be terminated or renegotiated.
As a result of the sale of its Sports related businesses and the terms of the
Company's Senior Notes, the Company is exploring various alternatives as to the
use of the cash proceeds from the sale and, in turn, the Company's overall
business strategy. Management of the Company continues to focus its efforts on
the operations of OCC and OCC's strategies to convert hotel rooms acquired in
the acquisition of SpectraVision, Inc. to OCC's on-demand technology and the
successful upgrade and expansion of OCC's technology and service offerings. On
August 1, 1999, the Company completed previously disclosed negotiations and
entered into a three-year extension through the end of 2002 of the NBC- ANS
Service Agreement, under which Ascent provides satellite service, maintenance
and support of NBC's national television network. Management of the Company does
not anticipate any significant capital expenditures will be incurred in
connection with the extension agreement. Management continues to believe that at
the end of such extension period, it is likely that NBC will engage ANS to
complete a full upgrade of the NBC distribution network to digital technology.
No assurance can be provided that a full digital upgrade will occur or that ANS
will be engaged to complete the digital upgrade on terms as favorable to the
Company as the current agreement.

     As previously discussed, on June 27, 1997, COMSAT completed the
Distribution of the Ascent common stock held by COMSAT as a tax-free dividend to
COMSAT's shareholders. The Distribution was intended, among other things, to
afford Ascent more flexibility in obtaining debt financing to meet its growing
needs. The Distribution Agreement between Ascent and COMSAT (see Note 2 of
Notes to Condensed Consolidated Financial Statements) terminated the Corporate
Agreement between Ascent and COMSAT which imposed restrictions on Ascent to
ensure compliance with certain capital structure and debt financing restrictions
imposed on COMSAT by the Federal Communications Commission. In addition,
pursuant to the Distribution Agreement, certain restrictions have been put in
place to protect the tax-free status of the Distribution.

INFORMATION SYSTEMS AND THE YEAR 2000

     General - The Year 2000 issue is the result of certain computer programs
     -------
and firmware having been developed using two digits rather than four digits to
define the application year, such that computer programs that are date sensitive
may recognize a date using "00" as the year 1900 rather than the year 2000.
This could result in a system failure or miscalculations causing disruptions of
operations, including, among other things, a temporary inability to process
transactions or engage in normal business activities for the Company and the
customers who rely on its products.

     The Company and its subsidiary are actively engaged, but have not yet
completed, evaluating, correcting and testing all of their Year 2000 compliance
issues. Based on the current review and remediation, the primary Year 2000
compliance issue facing the Company is that OCC will be required to modify or
replace some of its internally developed information technology software
products. OCC utilizes embedded technology in all of its hotel systems design.
OCC's engineering department has completed the majority of its evaluation
process and is currently developing solutions to this and other Year 2000 issues
affecting OCC's hotel systems. In addition, both OCC and the Company's other
subsidiary have determined that they will be required to modify and/or replace
certain third-party software so that it will function properly with respect to
dates in the Year 2000 and thereafter. The Company presently believes that with
the proper modifications to its products and third-party software and the
replacement of non-compatible hardware, the Year 2000 issue will not pose
significant operation problems for the Company's subsidiary or its customers.

15
<PAGE>

08/12/999:26 AM
     The Company and its subsidiary are currently on schedule to complete all
Year 2000 issues by November, 1999.  However, if such modifications and
replacements are not made, or completed timely, the Year 2000 issue could have a
material impact on the Company, its subsidiaries and their customers.

     Costs - The total cost associated with required modification to become
     -----
Year 2000 compliant is not expected to be material to the Company's consolidated
financial position. The total cost to address the Year 2000 issues from
continuing operations is estimated to be less than $1.0 million. The total
amount expended on Year 2000 compliance through June 30, 1999 from continuing
operations was approximately $470,000. The costs of Year 2000 compliance and the
date on which the Company plans to complete the Year 2000 modifications are
based on management's best estimates, which were derived utilizing numerous
assumptions, including third parties' Year 2000 readiness and other factors.

     Risks - The Company has and will continue to have communications with its
     -----
significant suppliers and customers to determine the extent to which the Company
may be vulnerable in the event that those parties fail to address their own Year
2000 issues.  The Company has taken steps to monitor the progress made by those
parties, and intends to test critical systems interfaces, as the year 2000
approaches.  Specifically, there is some unknown level of risk at OCC with
respect to its hotel customers and conditions that would make a hotel unable to
register guests which, in turn, could affect OCC's revenue.  A large number of
OCC's systems are interfaced with the respective hotel's property management
system.  If this interface fails, all movie charges would require manual
processing.  Processes to perform manual processing are in place in all of OCC's
customers' hotels and are occasionally utilized at times when the property
management system interface is not functioning.  This typically causes a
slightly higher number of lost charges, which could be material if applied to a
large number of hotel customers.

     Contingency Plans - While the Company has not completed a formal
     -----------------
contingency plan for the Year 2000 problem, it has evaluated several anticipated
scenarios for failures affecting its critical business systems, including third-
party hotel systems which could impact OCC as discussed above.  Currently, it is
OCC's opinion that any of the potential scenarios can be managed by manual
means, although less efficient, while the necessary corrective actions are
taken.  However, there can be no guarantee that the systems of third parties on
which the Company and its subsidiary rely will be corrected in a timely manner,
that manual processing of OCC's movie charges would be accomplished, or that the
failure to properly convert by another company would not have a material adverse
effect on the Company or its subsidiary.

Quantitative and Qualitative Disclosures About Market Risk

Interest Rate Risk.  The Company's exposure to market risk for changes in
------------------
interest rates relates primarily to the Company's investment portfolio,
including restricted investments and long-term debt obligations. The Company
does not use derivative financial instruments in its investment portfolio. The
Company places its investments with high credit quality issuers and, by policy,
and debt restrictions limit the amount of credit exposure to any one issuer. As
stated in its policy, the Company is averse to principal loss and ensures the
safety and preservation of its invested funds by limiting default risk, market
risk, and reinvestment risk.

     The Company mitigates default risk by investing in only the safest and
highest credit quality securities.  The portfolio includes only marketable
securities with active secondary or resale markets to ensure portfolio
liquidity.  At June 30, 1999, the weighted average interest rate on the
Company's cash and cash equivalent balance of $69.3 million was approximately
4.5% consisting of fixed rate short-term investments.  In addition, the
Company's weighted average interest rate on its restricted cash investments held
in trust (part of discontinued operations, see Note 3 of Notes to the Condensed
Consolidated Financial Statements) at June 30, 1999 of $75.6 million was
approximately 5.1%.  These restricted investments are primarily variable rate
money market instruments.

     The Company has cash flow exposure due to rate changes for portions of its
debt obligations. Specifically, no cash flow exposure exists on the Company's
Arena Notes and Senior Notes as they represent fixed-rate obligations. (See Note
6 of the 1998 Consolidated Financial Statements). However, revolving loans

16
<PAGE>


08/12/999:26 AM
extended under the OCC credit facility (see Note 6 of the 1998 Consolidated
Financial Statements) generally bear an interest rate that is variable and based
on the London Interbank Offering Rate ("LIBOR") and on certain operating ratios
of the Company. At June 30, 1999, OCC had $173.0 million outstanding under the
OCC credit facility and the weighted average interest rate on the OCC credit
facility was 5.9%. Assuming no increase or decrease in the amount outstanding, a
hypothetical immediate 100 basis point increase (or decrease) in interest rates
would have increased (or decreased) the Company's annual interest expense and
cash outflow by $ .9 million.

Foreign Currency Risk.   The Company, through OCC, transacts business in various
-----------------------
foreign currencies, primarily in Canada, Asia and in certain European countries.
However, the Company believes the risks of foreign exchange rate fluctuations on
its present operations are not material to the Company's overall financial
condition.  However, should the Company's international operations continue to
grow, the Company will consider using foreign currency contracts, swap
arrangements, or other financial instruments designed to limit exposure to
foreign exchange rate fluctuations.


     PART II.     OTHER INFORMATION

Item 1.  Legal Proceedings
         -----------------

         For a discussion of additional litigation in which the Company is
         involved -- See Note 5 of Notes to the Unaudited Condensed Consolidated
         Financial Statements. The Company and its subsidiary are defendants and
         may be potential defendants in lawsuits and claims arising in the
         ordinary course of its business. While the outcomes of such claims,
         lawsuits, or other proceedings cannot be predicted with certainty,
         management expects that such liability, to the extent not provided for
         by insurance or otherwise, will not have a material adverse effect on
         the financial condition of the Company.

Item 2.  Change in Securities
         --------------------
         None.

Item 3.  Defaults Upon Senior Securities
         -------------------------------
         None.

Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------
         None.


Item 5.  Other Information
         -----------------
         None.


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

         (A)  Exhibit
              -------

                No. 10.1  Purchase and Sale Agreement among Ascent Entertainment
                Group, Inc., Ascent Sports Holdings, Inc., Liberty Denver Arena,
                LLC and Sturm Sports, LLC, Sturm Avalanche LLC, Sturm Nuggets
                LLC, and Sturm Arena, LLC, dated as of July 27, 1999.

                No. 10.2  NBC Satellite System Service Contract Amendment

                No. 27.1  Financial Data Schedule


         (B)  Reports on Form 8-K:
              --------------------

                1.) The Registrant filed with the Commission on June 24, 1999 a
                Form 8-K describing the following:  (i) The Company had entered
                into a definitive agreement for the settlement of three lawsuits
                filed by stockholders in Delaware Chancery Court, (ii) as part
                of the settlement, that the

17
<PAGE>


08/12/999:26 AM
                Company had entered into a new purchase and sale agreement with
                entities controlled by William and Nancy Laurie and provides
                pursuant to which the Lauries might participate in an auction of
                the Sports related assets, (iii) the appointment of Mr. Peter W.
                May to the Board of the Company as part of the settlement and
                (iv) that Charlie Lyons, Chairman and CEO of the Company, had
                taken a leave of absence from his positions and that Charles
                Neinas, a Company director, had agreed to serve as acting
                Chairman and CEO of Ascent.

                2.)  The Registrant filed with the Commission on May 4, 1999 a
                Form 8-K describing its issuance of two press releases reporting
                the Company's announcement that (i) it has entered into a
                definitive agreement to sell its Sports-related businesses,
                including the Denver Nuggets, Colorado Avalanche and the team's
                future home, the Pepsi Center and, (ii) the Company released its
                1999 first quarter financial results, which included additional
                information on the Company's sale of its Sports-related
                businesses.

18

<PAGE>

08/12/999:26 AM

                                   SIGNATURES



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

Ascent Entertainment Group, Inc.
--------------------------------


By:  /s/ David A. Holden
     -------------------
     David A. Holden
     Vice President of Finance, Controller
     (Principal Accounting Officer)

Date:  August  13, 1999

19