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                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C.  20549

                                    FORM 10-K

                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

 FOR THE FISCAL YEAR ENDED DECEMBER 31, 1996      COMMISSION FILE NO. 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.)

                                One Tabor Center
                       1200 Seventeenth Street, Suite 2800
                             Denver, Colorado  80202
              (Address and Zip Code of principal executive offices)

          Registrant's telephone number, including area code:  (303) 626-7000

          Securities registered pursuant to Section 12(b) of the Act:

     Title of each class              Name of each exchange on which registered
     -------------------              -----------------------------------------

     Common Stock, par value $.01     NASDAQ National Market

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

     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 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.  /X/ Yes  / / No

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

     Aggregate market value of voting stock held by non-affiliates of the
Registrant was $69,419,262 based on a price of $12.125 per share, which was the
average of the bid and asked prices of such stock on March 3, 1997, as reported
on the NASDAQ National Market reporting system.

     29,754,000 shares of Common Stock were outstanding on March 3, 1997.

                       DOCUMENTS INCORPORATED BY REFERENCE

 The registrant's definitive proxy statement with respect to its annual meeting
of stockholders is incorporated herein to Part III of this document by
reference.

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                                Table of Contents
                                                                            Page
Part I                                                                         1
Item 1.   Business                                                             1
          General Information                                                  1
          Multimedia Distribution                                              2
               On Command Corporation                                          2
                    OCC Operating and Growth Strategy                          2
                    Services and Products                                      3
                    Technology                                                 4
                    Sales and Marketing                                        5
                    Installation and Service Operations                        5
                    Hotel Contracts                                            5
                    Suppliers                                                  5
                    Integrating Operations                                     6
                    Competition                                                6
                    International Markets                                      8
                    Investment in OCC                                          8
               Ascent Network Services                                         8
          Entertainment                                                        9
               Colorado Avalanche and Denver Nuggets                           9
                    Sources of Revenue                                        10
                         Ticket Sales                                         10
                         Television, Cable and Radio
                              Broadcasting                                    10
                         Other Sources                                        11
                    NBA and NHL Governance                                    11
                    Competition                                               12
                    Broadcast Operations                                      12
               Beacon Communications                                          12
                    Competition                                               13
          Other Business Interests                                            14
          Patents Trademarks and Copyrights                                   14
          Regulation                                                          15
          Employees                                                           15
Item 2.   Properties                                                          15
Item 3.   Legal Proceedings                                                   16
Item 4.   Submission of Matters to a Vote of Security Holders                 17
Executive Officers of the Registrant                                          17

Part II                                                                       18
Item 5.   Market for the Registrant's Common Equity and Related
               Stockholder Matters                                            18
Item 6.   Selected Financial Data                                             19
Item 7.   Management's Discussion and Analysis of Financial
               Condition and Results of Operations                            22
Item 8.   Financial Statements and Supplementary Data                         31
Item 9.   Changes in and Disagreements with Accountants on
               Accounting and Financial Disclosure                            57

Part III                                                                      58
Item 10.  Directors and Executive Officers of the Registrant                  58
Item 11.  Executive Compensation                                              58
Item 12.  Security Ownership of Certain Beneficial Owners and
               Management                                                     58
Item 13.  Certain Relationships and Related Transactions                      58
Item 14.  Exhibits, Financial Statement Schedules and Reports on
               Form 8-K                                                       58

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                                     PART I

     CERTAIN OF THE STATEMENTS THAT FOLLOW ARE FORWARD-LOOKING AND RELATE TO
ANTICIPATED FUTURE 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

ITEM 1. BUSINESS

                               GENERAL INFORMATION

     Ascent Entertainment Group, Inc. ("Ascent Entertainment Group" or the
"Company") is a diversified entertainment and media company which operates
entertainment production and distribution businesses characterized by well known
franchises.  The Company is the leading provider of on-demand in-room
entertainment services to the domestic lodging industry through its
approximately 57% owned subsidiary, On Command Corporation ("OCC"), which is in
turn the 100% owner of On Command Video Corporation, a Delaware corporation
("OCV") and the 100% owner of Spectravision, Inc., a Texas corporation
("Spectravision").  The Company is the primary provider of satellite
distribution support services to affiliates of the National Broadcasting Company
("NBC") television network through its wholly owned subsidiary, Ascent Network
Services, Inc. (formerly COMSAT Video Enterprises, Inc.) ("ANS").  The Company
owns two professional sports franchises, the National Hockey League ("NHL") 1996
Stanley Cup champion Colorado Avalanche (the "Avalanche") and the National
Basketball Association ("NBA") Denver Nuggets (the "Nuggets").  The Company owns
a motion picture and television production company, Beacon Communications Corp.
("Beacon").

     The Company is a Delaware corporation and was incorporated in 1995.  The
Company was formed by COMSAT Corporation ("COMSAT") to organize COMSAT's
multimedia distribution and entertainment assets under one management group. An
initial public offering (the "Offering") of Ascent's common stock was completed
in December 1995.  As a result of the Offering, COMSAT currently owns 80.67% of
the Company's common stock.

     COMSAT originally became involved in the entertainment industry through its
acquisition of the multimedia distribution businesses, ANS and OCV, and its
initial acquisition of an interest in the Nuggets.  COMSAT expanded the Company
by acquiring complementary entertainment businesses, including increasing its
investment in OCV and the Nuggets and acquiring the Avalanche, Beacon, and other
related interests. In 1996, the Company formed OCC to combine OCV and the assets
and certain liabilities of Spectravision.

     In connection with the Offering, the Company and COMSAT entered into three
intercompany agreements: (a) a one-year Services Agreement, pursuant to which
COMSAT leased office space, provided certain administrative, financial,
treasury, legal, insurance and other services to the Company and made available
certain of its employee benefit plans to the Company's employees, for which the
Company paid to COMSAT an annual fee of $2 million and actual costs and expenses
to COMSAT of providing benefits to the Company's employees and certain other
services; (b) a Corporate Agreement (the "COMSAT Corporate Agreement"), which
provides, among other things, that for so long as COMSAT owns at least 50% of
the Company's outstanding Common Stock, (i) the Company's board of directors
will consist of at least a majority of members designated by COMSAT, (ii) the
Company will not incur any indebtedness, other than


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that under its original credit facility (and refinancings thereof) and
indebtedness incurred in the ordinary course of business which together shall
not exceed $175 million in the aggregate, or issue any equity securities or any
securities convertible into equity securities without COMSAT's prior consent,
and (iii) the Company will not amend its Certificate of Incorporation or Bylaws
without COMSAT's prior consent; and (c) a Tax Sharing Agreement, pursuant to
which the Company and COMSAT will make payments between them such that with
respect to any period, the amount of taxes to be paid by the Company or any
refund payable to the Company will be determined as though the Company were to
file separate federal, state and local income tax returns (including any amounts
determined to be due as a result of a redetermination of the tax liability of
COMSAT arising from an audit or otherwise) as the common parent of an affiliated
group of corporations filing a consolidated return rather than as a member of
COMSAT's consolidated tax group.

     The Services Agreement was amended as of December 18, 1996.  Under the
Services Agreement, as amended, COMSAT will continue to provide to the Company
limited administrative and support services and the Company will pay to COMSAT
$15,000 per month.

     During 1996 COMSAT twice consented to permit the Company to incur
indebtedness above the original $175 million aggregate indebtedness limit under
the Corporate Agreement, and in March 1997 COMSAT consented to an increase in
the limitation on the Company's consolidated indebtedness under the Corporate
Agreement to $270 million, provided that: (i) no more than $50 million of such
indebtedness constituted long-term debt; and (ii) indebtedness subordinated to
indebtedness under Ascent's existing credit facility could only be incurred on
terms which did not adversely affect COMSAT's proposed tax-free distribution of
its interest in Ascent to COMSAT shareholders.

                             MULTIMEDIA DISTRIBUTION

                             ON COMMAND CORPORATION

     OCC is the leading provider of on-demand in-room entertainment for the
United States lodging industry.  On October 10, 1996 the Company, through OCC,
consummated the acquisition of the assets and properties and certain liabilities
of Spectravision (the "Acquisition").  Immediately prior to the Acquisition,
OCV, formerly an 84% (78.4% on a fully diluted basis) owned subsidiary of the
Company, was merged with a subsidiary of OCC, On Command Merger Corporation, and
OCV as the surviving corporation became a wholly owned subsidiary of OCC (the
"Merger" and with the Acquisition, the "OCC Transactions").  On Command
Development Corporation, a wholly owned subsidiary of OCC, develops technologies
to be used by OCV and SpectraVision to support and enhance OCV's and
SpectraVision's operations and to develop new applications to be marketed by OCV
and SpectraVision.

     In addition to installing systems in hotels served by OCC, OCC sells
systems to certain other providers of in-room entertainment, including MagiNet
Corporation (formerly Pacific Pay Video Limited), which is licensed to use OCC's
system to provide on-demand in-room entertainment in the Asia Pacific region.

OCC OPERATING AND GROWTH STRATEGY

     OCC's operating and growth strategy is to (i) increase its installed hotel
customer base by obtaining contracts with business and luxury hotels and select
mid-priced hotels without current service, converting hotels currently served by
other vendors as the contracts covering such hotels expire, and servicing hotels
which are acquired or constructed by existing customers, (ii) increase revenues
and decrease costs in certain hotels acquired in the SpectraVision acquisition
by


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installing OCC technology offering greater reliability, broader selection and
more viewing flexibility, (iii) create new revenue sources through an expanding
range of interactive and information services offered to the lodging industry,
and (iv) expand into foreign markets.

SERVICES AND PRODUCTS

     OCC provides on-demand and scheduled in-room television viewing of major
motion pictures (including new releases) and independent non-rated motion
pictures for mature audiences for which a hotel guest pays on a per-view basis.
Depending on the type of system installed and the size of the hotel, guests can
choose among twenty (20) to fifty (50) different movies with an on-demand system
or among eight (8) to twelve (12) movies with a scheduled system.

     OCC obtains non-exclusive rights to show motion pictures from major motion
picture studios generally pursuant to a master agreement with each studio.  The
license period and fee for each motion picture are negotiated individually with
each studio, which typically receives a percentage of that picture's gross
revenues generated by the pay-per-view system.  Negotiated fees are related to
the popularity of the picture and the volume of pictures licensed from a given
studio.  License fees typically decline over the time the movie is played.
Typically, OCC obtains rights to exhibit major motion pictures during the
"Hotel/Motel Pay-Per-View Window," which is the time period after initial
theatrical release and before release for home video distribution or cable
television exhibition.  OCC attempts to license pictures as close as possible to
a motion picture's theatrical release date to benefit from the studios'
advertising and promotional efforts.  OCC also obtains independent motion
pictures, most of which are non-rated and are intended for mature audiences, for
a one-time flat fee that is nominal in relation to the licensing fees paid for
major motion pictures.

     OCC provides services under contracts with hotels that generally run for a
term of five to seven years.  Under these contracts, OCC installs its system
into the hotel at OCC's cost and OCC retains ownership of all equipment utilized
in providing the service.  Traditionally, the hotel provides and owns the
televisions; however, based on certain economic evaluations, OCC may provide
televisions to certain hotels.  OCC undertakes a significant investment when it
installs its system in a property, sometimes rewiring part of the hotel.
Depending on the size of the hotel property and the configuration of the system
installed, the installed cost of a new on-demand system with interactive and
video game services capabilities, including the head-end equipment, averages
from approximately $400 to $700 per room, or approximately $300 per room if the
VideoNOW-TM- system is used.  OCC's contracts with hotels provide that OCC will
be the exclusive provider of in-room, pay-per-view television entertainment
services to the hotel and generally permit OCC to set the movie price.  The
hotels collect movie viewing charges from their guests and retain a commission
equal to a percentage of the total pay-per-view revenue that varies depending on
the size and profitability of the system.  Some contracts may also require OCC
to upgrade its system to the extent that new technologies and features are
introduced during the term of the contract.  At the scheduled expiration of a
contract, OCC generally seeks to extend the contract on terms substantially
similar to the current terms.

     The revenue generated from OCC's pay-per-view service is dependent upon the
occupancy rate at the property, the "buy rate" or percentage of occupied rooms
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 and
competitive position within its marketplace and over time based on seasonal
factors and general economic conditions.  Buy rates generally reflect the
hotel's guest mix profile, the popularity of the motion pictures or services
available at the hotel and the guests' other entertainment alternatives.  Buy
rates also vary


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over time with general economic conditions.  Movie price levels are established
by OCC and are set based on the guest mix profile at each property and overall
economic conditions.  Currently, OCV's movie prices typically are $8.95 for the
first purchase by an end-consumer and $4.95 for each subsequent buy by the same
end-consumer on the same day.  The SpectraVision equipped hotels currently do
not discount second buys.

     The hardware installed in OCV's systems consists of a microprocessor
controlling the television in each room, a hand held remote control, and a
central "head-end" video rack and system computer located elsewhere in the
hotel.  The in-room terminal unit may be integrated within, or located
behind, the television.  OCC emphasizes sales and installations of full-scale
OCV video on-demand systems to business and luxury hotels.  OCC markets lower
cost OCV VideoNOW systems to select mid-priced hotels.  The VideoNOW system
works with the hotel's existing televisions and telephones, allowing guests
to use their touchtone telephones to access movies and other programming.

     SpectraVision hotels contain several products including: (i) SPECTRAVISION,
a scheduled tape-based play system: (ii) SPECTRAVISION GUEST THEATER, a
scheduled play system using satellite delivery; (iii) GUEST CHOICE, an analog
tape system which provides on-demand viewing of up to 200 videotapes; and (iv)
DIGITAL GUEST CHOICE, the industry's only digital video on-demand service.

     OCC, through both OCV and SpectraVision, also markets a free-to-guest
service pursuant to which a hotel may elect to receive one or more satellite
programming channels, such as HBO, Showtime, CNN, ESPN, WTBS and other cable
networks.  OCC provides hotels free-to-guest services through a variety of
arrangements including having the hotel pay the company a fixed monthly fee per
room for each programming channel selected or having the price of such
programming included in OCC's other offerings.  OCC also provides certain
interactive services such as video check-out, room service ordering and guest
satisfaction surveys.  The OCC system also enables hotel owners to broadcast
informational and promotional messages and to monitor room availability.

TECHNOLOGY

     OCC's product development philosophy is to design high quality
entertainment and information systems which incorporate features allowing OCC to
add or upgrade system enhancements as they become commercially available and
economically viable.  The high speed, two-way digital communications capability
of OCV's system enables OCC to provide advanced interactive features, such as
video games, in addition to basic interactive services such as video checkout,
room service ordering and guest surveying.

     OCC's systems incorporate proprietary communications system designs with
commercially manufactured components and hardware such as video cassette
players, amplifiers and computers.  Because systems generally use industry
standard interfaces, OCC can integrate new technologies as they become
economically viable.  Such technologies might include digital compression and
store-and-forward, which would permit multiple users to access the same stored
movie at varying start times.

     In 1993, SpectraVision entered into an agreement with Electronic Data
Systems ("EDS") to install a satellite-based digital movie delivery system to
replace its existing tape-based delivery systems.  In conjunction with the
installation of this system, SpectraVision introduced its new SPEXIS-TM-
computer system which allows SpectraVision to provide new and improved
interactive services.  SpectraVision and EDS first installed equipment to
enable SpectraVision to provide its scheduled

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play movies in a compressed digital video format on a real time basis via
satellite (GUEST THEATER-TM-).  In late 1994, SpectraVision and EDS began the
second phase of the technology conversion and initiated the installation of a
digital video on-demand system (DIGITAL GUEST CHOICE) in selected hotels.  This
system consists of high capacity disk arrays, which are used to store digitized
movies, delivered to a hotel via satellite, for instantaneous on-demand viewing
by hotel guests.

     Upon completing the Acquisition, On Command Corporation entered into a new
agreement with EDS for the continued delivery of the satellite delivered service
for up to 45 months after the closing.  After the loss of AT&T's Telestar 401
satellite, the satellite through which EDS provided transmission services to
SpectraVision, in late January, 1997, the Company entered into a six-month
agreement with Hughes Network Systems for transponder capacity on a GE American
Communications, Inc. satellite to resume the service interrupted by the loss of
Telestar 401.  See Note 16 to Notes to the Consolidated Financial Statements.

SALES AND MARKETING

     OCC's marketing efforts are focused on business and luxury hotels with
approximately 150 rooms or more, as OCC management believes that such hotels
consistently generate the highest revenues per room in the lodging industry.
OCC also targets smaller business and luxury hotels and select mid-priced hotels
that meet its profitability criteria.  OCC intends to continue targeting
established hotel chains, certain business and luxury hotel management
companies, and selected independent hotels.

INSTALLATION AND SERVICE OPERATIONS

     At December 31, 1996, OCC's installation and service organization consisted
of approximately 400 installation and service personnel in the United States and
Canada.  OCC installation and service personnel are responsible for all of the
hotel rooms served by OCC.  Installation and service personnel are responsible
for system maintenance and distribution of video cassettes.  OCC's installation
personnel prepare site surveys to determine the type of equipment to be
installed at each hotel, install systems, train the hotel staff to operate the
systems, and perform quality control tests. OCC also uses local installation
subcontractors supervised by full-time OCC personnel to install its systems.

     OCC maintains a toll-free technical support hot line that is monitored 24
hours a day by trained support technicians.  The on-line diagnostic capability
of the OCV and SpectraVision systems enables the technician to identify and
resolve a majority of the reported system malfunctions from OCC's service
control center without visiting the hotel property.  When a service visit is
required, the modular design of the OCV and SpectraVision systems generally
permits installation and service personnel to replace defective components at
the hotel site.

HOTEL CONTRACTS

     On Command Corporation typically enters into a separate contract with each
hotel for the services provided.  Contracts with the corporate-managed hotels in
any one chain generally are negotiated by that chain's corporate management, and
the hotels subscribe at the direction of the corporate management.  In the case
of franchised or independently owned hotels, the contracts are generally
negotiated separately with each hotel.  Existing contracts generally have a term
of five or seven years from the date the system becomes operational.  At
expiration, OCC typically seeks to extend the term of the contract on terms
competitive in the market.  At December 31, 1996, approximately 8.5% of the pay-
per-view hotels served by OCC have contracts that have expired and are on a
month-to-month basis.  Approximately 9.5% of the pay-per-view hotels served by
OCC have contracts expiring in 1997.

SUPPLIERS

     OCC contracts directly with various electronics firms for the manufacture
and assembly of its systems hardware, the design of which is controlled by On
Command Development Corporation.  Historically, these suppliers have been
dependable and able to meet delivery schedules on time.  OCC believes that, in
the event of a termination of any of its sources, alternate suppliers could be
located without incurring significant costs or delays.  However, certain
electronic component parts used with OCC's products are available from a limited
number of suppliers and can be subject to temporary shortages because of general
economic conditions and the demand and supply for such component parts.  In
addition, some of SpectraVision's systems currently installed in hotels
require a high level of service and repair.  As these systems become older,
servicing replacement parts will become more difficult.  If OCC were to
experience a shortage of any given electronic part, OCC believes that
alternative parts could be obtained or system design changes implemented.  In
such event, OCC


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could experience a temporary reduction in the rate of new room installations
and/or an increase in the cost of such installations.

     The head-end electronics are assembled at OCC's facilities for testing
prior to shipping.  Following assembly and testing of equipment designed
specifically for a particular hotel, the system is shipped to each location,
where it is installed by OCC-employed and trained technicians, typically
assisted by independent contractors.

          OCC also maintains direct contractual relations with various suppliers
of pay-per-view and free-to-guest programming, including the motion picture
studios and programming networks.  OCC obtains its free-to-guest programming
pursuant to multi-year license agreements and pays its programming suppliers a
monthly fee for each room offering the service.  OCC believes its relationships
with all suppliers are good, except for Showtime Networks, Inc. which is
disputing OCC's performance of the contract with Showtime in connection with the
Company's termination of scheduled satellite delivered pay-per-view service.  In
addition, OCC is negotiating the renewal of a contract with HBO which expired in
June 1996, although OCC continues to provide HBO programming under the expired
contract.

INTEGRATING OPERATIONS

     On Command Corporation is working towards the full integration of its
operations in support of the OCV and SpectraVision systems.  Most of the work
had been completed by December 31, 1996, however, significant system development
and field support projects would continue throughout 1997 to complete the
integration.  In addition, OCC intends to pursue the renewal or extension of
these contracts by offering these customers the opportunity to obtain OCV on-
demand pay-per-view movie service and related services.

     Certain of SpectraVision's customers will not be offered the opportunity to
receive OCV equipment.  These customers are located in Hong Kong, Australia,
Singapore and Thailand.  OCV is currently a party to an agreement with MagiNet
Corporation ("MagiNet") to provide OCV systems and technology to MagiNet in the
Asia-Pacific region.

COMPETITION

     There are several providers of in-room video entertainment to the lodging
industry, at least two of which provide on-demand pay-per-view and free-to-guest
programming and other interactive services over the hotel television.  Pay-per-
view, the most profitable component of the services offered, competes for a
guest's time and entertainment resources with broadcast television, free-to-
guest programming and cable television services.  In addition, there are a
number of potential competitors that could utilize their existing infrastructure
to provide in-room entertainment to the lodging industry, including cable
companies (including wireless cable), telecommunications companies and direct-
to-home and direct broadcast satellite companies.  Some of these potential
competitors are already providing free-to-guest services to hotels and testing
video-on-demand.

     OCC, through OCV and SpectraVision, is the leading provider (by number of
hotel rooms served) of in-room video entertainment services and the leading
provider (by number of hotels rooms served) of in-room on-demand video
entertainment services to the United States lodging industry.  OCC competes on a
national scale primarily with LodgeNet Entertainment Corporation ("LodgeNet")
and on a regional basis with certain other smaller entities.  Based on publicly
filed information, OCC estimates that, at December 31, 1996, LodgeNet served
approximately 400,000 pay-per-view rooms, of which approximately 359,000 are


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equipped with on-demand service.  At December 31, 1996, OCC served approximately
918,000 rooms, of which approximately 709,000 are on-demand rooms.

     Competition with respect to new pay-per-view contracts centers on a variety
of factors, depending upon the circumstances important to a particular hotel.
Among the more important factors are (i) the features and benefits of the
entertainment systems, (ii) the quality of the vendor's technical support and
maintenance services and (iii) the financial terms and conditions of the
proposed contract.  With respect to hotel properties already receiving in-room
entertainment services, the current provider may have certain informational and
installation cost advantages as compared to outside competitors.

     The Company believes that OCC's competitive advantages include (i)
technological leadership represented by its superior on-demand capability and
range of services offered, and (ii) system reliability and high quality service.
OCC believes that its growth (including OCV's growth over the previous three
years) reflects the strong competitive position of OCC's products and services.
The OCC system offers an expansive library of on-demand movies and will allow
OCC to upgrade and add new features to the OCC system during the terms of the
pay-per-view contracts.

     OCC anticipates substantial competition in obtaining new contracts with
major hotel chains.  The Company believes that hotels view the provision of in-
room on-demand entertainment both as a revenue source and as a source of
competitive advantage in that sophisticated hotel guests are increasingly
demanding a greater range of quality entertainment and informational
alternatives.  At the same time, OCC believes that certain major hotel chains
have awarded contracts based primarily on the level and nature of financial and
other incentives offered by the pay-per-view service provider.  While the
Company believes its competitive advantages will enable OCC to continue to offer
financial arrangements that are attractive to hotels, its competitors may
attempt to gain or maintain market share at the expense of profitability.  OCC
may not always be willing to match the incentives provided by its competitors.

     The communications industry is subject to rapid technological change.  New
technological developments could adversely affect OCC's operations unless it is
able to provide equivalent services at competitive prices.


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INTERNATIONAL MARKETS

     In addition to its operations in the United States, OCC, through OCV and
SpectraVision and its international subsidiaries, offers its services in Canada,
Mexico, Puerto Rico, the U.S. Virgin Islands, Hong Kong, Singapore, Thailand,
Australia, and the Bahamas.

     SpectraVision has been a leading provider of in-room video entertainment in
the Asia-Pacific region and Australia.  SpectraVision has provided its
international hotel customers primarily with its tape-based systems, but
generally experiences higher revenues and operating cash flow per room than in
the United States because of higher prices, higher buy rate, and the lack of
programming alternatives.  At December 31, 1996, there were 375 hotels with a
total of 97,830 rooms located outside the United States with SpectraVision
systems.

     The competition to provide pay-per-view services to international hotels
is even more dispersed than in the United States.  Expansion of OCC's
operations into foreign markets involves certain risks that are not
associated with further expansion in the United States including availability
of programming, government regulation, currency fluctuations, language
barriers, differences in signal transmission formats, local economic and
political conditions, and restriction on foreign ownership and investment.
Consequently, these risks may hinder OCC's efforts to grow its base of hotel
rooms in foreign markets.

INVESTMENT IN OCC

     The Company made its initial investment in OCV in 1991 and owned
approximately 84% of OCV (78.4% on a fully diluted basis) prior to the
Acquisition.  In connection with the OCC Transactions, each stockholder of OCV
received (i) 2.84 shares of OCC common stock for each share of OCV common stock
previously held and (ii) Series A Warrants to purchase, on a cashless basis,
18.607% of a share of OCC common stock for each share of OCV common stock
previously held.  Of the 21,750,000 shares of OCC common stock and Series A
Warrants to purchase 1,425,000 shares of OCC common stock distributed to the OCV
stockholders, Ascent received 17,149,766 shares of OCC common stock and Series A
Warrants to purchase 1,123,823 shares of OCC common stock.  Hilton Hotels
Corporation, former minority stockholder of OCV that is unaffiliated with the
Company but is a significant customer of OCC, received approximately 2,331,986
shares of OCC common stock and Series A Warrants to purchase approximately
152,786 shares.

     The Company currently has no agreements or understandings with respect to
the minority stockholders of the Company or OCC, other than a letter agreement
dated April 19, 1996 with Gary Wilson Partners that provides that (i) Gary
Wilson Partners will, so long as (a) it owns any shares of OCC common stock
received upon exercise of the Series C Warrants that it received for advisory
and other services that it provided in connection with the OCC Transactions
and (b) the Company continues to own 20% of the outstanding shares of OCC
common stock, vote its shares of OCC common stock in accordance with the
instructions of the Company and (ii) so long as the Company owns 20% of the
outstanding OCC common stock, Gary Wilson Partners will not, without the prior
written consent of the Company, sell any interest in the Series C Warrants or
the shares of OCC common stock purchasable for cash in connection with the
Series C Warrants, until October 8, 1998.

                            ASCENT NETWORK SERVICES

     ANS, a wholly owned subsidiary of the Company, is a satellite distribution
support service company that operates a nationwide installation, field service
and


                                        8


<PAGE>

maintenance support business that principally services the NBC affiliate
distribution network.  Pursuant to a service contract which runs until 1999, ANS
distributes national television programming of the NBC television network via
satellite transponders leased by NBC to NBC affiliate stations nationwide.

     In 1984, in connection with its construction, service and support of NBC's
master earth station and receiver earth stations at NBC affiliates, ANS entered
into a ten year contract to design, build and operate a Ku-band satellite
distribution network, for which the network control center is located in
Florida.  The initial ten year contract with NBC was extended to continue
through 1999.  The Company owns and operates the network (excluding the
satellite transponders, which are leased by NBC) and receives yearly payments
from NBC in connection with such operations.  The network consists of the
network control center, two master earth stations, eight transmit/receive
stations, 170 receive earth stations at NBC affiliates, 54 portable uplink
antennas, and six transportable transmit/receive trucks.

     NBC, with ANS's technical assistance, issued a request for information to
certain of its hardware vendors in July 1995 with respect to procuring equipment
necessary to upgrade the NBC distribution network to digital technology.  In
August of 1996, ANS and NBC executed a letter of intent pursuant to which ANS
has procured and installed certain of such digital equipment to provide MSNBC,
LLC, a joint venture between NBC and Microsoft Corporation ("MSNBC") with
network service, maintenance and support.  The partial digital upgrade service
is being provided for a 10 year term and is currently governed by the
underlying NBC service contract.  ANS and MSNBC anticipate finalizing a
service agreement separate from the underlying NBC contract in the first half
of 1997 for the partial digital upgrade service.  The network service,
maintenance and support provided to MSNBC are related to and dependent upon
the original NBC distribution network.  The Company anticipates that ANS will
assist NBC in a full network upgrade of all satellite distribution locations
to digital technology in late 1998 or early 1999, which will likely involve
significant capital expenditures on the part of the Company and would be
accompanied by an extension of ANS's contract with NBC that expires in 1999.

     ANS also provides installation, integration, design and customer service
of the VSAT microwave and fiber optics systems to a variety of customers other
than NBC.  In addition, prior to 1996, ANS also included the Company's
Satellite Cinema division, which provided satellite-delivered pay-per-view
movies on a scheduled basis to the lodging industry.  In the third quarter of
1995, ANS contributed substantially all of its hotel pay per view assets,
including Satellite Cinema assets, to OCV in exchange for OCV common stock
(the "Contribution"), raising the Company's ownership in OCV by approximately
5% to 84.7% (which was subsequently adjusted to 83.7%).  See "Management's
Discussion and Analysis of Financial Condition and Results of Operations -
Overview" and Note 14 of Notes to Consolidated Financial Statements.  In
connection with the Contribution, OCC converted select Satellite Cinema hotel
properties to higher margin OCV services and OCV completed a transaction
whereby it sold certain of the contracts to provide pay-per-view service to
approximately 100,000 rooms and related equipment to TeleVideoComm Corporation
("TVC") for a payment of approximately $3.3 million.  Satellite Cinema
operations at the hotel properties not included in the TVC transaction were
not converted and were discontinued.

                                  ENTERTAINMENT

                      COLORADO AVALANCHE AND DENVER NUGGETS

     In June 1996, the Avalanche won the NHL championship in its first year in
Denver.  The Company had acquired one of the 26 franchises in the NHL in July
1995 and had moved the franchise to Denver.  For the 1995-1996 NHL season, the
Avalanche sold all 12,000 season tickets that the team made available for sale.



                                       9


<PAGE>

For the 1996 - 1997 season all 12,250 season tickets made available by the team
to the public were sold.

     The Nuggets are one of 29 franchises in the NBA.  Since the Company's
initial investment in the team in 1989 through the 1995 - 1996 season, the
Nuggets experienced gains in attendance, season ticket sales, corporate
sponsorships, broadcast fees and proceeds from licensed merchandise.  For the
1996 - 1997 season Nuggets season ticket sales declined from 11,960 to
approximately 8,700.  The Nuggets corporate sales and other arena related sales
have also seen declines of somewhat smaller proportions.  The Company assumed
operating control of the Nuggets at the end of the 1991-1992 season and through
the 1995-1996 season, the Nuggets have enjoyed a compound annual growth rate in
revenues (excluding $9.2 million of NBA expansion fees recorded in 1995) of
approximately 17.5%.  Revenues for the 1996-1997 season will almost certainly
show a decline from those of the 1995-1996 season.

     The Company markets, produces and sells advertising for local market over-
the-air television and radio broadcasts of the Avalanche and the Nuggets games.
In connection with cable television broadcasts, the Company has agreements with
Fox Sports Rocky Mountain ("Fox Sports") whereby Fox Sports pays a rights fee to
the Company and Fox Sports is then entitled to all cable advertising revenue.
The Company believes that the Avalanche and the Nuggets are among only a few
sports franchises to control their own local market cable, over-the-air
television and radio broadcast distribution.  The Company produces many of the
Avalanche and the Nuggets games through Colorado Studios, a television
production company that owns and operates mobile television production
facilities and in which the Company owns a one-third interest.  The Company
believes that its control of over-the-air television and radio broadcast
distribution increases the profitability to the Company from these media.  The
Company also capitalizes on its ownership of the Avalanche and the Nuggets
through marketing and local market sales of branded Avalanche, Nuggets, NHL and
NBA merchandise.  The Company believes that its ownership of the Avalanche and
the Nuggets and its control of its own over-the-air television and radio
broadcast distribution form a base of expansion into ancillary entertainment
opportunities in the Rocky Mountain region.  To capitalize on this competitive
advantage, the Company is proposing to build a new arena as an integral part of
its operating and growth strategy for the Avalanche and the Nuggets.  (See Item
2. "Properties")

SOURCES OF REVENUES

     The Avalanche and the Nuggets derive a significant amount of their revenues
from the sale of tickets to home games, the licensing of local market
television, cable network and radio rights and distributions from the leagues.

     TICKET SALES.  Each of the Avalanche and the Nuggets play an equal number
     of home games and away games during the 82-game NBA and 82-game NHL regular
     seasons.  In addition, the teams play approximately eight exhibition games
     prior to the commencement of the regular season.  The Avalanche and the
     Nuggets receive all revenues from the sale of tickets to regular season
     home games (subject, in the case of the Nuggets, to an NBA gate assessment)
     and no revenue from the sale of tickets to regular season away games.
     Generally, the Avalanche and the Nuggets retain all revenues from the sale
     of tickets to home exhibition games played in Denver and the Rocky Mountain
     region (less appearance fees paid to the visiting team), and receive
     appearance fees for exhibition games played elsewhere.  If the Avalanche or
     the Nuggets make the playoffs in their respective league, the team receives
     revenues from the sale of tickets to playoff games, although a portion of
     such ticket revenue is shared with the respective league.

     The seating capacity of Denver's McNichols Arena is approximately 17,000
     for Nuggets basketball games and approximately 16,000 for the Avalanche
     hockey games, including 27 executive suites containing a total of 374
     seats.  The policy of the Avalanche and the Nuggets is to limit the number
     of season tickets so that approximately 25% of the tickets are available on
     a per game basis.  For the 1996-1997 season, the Avalanche have sold 12,250
     season tickets and the Nuggets have sold approximately 8,700 season
     tickets.

     TELEVISION, CABLE AND RADIO BROADCASTING.  The Nuggets and the NBA license
     the television and radio broadcast rights to Nuggets basketball games.  The
     NBA, as agent for its members, licenses the national broadcast of the games
     under agreements with NBC Sports, a division of NBC, and Turner Network
     Television, Inc. ("TNT"), an affiliate of the Turner Broadcasting System.
     Each NBA member team shares equally in these license fees, except that
     pursuant to an agreement entered into when the Nuggets and the other former
     American Basketball Association ("ABA") teams joined the NBA in 1976, a
     portion of the national television revenues otherwise payable to each of
     the former ABA teams is paid to a group which owned an ABA franchise that
     was not admitted to the NBA.  The Nuggets license the local over-the-air
     rights to broadcast certain Nuggets games to KWGN, Inc. ("KWGN"), and the
     cable rights to broadcast certain games to Fox Sports.  Pursuant to the
     Nuggets' agreement with KWGN, the Nuggets pay a specified fee per game to
     KWGN.  In return, the Nuggets are entitled to sell all advertising spots
     available during the broadcast and retain all revenues from such sales.
     Pursuant to the Nuggets' agreement with Fox Sports, Fox Sports pays a fee
     to the Nuggets based upon the number of cable subscribers served, subject
     to a specified minimum fee per game, and Fox Sports is entitled to all
     advertising revenue.  The Nuggets also license the rights to broadcast all
     games on radio under an agreement with KKFN, 950 AM.

     The Avalanche and NHL license the television and radio broadcast rights to
     Avalanche hockey games.  The NHL, as agent for its members, licenses the
     national broadcast of the games under agreements with ESPN, the Fox
     television network and the Canadian Broadcasting Company, which broadcasts
     NHL games in Canada.  Each NHL member team shares equally in these license
     fees.  In addition, the Avalanche license the local over-the-air rights to
     broadcast select games to the local ABC affiliate, KMGH Television ("KMGH")
     and the cable rights to broadcast select games to Fox Sports.  Pursuant to


                                       10


<PAGE>

     the Avalanche's agreement with KMGH, the Avalanche pay a specified fee per
     game to KMGH.  In return, the Avalanche are entitled to sell all
     advertising spots available during the broadcast and retain all revenues
     from such sales.  Pursuant to the Avalanche's agreement with Fox Sports,
     Fox Sports pays a rights fee to the Avalanche and Fox Sports is entitled to
     all advertising revenue.  The Avalanche also license the rights to
     broadcast all games on radio under an agreement with KKFN, 950 AM.

     OTHER SOURCES.  Other sources of revenue for each of the Nuggets and the
     Avalanche include their pro rata share of franchise fees to be paid by
     expansion teams upon entry to the NBA or NHL and promotional and novelty
     revenues, including royalties from marketing and merchandising conducted by
     each of the NBA and NHL.  In 1995, the Nuggets recorded $9.2 million in
     revenue in connection with the admission of two new franchises into the
     NBA.  In connection with obtaining the NHL's consent to the Company's
     acquisition of the Avalanche franchise and relocation to Denver, the
     Company agreed that up to $2.0 million of the Avalanche's share of
     expansion fees from each of the next four expansion teams will be retained
     by the NHL.

     The Avalanche and the Nuggets also derive additional revenues through the
     sale of signage, promotions and program advertising space to corporate
     sponsors, arena concessions and parking  and sales generated by team stores
     that sell NHL, Avalanche, NBA and Nuggets branded goods.

     Each member of the NBA and NHL assigns to its respective league the
     exclusive rights to the merchandising of its team name, insignia and other
     similar properties, subject to certain restrictions and limitations.  Each
     of the leagues then pay royalties to each of their respective teams in
     consideration of the receipt of such rights.  This assignment is subject to
     the Nuggets' and the Avalanche's right to use their insignia and symbols in
     connection with the promotion of the team in their home territory and
     retail sales in their home arena and team owned stores.  Each of the NBA
     and NHL licenses other companies to manufacture and sell official NBA and
     NHL items such as warm-up jackets and sweatshirts, as well as certain non-
     sports items.

NBA AND NHL GOVERNANCE

     The NBA and the NHL are generally responsible for regulating the conduct of
their member teams.  The NBA and the NHL establish the regular season and
playoff schedules for the teams.  They also negotiate, on behalf of their
members, the leagues' national over-the-air and cable television contracts and
collective bargaining agreements with the NBA and NHL Players' Associations.
Because the NBA and NHL are joint ventures, each of their members generally has
joint and several liability for the league's liabilities and obligations and
shares in its profits.  Under the terms of the constitution and by-laws of the
NBA and the NHL, league approval is required under certain circumstances,
including in connection with the sale or relocation of a member team.

     Each of the NBA and the NHL is governed by a Board of Governors, which
consists of one representative from each member team.  The Board of Governors of
each league selects the league Commissioner who administers the daily affairs of
the league, including dealings with the Players' Association, interpretations of
playing rules and arbitration of conflicts among members.  The Commissioner also
has the power to impose sanctions, including fines and suspensions, for
violations of league rules.

     The Commissioner of each of the NBA and NHL has the exclusive power to
interpret the constitution, by-laws, rules and regulations of their respective


                                       11


<PAGE>

league, and their interpretations are final and binding on the Company, the
Nuggets, the Avalanche and their personnel.  In addition, member clubs of the
NBA and NHL may not resort to the courts to enforce or maintain rights or claims
against other member clubs, or to seek resolution of any dispute or controversy
between member clubs, but instead all such matters must be submitted for final
and binding determination to the respective Commissioner of such league without
any right of appeal to the courts or otherwise.  Finally, each of the NHL and
the NBA prohibits the acquisition of 5% or more of the direct or indirect
ownership interests in a member club owned by a publicly traded company without
the respective league's prior consent.  Neither the NBA nor the NHL, nor any of
their respective member clubs, nor any officer or employee of either league or
its member clubs, other than the Company, has reviewed in advance the
information being provided in this report, or assumes any responsibility for the
accuracy of any representations made by the Company to any potential investors.

     On September 13, 1995, the NBA Players' Association approved the new six-
year NBA Collective Bargaining Agreement, which was subsequently ratified by the
NBA owners on September 18, 1995.  The NBA Collective Bargaining Agreement
provides for, among other things, maximum and minimum total team salaries to be
paid to players and runs for a term from September 18, 1995 through June 30,
2001.  The NBA Collective Bargaining Agreement provides various exceptions to
the salary limitations, including exceptions relating to a team's resigning its
own veteran free agent players, replacing injured players, and signing players
at the minimum individual player salary.  As a result of the signing and
ratification of the NBA Collective Bargaining Agreement, the Company does not
anticipate any player labor disruptions in the near future.

     The NHL and the NHL Players' Association entered into the new seven-year
NHL Collective Bargaining Agreement on August 11, 1995 that took retroactive
effect as of September 6, 1993.  Though the NHL Collective Bargaining Agreement
does not expire until September 15, 2000, both the NHL and NHL Players'
Association had the right to reopen negotiations at the end of the 1997-1998
season.  However, both parties have agreed to waive the right to reopen
negotiations in connection with an agreement that allows NHL players to
participate in the 1998 Winter Olympics.  As with the NBA Collective Bargaining
Agreement, the Company believes that the NHL Collective Bargaining Agreement
renders unlikely any player labor disruptions in the near future.

COMPETITION

     The Nuggets and the Avalanche compete for sports fans' entertainment
dollars not only with each other and other major league sports, but also with
minor league sports, college athletics, other sports entertainment and non-
sports entertainment such as the Colorado Symphony, Opera and Ballet, movies,
local theater and recreational activities such as skiing.  During portions of
their respective seasons, the Nuggets and the Avalanche will experience
competition from each other, professional football (the Denver Broncos),
professional baseball (the Colorado Rockies) and women's professional basketball
(the Colorado Xplosion).  In addition, the colleges and universities in the
Rocky Mountain region, as well as public and private schools, offer a full
schedule of athletic events throughout the year.  The Nuggets and the Avalanche
compete with other United States and foreign teams, professional and otherwise,
for available players.

BROADCAST OPERATIONS

     In addition to its Denver sports franchises, the Company also owns a one-
third interest in Colorado Studios, a Denver television production company that
owns and operates mobile television production facilities.  Colorado Studios
allows the Company to produce and transmit Nuggets and Avalanche games to the
Rocky Mountain region.  Colorado Studios is co-owned equally by the Company, Fox
Sports and Norac, Inc., a Denver-based television production company.


                              BEACON COMMUNICATIONS

     Beacon, a wholly owned subsidiary of the Company acquired in 1994, was
founded in 1990 to produce feature length motion pictures for theater and
television distribution.  Beacon's principal focus is the production of high
quality motion pictures with varying budgets.  It has developed a production
formula that it believes will allow it to maximize its production capacity while
at the same time optimizing the cost structure and quality of its motion
pictures and television programming.  A component of that formula includes
Beacon's strategic relationships with significant domestic and international
motion picture distributors.  Beacon began production of three motion pictures
in 1996, all of which are intended to be released in 1997.  Beacon currently is
planning to begin production of three motion pictures in 1997, which may be
released in 1998.

     In July 1996, Beacon entered into a five-year agreement (the "Universal
Agreement") with Universal Pictures ("Universal"), pursuant to which Universal
has agreed to co-finance and distribute in the United States and Canada, up to
20 pictures produced by Beacon, although Universal is not obligated to accept
more than 4 films per year from Beacon.  To date, no motion pictures have been
produced and distributed pursuant to the Universal Agreement.  Pursuant to the
Universal Agreement, Beacon pays Universal a distribution fee out of the
revenues generated by domestic distribution of such motion pictures and Beacon
receives net revenues after Universal's fees and expenses.  Universal generally
controls all rights to distribute such motion pictures domestically for two full
television syndication cycles, not to exceed 21 years from the theatrical
release of the picture, although Beacon retains the copyrights and retains
certain other rights related to such films such as music publishing,
merchandising and hotel television rights.

     In April 1993, Beacon entered into a five-year agreement (the "Sony
Agreement") with Sony Pictures Entertainment, Inc. ("Sony"), pursuant to which
Sony agreed to co-finance and distribute in the United States and Canada,
through Sony's affiliates, including Columbia Pictures and Tri-Star Pictures, up
to 15 motion pictures produced by Beacon.  Two motion pictures have been
distributed pursuant to the Sony Agreement.  Another has been produced and is
scheduled to be


                                       12


<PAGE>

released in 1997, the motion picture "Air Force One" starring Harrison Ford.
Pursuant to the Sony Agreement, Beacon and Sony share in the revenues generated
by domestic distribution of such motion pictures.  Sony generally controls all
rights to distribute the motion pictures domestically for the later of 14 years
or the end of the second television syndication cycle for such motion picture
(but in no event later than 23 years), although Beacon retains the copyrights.
In July 1996, the Sony Agreement was amended to terminate Sony's exclusive
acquisition term and to provide that Sony has the right to jointly develop,
produce and distribute up to two additional motion pictures with Beacon for
distribution under the Sony Agreement.

     Generally, Beacon intends to produce motion pictures with production
budgets in the range of approximately $5 million to $40 million, although Beacon
will also consider certain higher budget projects.  In that regard, Beacon
produced "Air Force One" starring Harrison Ford with a production budget of
approximately $95 million which will be distributed domestically pursuant to the
Sony Agreement, and distributed internationally by Buena Vista International,
Inc., a subsidiary of the Walt Disney Company ("Buena Vista"), pursuant to an
agreement which provides for a fixed advance of a significant portion of
production costs.

     Beacon plans to release most of its motion pictures on a nationwide basis,
with advertising and distribution budgets generally comparable to those of the
major motion picture companies.  This type of release pattern requires
substantial marketing expenditures to create a campaign and purchase advertising
on television, newspapers, radio and other media. Beacon expects that the
Universal Agreement and the Sony Agreement, as amended, will help offset such
costs and provide more cost effective use of Beacon's resources than if Beacon
distributed its motion pictures alone.  The Universal Agreement and the Sony
Agreement, as amended, each allow Beacon to continue to offset risks by pre-
selling foreign distribution rights to its motion pictures and each provides
Beacon a proven domestic distribution network for its productions, however the
Universal Agreement is more favorable to Beacon in terms of the overhead advance
paid to Beacon, production funding and domestic print and advertising funding.

     In 1997, "Playing God" a suspense film starring David Duchovny and "A
Thousand Acres" starring Michelle Pfeiffer and Jessica Lange will be released
domestically by Buena Vista and not under the Universal Agreement or the Sony
Agreement, as amended.  Beacon has retained the foreign distribution rights to
"Playing God" and a portion of the film's production costs are offset by the
domestic distribution arrangement with Buena Vista.  "A Thousand Acres" is being
distributed internationally by Polygram Filmed Entertainment ("Polygram") and
the production costs are being split among Beacon, Beacon's co-producer
Propaganda Films, Inc. (a subsidiary of Polygram) and Buena Vista.

     The production and release of motion pictures are subject to numerous
uncertainties, however, and there can be no assurance that Beacon's strategy
will be successful, that its release schedule will be met, that Beacon will be
successful in obtaining the necessary financing for its operations or that it
will achieve its goals.  Beacon intends to maintain flexibility in order to
adjust its strategies, including the criteria for investing in motion pictures,
in response to changes in the motion picture industry.

COMPETITION

     Beacon competes with many other motion picture producers and distributors,
including major motion picture studios.  Although the motion picture industry is
extremely competitive, Beacon believes it can attract well known and highly
respected talent at or below market rates as a result of its focus on high
quality scripts.  In addition, the Company has generally produced its motion
pictures


                                       13


<PAGE>

consistent with the established budgets.  Beacon believes that its high quality
and production efficiency will allow it to compete effectively.

                            OTHER BUSINESS INTERESTS

     The Company owned a 26% limited partnership interest in New Elitch Gardens,
Ltd. ("Elitch Gardens"), which it purchased at a cost of approximately $7.9
million.  Elitch Gardens operated an amusement park in Denver, Colorado.  In
October 1996, Elitch Gardens' amusement park was sold to Premier Parks Inc.  In
connection with the sale, the Company has recorded a loss on its investment of
$2.3 million in 1996.  The Company has received distributions in 1996 and in
January of 1997 in an aggregate amount of $3.6 million for its interest as a
limited partner of Elitch Gardens, and expects an additional distribution in the
first half of 1997.  See Note 2 to the Company's Consolidated Financial
Statements.

     The Company also owns small equity interests in Maginet Corporation, which
purchases and uses OCC's on-demand systems in the Asia-Pacific region, and
Metromedia International Group, a diversified company pursuing
telecommunications ventures in eastern Europe and producing motion pictures,
among other things.  See Note 2 to the Company's Consolidated Financial
Statements.

                       PATENTS, TRADEMARKS AND COPYRIGHTS

     The Company uses a number of trademarks, wordmarks and logos for its
products and services, including "Ascent," "On Command," "Spectravision,"
"Denver Nuggets," "Colorado Avalanche," "Beacon" and others.  Many of these
trademarks are registered by the Company, and those trademarks that are not
registered are protected by common law and state unfair competition laws.
Additionally, "Denver Nuggets" is trademarked by the NBA and NBA Properties,
Inc. and "Colorado Avalanche" is trademarked by the NHL and NHL Enterprises,
L.P. and the Company is licensed by such entities to use the names in connection
with its operation of the teams.   Because the Company believes that these
trademarks are significant to the Company's business, the Company has taken
affirmative legal steps to protect its trademarks in the past and intends to
actively protect these trademarks in the future.  The Company believes that its
trademark position is adequately protected.  The Company also believes that its
trademarks are generally well recognized by consumers of its products and are
associated with a high level of quality and value.

     OCV and SpectraVision own a number of patents and patent licenses covering
various aspects of its pay-per-view and interactive systems.  Although OCV and
SpectraVision maintain these valuable assets, OCC believes that the design,
innovation, and quality of OCV's and SpectraVision's products and their
relations with their customers are at least as important, if not more so, to the
maintenance and growth of the Company.

     Distribution rights to motion pictures are granted legal protection under
the copyright laws of the United States and most foreign countries, which
provide substantial civil and criminal sanctions for unauthorized duplication
and exhibition of motion pictures.  Beacon plans to take all appropriate and
reasonable measures to secure, protect and maintain or obtain agreements from
licensees to secure, protect and maintain copyright protection for all of the
motion pictures distributed by Beacon under the laws of all applicable
jurisdictions.


                                       14


<PAGE>

                                   REGULATION

     The Federal Communications Commission (the "FCC") has broad jurisdiction
over electronic communications.  The FCC does not directly regulate On Command
Corporation's pay-per-view or free-to-guest services.  However, the FCC's
jurisdiction does encompass certain aspects of ANS's satellite delivery
operations and of OCC's operations as they relate to the offering of satellite-
delivered pay-per-view movies.

     The FCC's jurisdiction also encompasses certain aspects of On Command
Corporation's operations as they relate to its use of the radio frequency
spectrum in certain hotels acquired in connection with SpectraVision.
SpectraVision had obtained optional licenses from the FCC for a number of its
downlink, television receive-only satellite receivers, which are used to receive
transmissions from communications satellites in connection with its free-to-
guest services.  SpectraVision had also obtained the required licenses for the
microwave point-to-point relay facilities.

     On February 1, 1996, Congress passed the Telecommunications Act of 1996
(the "Telecommunications Act"), which was signed into law on February 8, 1996.
The Telecommunications Act has and will continue to alter federal, state and
local laws and regulations for telecommunications providers and services, and
may affect OCC.  There are numerous rulemakings to be undertaken by the FCC that
will interpret and implement the Telecommunications Act.  It is not possible at
this time to predict the outcome of such rulemakings.

                                   EMPLOYEES

     The Company had approximately 1,070 employees at December 31, 1996.  In
addition to the NBA Collective Bargaining Agreement and the NHL Collective
Bargaining Agreement, relating to the players for the Nuggets and the Avalanche,
respectively, Beacon is a signatory to collective bargaining agreements with the
Screen Actors Guild, the Directors' Guild of America and the Writers' Guild of
America.  These agreements generally require Beacon to employ union actors,
directors and writers and comply with certain other provisions relating to
compensation, benefits and work rules.  Other than the foregoing, none of the
Company's employees is represented by a labor union or collection burgeoning
unit.  The Company considers its relations with its employees to be good.

ITEM 2.  PROPERTIES

     The Company currently leases its principal offices in Denver, Colorado
under a lease which expires in August 1998.  The Company also leases facilities
for ANS from COMSAT in Maryland, for Beacon in Los Angeles, California, and for
ANS in Palm Bay, Florida.  Through 1996, OCV leased facilities in Santa Clara,
California for its headquarters and manufacturing plant; however, in December
1996 OCC entered into a lease for facilities in San Jose, California and
relocated its headquarters and OCV's manufacturing facilities to that location.
In connection with the OCC Transactions, OCC acquired Spectravision's
headquarters building in Plano, Texas and directed Spectravision to assume
certain leases for office space throughout the United States, Canada, Mexico,
Puerto Rico, Hong Kong and Australia for its customer support operations.

     The Avalanche and the Nuggets currently play their home games in Denver's
McNichols Arena, an indoor sports arena located in downtown Denver.  McNichols
Arena is owned by the City and County of Denver (the "City") and is made
available to the Nuggets under a lease agreement which extends until the
conclusion of the 2005-2006 season.  McNichols Arena is made available to the
Avalanche under a lease agreement which extends until the conclusion of the
1996-1997 season, subject to renewals for two one-year terms.  Pursuant to an
amendment to the


                                       15

<PAGE>

Nuggets lease agreement, the term of the Nuggets' lease decreased by one year
for each of the first two years that the Avalanche played in McNichols Arena
(from the 2007-2008 season to the 2005-2006 season).

     The Avalanche's and the Nuggets' leases with the City require the teams to
pay rent to the City for use of McNichols Arena equal to a percentage of the
teams' net income from ticket sales, subject to certain minimum and maximum
annual payments.  The City is generally responsible for maintaining McNichols
Arena and providing administrative personnel such as ushers, electricians,
janitors, technicians and engineers.  The Avalanche and the Nuggets are
responsible for providing police and fire safety personnel, announcers, timers,
scorers and statisticians.  The Avalanche and the Nuggets also share in revenue
from food and beverage concessions and parking rights at McNichols Arena.

     The Company is currently developing and reviewing plans for a privately
financed arena for the Avalanche, the Nuggets and other entertainment events,
including among other things, concerts, college sporting events, ice and dance
performances, comedy shows and circuses.  Under current plans, the proposed
arena would seat approximately 18,000 for Avalanche games, approximately 19,000
for Nuggets games and approximately 20,000 for concerts and other events.  The
proposed arena would have approximately 95 luxury suites and 1,669 luxury seats.
The Company estimates that the cost of the new arena would be approximately $160
million.  The Company is currently negotiating with the City regarding the
proposed arena and the current leases of the Avalanche and Nuggets.  Management
believes that these negotiations can be successfully concluded, but there can be
no assurance that Ascent will be able to reach acceptable terms for the
construction of the new arena.

     On March 28, 1996, Ascent entered into a Land Purchase Agreement with
Southern Pacific Transportation Company ("SPT") pursuant to which Ascent would
purchase approximately 49 acres in downtown Denver as a site for the proposed
arena and entertainment complex for a purchase price of $20,000,000.  Pursuant
to the Land Purchase Agreement, the closing of the land purchase had to have
occurred on or before June 29, 1996.  The closing did not take place by this
time and the Land Purchase Agreement terminated.  It is management's belief
that SPT is likely to reinstate the agreement and the closing date of the
transaction would be subject to several conditions, including obtaining
satisfactory financing and reaching agreements with the City regarding the
construction of the proposed arena and the release of the Nuggets and the
Avalanche from their existing leases at McNichols Arena.  The Land Purchase
Agreement also provides for SPT to effect a state-approved environmental
clean-up plan on the site, and provide continuing indemnification with regard
to certain environmental liabilities.  Although there can be no assurance, it
is management's belief that SPT will reinstate the Land Purchase Agreement on
substantially similar terms and the closing date for the Land Purchase
Agreement will be extended.

ITEM 3.  LEGAL PROCEEDINGS

     The Company is a party to certain legal proceedings in the ordinary course
of its business.  While the outcome of such proceedings cannot be predicted with
certainty, the Company does not believe that any such legal proceedings, to the
extent covered by insurance or otherwise, will have a material adverse effect on
the Company's financial condition or results of operations.  In addition,
through its ownership of the Avalanche and the Nuggets, the Company is a
defendant along with other NHL and NBA owners in various lawsuits incidental to
the operations of the two professional sports leagues.  The Company will
generally be liable, jointly and severally, with all other owners of the NHL and
NBA, as the case may be, for the costs of defending such lawsuits and any
liabilities of the NHL or NBA which might result from such lawsuits. While the
outcome of such proceedings


                                       16


<PAGE>

cannot be predicted with certainty, the Company does not believe that any such
lawsuits, singly or in the aggregate, will have a material adverse effect on the
Company's financial condition or results of operations.  The Nuggets, along with
three other teams, have also agreed to indemnify the NBA, its member teams and
other related parties against certain ABA-related obligations and litigation,
including costs to defend such actions.  The Company believes that the ultimate
disposition and the costs of defending these or any other incidental NBA or NHL
legal matters or of reimbursing related costs, if any, will not have a material
adverse effect on the Company's financial condition or results of operations.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.  None.

EXECUTIVE OFFICERS OF THE REGISTRANT

     In accordance with General Instruction G to the Annual Report on Form 10-K,
included herein is the following table, which sets forth the names, ages at
March 3, 1997 and titles of the executive officers of the Company, and
biographical information with respect to such officers.

Charles Lyons       42   President and Chief Executive Officer

Robert M. Kavner    53   President and Chief Executive Officer, On Command
                         Corporation

James A. Cronin,    42   Executive Vice President, Finance and Chief Operating
     III                 Officer

Arthur M. Aaron     39   Vice President, Business and Legal Affairs and
                         Secretary

David A. Holden     37   Controller

Ellen Robinson      34   President, Ascent Sports, Inc.

     There is no family relationship between an officer and any other officer or
director and no arrangement or understanding between an officer and any other
person pursuant to which he or she was selected as an officer.

     Mr. Lyons has been President and a director of the Company since February
1992.  He was Vice President and General Manager of the Company from October
1990 to January 1992.  Prior to joining COMSAT, Mr. Lyons was with Mariott
Corporation from 1982 to October 1990 in various executive positions.  Mr. Lyons
is Chairman of the Board of Directors of OCC.

     Mr. Kavner has been President and Chief Executive Officer of OCC since
September, 1996.  Prior thereto Mr. Kavner was a principal in Kavner &
Associates, a consulting firm for media and communications companies.  From June
1994 through September 1995 Mr. Kavner was an Executive Vice President of
Creative Artists Agency, Inc. ("CAA").  Prior to joining CAA, Mr. Kavner was
Executive Vice President of AT&T Corp. ("AT&T") and Chief Executive Officer of
AT&T's Multimedia Products and Services Group.  From 1992 to 1994, Mr. Kavner
was Group Executive for the Communications Products Group of AT&T.  From 1988 to
1991, Mr. Kavner was President of AT&T's Data Systems Group.  Mr. Kavner is a
director of Fleet Financial Corp. and Tandem Computers Incorporated.

     Mr. Cronin has been Executive Vice President, Finance and Chief Operating
Officer of the Company since June 1996.  From July to October 1996 Mr. Cronin
was Executive Vice President - Finance, acting Chief Financial Officer and
acting Chief Operating Officer of OCC.  Mr. Cronin served as a financial and
management consultant from 1992 through June 1996 and as a partner in Alfred
Checchi Associates, a merchant bank from 1990 through 1991.  Mr. Cronin is a
director of OCC and Landair Services, Inc.

     Mr. Aaron has been Vice President, Business and Legal Affairs of the
Company since April 1995.  From July to December 1996, Mr. Aaron was Vice
President and acting General Counsel of OCC. He was a General Attorney in the
Office of the General Counsel of COMSAT from July 1993 to April 1995.  From
October 1987 to July 1993, Mr. Aaron was an attorney at the law firm of Skadden,
Arps, Slate, Meagher & Flom in Boston, Massachusetts.


                                       17


<PAGE>

     Mr. Holden has been Controller of the Company since April 1996.  Prior
thereto, Mr. Holden was Senior Manager at Deloitte & Touche LLP  ("Deloitte")
from 1987 through 1996.  Prior to 1987, Mr. Holden was an audit manager at
Deloitte.

     Ms. Robinson has been President of Ascent Sports, Inc. since June 1996.
Prior thereto, Ms. Robinson served as General Manager of Pepsi Cola Bottling
Company ("Pepsi")in Denver from 1995 to 1996, Vice President of Customer
Development of Pepsi from 1992 through 1995 and Area Marketing Manager of Pepsi
from 1988 through 1992.

                                     PART II

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

     As of March 3, 1997, there were approximately 150 record holders of shares
of Common Stock, $.01 par value, of the Company ("Common Stock").  The principal
market for the Common Stock is the NASDAQ Stock Market, where it is traded under
the symbol "GOAL."  The Company's Transfer Agent and Registrar is The Bank of
New York, 101 Barclay Street, New York, New York.  The Company has not declared
or paid any dividends on the Common Stock and does not intend to do so in the
foreseeable future.  For a description of certain restrictions on the Company's
payment of dividends, see "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and Note 5 to the Company's Consolidated
Financial Statements

     The high and low closing prices for the Company's Common Stock for the year
ended December 31, 1996 are as follows:

     Quarter Ended            High           Low
     -------------            ----           ---

     December 31, 1996        $23 1/8        $11 1/2
     September 30, 1996       $24 7/8        $15 3/4
     June 30, 1996            $25 1/4        $14 1/2
     March 31, 1996           $15 3/4        $11 1/4

     December 31, 1995*       $16            $13 1/2

     *The Offering occurred on December 18, 1995, prior to which there was no
public market for the Company's Common Stock.


                                       18


<PAGE>

Item 6.   SELECTED FINANCIAL DATA FOR THE REGISTRANT FOR EACH OF THE LAST FIVE
          FISCAL YEARS.

The following selected consolidated financial data should be read in conjunction
with the Company's consolidated financial statements and schedules and
accompanying notes and with "Management's Discussion and Analysis of Financial
Conditions and Results of Operations" presented elsewhere in this document.

                           FIVE YEAR FINANCIAL SUMMARY
           (Dollar amounts in thousands, except per share information)

<TABLE>
<CAPTION>



                                                                       YEARS ENDED DECEMBER 31,
                                                                       ------------------------

OPERATIONS:
Income Statement Data:                      1996           1995           1994           1993           1992
                                            ----           ----           ----           ----           ----
<S>                                     <C>             <C>            <C>            <C>            <C>
  Multimedia Distribution Revenue(1).   $  167,976(2)   $ 135,782      $ 125,823      $  97,855      $  81,767
  Entertainment Revenue (1) . . . . .       90,144         66,036(3)      39,653         27,826         21,901
                                        ----------      ---------      ---------      ---------      ---------
  Total Revenue . . . . . . . . . . .      258,120        201,818(3)     165,476        125,681        103,668
                                        ----------      ---------      ---------      ---------      ---------
Operating expenses
  Cost of services . . . . . . . . . .     217,949        154,676        107,452         85,998         75,046
  Depreciation and amortization. . . .      74,812         53,675         38,820         27,227         22,386
  General and administrative . . . . .       9,678         10,002          9,203          7,967          7,089
  Provision for restructuring . . . .            -         10,866(4)           -              -         15,318(5)
                                        ----------      ---------      ---------      ---------      ---------
    Total operating expenses. . . . .      302,439        229,219(4)     155,475        121,192        119,839
                                        ----------      ---------      ---------      ---------      ---------
  Income (loss) from operations. . . .     (44,319)       (27,401)        10,001          4,489        (16,171)
  Interest expense . . . . . . . . . .     (10,715)          (759)          (326)          (567)        (2,186)
  Other income (expense), net. . . . .         565         (2,070)         1,021            585            597
  Income tax benefit (expense) . . . .      11,957          9,835         (4,831)        (2,416)         5,506
  Minority interest. . . . . . . . . .       6,812           (628)          (265)          (362)           583
                                        ----------      ---------      ---------      ---------      ---------
  Income (loss) before cumulative
    effect of accounting change
    and extraordinary loss . . . . . .     (35,700)       (21,023)         5,600          1,729        (11,671)
  Cumulative effect of accounting
    change for income taxes. . . . . .           -              -              -            941              -
  Extraordinary loss, net of taxes . .        (334)             -              -              -              -
                                        ----------      ---------      ---------      ---------      ---------
  Net income (loss). . . . . . . . . .  $  (36,034)     $ (21,023)     $   5,600      $   2,670      $ (11,671)
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------
  Weighted average number of common
    shares outstanding (6) . . . . . .      29,753         24,217         24,000         24,000         24,000
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------
  Net income (loss) per common
   share (6) . . . . . . . . . . . . .  $    (1.21)     $    (.87)     $     .23      $     .11      $    (.49)
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------
BALANCE SHEET DATA
(AT END OF PERIOD):
    Total assets . . . . . . . . . . .  $  736,602      $ 502,603      $ 372,580      $ 270,473      $ 203,085
    Total long-term debt . . . . . . .      50,000         70,000            207          1,024          2,570
    Equity . . . . . . . . . . . . . .     269,585        301,269        268,197        181,181        137,209


                                       19

<PAGE>

OTHER DATA:
Operating income (loss):
  Multimedia Distribution. . . . . . .  $   (9,775)     $   2,885      $  18,140      $  15,327      $  12,793
  Entertainment. . . . . . . . . . . .     (24,812)        (9,418)         1,064         (2,871)        (6,557)
  General and administrative . . . . .      (9,732)       (10,002)        (9,203)        (7,967)        (7,089)
  Restructuring Reserve. . . . . . . .          --        (10,866)(4)         --             --        (15,318)
                                        ----------      ---------      ---------      ---------      ---------
    Total. . . . . . . . . . . . . . .  $  (44,319)     $ (27,401)     $  10,001      $   4,489      $ (16,171)
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------
Capital Expenditures:
  Multimedia Distribution. . . . . . .     $78,220      $  82,903      $  89,073      $  63,708      $  17,700
  Entertainment. . . . . . . . . . . .      10,066          2,208            980          1,232            371
                                        ----------      ---------      ---------      ---------      ---------
    Total Capital Expenditures . . . .     $88,286      $  85,111      $  90,053      $  64,940      $  18,071
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------
Cash Flow Data:
  Net cash provided by operating
  activities . . . . . . . . . . . . .  $   23,277      $  63,771      $  38,560      $  27,713      $  27,528

  Net cash used in investing
  activities . . . . . . . . . . . . .    (113,314)     $(180,523)     $(119,975)     $ (76,086)     $ (23,212)

  Net cash provided by (used in)
  financing activities . . . . . . . .      82,988      $ 124,406      $  81,554      $  51,217      $  (3,512)

  EBITDA (7)
  Multimedia Distribution. . . . . . .  $   52,457      $  48,277      $  53,031      $  39,071      $  31,227
  Entertainment. . . . . . . . . . . .     (12,286)        (1,135)         4,993            612         (2,695)
  General & Administrative . . . . . .      (9,678)       (10,002)        (9,203)        (7,967)        (7,089)
                                        ----------      ---------      ---------      ---------      ---------
  Total EBITDA . . . . . . . . . . . .  $   30,493      $  37,140      $  48,821      $  31,716        $21,443
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------

Room data:
Total Number of Guest-pay rooms
  (at end of period):
  On-demand. . . . . . . . . . . . . .     710,000        361,000        248,000        124,000         37,000
  Scheduled only . . . . . . . . . . .     208,000         51,000        194,000        264,000        298,000
                                        ----------      ---------      ---------      ---------      ---------
    Total Rooms. . . . . . . . . . . .     918,000        412,000        442,000        388,000        335,000
                                        ----------      ---------      ---------      ---------      ---------
                                        ----------      ---------      ---------      ---------      ---------

OCC on-demand backlog (at end of
period (8) . . . . . . . . . . . . . .      58,000        113,000        128,000        137,000         27,000
                                            ------        -------        -------        -------         ------
                                            ------        -------        -------        -------         ------
</TABLE>

(1)  OCC has reclassified certain income statement amounts in OCV's historical
     financial statements to be consistent with the presentation used by
     SpectraVision, Inc. and to conform to a more common presentation used by
     providers of in-room entertainment to the lodging industry.  Specifically,
     OCV previously reflected certain costs as a reduction of Revenues and has
     reclassified such costs as a Cost of Service.  This reclassification has no
     impact on either OCC's or Ascent's previously reported operating income
     (loss).  Accordingly, Ascent conformed its presentation to that of OCC's
     during the fourth quarter of 1996 in conjunction with this Annual Report on
     Form 10-K and Revenues for the Multimedia Distribution segment have
     increased by $8.4 million to $135.8 million, by $5.3 million to $125.8
     million, by $1.9 million to $97.9 million and by $.7 million to $81.8
     million for the years ended December 31, 1995, 1994, 1993, and 1992,
     respectively.  In addition, both the Avalanche and Nuggets reclassified
     certain income statement amounts in their historical financial statements
     to be consistent with the presentation in 1996.  Accordingly, revenues for
     the Entertainment Segments have been restated for all years presented
     above.

(2)  Includes $24.1 million in revenues from SpectraVision.  The results of
     operations for the fourth quarter of 1996 include the results from


                                       20


<PAGE>

     SpectraVision assets which were acquired on October 8, 1996.  See Note 2 of
     Notes to the Consolidated Financial Statements.

(3)  Includes $9.2 million of NBA expansion fee revenue recorded in the second
     quarter of 1995. In addition, the results of operations for the second and
     third quarter of 1995 include the results of the Avalanche which was
     acquired on July 1, 1995.

(4)  Includes a $10.9 million restructuring charge resulting from the
     discontinuation of Satellite Cinema's lower margin, scheduled, satellite
     delivered pay-per-view service.  See Note 12 of Notes to Consolidated
     Financial Statements.

(5)  Includes a restructuring charge of $15.3 million relating to the Company's
     decision to shift its business focus from mid-priced hotels served by
     Satellite Cinema's scheduled, satellite delivered pay-per-view systems to
     business and luxury hotels served by OCV's on-demand technology, and the
     write-off of an equity investment in a company pursuing media ventures in
     Russia and other countries in the Commonwealth of Independent States.

(6)  Gives effect to the 24,000-for-1 stock split of the outstanding Common
     Stock effected upon consummation of the Offering.

(7)  EBITDA represents earnings before interest expense, income taxes,
     depreciation and amortization.  The most significant difference between
     EBITDA and cash provided from operations is changes in working capital.
     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 income 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 and discussed
     in Item 7 under Liquidity and Capital Resources.  See the Consolidated
     Financial Statements and the Notes thereto appearing elsewhere in this
     document.  EBITDA for the years ended December 31, 1992 and 1995 excludes
     the provisions for restructuring during such periods.

(8)  OCC backlog represents the approximate number of hotel rooms under contract
     with OCC which are awaiting installation of OCV equipment.
     The vast majority of such rooms in the 1996 backlog amount represent
     SpectraVision rooms which are to be converted to OCV systems.

                                       21


<PAGE>

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

The following discussion and analysis of the Company's financial condition and
results of operations should be read in conjunction with the Consolidated
Financial Statements and Notes thereto included elsewhere in this Annual Report.

CERTAIN OF THE STATEMENTS THAT FOLLOW ARE FORWARD-LOOKING AND RELATE TO
ANTICIPATED FUTURE 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.

OVERVIEW

The Company operates in two segments:  MultiMedia Distribution, which consists
of OCC and Ascent Network Services, and Entertainment, which consists of the
Denver Nuggets, the Colorado Avalanche and Beacon.

MULTIMEDIA DISTRIBUTION

The Company made its initial investment in OCV in 1991 and owned approximately
84% (78.4% fully diluted) of OCV prior to the acquisition of SpectraVision.  On
October 10, 1996 the Company, through OCC, consummated the acquisition of the
assets and properties and certain liabilities of SpectraVision (the
"Acquisition") and acquired 100% of On Command Video Corporation, its previously
84% owned subsidiary ("OCV").  Immediately prior to the Acquisition, OCV, was
merged with a subsidiary of OCC, On Command Merger Corporation, and, OCV as the
surviving corporation, became a wholly owned subsidiary of OCC.  At December 31,
1996, 1995 and 1994, the Company owned interests representing approximately 57%,
84% and 80%, respectively in OCC (or OCV in prior years).  Subsequent to the
Acquisition, OCC is the leading provider of on-demand in-room entertainment for
the United States lodging industry.

Prior to the OCC Transactions, OCV had experienced rapid growth in the past
three and one half years, increasing its base of installed rooms from
approximately 37,000 rooms in approximately 90 hotels at the end of 1992 to
approximately 441,000 rooms in approximately 1,585 hotels at October 1996.
Conversely, SpectraVision, as a result of financial constraints and its
bankruptcy filing in June 1995, had experienced deterioration in its room base
over the same period.  SpectraVision's room base, including both pay-per-view
and free-to-guest, had decreased from approximately 1,059,000 installed rooms in
approximately 2,543 hotels at the end of 1992 to approximately 484,000 rooms,
including both pay-per-view and free-to-guest, in approximately 1,632 hotels at
October 1996.

The following table sets forth information in regard to pay-per-view rooms
installed as of December 31:


                                       22


<PAGE>

                    1996                1995                1994
                    ----                ----                ----
                ROOMS   PERCENT     ROOMS   PERCENT     ROOMS   PERCENT
                -----   -------     -----   -------     -----   -------

 On-Demand     710,000    77.3 %   361,000    87.6 %   248,000    56.1 %
 Scheduled     208,000    22.7      51,000    12.4     194,000    43.9
               -------   -----     -------   -----     -------   -----
               918,000   100.0 %   412,000   100.0 %   442,000   100.0 %
               -------   -----     -------   -----     -------   -----
               -------   -----     -------   -----     -------   -----

The Company will continue to derive a majority of its revenues from OCC.
Revenue and income growth are expected from the continued installation of on-
demand systems for new hotel customers and to replace scheduled systems of
existing customers.  The primary sources of revenues of OCC (which are more
fully discussed below) are movie rentals (including video games and free-to-
guest services), and video system sales.

Through ANS, the Company also provides satellite distribution support services,
principally to affiliates of the NBC television network.  In connection with an
extension of ANS's agreement with NBC through 1999, the Company agreed to reduce
the amounts payable by NBC to the Company under the contract, since the original
contract provided for higher payments to the Company to reimburse the Company
for capital expenditures made in connection with the purchase and construction
of certain equipment.  As a result of this agreement, the Company expects that
revenues from the NBC contract for each year from 1995 through 1999 will be
approximately $12 million less than in 1994.  In addition, NBC, with ANS'
technical assistance, issued a request for information to certain hardware
vendors in July 1995 with respect to procuring equipment necessary to upgrade
the NBC distribution network to digital technology.  In August of 1996, ANS and
NBC executed a letter of intent pursuant to which ANS has procured and installed
certain of such digital equipment to provide MSNBC, LLC, a joint venture between
NBC and Microsoft Corporation ("MSNBC") with network service, maintenance and
support.  The partial digital upgrade service is being provided for a 10 year
term and is currently governed by the underlying NBC service contract.  ANS and
MSNBC anticipate finalizing a service agreement separate from the underlying NBC
contract in the first half of 1997 for the partial digital upgrade service.  The
network service, maintenance and support provided to MSNBC are related to and
dependent upon the original NBC distribution network.  The Company anticipates
that ANS will assist NBC in completing the upgrade of the NBC network to digital
technology, which will likely involve significant capital expenditures on the
part of the Company and would be accompanied by an extension of ANS's contract
with NBC that expires in 1999.  The Company does not anticipate that the
contract to complete the digital upgrade for NBC will be awarded until 1998.

ENTERTAINMENT

The Company made its initial investment in the Nuggets in 1989 with the
acquisition of a 62.5% interest in a limited partnership that acquired the
Nuggets.  In 1991 and 1992, the Company acquired the remaining interests in the
partnership.  As discussed below, in December 1994, the Company acquired Beacon
and, in July 1995, the Company acquired the Avalanche.  As a result, the
Company's results of operations for the year ended December 31, 1994 do not
include results of operations from Beacon or the Avalanche (except, in the case
of Beacon, for results of operations for the month of December 1994).
Similarly, the results of operations for the year ended December 31, 1995
include results of operations from the Avalanche only for the last six months.

In July 1995, the Company acquired one of the 26 franchises in the NHL at a cost
of approximately $75.8 million.  The Company has moved the franchise to Denver
to


                                       23


<PAGE>

share Denver's McNichols Arena with the Nuggets, where the team has commenced
play under the Colorado Avalanche name.  The financial performance of the
Nuggets and the Avalanche are, to a large extent, dependent on their performance
in their respective leagues.  In addition, due to the limitation of the
facilities available at McNichols Arena, the Company expects the Avalanche and
the Nuggets to experience operating losses as long as both teams play in
McNichols Arena.  The Company has proposed the construction of a new sports
arena and entertainment complex in which the Nuggets and Avalanche would play,
which is expected to result in increased revenues and improved operating results
for both the Nuggets and the Avalanche.

As a result of the operating losses expected to be incurred by the Avalanche and
the Nuggets and operating expenses at Beacon, the Company expects to incur
operating losses on a consolidated basis through the end of 1997.  However, the
Company expects to record positive earnings before income taxes, depreciation
and amortization and positive operating cash flow during this period.

RESULTS OF OPERATIONS

YEAR ENDED DECEMBER 31, 1996 COMPARED TO YEAR ENDED DECEMBER 31, 1995
The following table sets forth certain data as a percentage of revenue for the
period indicated:

<TABLE>
<CAPTION>

                                                       1996                     1995
                                                       ----                     ----
                                                Amount       Percent     Amount       Percent
                                                ------       -------     ------       -------
<S>                                           <C>            <C>       <C>            <C>
                                                            (Dollars in thousands)
INCOME STATEMENT DATA
Revenue:
   Multimedia Distribution . . . . . . .      $ 167,976        65.1%   $ 135,782        67.3%
   Entertainment . . . . . . . . . . . .         90,144        34.9       66,036        32.7
                                              --------        -----    --------        -----
      Total. . . . . . . . . . . . . . .        258,120       100.0      201,818       100.0
 Cost of services. . . . . . . . . . . .        217,949        84.4      154,676        76.6
 Depreciation and amortization . . . . .         74,812        29.0       53,675        26.6
 General and administrative. . . . . . .          9,678         3.8       10,002         5.0
 Provision for restructuring . . . . . .              -        --         10,866         5.4
                                              --------        -----    --------        -----
 Operating loss. . . . . . . . . . . . .       (44,319)       (17.2)    (27,401)       (13.6)
 Other income (expense). . . . . . . . .            565         0.2      (2,070)        (1.0)
 Interest expense. . . . . . . . . . . .       (10,715)        (4.1)       (759)        (0.4)
 Income tax benefit  . . . . . . . . . .         11,957         4.6        9,835         4.9
 Minority interest . . . . . . . . . . .          6,812         2.6        (628)        (0.3)
 Extraordinary loss, net . . . . . . . .          (334)        (0.1)           -         -
                                              --------        -----    --------        -----
 Net loss. . . . . . . . . . . . . . . .       (36,034)       (14.0)%  $(21,023)       (10.4)%
                                              --------        -----    --------        -----
                                              --------        -----    --------        -----

</TABLE>

REVENUE.  Revenue increased by $56.3 million, or 27.9%, to $258.1 million for
the year ended December 31, 1996 from $201.8 million for the year ended December
31, 1995.  Multimedia Distribution revenue increased by $32.2 million, or 23.7%,
to $168.0 million for the twelve months ended December 31, 1996 from $135.8
million for the twelve months ended December 31, 1995.  While Revenues for the
year ended December 31, 1996 include $21.4 million from the SpectraVision assets
acquired by OCC in October, 1996, 1995 revenue includes $24.7 million of
revenues from the Company's Satellite Cinema business, which ceased operations
on December 31, 1995.  Excluding the  1995 Satellite Cinema revenues and the
1996 SpectraVision revenues, MultiMedia distribution segment revenues increased
$35.3 million or 32% over 1995 revenues.  This increase is primarily
attributable to the 29% growth in 1996 of OCV installed on-demand rooms (from
361,000 rooms at December 31, 1995 to 466,000 rooms at December 31, 1996.)  In
addition, revenues increased at ANS due to revenues earned for services provided
under the NBC agreement for the MSNBC partial digital upgrade.  Entertainment
revenue increased by $24.1 million, or 36.5%, to $90.1 million for the year
ended December 31, 1996 from $66.0 million


                                       24


<PAGE>

for the year ended December 31, 1995 primarily as a result of revenues from the
Avalanche.  The Avalanche, acquired in July 1995, reflected no revenues in the
first half of 1995 as compared to $26.4 million for the first six months of
1996.  The increased Avalanche revenues was partially offset by lower revenues
at the Nuggets, primarily attributable to the absence of $9.2 million in NBA
expansion fees recognized in 1995 and by lower revenues at Beacon, as Beacon had
no movie releases in 1996 as compared to one in 1995.

COST OF SERVICES.  Cost of services for Multimedia Distribution was $115.5
million, or 69% of Multimedia Distribution revenue, for the year ended December
31, 1996 compared to $87.5 million, or 64% of Multimedia Distribution revenue,
for the year ended December 31, 1995.  The decline in Multimedia Distribution
margin is primarily attributable to one-time charges of $8.7 million at OCC for
costs associated with the integration of SpectraVision, the alignment of OCC's
operating practices and the establishment of OCC as a new public company.  In
addition, OCC's margin also decreased due to increases in free-to-guest costs
and movie royalty expenses in 1996 as compared to 1995.  Cost of services for
Entertainment was $102.4 million, or 114% of Entertainment revenue for the year
ended December 31, 1996, compared to $67.2 million, or 102% of Entertainment
revenue, for the year ended December 31, 1995.  The decline in Entertainment
margin is attributable to increased operating losses at the Nuggets which is
primarily attributable to lower ticket revenues due to reduced attendance and
the absence of NBA expansion fees of $9.2 million recognized in 1995.

DEPRECIATION AND AMORTIZATION.  Depreciation and amortization for Multimedia
Distribution was $62.2 million, or 37% of Multimedia revenue for the year ended
December 31, 1996, compared to $45.4 million, or 33% of Multimedia revenue for
the year ended December 31, 1995.  This increase in depreciation and
amortization is primarily attributable to the capital investment associated with
installing on-demand service systems in hotels and to a lesser extent, the
depreciation and amortization associated with assets acquired from the
SpectraVision acquisition.  Depreciation and amortization for Entertainment was
$12.6 million, or 14.0% of Entertainment revenue, for the year ended December
31, 1996, compared to $8.3 million, or 12.6% of Entertainment revenue, for the
year ended December 31, 1995.  This increase in depreciation and amortization is
attributable to the amortization of the intangible assets acquired in the
Avalanche acquisition for the entire calendar year of 1996.

GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses for
the year ended December 31, 1996 were $9.7 million, or 3.8% of revenues,
compared to general and administrative expenses of $10.0 million, or 5% of
revenues for the year ended December 31, 1995.  This decrease primarily reflects
the reduction of approximately $2.4 million in certain general and
administrative service charges from COMSAT offset by an increase in costs
associated with the relocation of the Company's headquarters to Denver and the
costs associated with being a publicly traded corporation in 1996.

OTHER INCOME (EXPENSE).  Other income for the year ended December 31, 1996 was
$.6 million, an increase of $2.6 million from the year ended December 31, 1995
which reflected $2.1 million in other expense.  Other income in 1996 includes a
gain of $1.9 million from the sale of investment securities in 1996 offset by a
$2.3 million loss in 1996 on its limited partnership investment in Elitch
Gardens. The improvement over 1995 is primarily due to the settlement of a
lawsuit in 1995 with a former employee of OCV of $1.5 million and a charge of
$.9 million for expenses in 1995 associated with the Company's portion of
certain site-specific plans for a new arena in Denver.

INTEREST EXPENSE AND EXTRAORDINARY LOSS.  Interest expense for the year ended
December 31, 1996 was $10.7 million, an increase of $10.0 million from the year


                                       25


<PAGE>

ended December 31, 1995.  This increase is attributable to borrowings incurred
in conjunction with Ascent's initial public offering in December 1995 and the
additional borrowings incurred during 1996 to fund the Company's continuing
expansion of its businesses, primarily for capital expenditures at OCC and the
assumption of debt in connection with the SpectraVision acquisition.  In
conjunction with the SpectraVision transaction, the Company and On Command each
obtained new credit agreements with a bank.  The Company recorded an
extraordinary loss of $334,000, net of taxes, in the fourth quarter of 1996 in
connection with the extinguishment of its previous credit facility with its
former lender.

INCOME TAX BENEFIT.  Income tax benefit for the year ended December 31, 1996 was
$12.0 million, compared to an income tax benefit of $9.8 million for the year
ended December 31, 1995.  The Company's effective rate declined to 22 percent in
1996 from 32.5 percent in 1995.  This decline in the Company's effective tax
rate is primarily attributable to the losses incurred by OCC during the fourth
quarter of 1996, in which no tax benefit was recognized due to uncertainties
regarding OCC's ability to realize a portion of the benefits associated with
future deductible temporary differences (deferred tax assets) and net operating
loss carryforward, prior to their expiration.  See Note 8 of Notes to the
Consolidated Financial Statements.

NET INCOME (LOSS).  As a result of the foregoing, net loss for the year ended
December 31, 1996 was $36.0 million, compared to net loss of $21.0 million for
the year ended December 31, 1995.

YEAR ENDED DECEMBER 31, 1995 COMPARED TO YEAR ENDED DECEMBER 31, 1994

The following table sets forth certain data as a percentage of revenue for the
period indicated:

<TABLE>
<CAPTION>

                                                       1995                     1994
                                                       ----                     ----
                                                Amount       Percent     Amount       Percent
                                                ------       -------     ------       -------
<S>                                            <C>           <C>         <C>          <C>
                                                            (Dollars in thousands)
INCOME STATEMENT DATA
 Revenue:
  Multimedia Distribution. . . . . . . .       $135,782      67.3%       $125,823     76.0%
  Entertainment. . . . . . . . . . . . .         66,036      32.7         39,653      24.0
                                               --------     -----       --------     -----
    Total. . . . . . . . . . . . . . . .        201,818     100.0        165,476     100.0
 Cost of services. . . . . . . . . . . .        154,676      76.6        107,452      64.9
 Depreciation and amortization . . . . .         53,675      26.6         38,820      23.5
 General and administrative. . . . . . .         10,002       5.0          9,203       5.6
 Provision for restructuring . . . . . .         10,866       5.4              -         -
                                               --------     -----       --------     -----
 Operating income (loss) . . . . . . . .        (27,401)     13.6         10,001       6.0
 Other income (expense). . . . . . . . .         (2,070)     (1.0)         1,021       0.6
 Interest expense. . . . . . . . . . . .           (759)     (0.4)          (326)     (0.2)
 Income tax benefit (expense). . . . . .          9,835       4.9         (4,831)     (2.9)
 Minority interest . . . . . . . . . . .           (628)     (0.3)          (265)     (0.1)
                                               --------     -----       --------     -----
 Net income (loss) . . . . . . . . . . .       $(21,023)    (10.4)%     $  5,600       3.4%
                                               --------     -----       --------     -----
                                               --------     -----       --------     -----


</TABLE>

REVENUE.  Revenue increased by $36.3 million, or 21.9%, to $201.8 million for
the year ended December 31, 1995 from $165.5 million for the year ended December
31, 1994.  Multimedia Distribution revenue increased by $10.0 million, or 7.9%,
to $135.8 million for the twelve months ended December 31, 1995 from $125.8
million for the twelve months ended December 31, 1994 as a result of a 46%
increase in installed on-demand rooms, offset in part by a 74% decrease in
installed scheduled service rooms (primarily as a result of conversion to OCV's
on-demand technology) and reduced revenue from NBC for network distribution
support services.  See "Overview - Multimedia Distribution."  Entertainment
revenue increased by $26.4 million, or 66.5%, to $66.0 million for the year
ended December 31, 1995 from $39.7 million for the year ended December 31, 1994
as a result of the Nuggets' share of NBA expansion fees of $9.2 million in
connection with the admission of two new teams to the NBA in 1995; the
acquisition of Beacon on December 1, 1994, which generated $6.5 million in
revenue; and the acquisition of the Colorado Avalanche in July 1995, which
generated revenue of $12.3 million during the last six months of 1995.

COST OF SERVICES.  Cost of services for Multimedia Distribution was $87.5
million, or 64.4% of Multimedia Distribution revenue, for the year ended
December 31, 1995 compared to $72.8 million, or 57.9% of Multimedia Distribution
revenue, for the year ended December 31, 1994.  The decline in Multimedia
Distribution margin is attributable to lower margins under the NBC contract and
the Company's Satellite Cinema division, offset in part by the growth in the
number of higher margin on-demand hotel rooms serviced by OCV.  In connection
with the 1994 extension of the Company's agreement with NBC, the Company agreed
to reduce its margins under the NBC contract in connection with the extension of
such contract through 1999.  Cost of services for Entertainment was $67.2
million, or 102% of Entertainment revenue, for the year ended December 31, 1995,
compared to $34.7 million, or 87.5% of Entertainment revenue, for the year ended
December 31, 1994.  The decline in Entertainment margin is attributable to
negative operating margins for both Beacon and the Colorado Avalanche, partially
offset by NBA expansion fees.



                                       26


<PAGE>

DEPRECIATION AND AMORTIZATION.  Depreciation and amortization for Multimedia
Distribution was $45.4 million for the year ended December 31, 1995, compared to
$34.9 million for the year ended December 31, 1994.  This increase in
depreciation and amortization is attributable to the capital investment
associated with installing on-demand service systems in hotels, coupled with
slightly higher installation costs per room as a result of the addition of
smaller hotels to the room base.  Depreciation and amortization for
Entertainment was $8.3 million, or 12.6% of Entertainment revenue, for the year
ended December 31, 1995, compared to $3.9 million, or 9.8% of Entertainment
revenue, for the year ended December 31, 1994.  This increase in depreciation
and amortization is attributable to the amortization of the intangible assets
acquired in the Beacon acquisition beginning in December 1994 and amortization
of the intangible assets acquired in the Avalanche acquisition beginning in July
1995.

GENERAL AND ADMINISTRATIVE EXPENSES.  General and administrative expenses for
the year ended December 31, 1995 were $10.0 million, or 5.0% of revenues,
compared to general and administrative expenses of $9.2 million, or 5.6% of
revenues for the year ended December 31, 1994.

PROVISION FOR RESTRUCTURING.  The provision for restructuring during the year
ended December 31, 1995 resulted from the discontinuation of Satellite Cinema's
lower margin, scheduled, satellite-delivered pay-per-view service.  See Note 12
of Notes to Consolidated Financial Statements.

OPERATING INCOME.  As a result of the above factors, operating income (excluding
the restructuring provision) for the Multimedia Distribution segment was $2.9
million, or 2.1% of Multimedia Distribution revenue, for the year ended December
31, 1995, compared to $18.1 million, or 14.4% of Multimedia Distribution
revenue, for the year ended December 31, 1994.  Entertainment had an operating
loss of $9.4 million, or 14.2% of Entertainment revenue, for the year ended
December 31, 1995, compared to operating income of $1.1 million, or 2.8% of
Entertainment revenue, for the year ended December 31, 1994.

OTHER INCOME (EXPENSE).  Other expense for the year ended December 31, 1995 was
$2.1 million, an increase of $3.1 million from the year ended December 31, 1994.
This increase is primarily due to the settlement of a lawsuit in 1995 with a
former employee of OCV and a charge for expenses associated with the Company's
portion of certain site-specific plans for a new arena in Denver.

INTEREST EXPENSE.  Interest expense for the year ended December 31, 1995 was $.8
million as compared to $.3 million for the year ended December 31, 1994.  The
increase is attributable to interest incurred on certain severance obligations
of the Nuggets.

INCOME TAX BENEFIT (EXPENSE).  Income tax benefit for the year ended December
31, 1995 was $9.8 million, compared to income tax expense of $4.8 million for
the year ended December 31, 1994.  The Company's effective tax rate in 1995 was
33% as compared to 45% in 1994.  In 1994, the Company generated operating income
of $10.0 million, a significant portion of which was attributable to OCV which,
at that time, was not included in the Company's consolidated tax group.
Accordingly, tax losses generated by the Company's other subsidiaries could not
be used to offset OCV's taxable income in 1994.  See Note 8 of Notes to the
Consolidated Financial Statements.

NET INCOME (LOSS).  As a result of the foregoing, net loss for the year ended
December 31, 1995 was $21.0 million, compared to net income of $5.6 million for
the year ended December 31, 1994.


                                       27


<PAGE>

LIQUIDITY AND CAPITAL RESOURCES

The primary sources of cash during the year ended December 31, 1996 were cash
from operations of $23.3 million, net borrowings under the Company's bank credit
facilities of $120.3 million, proceeds of $3.6 million from the sale of certain
investments owned by the Company and the collection of $6.7 million on notes and
other receivables.  Cash was expended primarily for property and equipment as
the Company continued to make investments to support business growth.
Specifically, capital expenditures of $70.5 million were made by OCC for the
continuing installation of on-demand systems, $9.1 million for the development
of the proposed arena in Denver, $6.8 million by ANS for the partial digital
upgrade of the MSNBC network and the investment of $21.1 million in cash by
Beacon for the development and production of three major motion pictures.

The Company's negative working capital position increased by $190.5 million from
December 31, 1995 to December 31, 1996.  This is primarily attributable to an
increase in short-term debt of $143.0 million used mainly for the acquisition of
long-term assets of $221.4 million.

The Company has access to short-term financing and OCC has access to short-term
and long-term financing under their respective Credit Facilities, as amended on
March 23, 1997.  See Note 6 of Notes to the Consolidated Financial Statements.
As a result of these amendments, Ascent reduced the maximum amount available
under the Ascent Credit Facility from $200.0 million to $140.0 million and OCC
increased its available borrowings under its revolving credit facility from
$125.0 million to $150.0 million (see Note 6 of Notes to the Consolidated
Financial Statements).  Based on these amendments and borrowings outstanding
at March 23, 1997, Ascent has $33.0 million available under the Ascent Credit
Facility and OCC has $47.0 million in available borrowings under the OCC
Credit Facility, subject to certain covenant restrictions.

     The Amendment to the Ascent Credit Facility provides among other things,
that the facility will not be renewable for two additional one year options
beyond October 9, 1997 unless, prior thereto, Ascent has received not less than
$50.0 million in proceeds from a new debt financing which is subordinated to the
Ascent Credit Facility.  Based on current market conditions, management of
Ascent currently believes that they will be successful in obtaining the
additional subordinated debt by October 9, 1997.  However, there can be no
assurances that other contingencies will not arise which could impact Ascent's
ability to obtain the additional subordinated financing or that such financing
will be available on terms acceptable to Ascent.  If Ascent were not able to
obtain the additional subordinated financing, Ascent could be required to
refinance the Ascent Credit Facility which could require Ascent to reduce or
reschedule planned capital investments, reduce capital outlays or sell assets.

The Company's cash requirements during 1997 are expected to include (i) the
continuing installation by OCC of on-demand systems, (ii) an investment in a new
arena and entertainment complex in Denver for use by the Nuggets and Avalanche,
(iii) the funding of the production of motion pictures at Beacon (iv) funding
the operating requirements of Ascent and its subsidiaries (excluding OCC), and
(v) the payment of interest under the Ascent and OCC credit facilities.  The
Company anticipates that capital expenditures for the continued 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.  While the Company
continues to plan to finance the construction of the new arena in Denver,
whereby the Company's equity participation would consist of expenditures
totaling $20-$25 million, of which approximately $11.5 million has been
incurred, any additional cash expenditures for such participation would be
delayed until the summer of 1997 due to continued delays in reaching an
agreement with the City and County of Denver.  Beacon's capital requirements
with respect to the funding of its current movie productions are expected to
consist of expenditures totaling $30-35 million during the first three
quarters of 1997.  Capital requirements with respect to the


                                       28

<PAGE>

funding of additional productions at Beacon will be dependent upon the number,
nature and timing of these projects that the Company determines to pursue
during 1997.  The Company will utilize the Universal Agreement when
appropriate, to pre-sell a portion of the international distribution rights to
help fund motion picture costs.

Management of the Company believes that available cash and funds available under
the amended Ascent and OCC Credit Facilities will be sufficient for the Company
and its subsidiaries to satisfy their growth and finance working capital
requirements through 1997.

In the COMSAT Corporate Agreement, Ascent agreed not to incur any indebtedness,
other than that under Ascent's previous $175 million revolving credit facility
(and refinancings thereof) and indebtedness incurred in the ordinary course of
business which together shall not exceed $175 million in the aggregate, without
COMSAT's consent.  In September 1996, in connection with the combination of On
Command Video Corporation ("OCV") and the assets and certain liabilities of
SpectraVision, Inc. into On Command Corporation ("OCC"), and in consideration of
Ascent's other capital requirements, COMSAT consented to permit Ascent to incur
consolidated indebtedness (including indebtedness of OCC) of up to $216 million
under the COMSAT Corporate Agreement, provided that: (i) no more than $50
million of such indebtedness may constitute long term debt; and (ii)
indebtedness in excess of $175 million may only be incurred to satisfy funding
requirements for 1996.   At that time, COMSAT also consented to Ascent entering
into a new credit facility with aggregate available borrowings of up to $200
million, and OCC entering into a $125 million credit facility, as discussed
above.

On November 15, 1996, COMSAT consented to increase the limitation on
consolidated indebtedness which Ascent may incur pursuant to the COMSAT
Corporate Agreement to $236 million; provided that: (i) no more than $50
million of such indebtedness may constitute long term debt; and (ii)
indebtedness in excess of Ascent's indebtedness existing at December 31, 1996
may only be used to satisfy Ascent's consolidated funding requirements through
June 30, 1997, as approved by the Ascent Board of Directors.

Also in connection with the SpectraVision transaction, Ascent and OCC entered
into a Corporate Agreement (the "OCC Corporate Agreement"), pursuant to which
OCC  agreed, among other things, not to incur any indebtedness, other than under
OCC's Credit Facility (and refinancings thereof) and indebtedness incurred in
the ordinary course of business which together shall not exceed $100 million in
the aggregate, without Ascent's prior written consent.

A primary purpose of both the COMSAT Corporate Agreement and the OCC Corporate
Agreement is to require Ascent to coordinate its consolidated capital
requirements with COMSAT so that COMSAT can monitor compliance with the
regulations of the Federal Communications Commission ("FCC") applicable to the
capital structure and debt financing activities of COMSAT and its consolidated
subsidiaries.  COMSAT is required to submit a financial plan to the FCC for
review annually.  Under existing FCC guidelines, COMSAT is subject to a limit of
$200 million in short-term debt, a maximum long-term debt to total capital ratio
of 45%, and an interest coverage ratio of 2.3 to 1.  The latter two guidelines
are measured at year end.  In October 1996, the FCC approved a temporary
decrease in the interest coverage ratio to a minimum of 1.9 to 1, and an
increase in the short-term debt limit to $325 million for the 1996 plan year and
until the FCC acts on COMSAT's 1997 capital plan.  COMSAT has informed Ascent
that COMSAT was in compliance with the FCC guidelines, as modified, at December
31, 1996.

As part of Ascent's 1997 operating and capital planning process, Ascent
management requested that COMSAT increase its debt limit beginning in January
1997, which


                                       29


<PAGE>

resulted in the increase described above.  On March 21, 1997, COMSAT consented
to increase the limitation on aggregate consolidated indebtedness which Ascent
may incur pursuant to the COMSAT Corporate Agreement to $270.0 million for the
remainder of 1997; provided that (i) no more than $50 million of such
indebtedness may constitute long term debt; and (ii) indebtedness subordinated
to indebtedness under Ascent's existing credit facility could only be incurred
on terms which did not adversely affect COMSAT's proposed tax-free
distribution of its interest in Ascent to COMSAT shareholders.  In connection
with COMSAT's consent under the COMSAT Corporate Agreement, Ascent consented
under the OCC Corporate Agreement to increase OCC's limitation on indebtedness
to not more than $116,000,000 by June 30, 1997, and to $130,000,000 by
December 31, 1997; provided however, that (i) no more than $50,000,000 of such
indebtedness may constitute long term debt, and (ii) indebtedness may only be
incurred in compliance with the financial covenants contained in OCC's
existing $150,000,000 Credit Facility, with any amendments to such covenants
subject to the written consent of Ascent.  Ascent management believes that the
$270.0 million aggregate limit and related restrictions on Ascent's
consolidated indebtedness will be adequate to fund its consolidated operations
through 1997.  A number of factors could cause Ascent's funding requirements
to differ materially from those projected, including, but not limited to, the
ability of Ascent to obtain the $50.0 million in additional subordinated debt
financing by October 9, 1997, the operating performance of Ascent's
subsidiaries, unanticipated costs associated with the integration of
SpectraVision's and OCV's businesses, the level of ticket sales and other
revenues by Ascent's professional sports franchises, the timing of film
productions and releases, the timing of NBC's decision to grant ANS the
digital upgrade contract, and other market conditions.

Finally, on October 18, 1996 COMSAT announced that it intends to divest its
80.67% percent ownership interest in Ascent through a sale, spin-off or other
transaction.  COMSAT has engaged Morgan Stanley & Co. Incorporated to act as its
financial advisor for the divestiture.  On March 24, 1997, COMSAT announced that
in January 1997 it had filed for a ruling with the Internal Revenue Service to
allow the spin-off of Ascent as a tax-free dividend to its shareholders, and
that it expects to receive the ruling by May 1997.  Pending the ruling, COMSAT
will continue efforts to identify a purchaser for its interest in Ascent.
Depending on COMSAT's form of divestiture, the impact to the ongoing operations
of Ascent may vary.  However, as a result of a divestiture whereby Ascent is no
longer part of COMSAT's consolidated tax group, Ascent may be unable to
recognize tax benefits and in turn, receive cash payments from COMSAT resulting
from Ascent's anticipated operating losses during 1997.

Inflation has not significantly impacted the Company's financial position or
operations.

SEASONALITY

OCC's business is seasonal, with higher revenues realized during the summer
months and lower revenues realized during the winter months due to business and
vacation travel patterns.  Conversely, because the NHL and NBA season extend
from the fall to late spring, the Company realizes the vast majority of its
revenues from the Nuggets and the Avalanche during such period.


                                       30


<PAGE>

Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA


                          INDEPENDENT AUDITOR'S REPORT


To the Board of Directors of
Ascent Entertainment Group, Inc.:

We have audited the accompanying consolidated balance sheets of Ascent
Entertainment Group, Inc. and its subsidiaries (the "Company") as of December
31, 1996 and 1995, and the related consolidated statements of operations,
stockholders' equity, and cash flows for each of the three years in the period
ended December 31, 1996.  Our audits also included the financial statement
schedule listed in the Index at Item 14(a).  These financial statements and the
financial statement schedule are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements and
the financial statement schedule based on our audits.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Ascent Entertainment
Group and its subsidiaries as of December 31, 1996 and 1995, and the results of
their operations and their cash flows for each of the three years in the period
ended December 31, 1996 in conformity with generally accepted accounting
principles.  Also, in our opinion, such financial statement schedule, when
considered in relation to the basic consolidated financial statements taken as a
whole, presents fairly in all material respects, the information set forth
therein.


/s/ Deloitte & Touche

Deloitte & Touche LLP

Denver, Colorado
March 23, 1997


                                       31


<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                           CONSOLIDATED BALANCE SHEETS
                                 (IN THOUSANDS)

                                     ASSETS

                                                            December 31,
                                                     --------------------------
                                                         1996           1995
                                                         ----           ----
Current assets:
   Cash and cash equivalents . . . . . . . .         $    3,963     $   11,012
   Receivables, net (Note 3) . . . . . . . .             54,695         45,041
   Deferred income taxes (Note 8). . . . . .              3,580          4,394
   Income taxes receivable . . . . . . . . .              6,931            434
   Prepaid expenses. . . . . . . . . . . . .             11,247          6,558
   Other current assets. . . . . . . . . . .              3,324          3,656
                                                     ----------     ----------
     Total current assets. . . . . . . . . .             83,740         71,095
Property and equipment, net (Note 4) . . . .            301,498        220,602
Goodwill, net. . . . . . . . . . . . . . . .            132,805         47,393
Franchise rights, net. . . . . . . . . . . .            102,189        107,962
Film inventory, net (Note 5) . . . . . . . .             76,234         11,470
Investments. . . . . . . . . . . . . . . . .              9,150          6,628
Other assets, net. . . . . . . . . . . . . .             30,986         37,453
                                                     ----------     ----------
Total assets . . . . . . . . . . . . . . . .         $  736,602     $  502,603
                                                     ----------     ----------
                                                     ----------     ----------

                             LIABILITIES AND EQUITY
Current liabilities:
   Short-term borrowings (Note 6). . . . . .         $  143,000           $  -
   Current portion of long-term debt . . . .                  -            207
   Accounts payable. . . . . . . . . . . . .             19,992          6,783
   Payable to COMSAT . . . . . . . . . . . .              4,662          7,217
   Deferred income . . . . . . . . . . . . .             81,942         38,060
   Other accrued liabilities . . . . . . . .             39,559         33,764
                                                     ----------     ----------
     Total current liabilities . . . . . . .            289,155         86,031
Long-term debt (Note 6). . . . . . . . . . .             50,000         70,000
Other long-term liabilities (Note 7) . . . .             14,645         13,843
Deferred income taxes (Note 8) . . . . . . .              5,742          3,593
                                                     ----------     ----------

     Total liabilities . . . . . . . . . . .            359,542        173,467
Minority interest (Note 2) . . . . . . . . .            107,475         27,867
Commitments and contingencies
   (Notes 2, 4, 6, 9). . . . . . . . . . . .                  -              -
Stockholders' equity (Note 10):
  Preferred stock, par value $.01 per share,
     5,000,000 shares authorized, none
     outstanding . . . . . . . . . . . . . .                  -              -
  Common stock, par value $.01 per share,
     60,000,000 shares authorized,
     29,754,000 issued and outstanding . . .                297            297
     Additional paid-in capital. . . . . . .            307,569        304,571
     Accumulated deficit . . . . . . . . . .            (39,633)        (3,599)
  Unrealized gain on available for sale
     securities, net of taxes. . . . . . . .              1,352              -
                                                     ----------     ----------
     Total stockholders' equity. . . . . . .            269,585        301,269
                                                     ----------     ----------
Total liabilities and stockholders'
   equity. . . . . . . . . . . . . . . . . .         $  736,602     $  502,603
                                                     ----------     ----------
                                                     ----------     ----------

The accompanying notes are an integral part of these consolidated financial
statements.


                                       32


<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                (DOLLARS IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)

<TABLE>
<CAPTION>


                                                       Years ended December 31,
                                                1996           1995            1994
                                                ----           ----            ----
<S>                                         <C>            <C>            <C>
Revenues (Note 3 and Note 14 for related
   party revenues) . . . . . . . . . . .    $   258,120    $   201,818    $   165,476
                                            -----------    -----------    -----------


Operating expenses:
  Cost of services . . . . . . . . . . .        217,949        154,676        107,452
  Depreciation and amortization. . . . .         74,812         53,675         38,820
  General and administrative . . . . . .          9,678         10,002          9,203
  Provision for restructuring (Note 11)               -         10,866              -
    Total operating expenses . . . . . .        302,439        229,219        155,475
                                            -----------    -----------    -----------


Income (loss) from operations. . . . . .        (44,319)       (27,401)        10,001
Other income (expense), net. . . . . . .            565         (2,070)         1,021
Interest expense . . . . . . . . . . . .        (10,715)          (759)          (326)
                                            -----------    -----------    -----------

Income (loss) before taxes, minority
   interest and extraordinary loss . . .        (54,469)       (30,230)        10,696
Income tax benefit (expense) (Note 8) .          11,957          9,835         (4,831)
                                            -----------    -----------    -----------

Income (loss) before minority interest
   and extraordinary loss. . . . . . . .        (42,512)       (20,395)         5,865
Minority interest. . . . . . . . . . . .          6,812           (628)          (265)
                                            -----------    -----------    -----------

Income (loss) before extraordinary
   loss. . . . . . . . . . . . . . . . .        (35,700)       (21,023)         5,600
Extraordinary loss on early
   extinguishment of debt, net of
   taxes (Note 6). . . . . . . . . . . .           (334)             -              -
                                            -----------    -----------    -----------
Net income (loss). . . . . . . . . . . .    $   (36,034)   $   (21,023)   $     5,600
                                            -----------    -----------    -----------
                                            -----------    -----------    -----------

Net income (loss) per common share:
   Before extraordinary loss . . . . . .    $     (1.20)   $      (.87)   $       .23
   Extraordinary loss on early
     extinguishment of debt, net of
     taxes . . . . . . . . . . . . . . .           (.01)             -              -
                                            -----------    -----------    -----------
   Net income (loss) per share . . . . .    $     (1.21)   $      (.87)   $       .23
                                            -----------    -----------    -----------
                                            -----------    -----------    -----------

Weighted average number of common
  shares outstanding . . . . . . . . . .     29,753,000     24,217,000     24,000,000
                                            -----------    -----------    -----------
                                            -----------    -----------    -----------

</TABLE>


The accompanying notes are an integral part of these consolidated financial
statements.


                                       33


<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>


                                                                                                     Unrealized
                                                                                                      Gain on
                                                                      Additional                     Available-       Total
                                             Business      Common      Paid-in       Accumulated     for-Sale-    Stockholders'
                                              Equity       Stock       Capital         Deficit       Securities      Equity
                                              ------       -----       -------         -------       ----------      ------
<S>                                         <C>          <C>         <C>            <C>            <C>            <C>

Balance at January 1, 1994 . . . . . . .    $   181,181

  Net income . . . . . . . . . . . . . .          5,600
  Net transfers from COMSAT
    and subsidiaries . . . . . . . . . .         81,416
                                            -----------


Balance at December 31, 1994 . . . . . .        268,197

  Net loss . . . . . . . . . . . . . . .        (17,424)
  Net transfers from COMSAT
    and subsidiaries . . . . . . . . . .        115,110
                                            -----------


Balance at December 17, 1995 . . . . . .        365,883

  Net loss . . . . . . . . . . . . . . .                                              $  (3,599)                      $(3,599)
  Repayment of COMSAT loan . . . . . . .       (140,000)
  Incorporation of Ascent
    Entertainment Group, Inc.. . . . . .       (225,883)   $  240     $  225,643                                      225,883
  Net proceeds from initial
    public offering on
    December 18, 1995. . . . . . . . . .                       57         78,928                                       78,985
                                            -----------    ------     ----------     -----------      --------     ----------

Balance at December 31, 1995 . . . . . .              -       297        304,571         (3,599)                      301,269
  Net loss . . . . . . . . . . . . . . .                                                (36,034)                      (36,034)
  Investment in OCC adjustment
    (Note 2) . . . . . . . . . . . . . .                                   1,178                                        1,178
  Capital contribution from
    COMSAT (Note 10) . . . . . . . . . .                                   1,820                                        1,820
  Unrealized gain on available -
    for-sale-securities, net of
    taxes. . . . . . . . . . . . . . . .                                                                 1,352          1,352
                                            -----------    ------     ----------     -----------      --------     ----------
Balance at December 31, 1996 . . . . . .    $         -    $  297     $  307,569     $  (39,633)      $  1,352     $  269,585
                                            -----------    ------     ----------     -----------      --------     ----------
                                            -----------    ------     ----------     -----------      --------     ----------

</TABLE>



The accompanying notes are an integral part of these consolidated financial
statements.


                                       34


<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                     CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (IN THOUSANDS)

<TABLE>
<CAPTION>


                                                       Years ended December 31,
                                             ----------------------------------------
                                                1996           1995            1994
                                                ----           ----            ----
<S>                                         <C>            <C>            <C>
CASH FLOW FROM OPERATING ACTIVITIES:
 Net income (loss) . . . . . . . . . . .     $  (36,034)    $  (21,023)      $  5,600
   Adjustments to reconcile net income
   (loss) to net cash provided by
   operating activities:
  Depreciation and amortization. . . . .         74,812         53,675         38,820
  Amortization of film inventory . . . .          8,442          4,904              -
  Provision for loss on investments. . .          2,310              -              -
  Extraordinary loss on
   extinguishment of debt, net . . . . .            334              -              -
  Provision for restructuring. . . . . .              -         10,866              -
 Changes in operating assets and
 liabilities:
  Current assets . . . . . . . . . . . .         (2,723)       (10,034)        (7,860)
  Current liabilities. . . . . . . . . .        (19,203)        27,749         10,095
  Noncurrent assets. . . . . . . . . . .         (4,892)        (1,872)        (6,535)
  Noncurrent liabilities . . . . . . . .           (341)        (1,280)        (1,981)
 Other . . . . . . . . . . . . . . . . .            572            786            421
                                               --------      ---------       --------
  Net cash provided by operating
    activities . . . . . . . . . . . . .         23,277         63,771         38,560
                                               --------      ---------       --------


CASH FLOW FROM INVESTING ACTIVITIES:
 Proceeds from notes and other long-term
   receivable. . . . . . . . . . . . . .          6,684            787              -
 Proceeds from sale of investments . . .          3,608              -              -
 Net expenditures for film production
   costs . . . . . . . . . . . . . . . .        (21,050)       (12,549)          (181)
 Purchase of property and equipment. . .        (88,859)       (89,487)       (87,681)
 Investment in unconsolidated
   businesses. . . . . . . . . . . . . .         (4,125)        (3,625)             -
 Acquisitions of businesses. . . . . . .         (9,572)       (76,249)       (33,148)
 Other . . . . . . . . . . . . . . . . .              -            600          1,035
                                               --------      ---------       --------
  Net cash used in investing
   activities. . . . . . . . . . . . . .       (113,314)      (180,523)      (119,975)
                                               --------      ---------       --------

CASH FLOW FROM FINANCING ACTIVITIES:
 Proceeds from borrowings under former
   credit facilities . . . . . . . . . .         75,000         70,000              -
 Repayment of borrowings under former
   credit facilities . . . . . . . . . .       (145,000)          (817)        (1,348)
 Proceeds from borrowings under revolving
   credit loans. . . . . . . . . . . . .        205,537              -
 Payments under revolving credit loans
     and other notes payable . . . . . .        (15,207)             -              -
 Payment of assumed debt from
   SpectraVision acquisition . . . . . .        (40,000)             -              -
 Capital Contribution from COMSAT. . . .          1,820              -              -
 Proceeds from issuance of subsidiary's
   stock . . . . . . . . . . . . . . . .          2,587            209          1,486
 Repayment of COMSAT note. . . . . . . .              -       (140,000)             -
 Net transfers from COMSAT and its
   subsidiaries. . . . . . . . . . . . .              -        115,110         81,416
 Common stock issued . . . . . . . . . .              -         78,985              -
 Other . . . . . . . . . . . . . . . . .         (1,749)           919              -
                                               --------      ---------       --------
 Net cash provided by financing
   activities. . . . . . . . . . . . . .         82,988        124,406         81,554
                                               --------      ---------       --------

   Net increase (decrease) in cash
     and cash equivalents. . . . . . . .         (7,049)         7,654            139
 Cash and cash equivalents, beginning
   of year . . . . . . . . . . . . . . .         11,012          3,358          3,219
                                               --------      ---------       --------
 Cash and cash equivalents, end of
   year. . . . . . . . . . . . . . . . .       $  3,963      $  11,012       $  3,358
                                               --------      ---------       --------
                                               --------      ---------       --------
 Supplemental cash flow information:
   Interest paid . . . . . . . . . . . .       $  8,851         $  166         $  293
   Income taxes paid . . . . . . . . . .              -          1,482          7,271

</TABLE>


The accompanying notes are an integral part of these consolidated financial
statements.


                                       35


<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  YEARS ENDED DECEMBER 31, 1996, 1995 AND 1994


NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accounting and reporting practices of Ascent Entertainment Group, Inc. (the
"Company" or "Ascent") and its majority owned subsidiaries conform to generally
accepted accounting principles and prevailing industry practices.  The following
is a summary of the Company's significant accounting and reporting policies.

BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION.  The accompanying
financial statements present the financial position and results of operations of
COMSAT Video Enterprises, Inc. ("CVE") which, until April 1995, was a wholly
owned subsidiary of COMSAT Corporation ("COMSAT").  In April 1995, COMSAT formed
COMSAT Entertainment Group, Inc. ("CEG") and contributed 100% of the stock of
CVE to CEG.  Subsequently, CEG changed its name to Ascent Entertainment Group,
Inc. ("Ascent").  Accordingly, the Company operated as CVE up to April 1995 and
as Ascent after that date.  The consolidated financial statements include the
accounts of the Company and its majority-owned subsidiaries. Significant
intercompany transactions have been eliminated.  Minority interest in the
financial statements consists of the interest of other stockholders in On
Command Corporation.  The significant majority-owned subsidiaries of Ascent are
as follows:

     On Command Corporation ("OCC") and its wholly-owned subsidiaries, On
       Command Video Corporation ("OCV") and SpectraVision, Inc.
       ("SpectraVision")
     Ascent Network Services, Inc. ("ANS"), (formerly CVE)
     Denver Nuggets Limited Partnership ("Nuggets")
     Beacon Communications Corp. ("Beacon")
     Colorado Avalanche LLC ("Avalanche")

OCC provides video distribution and pay-per-view video entertainment services to
the lodging industry and has operating subsidiaries in the United States,
Canada, Mexico, Hong Kong, Singapore, Thailand and Australia.  ANS provides
video distribution services to the National Broadcasting Company ("NBC")
television network and other private networks.  The Nuggets own a franchise in
the National Basketball Association ("NBA").  The Avalanche own a franchise in
the National Hockey League ("NHL").  Beacon is a producer of motion pictures and
television programming.

Ascent executed an initial public offering (the "Offering") of a portion of its
common stock on December 18, 1995.  Prior to the Offering, Ascent split each
share of common stock outstanding into 24,000,000 shares of common stock.
Earnings per share and share amounts for all prior periods have been restated to
reflect this stock split.  After the Offering, COMSAT continues to own a
majority (80.67%) of Ascent's common stock and continues to control Ascent.  In
addition, during 1996 Ascent's relationship with COMSAT was governed by
agreements entered into in connection with the Offering, including an
Intercompany Services Agreement, a Corporate Agreement and a Tax Sharing
Agreement.  The Corporate Agreement restricts the Company from issuing
additional equity securities or incurring additional indebtedness without the
consent of COMSAT (See Notes 6 and 14.)


                                       36


<PAGE>

CASH AND CASH EQUIVALENTS.  Ascent considers highly liquid investments with a
maturity of three months or less at the time of purchase to be cash equivalents.

PROPERTY AND EQUIPMENT.  Property and equipment is stated at cost, less
accumulated depreciation and amortization. Installed video systems consist of
video system equipment and related costs of installation at hotel locations.
Distribution systems to networks consist of equipment at network affiliates and
the related costs of installation.  Construction in progress consists
principally of purchased and manufactured parts of partially constructed video
systems and the Company's expenditures through December 31, 1996 on the Denver
arena project (See Note 4.)

Depreciation and amortization are calculated using the straight-line method over
the estimated service life of each asset.  The service lives for property and
equipment are: installed video systems, 3 to 7 years; distribution systems, 10
to 15 years; furniture, fixtures and equipment, 3 to 10 years; and buildings and
leasehold improvements, 20 years.

GOODWILL.  The consolidated balance sheet includes goodwill related to the
acquisitions of SpectraVision by OCC, OCV by CVE, the Nuggets and Beacon.
Goodwill is amortized over 10 to 25 years.  Accumulated goodwill amortization
was $13,801,000 and $8,593,000 at December 31, 1996 and 1995, respectively.

FRANCHISE RIGHTS.  Franchise rights were recorded in connection with the
purchases of the Nuggets beginning in 1989 and the Avalanche beginning in 1995.
Such rights are being amortized over 25 years.  The amounts shown on the
consolidated balance sheet are net of accumulated amortization of $18,172,000
and $13,398,000 at December 31, 1996 and 1995, respectively.

EVALUATION OF LONG-LIVED ASSETS.  The Company evaluates the potential impairment
of long-lived assets and long-lived assets to be disposed of in accordance with
Statement of Financial Accounting Standards No. 121, "Accounting for the
Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed Of"
("SFAS No. 121").  SFAS No. 121 establishes procedures for review of
recoverability, and measurement of impairment if necessary, of long-lived assets
and certain identifiable intangibles held and used by an entity.  SFAS No. 121
requires that those assets be reviewed for impairment whenever events or changes
in circumstances indicate that the carrying amount of an asset may not be fully
recoverable.  SFAS No. 121 also requires that long-lived assets and certain
identifiable intangibles to be disposed of be reported at the lower of carrying
amount or fair value less estimated selling costs.  As of January 1, 1996 and
December 31, 1996, management believes that there was not any impairment of the
Company's long-lived assets or any other such identifiable intangibles.

FILM INVENTORIES.  Film inventories are stated at the lower of cost or net
realizable value.  Revenue estimates and costs on a film-by-film basis are
reviewed periodically by management and are revised, if warranted, based upon
management's appraisal of current market conditions.  When estimates of total
revenue indicate that a film will result in an ultimate loss, the entire loss is
recognized.  It is reasonably possible that estimates of anticipated future
gross revenues and film carrying costs may be reduced materially in the near
term due to a significant degree of variability in the performance of theatrical
films.


                                       36


<PAGE>

DEFERRED FINANCING COSTS.  Costs incurred with the issuance of the Company's
current credit facilities are included in prepaid expenses, net of accumulated
amortization.  Amortization is charged to operations over the respective lives
of the loan agreements and is included in interest expense.  (See Note 6).

DEFERRED COMPENSATION COSTS.  Certain current and former players of the Nuggets
and the Avalanche have contracts that provide for deferred compensation and
bonuses.  Ascent records a charge to operations equal to the present value of
the future guaranteed payments in the period in which the compensation is
earned.  In addition, certain players' contracts provide for guaranteed
compensation payments.  (See Note 7).

REVENUE AND COST RECOGNITION.  OCC installs pay-per-view video systems in
hotels, generally under five to seven year agreements, whereby revenues are
recognized at the time of viewing.  Revenue from the sale of video systems is
recognized when the equipment is shipped, except for systems requiring
installation by the Company, which is recognized upon completion of the
installation.  Revenues from video management services and royalties are
recognized when earned.

The Nuggets and Avalanche game admission and broadcasting revenues are
recognized as earned per home game during the teams' regular playing seasons,
generally from October to April of the following calendar year. Team and game
costs, principally gate assessments, arena rentals and user fees, are recorded
and expensed on the same basis.  Team costs, principally player salaries,
related fringe benefits and insurance, are recognized on a per-day basis during
the teams' regular playing seasons.  Accordingly, advance ticket sales and
advance payments on television, radio, concessionaire and marketing contracts,
and payments for team and game expenses not earned or incurred, are recorded as
deferred revenues and deferred game expenses, respectively, and amortized
ratably as regular season games are played.

Minimum guaranteed amounts from theatrical exhibition and revenues from home
videos, pay television and free television license agreements are recognized
when the applicable license period begins for each motion picture and such
motion picture is made available to the distributor for exploitation pursuant to
the terms of the applicable license agreement.  Amounts in excess of the minimum
guarantee under such license agreements and other amounts (where no minimum
guarantee was given) are recognized when earned.  Cash collected in advance of
the time of film availability is recorded as deferred revenue.

Film costs include the acquisition of story rights, the development of stories,
production, print and advertising costs (which benefit future periods) and
certain amounts of overhead related to production are capitalized as film
inventory.  Such costs are amortized under the individual film forecast method.
Completed film costs are amortized in the proportion that each film's current
revenues bear to management's estimates of total remaining ultimate revenues
from all sources for such film.  Estimated liabilities for royalties and profit
participations are accrued based upon recognized film revenues and expenses in
the same manner as film cost inventories.

Revenue from other services is recorded as services are provided.

GENERAL AND ADMINISTRATIVE EXPENSE.  General and administrative expenses include
those costs incurred by the parent company, Ascent Entertainment Group, Inc.
Similar costs incurred by the Company's majority-owned subsidiaries are included
in cost of services in the accompanying statements


                                       37


<PAGE>

of operations.  For the years ended December 31, 1996, 1995 and 1994, the
Company's subsidiaries incurred related costs of $23,984,000, $10,844,000, and
$5,441,000, respectively.

INCOME TAXES.  A current or deferred income tax liability or asset is recognized
for temporary differences which exist due to the recognition of certain income
and expense items for financial reporting purposes in periods different than for
tax reporting purposes.  The provision for income taxes is based on the amount
of current and deferred income taxes payable or refundable at the date of the
financial statement as measured by the provisions of current tax laws.

NET INCOME (LOSS) PER SHARE.  Net income (loss) per common share is calculated
using the weighted average number of common and common equivalent shares
outstanding in the respective years.  Except when inclusion of such shares is
antidilutive, common equivalent shares include net shares issuable upon the
assumed exercise of options using the treasury stock method, assuming purchases
at average market values.

Common equivalent shares were not included in the calculation of income (loss)
per share for 1996 and 1995, because their inclusion would have been
antidilutive.  There were no common equivalent shares in 1994.

RESEARCH AND DEVELOPMENT COSTS.  Research and development costs are charged to
operations as incurred.  These costs are included in cost of services on the
income statements.  The amounts charged were $4,628,000, $2,734,000 and
$2,882,000 for the years ended December 31 1996, 1995 and 1994, respectively.
Included in these amounts were amounts for services purchased from COMSAT
affiliates of $132,000 for the year ended December 31, 1994.  No such services
were purchased in 1996 and 1995.

CERTAIN SIGNIFICANT RISKS AND UNCERTAINTIES.  The preparation of financial
statements in conformity with generally accepted accounting principles requires
management to make estimates and assumptions that affect the reported amounts of
assets and liabilities and disclosures of contingent assets and liabilities at
the date of the financial statements and the reported amounts of revenues and
expenses during the reporting period.  Such management estimates include the
allowance for doubtful accounts receivable, the estimated useful lives of video
systems and property and equipment, intangible assets, including goodwill,  the
amortization of film costs based on future film revenues, the reduction in
construction in progress and film inventory to their net realizable value and
the amounts of certain accrued liabilities.

The Company participates in the highly competitive multimedia distribution and
entertainment industries and believes that changes in any of the following areas
could have a material adverse affect on the Company's future financial position
or results of operations: declines in hotel occupancy as a result of general
business, economic, or other factors; loss of one or more of its major hotel
chain customers; a decline in ticket sales and other revenues by the sports
franchises; the timing and success of film releases; ability to obtain
additional capital to finance capital expenditures and film production costs;
ability to retain senior management and key employees; disruption of
satellite service; and risks of technological obsolescence.

FAIR VALUE OF FINANCIAL INSTRUMENTS.  The fair value of cash and cash
equivalents, receivables, other current assets, accounts payable and other
accrued liabilities approximate their carrying value due to the short term


                                       38


<PAGE>

nature of these financial instruments.  The fair value of certain short-term and
long-term investments approximates their carrying value.  The fair value of the
Company's bank borrowings and other long-term liabilities approximates their
carrying value due to the variable nature of the interest associated with those
obligations.

RECENTLY ISSUED ACCOUNTING STANDARD.  In February 1997, the Financial Accounting
Standards Board issued Statement of Financial Accounting Standards No. 128,
"Earnings Per Share."  This Statement establishes standards for computing and
presenting earnings per share.  This Statement is effective for financial
statements issued for periods ending after December 15, 1997, including interim
periods; early application is not permitted.  The Company will adopt this
Statement in the fourth quarter of 1997 and will restate all prior period
earnings per share data presented as required.  The Company has not yet
determined the impact of adopting this Statement on its reported net income
< loss > per common share.


RECLASSIFICATIONS.  Certain amounts in prior periods have been reclassified to
conform with the current year's presentation, most notably OCC has reclassified
certain income statement amounts in OCV's historical financial statements to be
consistent with the presentation used by SpectraVision and to conform to a more
common presentation used by providers of in-room entertainment to the lodging
industry.  Specifically, OCV previously reflected certain costs as a reduction
of revenues and now classifies such costs as a cost of service.

NOTE 2 - ACQUISITION AND INVESTMENTS

The Company completed one acquisition per year in 1994, 1995 and 1996.  These
acquisitions have been accounted for under the purchase method and, accordingly,
the results of operations of the acquired businesses are included in the
consolidated financial statements from the dates of acquisition.  These
acquisitions are summarized as follows:

SPECTRAVISION, INC. - Effective October 8, 1996, Ascent through its newly formed
subsidiary, OCC, acquired the assets, properties and certain liabilities of
SpectraVision, Inc. (the "Acquisition") with an effective closing date of
October 8, 1996 (the "Closing Date").  The Acquisition was consummated
pursuant to an Acquisition Agreement dated August 13, 1996, among Ascent,
OCC, SpectraVision and the other parties named therein (the "Acquisition
Agreement").  Pursuant to the Acquisition Agreement, OCC acquired all of the
outstanding capital stock of SpectraDyne, Inc. ("SpectraDyne") the primary
operating subsidiary of SpectraVision, together with certain other assets of
SpectraDyne and its affiliates.  SpectraDyne subsequently changed its name to
SpectraVision, Inc. Prior to the Closing Date, OCV, formerly an 84% owned
subsidiary of Ascent (approximately 78.4% owned on a fully diluted basis),
was merged (the "Merger") with a subsidiary of OCC and became a wholly owned
subsidiary of OCC pursuant to an Agreement and Plan of Merger (the "Merger
Agreement") by and among OCC, SpectraVision, OCV and On Command Merger
Corporation also dated August 13, 1996. The Acquisition Agreement and the
Merger Agreement were entered into to effect the terms of the Agreement dated
April 19, 1996 entered into among Ascent, OCV, SpectraVision and the other
parties named therein and to effectuate the transactions contemplated
thereby.   In accordance with Emerging Issues Task Forces Issue No. 95-19,
"Determination of the Measurement Date for the Market Price of Securities
Issued in a Purchase Business Combination," the fair value of the Acquisition
consideration was determined


                                       39


<PAGE>

as of April 19, 1996.  The fair value was based on an independent appraisal of
the net assets acquired.

At the Closing Date, Ascent and the minority stockholders of OCV received
21,750,000 shares of OCC common stock (72.5% of the initial outstanding OCC
common stock).  Of these shares, Ascent received 17,149,766 shares.  In
consideration of the acquisition of the assets and properties of SpectraVision
by OCC, 8,041,618 shares of OCC common stock were issued to the SpectraVision
bankruptcy estate for distribution to SpectraVision's creditors.  Additionally,
208,382 shares were held in reserve pending finalization of closing balance
sheet pursuant to the Acquisition Agreement.  Of these, 196,382 shares of
reserved stock were distributed to the SpectraVision bankruptcy estate for the
benefit of SpectraVision's creditors with the remaining 12,000 shares
distributed to Ascent and OCV minority stockholders.  Ascent owns approximately
57.2% of the outstanding common stock of OCC at December 31, 1996.

In connection with the Acquisition and the Merger, OCC also issued warrants
representing the right to purchase a total of 7,500,000 shares of OCC common
stock (20% of the outstanding common stock of OCC, after exercise of the
warrants).  The warrants have a term of 7 years and an exercise price of $15.27
per share.  Series A warrants to purchase on a cashless basis up to 1,425,000
shares of OCC common stock were issued to former OCV shareholders, of which
Ascent received warrants to purchase 1,123,823 shares; Series B warrants to
purchase for cash an aggregate of 2,625,000 shares of OCC common stock were
issued to the SpectraVision bankruptcy estate for distribution to creditors; and
Series C warrants were issued to OCC's investment advisors to purchase for cash
an aggregate of 3,450,000 shares of OCC common stock in consideration for
certain banking and advisory services provided in connection with the
transactions.

The aggregate purchase consideration has been allocated to the acquired assets
and assumed liabilities of SpectraVision, based on their respective fair market
values.  The fair value of tangible assets acquired and liabilities assumed was
approximately $66,000,000 and $67,000,000, respectively.  In addition,
$2,000,000 of the purchase price was allocated to purchased technology.  The
balance of the purchase price, $90,636,000, was recorded as goodwill and is
being amortized over twenty years on a straight-line basis.  The accompanying
financial statements reflect the preliminary allocation of the purchase price as
the purchase price allocation has not been finalized. The assets acquired and
liabilities assumed are as follows (in thousands):

     Estimated fair value of assets acquired
       (including intangibles of $92,636)            $ 158,916
     Liabilities assumed                               (67,282)
                                                     ---------
     Net assets acquired at estimated fair value        91,634
     Cash paid (net of cash received of $257)           (9,572)
                                                     ---------

     Common stock and warrants issued                $  82,062
                                                     ---------
                                                     ---------

The following unaudited pro forma consolidated results of operations for the
years ended December 31, 1996 and 1995 are presented as if the SpectraVision
acquisition had been made at the beginning of each period presented.  The
unaudited pro forma information is not necessarily indicative of either the
results of operations that would have occurred had the purchase been made during
the periods presented or the future results of the combined operations.


                                       40


<PAGE>

                                   Year Ended December,31
                                   ----------------------
                                        (in thousands)
                                      1996           1995
                                      ----           ----
     Revenues . . . . . . . . .    $ 343,420      $ 325,804
     Net loss . . . . . . . . .    $ (42,982)     $ (34,749)
     Loss per common share. . .    $   (1.45)     $   (1.44)


In connection with this transaction, the Company recorded an increase in
additional paid-in capital of $1,178,000 as a result of the exchange of it's
investment in OCV for its investment in OCC.

COLORADO AVALANCHE LLC.  In July 1995, Ascent acquired a NHL franchise and
related player contracts, management contracts and certain other assets from Le
Club de Hockey Les Nordiques located in Quebec, Canada.  The franchise was
relocated to Denver, Colorado in time for the 1995-1996 NHL season, renamed the
Colorado Avalanche, and its results since July 1, 1995 have been included in the
accompanying consolidated financial statements.

The cost of the acquisition was $75,840,000 which was allocated principally to
franchise rights and player contracts.  As part of the purchase, Ascent assumed
contractual commitments to players aggregating $24,625,000 over three years.

BEACON COMMUNICATIONS CORP.  In December 1994, Ascent acquired the assets of
Beacon, a film and television production company based in Los Angeles.  The
acquisition has been accounted for as a purchase and, accordingly, Beacon's
results of operations have been included in the accompanying consolidated
financial statements beginning on December 1, 1994.  The cost of this
acquisition was $29,133,000, which was allocated to the net assets acquired,
principally a development, production and domestic distribution agreement (the
"Distribution Agreement"), two feature films and goodwill, based on their
estimated fair market values.  The purchase price consisted of $16,180,000 in
cash and liabilities assumed of $12,953,000.  The purchase agreement also calls
for future cash consideration, which is contingent on the production and
performance of up to thirteen motion pictures during the next five years, with a
total pay-out not to exceed $16,900,000.  The contingent payments, if made, will
be accounted for in part, as additional costs of the acquired assets and in
part, as additional costs of the movies to be made.  During 1996 and 1995,
$1,000,000 and $800,000 of contingent payments were paid in cash, respectively.

If Beacon had been acquired as of January 1, 1994, unaudited proforma
consolidated revenues would have been $183,205,000 for 1994 and the unaudited
proforma consolidated net loss would have been $9,677,000 for 1994,
respectively.  The unaudited proforma consolidated loss per share would have
been $.40 for 1994.

OTHER INVESTMENTS.  Other Investments consist of the following of December 31,
1996 and 1995:

                                                            1996           1995
                                                            ----           ----
                                                              (in thousands)
     Marketable equity securities  . . . . .             $  2,080      $     -
     Investment in MagiNet Corporation . . .                1,265        1,265
     Investments in partnerships or
       joint ventures:


                                       41


<PAGE>

     Elitch Gardens. . . . . . . . . . . . .                2,379        3,041
     NBA partnerships. . . . . . . . . . . .                2,657        1,825
     Colorado Studios. . . . . . . . . . . .                  769          497
                                                         --------     --------
     Total other investments.. . . . . . . .             $  9,150     $  6,628
                                                         --------     --------
                                                         --------     --------

At December 31, 1996, the Company's investment in marketable equity securities
consists of its investment in MetroMedia International Group.  This investment
is considered to be available-for-sale and accordingly, the net unrealizable
holding gain, net of deferred income taxes, is reported as a separate
component of stockholders' equity.  In 1996, the gross realized gain from the
sale of a portion of these available-for-sale securities was $1,892,000 and is
included in other income (expense) in the accompanying financial statements.

The Company's investment in MagiNet Corporation, a private company, is accounted
for at cost (See Note 14.)  Investments in partnerships and joint ventures are
accounted for using the equity method.

The Company's investment in the limited partnership owning Elitch Gardens, an
amusement park in Denver, Colorado, was increased from 13% to 26% in March 1996,
when Ascent purchased all of The Anschutz Corporation's (TAC's) interest in the
limited partnership for $4,125,000 in cash (see Note 4).  Subsequently, in
September, 1996, the Company recorded a $1,800,000 loss on its limited
partnership investment in Elitch Gardens, based on the announced sale of the
amusement park to Premier Parks, Inc.  The Company's share of proceeds from the
sale, which closed on October 30, 1996, are subject to certain future
adjustments.  In December 1996, the Company recorded an additional loss of
$510,000 on its investment due to the Company's concerns over the liquidation of
the partnership.  Prior to December 31, 1996, the Company had received
distributions of $1,716,000 and in January 1997, the Company received an
additional $1,900,000 of partnership distributions.  Management of the Company
believes its remaining investment in Elitch's is likely to be recovered through
an additional partnership distribution to be received in the first half of 1997.


NOTE 3 - RECEIVABLES AND CONCENTRATION OF CREDIT RISK

Receivables consist of the following at December 31, 1996 and 1995:

                                                            1996      1995
                                                            ----      ----
                                                              (in thousands)
     Trade receivables . . . . . . . . . . .            $  52,426    $  44,571
     Current portion of notes and long-term
       receivables . . . . . . . . . . . . .                4,405        3,710
     Less allowance for doubtful accounts. .                2,136        3,240
                                                        ---------    ---------
        Receivables, net . . . . . . . . . .            $  54,695    $  45,041
                                                        ---------    ---------
                                                        ---------    ---------

Ascent generates a substantial portion of its revenues from OCC and from hotel
guest's usage of OCC pay-per-view video systems located in various hotels
primarily throughout the United States, Canada, Mexico and the Far East.  OCC
performs periodic credit evaluations of its installed hotel locations and
generally requires no collateral.  While the Company does maintain allowances
for potential credit losses, actual bad debt losses have not been significant.
The Company invests its cash in high-credit quality instruments.  These
instruments are short-term in nature and, therefore, bear minimal risk.

OCC has one customer, including its affiliates, which accounted for 14%, 16% and
14% of consolidated revenues in 1996, 1995 and 1994, respectively.  A second
customer of OCC accounted for 17% of consolidated revenues in 1994.  No


                                       42


<PAGE>

other customer accounted for more than 10% of consolidated revenues during
1996, 1995 and 1994.

Included in other long-term assets is a long term receivable of $5,655,000 and
$9,714,000 at December 31, 1996 and 1995, respectively.

NOTE 4 - PROPERTY AND EQUIPMENT

Property and equipment consists of the following at December 31, 1996 and 1995:

                                                            1996      1995
                                                            ----      ----
                                                              (in thousands)
     Land  . . . . . . . . . . . . . . . . .           $    2,000   $        -
     Buildings and leasehold improvements. .                2,997          883
     Installed video systems . . . . . . . .              343,475      249,845
     Distribution systems to networks. . . .               95,334      104,204
     Furniture, fixtures and equipment . . .               16,836       13,068
                                                       ----------   ----------

        Total. . . . . . . . . . . . . . . .              460,642      368,000
     Less accumulated depreciation and
       amortization. . . . . . . . . . . . .              200,452      181,648
                                                       ----------   ----------

     Net property and equipment in service.               260,190      186,352
     Construction in progress. . . . . . . .               41,308       34,250
                                                       ----------   ----------

           Property and equipment, net . . .           $  301,498   $  220,602
                                                       ----------   ----------
                                                       ----------   ----------

DENVER ARENA PROJECT.  On March 28, 1996, the Company entered into an agreement
with The Anschutz Corporation ("TAC") pursuant to which the Company purchased
all of TAC's interests in a proposed arena development project in Denver and
related goodwill, rights, plans, specifications, drawings, contracts,
relationships, approvals, permits and other work product of every kind that had
been generated by the efforts of TAC and Ascent with respect to the proposed
arena (the "Arena Assets"), and TAC agreed to use reasonable efforts to
facilitate the development and construction of the proposed arena.  Ascent and
TAC had worked together on the proposed arena development from early 1994 until
September 1995.  In consideration for TAC's interest in the Arena Assets and its
agreement to facilitate development of the proposed arena, Ascent paid TAC
$6,600,000 in cash.  On a contingent and non-interest bearing basis Ascent
agreed to pay TAC an additional $5,000,000 and grant a paid-up suite license,
both contingent on the construction and occupancy of the proposed arena.  This
obligation, net of discount, has been accrued and is included in the
accompanying balance sheet in other accrued liabilities ($2,500,000) and other
long-term liabilities ($2,000,000) at December 31, 1996.  The Company has
classified costs of $11,540,000 and $2,445,000, representing the total
expenditures on the proposed arena at December 31, 1996 and 1995, respectively,
in Construction-in-Progress.

On March 28, 1996, the Company entered into a Land Purchase Agreement with
Southern Pacific Transportation Company ("SPT"), a company related to TAC,
pursuant to which the Company would purchase approximately 49 acres in Denver
as the site for the proposed arena for $20,000,000.  Pursuant to the Land
Purchase Agreement, the closing of the land purchase had to have occurred on
or before June 28, 1996. The closing did not take place by this time and the
Land Purchase Agreement terminated. Although there can be no assurance, it is
management's belief that SPT will reinstate the Land Purchase Agreement on
substantially similar terms and the

                                       43


<PAGE>

closing date for the Land Purchase Agreement will be extended.  Consummation
of the transaction is subject to several conditions, including obtaining
satisfactory financing and reaching agreements with the City and County of
Denver regarding the construction of the proposed arena and the release of the
Nuggets and the Avalanche from their existing leases at the City and County of
Denver's current arena, McNichols Arena.  The Agreement also provides for SPT
to effect a state-approved environmental clean-up plan on the site, and
provide continuing partial indemnification with regard to certain
environmental liabilities.  Management believes that these negotiations will
be successfully concluded, but there can be no assurance that Ascent will be
able to reach acceptable terms for the construction of the new arena.

NOTE 5 - FILM INVENTORY

Film inventory consists of the following at December 31, 1996 and 1995:


                                                            1996      1995
                                                            ----      ----
                                                              (in thousands)
     Films released, less amortization . . .           $    3,382   $    6,330
     Films in process and development. . . .               69,732        2,786
     Development . . . . . . . . . . . . . .                3,120        2,354
                                                       ----------   ----------

        Total film inventory . . . . . . . .           $   76,234   $   11,470
                                                       ----------   ----------
                                                       ----------   ----------

The Company estimates that approximately 97% of unamortized released film cost
will be amortized over the next three fiscal years.  In 1996, the Company
increased film inventory and deferred revenues by approximately $49,852,000 in
connection with the distribution rights relating to certain films under
development at December 31, 1996.

NOTE 6 - NOTES PAYABLE AND LONG-TERM DEBT

Notes payable and long-term debt consists of the following at December 31, 1996
and 1995:

                                                            1996      1995
                                                            ----      ----
                                                              (in thousands)
     OCC revolving credit facility . . . . .           $   98,000   $        -
     Ascent revolving credit facility. . . .               95,000            -
     Note payable to OCV minority stockholders,
       paid August 1996. . . . . . . . . . .                    -          207
     Former Ascent credit facility, paid
       October 1996. . . . . . . . . . . . .                    -       70,000
                                                       ----------   ----------
         Total . . . . . . . . . . . . . . .              193,000       70,207
     Less:  Short-term borrowings. . . . . .              143,000            -
            Current maturities . . . . . . .                    -          207
                                                       ----------   ----------
         Total long-term debt. . . . . . . .           $   50,000   $   70,000
                                                       ----------   ----------
                                                       ----------   ----------

OCC REVOLVING CREDIT FACILITY.  In conjunction with the SpectraVision
acquisition, OCC obtained a $125 million revolving credit facility, (the "OCC
Credit Facility").  The OCC Credit Facility consists of (i) a 364-day revolving
credit and competitive advance facility which, subject to certain conditions,
will be renewable for four 364-day periods, and (ii) a five year revolving
credit and competitive advance facility; provided, however, that any amounts
borrowed under the five year facility will reduce the amount available under the
364-day facility.  At December 31, 1996, $50,000,000 was outstanding

                                       44


<PAGE>

as a long-term revolving loan and is repayable in 2001, while $48,000,000 is
considered a short-term borrowing.

Revolving loans extended under the OCC Credit Facility generally will bear
interest at the London Interbank Offering Rate ("LIBOR") plus a spread that may
range from 0.375% to 0.625% depending on certain operating ratios of OCC.  At
December 31, 1996, the weighted average interest rate on the OCC Credit Facility
was 6.17%.  In addition, a fee ranging from .1875% to .25% per annum is charged
on the unused portion of the OCC Credit Facility, depending on certain OCC
operating ratios.

The OCC Credit Facility contains customary covenants, including, among other
things, compliance by OCC with certain financial covenants.  At December 31,
1996, OCC was in compliance with these covenants.  The OCC Credit Facility
limits OCC's ability to incur indebtedness or pay dividends, but does not
preclude OCC from paying cash dividends on its Common Stock.

Upon the closing of the SpectraVision acquisition,  OCC borrowed $92.0 million
under its credit facility to (i) pay-off debt obligations of SpectraVision of
approximately $40.0 million, (ii) pay-off intercompany obligations of OCV to
Ascent and other OCC obligations of approximately $43.6 million and (iii) to pay
certain administrative claims and other bankruptcy costs of SpectraVision and
its affiliated debtors of approximately $8.4 million.

On March 23, 1997, OCC entered into an amendment to the OCC Credit Facility (the
"OCC Amendment").  Under the OCC Amendment, the amount available under the OCC
Credit Facility was increased from $125.0 million to $150.0 million, and certain
other terms were amended to clarify such terms.  At March 23, 1997, there was
$47.0 million of available borrowings under the amended OCC Credit Facility,
subject to certain covenant restrictions.

ASCENT REVOLVING CREDIT FACILITY.  In October 1996, Ascent also entered into a
new revolving credit facility (the "Ascent Credit Facility") with the same bank
as OCC.  The Ascent Credit Facility provided for borrowings of up to $200
million, consisting of a 364-day secured revolving credit facility.  This
facility, subject to certain conditions, was to be renewable for two 364-day
periods on October 9, 1997 and October 8, 1998 respectively.  At December 31,
1996, the Company has classified all of its outstanding borrowings under the
Ascent credit facility as short-term borrowings.

Revolving loans extended under the Ascent Credit Facility generally will bear
interest at LIBOR plus a spread that may range from 1.75% to 2.50% depending on
certain operating ratios of Ascent.  A fee of .5% per annum is charged on the
unused portion of the Ascent Credit Facility.  At December 31, 1996, the
weighted average interest rate on the Ascent Credit Facility was 8.05%.  The
Ascent Credit Facility provides that at no time will amounts outstanding under
the facility exceed (a) $125.0 million, until Ascent shall have received consent
from the NBA and NHL to pledge Ascent's interests in the Nuggets and Avalanche,
respectively, and thereafter (b) the sum of (i) up to $100 million secured by
first priority pledges of, and liens on, the equity interests in all of Ascent's
subsidiaries (excluding OCC), plus (ii) 50% of the value of the OCC Common Stock
owned by Ascent, secured by a pledge of such stock.  The Company expects to
obtain the consents from the NBA and NHL during the second quarter of 1997.

Upon the closing of the Ascent Credit Facility, Ascent extinguished borrowings
of $145.0 million outstanding under its then existing $175.0 million credit


                                       45


<PAGE>

facility with a different bank.  The Company utilized funds received from OCC of
$39.3 million  and borrowed $110.0 million under its new credit facility to
extinguish its outstanding bank obligations, including accrued interest, and
other Ascent obligations.  The Company recorded an extraordinary loss of
approximately $334,000 net of tax during the fourth quarter of 1996 in
connection with the extinguishment of its previous credit facility.

The Ascent Credit Facility also contained covenants requiring Ascent and OCC to
maintain certain financial covenants, limited Ascent's ability to incur
indebtedness and precludes Ascent from paying cash dividends on its Common
Stock. At December 31, 1996, Ascent was in compliance with these covenants. In
addition, the failure of Ascent to commence construction on the Denver Arena
Complex (see Note 4) prior to August 31, 1997 is an event of default under the
Ascent Credit Facility.

On March 23, 1997, Ascent entered into an amendment to the Ascent Credit
Facility (the "Ascent Amendment").  The Ascent Amendment provides, among other
things, that the Ascent Credit Facility will not be renewable for two additional
one year options beyond October 9, 1997 unless, prior thereto, Ascent has
received not less than $50.0 million in proceeds from a new debt financing which
is subordinated to the Ascent Credit Facility; for the maximum amount available
to be borrowed under the facility to be reduced from $200.0 million to $140.0
million; for the elimination of the $125.0 million limit on available borrowings
under the facility prior to receipt of NBA and NHL consents; that those
financial covenants contained in the Ascent Credit Facility related to the
financial results of OCC will not be measured until year end 1997; for the
$140.0 million of availability to be divided into a term loan of $50.0 million
and a revolving facility of $90.0 million; and for amendments to certain other
financial covenants.  Based on current market conditions, management of Ascent
currently believes that they will be successful in obtaining the additional
subordinated debt by October 9, 1997.  In addition, management currently
believes that they will have commenced construction on the Denver Arena Project
prior to August 31, 1997 or they will have made sufficient progress on the
negotiations involving the Denver Arena Project to enable Ascent to obtain an
extension under the Ascent Credit Facility.  However, there can be no assurances
that other contingencies will not arise which could impact Ascent's ability to
obtain this additional subordinated financing, that such financing will be
available on terms acceptable to Ascent or that negotiations with the City and
County of Denver on the Denver Arena Project will have been completed or
progressed significantly.  If Ascent were not able to obtain the additional
subordinated financing, Ascent could be required to refinance the Ascent Credit
Facility which could require Ascent to reduce or reschedule planned capital
investments, reduce capital outlays, sell assets or equity.  At March 23, 1997,
there was $33.0 million of available borrowings under the amended Ascent credit
facility.

OTHER.  As a consolidated subsidiary of COMSAT, Ascent is subject to
restrictions on its debt structure as a result of Federal Communications
Commission regulations applicable to COMSAT (see Note 14).

NOTE 7 - DEFERRED COMPENSATION

Deferred compensation, which is included in other long-term liabilities on the
accompanying balance sheet, consists of the following at December 31, 1996 and
1995:


                                       46


<PAGE>

                                                            1996      1995
                                                            ----      ----
                                                              (in thousands)
     Deferred compensation contracts payable, at
       varying interest rates, through 2002.           $    3,914   $    3,571
     Less:  Imputed interest . . . . . . . .                  720          808
            Current maturities . . . . . . .                  439          349
                                                       ----------   ----------
            Total. . . . . . . . . . . . . .           $    2,755   $    2,414
                                                       ----------   ----------
                                                       ----------   ----------

Total annual payments on long-term deferred compensation for the years
subsequent to December 31, 1996 are as follows (in thousands):

     1997. . . . . . . . . . . . . . . . . . . . . . . . . .       $    439
     1998. . . . . . . . . . . . . . . . . . . . . . . . . .          1,154
     1999. . . . . . . . . . . . . . . . . . . . . . . . . .            749
     2000. . . . . . . . . . . . . . . . . . . . . . . . . .            800
     2001. . . . . . . . . . . . . . . . . . . . . . . . . .            550
     Thereafter. . . . . . . . . . . . . . . . . . . . . . .            222
                                                                   --------
           Total . . . . . . . . . . . . . . . . . . . . . .       $  3,914
                                                                   --------
                                                                   --------

NOTE 8 - INCOME TAXES

For the periods presented in these financial statements, Ascent has been a
member of COMSAT's consolidated tax group for federal income tax purposes.  OCV,
however, filed separate returns until the third quarter of 1995, at which time
Ascent's ownership interest increased to 84.7% (see Note 2).  However, in
conjunction with the formation of OCC and acquisition of SpectraVision, Ascent's
ownership in OCC decreased to 57%.  Accordingly, OCC will file a separate return
commencing on October 9, 1996.  Ascent has prepared its tax provision based on
it's inclusion in COMSAT's consolidated return.  For years 1993 and thereafter,
the provision as calculated would approximate the provision if prepared on a
separate return basis.  In connection with the Offering, Ascent and COMSAT
entered into a tax allocation agreement that provides for cross indemnification
with respect to these periods.

In connection with the SpectraVision Acquisition, OCC has until July 15, 1997 to
determine whether it will elect under Internal Revenue Code Section 338(h)(10)
to treat the transaction as a purchase of assets for tax purposes.  The
computation of deferred taxes for OCC has been made on the assumption that OCC
will make this election.  However, management will continue to evaluate the
alternative tax treatments for the Acquisition and may choose to treat it as a
taxable stock purchase whereby the Company would assume carryover basis in
SpectraVision's assets, including net operating losses.

The current and deferred tax expenses have been allocated according to each
entity's separately computed tax liability.  Taxes payable or receivable are
settled with COMSAT annually.  For the years ended December 31, 1996 and 1995,
Ascent's federal taxes receivable from COMSAT were $12,623,000 and $2,247,000,
respectively.  These amounts due from COMSAT are shown net of income tax
obligations at OCC of $5,692,000 and $1,813,000 at December 31, 1996 and 1995,
respectively, in the accompanying consolidated balance sheets.

The components of income tax expense (benefit) for the years ended December 31,
1996, 1995 and 1994 are as follows:

                                       1996           1995          1994
                                       ----           ----          ----
                                                 (in thousands)
     Federal:
       Current . . . . . . . .     $  (15,695)     $  (1,589)      $  4,386
       Deferred. . . . . . . .          3,130         (8,125)           116
     State and local . . . . .            110           (121)           329
     Foreign . . . . . . . . .            498              -              -
                                   -----------     ----------      --------
        Total. . . . . . . . .     $  (11,957)     $  (9,835)      $  4,831
                                   -----------     ----------      --------
                                   -----------     ----------      --------

The difference between tax expense (benefit) computed at the statutory federal
tax rate and Ascent's effective tax rate is:

                                       1996           1995          1994
                                       ----           ----          ----


                                       47


<PAGE>
                                                 (in thousands)
Federal income taxes (benefit) computed
  at the statutory rate. . . . . . . . .   $ (19,063)  $  (10,580)    $  3,743
State income taxes, net of federal income
  tax (benefit). . . . . . . . . . . . .        (573)         (72)         214
Goodwill . . . . . . . . . . . . . . . .         860          831          742
Foreign. . . . . . . . . . . . . . . . .         498            -            -
Valuation allowance. . . . . . . . . . .       5,333            -            -
Other. . . . . . . . . . . . . . . . . .         988          (14)         132
                                           ----------   ----------    --------
   Income tax expense (benefit). . . . .   $ (11,957)   $  (9,835)    $  4,831
                                           ----------   ----------    --------
                                           ----------   ----------    --------

The net current and net non-current components of deferred tax assets and
liabilities, tax effected, as shown on the balance sheet at December 31, 1996
and 1995 are:

                                                    1996           1995
                                                    ----           ----
                                                       (in thousands)
     Current deferred tax asset. . . . . . . .    $  3,580       $  4,394
     Non-current deferred tax liability. . . .      (5,742)        (3,593)
                                                  ---------      ---------
        Net asset (liability). . . . . . . . .    $ (2,162)      $    801
                                                  ---------      ---------
                                                  ---------      ---------

The deferred tax assets and liabilities at December 31, 1996 and 1995 are:

                                                        1996            1995
                                                        ----            ----
                                                            (in thousands)
Assets:
  Alternative minimum tax credit . . . . . .          $  11,137       $  9,145
  Other accrued liabilities. . . . . . . . .              8,471          4,607
  Amortization of intangibles. . . . . . . .              4,261          2,539
  Net operating loss carryforwards . . . . .              2,876              -
  Other. . . . . . . . . . . . . . . . . . .                847            543
  Contract revenue . . . . . . . . . . . . .                582            649
  Post retirement benefits . . . . . . . . .                  -            608
  Tax basis in excess of book basis
    (338 election) . . . . . . . . . . . . .             52,397              -
  Valuation allowance. . . . . . . . . . . .            (56,885)             -
                                                      ----------      ---------
  Total deferred tax assets. . . . . . . . .             23,686         18,091
                                                      ----------      ---------

Liabilities:
  Property and equipment . . . . . . . . . .            (13,242)       (10,380)
  Franchise rights . . . . . . . . . . . . .            (11,620)        (6,593)
  Other. . . . . . . . . . . . . . . . . . .               (986)          (317)
                                                      ----------      ---------

Total deferred tax liabilities . . . . . . .            (25,848)       (17,290)
                                                      ----------      ---------
Net asset (liability). . . . . . . . . . . .          $  (2,162)      $    801
                                                      ----------      ---------
                                                      ----------      ---------

OCC has federal net operating loss carryforwards of approximately $6,100,000,
which expire beginning in 2012.  In addition, OCC has California net operating
loss carryforwards of approximately $15,000,000 which expire beginning in 2000
and may be subject to limitation in the event of certain defined changes in
stock ownership.  Alternative minimum tax credit carryforwards of approximately
$1,700,000 and $250,000 are available to offset future regular federal and state
tax liabilities, respectively.

The Internal Revenue Service ("IRS") has examined the COMSAT returns through
1989 and is currently examining federal income tax returns for 1990 through
1994.  In the opinion of Ascent, adequate provision has been made for income
taxes for all periods through 1996.


                                       48


<PAGE>

NOTE 9 - COMMITMENTS AND CONTINGENCIES

EMPLOYMENT AND CONSULTING AGREEMENTS.  Ascent has employment and consulting
agreements with certain officers and entertainment talent.  Virtually all of the
player agreements provide for guaranteed payments.  Other contracts provide for
payments upon the fulfillment of their contractual terms and conditions, which
generally relate only to normal performance of employment duties.

Amounts required to be paid under such agreements (including approximately
$118,821,000 relating to player agreements) are as follows at December 31, 1996
(in thousands):


     1997. . . . . . . . . . . . . . . . . . . . . . . . . .      $  59,550
     1998. . . . . . . . . . . . . . . . . . . . . . . . . .         43,407
     1999. . . . . . . . . . . . . . . . . . . . . . . . . .         27,370
     2000. . . . . . . . . . . . . . . . . . . . . . . . . .         17,015
     2001. . . . . . . . . . . . . . . . . . . . . . . . . .          8,670
     Thereafter. . . . . . . . . . . . . . . . . . . . . . .          9,284
                                                                  ---------
           Total . . . . . . . . . . . . . . . . . . . . . .      $ 165,296
                                                                  ---------
                                                                  ---------

FACILITY AND EQUIPMENT LEASES -  Ascent leased its Corporate headquarters from
COMSAT through June, 1996.  In connection with Ascent's relocation to Denver in
June of 1996, the Company entered into an operating lease for its corporate
headquarters which expires in August 1998.

OCC leases its principal facilities from one of its minority stockholders under
a non-cancelable operating lease which expires in December 2003.  In addition to
lease payments, OCC is responsible for taxes, insurance and maintenance of the
leased premises.  OCC also leases certain other office space from unrelated
parties.

The Nuggets and the Avalanche have an agreement with the City and County of
Denver (the "City") for use of the City's playing facility, McNichols Arena, as
well as offices and training rooms.  The lease for the Nuggets extends through
June 30, 2008 and requires an annual rent payment of 5% of ticket sales revenue
with minimum and maximum guaranteed amounts of $250,000 and $350,000 per year,
respectively, through June 30, 1998.  Thereafter, the $350,000 maximum payment
is no longer applicable.  The term of the lease shall be shortened by one year,
with a maximum of two years, for each regular season that the Avalanche plays
its home games at McNichols Arena.  The lease for the Avalanche is for two years
beginning with the 1995-1996 season with two one-year options (at the discretion
of the Avalanche).  The rent is a maximum of $350,000 per season in the first
two years, and $400,000 per season in the option years.  The total payment for
McNichols Arena was $700,000, $667,000 and $350,000 for the years ended December
31, 1996 and 1995 and 1994, respectively.

The Company also leases equipment under non-cancelable operating leases,
primarily those assumed in conjunction with the SpectraVision transaction (see
Note 2), which extend through 2000.

The future minimum rental commitments under the Company's facility and equipment
leases at December 31, 1996 are as follows (in thousands):


     1997. . . . . . . . . . . . . . . . . . . . . . . . . .      $  14,334
     1998. . . . . . . . . . . . . . . . . . . . . . . . . .         13,161


                                       49


<PAGE>

     1999. . . . . . . . . . . . . . . . . . . . . . . . . .         12,212
     2000. . . . . . . . . . . . . . . . . . . . . . . . . .          6,710
     2001. . . . . . . . . . . . . . . . . . . . . . . . . .          1,677
     Thereafter. . . . . . . . . . . . . . . . . . . . . . .          4,175
                                                                  ---------
           Total . . . . . . . . . . . . . . . . . . . . . .      $  52,269
                                                                  ---------
                                                                  ---------

Rental payments to COMSAT and the OCC minority stockholder referred to above
were approximately $911,000, $1,635,000, and $1,473,000 for the years ended
December 31, 1996, 1995 and 1994, respectively.  Rental expense under all non-
cancelable leases was approximately $5,774,000, $3,125,000, and $2,566,000 for
the years ended December 31, 1996, 1995 and 1994, respectively.

CONCESSION AGREEMENT.  In conjunction with the purchase of the Nuggets, Ascent
assumed the rights and obligations of a concessions agreement (the "Concessions
Agreement") with Ogden Allied Leisure Services, Inc. ("Ogden") and the City.
The Concessions Agreement expires in 2001 and provides for the Nuggets and the
City to share in concession revenues according to formulas contained in the
Agreement.  At December 31, 1996, under the terms of the Concessions Agreement,
the Nuggets were contingently liable for approximately $2,333,000, plus other
reasonable damages, if the Nuggets terminate the agreement.  The Nuggets have no
present intention of terminating this agreement so long as the Nuggets continue
to play in McNichols Arena, and Ogden has expressed its willingness to enter
into a new agreement if the Nuggets relocate to a new arena in Denver.

PROPERTY AND EQUIPMENT.  As of December 31, 1996, OCC had noncancelable
commitments to purchase video systems totaling $6,600,000.

FILM RIGHTS.  As of December 31, 1996, the Company had a purchase commitment for
undelivered film product of approximately $9,629,000.

OFF BALANCE SHEET RISKS.  At December 31, 1996, Ascent was contingently liable
to banks for $389,000 for outstanding letters of credit securing performance of
certain contracts.  These guarantees expire in 1997.  The estimated fair value
of these instruments is not significant.

LITIGATION.  The Company is a party to certain legal proceedings in the ordinary
course of its business.  However, the Company does not believe that any such
legal proceedings will have a material adverse effect on the Company's financial
position or results of operations.  In addition, through its ownership of the
Nuggets and the Avalanche, the Company is a defendant along with other NBA and
NHL owners in various lawsuits incidental to the operations of the two
professional sports leagues.  The Company will generally be liable, jointly and
severally, with all other owners of the NBA or NHL, as the case may be, for the
costs of defending such lawsuits and any liabilities of the NBA or NHL which
might result from such lawsuits.  The Company does not believe that any such
lawsuits, individually or in the aggregate, will have a material adverse effect
on the Company's financial condition or results of operations.  The Nuggets,
along with three other teams, have also agreed to indemnify the NBA, its member
teams and other related parties against certain American Basketball Association
("ABA") related obligations and litigation, including costs to defend such
actions.  Management of Ascent believes that the ultimate disposition and the
costs of defending these or any other incidental NBA or NHL legal matters or of
reimbursing related costs, if any, will not have a material adverse effect on
the financial statements of the Company.


                                       50


<PAGE>

In 1990, a lawsuit was filed against OCV by a former employee alleging wrongful
termination and breach of contract.  In March 1995, a verdict in a jury trial
was entered against OCV.  In consideration for not appealing the verdict, OCV
entered into a settlement agreement with the plaintiff and recorded the $856,000
after-tax cost of the settlement in the first quarter of 1995.

In 1995, OCV filed suit against a competitor alleging patent infringement and
seeking unspecified damages.  In 1996, the competitor filed a counter suit
against OCV alleging patent infringement and seeking unspecified damages.  OCV
intends to contest the counter suit vigorously and believes the claim is without
merit and will not result in a material adverse effect to OCV's financial
position or results of operations or cash flows.

NOTE 10 - STOCKHOLDERS' EQUITY

STOCK OPTION PLANS.   Ascent adopted the 1995 Key Employee Stock Plan and the
1995 Non-Employee Directors Stock Plan (the "Ascent Plans") contemporaneously
with the Offering.  The Ascent Plans provide for the issuance of stock options,
restricted stock awards, stock appreciation rights and other stock based awards.
Options granted under the Ascent Plans expire in 2006.  For each of the
Ascent plans, options are generally granted at prices not less than the fair
market value of the Company's stock at the date of grant.  Under the terms of
the Ascent Plans, options vest over either a three year or five year period from
the date of grant.  However, so long as COMSAT owns at least 80% of the common
stock of the Company, no options will vest until three years after the date of
the grant and accordingly, no options are exercisable at December 31, 1996.  The
weighted average remaining contractual life of the options outstanding at
December 31, 1996 is approximately 10 years.  The following is a summary of
changes in shares under option.

<TABLE>
<CAPTION>
                                                                         Options Outstanding
                                                                 ---------------------------------
                                                     Options                           Weighted
                                                  Available for      Number of         Average
                                                     Grant            Shares       Exercise Price
                                                     -----             -----       --------------
<S>                                               <C>                <C>           <C>
Balances, December 18, 1995. . . . . . . . .         1,610,000               -    $        -
   Granted (weighted average fair
   value of $9.01) . . . . . . . . . . . . .          (949,750)        949,750         15.00
                                                     ---------      ----------    ----------

Balances, December 31, 1995. . . . . . . . .           660,250         949,750         15.00
   Granted (weighted average fair
   value of $8.63) . . . . . . . . . . . . .          (397,500)        397,500         18.14
   Exercised . . . . . . . . . . . . . . . .                 -               -             -
   Canceled/expired. . . . . . . . . . . . .             3,000          (3,000)        15.00
                                                     ---------      ----------    ----------

Balances, December 31, 1996. . . . . . . . .           265,750       1,344,250    $    15.93
                                                     ---------      ----------    ----------
                                                     ---------      ----------    ----------
</TABLE>

The Company has adopted the disclosure-only provisions of Statement of Financial
Accounting Standards No. 123, "Accounting for Stock-Based Compensation."
Accordingly, no compensation cost has been recognized for the Ascent Plans.  Had
compensation cost for the Ascent Plans been determined based on the fair value
at the grant date for awards in 1995 and 1996 consistent with the provisions of
SFAS No. 123, the Company's net loss and loss per common share in 1996 would
have been reduced to the proforma amounts as indicated below (in thousands,
except per share information).


                                        51
<PAGE>

Net loss - as reported                  $   (36,034)
Net loss - pro forma                    $   (37,668)
Loss per share - as reported            $   (1.21)
Loss per share - pro forma              $   (1.27)

The proforma amounts for 1995 would not differ significantly from the reported
amounts in 1995 as the awards granted in 1995 were granted on December 18, 1995.

Under SFAS 123, the fair value of stock-based awards to employees is calculated
through the use of option pricing models, even though such models were developed
to estimate the fair value of freely tradable, fully transferable options
without vesting restrictions, which significantly differ from the Company's
stock option awards.  These models also require subjective assumptions,
including future stock price volatility and expected time to exercise, which
greatly affect the calculated values and in which the Company has no significant
history or established trends.  The Company's calculations were made using the
Black-Scholes option pricing model with the following weighted average
assumptions for 1996: expected life, 12-24 months following the last vesting
date of the award; stock volatility, 57.6%; risk free interest rates, 5.9%; and
no dividends during expected term.  The Company's calculations are based on an
option valuation approach and forfeitures are recognized as they occur.

OCC also has adopted a stock incentive plan (the "OCC Plan"), expiring in 2006,
under which employees of OCC may be granted stock options, restricted stock
awards, stock appreciation rights and other stock based awards.  Under the OCC
plan options generally are granted at fair market value on the date of grant.
At December 31, 1996, the OCC plan has 3,000,000 shares reserved for issuance
and options to purchase 2,181,565 shares outstanding under the plan.  OCC has
also adopted the disclosure only provisions of SFAS 123.  The Company's share
of OCC's pro forma compensation cost for 1996 would be approximately $475,000
or an additional loss of $.02 per share to the proforma amounts above.

STOCK INCENTIVE PLANS.  COMSAT Corporation ("COMSAT") has stock incentive
plans which provide for the issuance of stock options, restricted stock
awards, stock appreciation rights and restricted stock units.  Qualifying
employees of the Company have been participants of these plans.  The amount of
expense charged to the Company for participation in these plans in 1996, 1995
and 1994 was $1,471,000, $865,000 and $1,231,000, respectively.

OTHER MATTERS.  In August 1996, the Company, OCV and Hilton Hotels Corporation
("Hilton") entered into a letter agreement ("Letter Agreement") providing for
the cancellation of approximately 1,336,000 shares of OCV common stock issued
to Ascent pursuant to the Contribution Agreement entered into between OCV and
the Company in September 1995 ("Contribution Agreement").  The Contribution
Agreement set forth the terms and conditions of the transaction whereby OCV
acquired certain assets from Ascent (see Note 14).  As a result of the
cancellation of these shares, Ascent's ownership interest in OCV was reduced
from 84% to 83% (prior to the consummation of the SpectraVision transaction
-see Note 2).  Pursuant to the Corporate Agreement between COMSAT and Ascent,
COMSAT had indemnified Ascent with respect to the adjustment effected by the
Letter Agreement and accordingly, COMSAT contributed $1,820,000 to the Company
in the fourth quarter of 1996 in accordance with this obligation.

                                       51
<PAGE>

The Letter Agreement also provided for an extension of the date on which the
exercise price of approximately 1,166,000 warrants previously issued to Hilton
by OCV would expire from June 1, 1996 to the later of (i) 90 days after the
closing or the abandonment of the proposed transaction with SpectraVision or
(ii) December 1, 1996.  On October 7, 1996, Hilton exercised its warrants under
the terms of the letter agreement and OCV received consideration of
approximately $10,685,000.  In turn, OCV distributed a pro rata dividend to its
stockholders, consisting of a cash dividend to its minority stockholders of
$1,781,000 and a promissory note in the amount of $8,904,000 (which OCV had
received from Hilton) for Ascent's portion of the dividend, pursuant to the
letter agreement.  In December 1996, Ascent received full payment on the
promissory note from Hilton.

The Letter Agreement also provided Hilton the right to put to Ascent all, but
not less than all, of the shares acquired from exercise of the Hilton Warrants
and still held by Hilton on the date 90 days after the closing of the
Acquisition of SpectraVision at the same exercise price at which Hilton
exercised its warrants.  On January 5, 1997, this put right expired unexercised.

NOTE 11 - EMPLOYEE BENEFIT PLANS

SAVINGS PLANS.  OCC, ANS, the Nuggets, the Avalanche and Beacon each participate
in various 401(k) plans for qualifying employees.  A portion of employee
contributions is matched by the respective entity.  Matching contributions for
the years ended December 31, 1996, 1995 and 1994 were $1,266,000, $600,000 and
$557,000, respectively.

In conjunction with the amendment to the Intercompany Services Agreement with
COMSAT (see Note 13), the Company has established the Ascent Employee Benefit
Plan to cover Ascent employees at Beacon, ANS and the Corporate office.  These
defined contribution plans did not have significant activity in 1996.

COMSAT PLANS. On January 1, 1996, Ascent elected to terminate its participation
in the COMSAT defined benefit pension plan, COMSAT's postretirement benefit plan
and the COMSAT supplemental pension plan for executives discussed below.

COMSAT sponsored a noncontributory defined benefit pension plan for qualifying
employees at ANS and Beacon.  Pension benefits were based on years of service
and compensation prior to retirement.  Ascent's policy was to fund the minimum
actuarially computed contributions required by law as determined by COMSAT's
actuaries.  Ascent contributions to the plan charged to expense were $126,000
and $271,000 in 1995 and 1994, respectively.

COMSAT also sponsored an unfunded supplemental pension plan for executives.
Ascent's expense for this plan was $56,000 in 1995.  No expense was recorded in
1994.

COMSAT provided health and life insurance benefits to qualifying retirees.  The
expected cost of these benefits was recognized during the years in which
employees rendered service.  COMSAT charged Ascent $314,000 and $425,000 in 1995
and 1994, respectively, for Ascent's share of postretirement benefit expense.


                                       52
<PAGE>

NUGGETS.  The Nuggets contribute annually to the NBA's General Manager, Coaches
and Trainers Pension Plan as well as the NBA Players Association Players'
Pension Plan (collectively, the "NBA Plans").  These multi-employer plans are
administered by the NBA and require the Nuggets to make annual contributions to
the NBA Plans equal to an amount stated pursuant to the actuarial valuation.
Contributions to the General Manager, Coaches and Trainers Plan charged to
expense were $134,000, $94,000 and $45,000 for the periods ended December 31,
1996, 1995 and 1994, respectively.  Contributions to the Players' Plan charged
to expense were $159,000, $132,000 and $78,000 for the periods ended December
1996, 1995 and 1994, respectively.  The Nuggets policy is to fund pension costs
determined by the NBA actuaries.

The NBA, in conjunction with the NBA Players Association, has established a Pre-
Pension Benefit Plan which is designed to pay benefits to players subsequent to
their retirement from the NBA but prior to the age of qualification for the
normal players' pension plan.  There were no contributions charged to expense
under this plan for the years ended December 31, 1996, 1995 and 1994,
respectively.

AVALANCHE.  The Avalanche contributes monthly to the National Hockey League
Pension Society ("NHL Plan") for the benefit of its players.  This multi-
employer plan is administered by the NHL and requires the Avalanche to make
contributions to the NHL Plan for the applicable playing season equal to an
amount stated pursuant to an actuarial valuation.  Contributions to the NHL Plan
charged to expense were $210,000 and $130,000 for the periods ended December 31,
1996 and 1995, respectively.

The Avalanche is also required by the NHL to provide a pension or equivalent
benefit for its general manager and head coach.  This benefit corresponds to an
established annual amount for each year of service beginning the season
following age 60.  The Avalanche has chosen to fund this benefit separately from
the NHL plan for its various participants.  The Avalanche is also required by
the NHL to provide a pension benefit to other participants, however, the
Avalanche makes available an employer matching contribution in conjunction with
its' 401(k) plan which satisfies this funding requirement.

NOTE 12 - PROVISION FOR RESTRUCTURING

During the third quarter of 1995, management of the Company decided to
discontinue the Satellite Cinema scheduled movie operations.  As a result of
this decision, a restructuring charge of $10,866,000 was recorded in the third
quarter of 1995.  The components of this restructuring charge included a write-
down of property and equipment of $5,140,000 to their estimated salvage value,
an accrual for severance costs of $1,010,000 and a charge of $4,716,000 for
costs related to contractual commitments that would not be fulfilled.  Through
December 31, 1996, the Company has made cash payments for severance costs and
contractual commitment costs totaling $4,787,000 and has written-off other
assets of $5,433,000 relating to contractual commitments.  In the fourth quarter
of 1996, the Company evaluated its remaining restructuring accruals, which are
primarily for severance and contractual obligations to be paid through September
1997, and reduced such accruals by $300,000. Although subject to future
adjustment, management of Ascent believes its' remaining reserves of $346,000 as
of December 31, 1996, are adequate to complete the restructuring plan of
Satellite Cinema's operations.  During the years ended December 31, 1995 and
1994, Satellite Cinema operations reflected revenues of $24,682,000 and
$34,753,000 and an operating income (loss), before allocation


                                       53
<PAGE>

of general and administrative expenses, of $(16,156,000) and $3,897,000,
respectively.

In December 1995, certain assets and contracts relating to Satellite Cinema
customers were sold by OCV for a $4,000,000 promissory note due in June 1996.
As of December 31, 1995, Ascent did not record the note receivable due to the
uncertainty of its collection and included the net book value of the assets sold
of $1,689,000 in Other Long Term Assets in the accompanying balance sheet.  In
1996, OCV received payments totaling approximately $3,300,000 representing a
negotiated settlement of the $4,000,000 promissory note.

NOTE 13 - BUSINESS SEGMENT INFORMATION

Ascent reports operating results and financial data in two business segments:
multimedia distribution and entertainment.  The multimedia distribution segment
includes video distribution and on-demand video entertainment services to the
lodging industry, and video distribution services to the NBC television network
and other private networks.  The results of ANS and OCC are reported in the
multimedia distribution segment.  The entertainment segment includes the Denver
Nuggets and the Colorado Avalanche franchises in the NBA and NHL,
respectively, and Beacon, a producer of theatrical films and television
programming.

<TABLE>
<CAPTION>
                                                    1996             1995           1994
                                                    ----             ----           ----
                                                                (in thousands)
<S>                                            <C>                 <C>               <C>
Revenue:
 Multimedia Distribution . . . . . . . . .     $     167,976(1)    $   135,782       $  125,823
 Entertainment . . . . . . . . . . . . . .            90,144(2)         66,036(2)        39,653
                                               -------------       -----------       ----------
     Total . . . . . . . . . . . . . . . .     $     258,120       $   201,818       $  165,476
                                               -------------       -----------       ----------
                                               -------------       -----------       ----------

Operating income (loss):
 Multimedia Distribution . . . . . . . . .     $      (9,775)(1)   $     2,885       $   18,140
 Entertainment . . . . . . . . . . . . . .           (24,812)           (9,418)           1,064
 General and administrative. . . . . . . .            (9,732)          (10,002)          (9,203)
 Restructuring Reserve . . . . . . . . . .                 -           (10,866)(3)            -
                                               -------------       -----------       ----------
     Total . . . . . . . . . . . . . . . .     $     (44,319)      $   (27,401)      $   10,001
                                               -------------       -----------       ----------
                                               -------------       -----------       ----------

Identifiable assets:
 Multimedia Distribution . . . . . . . . .     $     457,398       $   279,591       $  251,724
 Entertainment . . . . . . . . . . . . . .           266,216           207,172          114,761
 Other corporate . . . . . . . . . . . . .            12,988            15,840            6,095
                                               -------------       -----------       ----------
     Total . . . . . . . . . . . . . . . .     $     736,602       $   502,603       $  372,580
                                               -------------       -----------       ----------
                                               -------------       -----------       ----------

Capital expenditures:
 Multimedia Distribution . . . . . . . . .     $      78,793       $    82,903       $   89,073
 Entertainment . . . . . . . . . . . . . .            10,066             2,208              980
                                               -------------       -----------       ----------
     Total . . . . . . . . . . . . . . . .     $      88,859       $    85,111       $   90,053
                                               -------------       -----------       ----------
                                               -------------       -----------       ----------

Depreciation and amortization:
 Multimedia Distribution . . . . . . . . .     $      62,232       $    45,392       $   34,891
 Entertainment . . . . . . . . . . . . . .            12,580             8,283            3,929
                                               -------------       -----------       ----------
     Total . . . . . . . . . . . . . . . .     $      74,812       $    53,675       $   38,820
                                               -------------       -----------       ----------
                                               -------------       -----------       ----------

</TABLE>

(1)  The Multimedia distribution segment for 1996 reflects the acquisition of
     SpectraVision by OCC in October 1996 (see Notes 2 and 15).

(2)  Entertainment revenues in 1995 include $9,200,000 of NBA expansion fees
     and in 1996, include a full year of operations for the Avalanche.

(3)  Applies to Multimedia Distribution segment.

NOTE 14 - RELATED PARTY TRANSACTIONS

Ascent is charged by COMSAT for certain general and administrative services,
such as treasury services, pension and insurance administration, legal services,
tax services, internal audit review, payroll and personnel benefits
administration, public relations and various other general corporate functions.
Prior to the Offering, the cost of administering these services was allocated to
Ascent using a formula which considered Ascent's proportionate share of sales,
payroll and properties.  The amounts charged to Ascent under this method for
services were $4,540,000 and $3,073,000 for the years ended December 31, 1995
and 1994, respectively. Management believes that the allocation methods with
respect to all charges were reasonable.  In 1996, charges for these services
from COMSAT were determined pursuant to the Intercompany Services Agreement
("Services Agreement") with charges totaling $2,000,000 plus other incidental
charges.  On December 18, 1996, the Services Agreement was amended whereby
COMSAT will provide limited administrative and support services on a month-to-
month basis to the Company commencing in January 1997.  Monthly charges for
these services will be approximately $15,000.


                                       54

<PAGE>

In conjunction with Ascent's Offering (see Note 1), the Company and COMSAT
entered into a Corporate Agreement (the "Corporate Agreement"), pursuant to
which, among other things, the Company has agreed with COMSAT not to incur
any indebtedness without COMSAT's prior consent, other than indebtedness
under the Company's amended Credit Facilities (see Note 6), and indebtedness
incurred in the ordinary course of operations which together shall not exceed
$270.0 million in the aggregate; provided that not more than $50.0 million of
such indebtedness may constitute long-term debt.

From April through July 1995, Ascent loaned $2,000,000 to one of its directors.
The loan, plus interest thereon at the prime rate plus one percent, was repaid
in full in November 1995.

During the third quarter of 1995, the Company entered into a Contribution
Agreement with OCV, whereby the Company contributed various assets and
liabilities (primarily installed video systems and related construction in
progress, accounts receivable, deferred income taxes and other assets) to OCV
with a net book value of approximately $56,539,000 in exchange for
approximately 5,337,000 shares of common stock of OCV.  This transfer of net
assets and shares between companies under common control has been accounted
for at historical cost. During the second quarter of 1996, the Company
contributed some additional assets and liabilities (installed video systems
and related deferred income taxes and other assets) to OCV in connection with
the aforementioned contribution agreement.  These assets and liabilities had
a net book value of approximately $1,385,000.  In August 1996, the Company,
OCV and Hilton entered into a letter of agreement providing for the
cancellation of 1,336,470 shares of common stock of OCV issued to Ascent
pursuant to the Contribution Agreement (see Note 10).

In conjunction with the Acquisition and Merger (see Note 2), Ascent and OCC
entered into a corporate agreement (the "OCC Corporate Agreement"), pursuant
to which, among other things, OCC has agreed not to incur any indebtedness
without Ascent's prior consent, other than indebtedness under OCC's amended
credit facility (see Note 6), and indebtedness incurred in the ordinary
course of operations which together shall not exceed $116 million through
June 30, 1997, and shall not exceed $130 million through December 31, 1997;
provided however, that (i) no more than $50,000,000 of such indebtedness may
constitute long term debt and (ii) indebtedness may only be incurred in
compliance with the financial covenants contained in OCC's existing credit
facility (see Note 6), with any amendments to such covenants subject to the
written consent of Ascent.

OCC earned revenues of approximately $18,900,000, $15,000,000 and $12,400,000 in
1996, 1995 and 1994, respectively, from Hilton and its affiliates.  Hilton is a
minority stockholder of OCC.

OCC earned revenues of $4,944,000, and $3,362,000 for the years ended December
31, 1996 and 1995 respectively, from MagiNet Corporation, which is a related
party by virtue of OCC's investment in its preferred stock (see Note 2).
Accounts receivable from MagiNet at December 31, 1996 were approximately
$1,000,000.


                                       55
<PAGE>

NOTE 15 - QUARTERLY RESULTS OF OPERATIONS (UNAUDITED):

The following is a summary of unaudited quarterly results of operations for the
years ended December 31, 1996 and 1995.

<TABLE>
<CAPTION>
                                                         Dec. 31        Sept. 30         June 30           March 31
                                                         -------        --------         -------           --------
                                                                     (In thousands, except per share data)
   <S>                                                  <C>             <C>              <C>              <C>
   1996 (1)
   Revenues. . . . . . . . . . . . . . . . . . . .      $  91,594       $  38,141        $  56,045        $  72,340
   Operating Expenses. . . . . . . . . . . . . . .         91,820          28,333           46,921           60,553
   Depreciation and Amortization . . . . . . . . .         26,175          16,939           15,966           15,732
   Operating loss. . . . . . . . . . . . . . . . .        (26,401)(2)      (7,131)          (6,842)          (3,945)
   Loss before extraordinary item. . . . . . . . .        (19,134)         (6,035)          (6,256)          (4,275)
   Net Loss. . . . . . . . . . . . . . . . . . . .        (19,468)         (6,035)          (6,256)          (4,275)
   Loss per share. . . . . . . . . . . . . . . . .           (.65)           (.20)            (.21)            (.14)

   1995 (1)
   Revenues. . . . . . . . . . . . . . . . . . . .      $  59,710       $  39,952        $  52,601        $  49,555
   Operating Expenses. . . . . . . . . . . . . . .         56,263          32,888           34,004           41,523
   Depreciation and Amortization . . . . . . . . .         14,925          14,545           12,442           11,763
   Provision for restructuring . . . . . . . . . .              -          10,866 (3)            -                -
   Operating income (loss) . . . . . . . . . . . .        (11,478)        (18,347)           6,155 (4)       (3,731)
   Net income (loss) . . . . . . . . . . . . . . .         (7,855)        (13,733)           3,898           (3,333)
   Income (loss) per share . . . . . . . . . . . .           (.32)           (.57)             .16             (.14)
</TABLE>

(1)  The Company has restated its Consolidated Financial Statements for the Year
     ended December 31, 1995 and for the first three quarters of 1996.  The net
     effect of the restatement was to increase the previously reported 1995
     operating loss by $2,410,000, net loss by $1,567,000 (net of a tax benefit
     of $843,000) and loss per common share by $.07.  The impact of the
     restatement on previously reported 1996 quarterly information is not
     material, and results in decreasing the previously reported net losses in
     each of the first three quarters of 1996 by $67,000.  The previously
     reported quarterly information for 1995 and 1996 in the above tables has
     been restated.  For further information see the Company's Form 10-K/A filed
     on February 19, 1997.

(2)  Results for the fourth quarter of 1996 include $8.7 million of non-
     recurring charges incurred by OCC and operating losses incurred by
     SpectraVision since the date of acquisition.  These non-recurring charges
     include costs relating to asset write-downs, reserve and expense accruals
     associated with the integration of SpectraVision, the alignment of the
     OCC's operating practices for OCV and SpectraVision and the establishment
     of OCC as a new public company.

(3)  In the third quarter of 1995, a $10.9 restructuring charge was incurred
     resulting from the discontinuation of Satellite Cinema's lower margin,
     schedule, satellite delivered pay-per-view service (see Note 12).

(4)  In the second quarter of 1995, the Company recognized an $8.8 million NBA
     expansion fee payable to the Nuggets (an additional $.4 million was
     recognized in the fourth quarter of 1995 upon resolution of certain
     contingencies).


NOTE 16 - SUBSEQUENT EVENTS


                                       56
<PAGE>

On January 11, 1997, SpectraVision experienced an interruption in service caused
by the loss of communication with a satellite used to deliver pay-per-view
programming to 950 of OCC's approximately 3,100 hotels.  Of the hotels affected,
approximately 410 hotels continued to provide limited pay-per-view services
through alternate disk or tape-based systems.

By February 9, 1997, OCC was able to obtain alternate satellite service and had
restored full service to all the hotels affected.  The Company believes the loss
of service will result in approximately $4,000,000 of decreased revenues and
incremental expenses in the first quarter of 1997.

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

          None.









                                       57
<PAGE>

                                    PART III

     Except for the portion of Item 10 relating to Executive Officers which is
included in Part I of this Report, the information called for by Items 10
through 13 is incorporated by reference from the Ascent Entertainment Group,
Inc. 1996 Annual Meeting of Stockholders - Notice and Proxy Statement - (to be
filed pursuant to Regulation 14A not later than 120 days after the close of the
fiscal year) which meeting involves the election of directors, in accordance
with General Instruction G to the Annual Report on Form 10-K.

ITEM 10.  DIRECTORS AND OFFICERS OF THE REGISTRANT.
ITEM 11.  EXECUTIVE COMPENSATION.
ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.



                                     PART IV



ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.

(a)  Documents filed as part of this Report.

1.   Consolidated Financial Statements and Supplementary Data of
     Registrant

     Independent Auditors' Report

     Consolidated Balance Sheets as of December 31, 1996 and 1995

     Consolidated Statements of Operations for the years ended
     December 31, 1996, 1995 and 1994

     Consolidated Statements of Stockholders' Equity for the years
     ended December 31, 1996, 1995 and 1994

     Consolidated Statements of Cash Flows for the years ended
     December 31, 1996, 1995 and 1994

     Notes to Consolidated Financial Statements

     Schedule II - Valuation and Qualifying Accounts for the
     years ended December 31, 1996, 1995 and 1994

(b)  REPORTS ON FORM 8-K.

     Current Report on Form 8-K (File no. 0-27192) filed on October 17, 1996
     and including a discussion regarding (i) the election of Allen Flower as
     a director of the Company; (ii) the terms of the Spectravision acquisition;
     (iii) COMSAT's consent to an increase in the Company's debt


                                       58
<PAGE>

     limitation under the COMSAT Corporate Agreement to $216 million; and (iv)
     the terms of the Ascent and OCC credit facilities.

     Current Report on Form 8-K (File no. 0-27192) filed on November 14, 1996
     and including pro forma financial information filed in connection with
     the Spectravision acquisition.

     Current Report on Form 8-K (File no. 0-27192) filed on November 27, 1996
     and including a discussion regarding COMSAT's consent to an increase in
     the Company's debt limitation under the COMSAT Corporate Agreement to $236
     million.

     Current Report on Form 8-K (File No. 0-27192) filed on February 21, 1997
     and including the Registrant's press release reporting its 1996  financial
     performance.

(c) EXHIBITS:           The following exhibits are listed according
                        to the number assigned in the table in Item
                        601 of Regulation S-K.

     3.1       Amended and Restated Certificate of Incorporation of the
               Registrant*

     3.2       Amended and Restated Bylaws of the Registrant**

     10.1      Development, Production and Domestic Distribution Agreement,
               dated as of April 15, 1993 and amended as of
               August 11, 1993 and November 12, 1993, between Beacon
               Communications Corp. and SONY Pictures Entertainment,
               Inc. (Confidential treatment granted).***

     10.1a     Second Amendment to Development, Production and Domestic
               Distribution Agreement between Beacon Communications Corp.
               and Sony Pictures Entertainment, Inc. dated as of July 22, 1996,
               incorporated by reference from exhibit 10.6 to Amendment No. 2 to
               the Registration Statement on Form S-4 of On Command Corporation
               (No. 333-10407) filed on September 26, 1996 (Confidential
               treatment granted).

     10.2      Assignment, Assumption, Consent and Amendment, dated as
               of October 27, 1994, by and among Beacon Communications
               Corp., BCC Funding Corporation, COMSAT Corporation and
               SONY Pictures Entertainment, Inc. (Confidential
               treatment granted).***

     10.3(*)   Form of Employment Agreement between On Command Corporation and
               Robert Kavner, incorporated by reference from exhibit 10.6 to
               Amendment No. 2 to the Registration Statement on Form S-4 of On
               Command Corporation (No. 333-10407) filed on September 26, 1996.

     10.4(*)   Employment Agreement, dated as of December 1, 1994, by
               and among COMSAT Corporation, BCC Funding Corporation
               and Armyan Bernstein.**

     10.5(*)   Employment Agreement, dated as of December 1, 1994, by
               and among COMSAT Corporation, BCC Funding Corporation
               and Marc Abraham.**


                                       59
<PAGE>

     10.6      Master Services Agreement, dated as of August 3, 1993,
               by and between Marriott International, Inc., Marriott
               Hotel Services, Inc. and On Command Video (Confidential
               treatment granted).***

     10.7      Consent Agreement, dated as of July 1, 1995, by and
               among the National Hockey League, Le Club de Hockey Les
               Nordiques, Les Nordiques de Quebec 1988, Marcel Aubut,
               COMSAT Hockey Enterprises, LLC, COMSAT Video Enterprises,
               Inc., the Registrant and COMSAT Corporation.**

     10.8      Basketball Agreement, dated as of July 15, 1992, by and
               between the City and County of Denver and the Denver
               Nuggets Limited Partnership.**

     10.9      Amendatory Agreement by and between the City and County
               of Denver and the Denver Nuggets Limited Partnership.**

     10.10     User Agreement by and between the City and County of
               Denver and the Colorado Avalanche LLC.**

     10.11(*)  Employment Agreement, dated as of June 3, 1996, between the
               Registrant and James A. Cronin, III.


     10.12     Corporate Agreement by and between the Registrant and
               COMSAT Corporation, incorporated by reference from the exhibit of
               the same number to  the Annual Report on Form 10-K of Registrant
               (No. 0-27192) filed on March 29, 1996.

     10.13     Tax Sharing Agreement by and between the Registrant and
               COMSAT Corporation, incorporated by reference from the exhibit of
               the same number to  the Annual Report on Form 10-K of Registrant
               (No. 0-27192) filed on March 29, 1996.

     10.14(*)  Amended and Restated Employment Agreement between the Registrant
               and Charles Lyons.

     10.15(*)  Ascent Entertainment Group, Inc. 1995 Key Employee Stock
               Plan, incorporated by reference from the exhibit of the same
               number to the Annual Report on Form 10-K of Registrant (No. 0-
               27192) filed on March 29, 1996.

     10.16(*)  Ascent Entertainment Group, Inc. 1995 Non-Employee
               Directors Stock Plan, incorporated by reference from the exhibit
               of the same number to the Annual Report on Form 10-K of
               Registrant (No. 0-27192) filed on March 29, 1996.

     10.17     Agreement between Beacon Communications Corp. and Universal
               Pictures, a division of Universal City Studios, Inc. dated as of
               July 10, 1996, incorporated by reference from exhibit 10.5 to the
               Quarterly Report on Form 10-Q of Registrant (No. 0-27192) filed
               on November 13, 1996 as amended by Registrant's Quarterly Report
               on Form 10-Q/A filed on January 6, 1997.


                                       60
<PAGE>

     10.18     First Amended and Restated $140,000,000 Credit Agreement dated as
               of March 23, 1997 among the Registrant, the lenders named therein
               and NationsBank of Texas, N.A., as administrative agent.

     10.19     $125,000,000 Credit Agreement dated as of October 8, 1996 among
               On Command Corporation, the lenders named therein and NationsBank
               of Texas, N.A., as administrative agent, marked to show changes
               from the credit agreement filed with the Registrant's Current
               Report on Form 8-K (File No. 0-27192) filed on October 17, 1996.

     10.19a    First Amendment to Credit Agreement dated March 23, 1997 among
               On Command Corporation, the lenders named therein and NationsBank
               of Texas, N.A., as administrative agent.

     10.20(*)  Employment Agreement between the Registrant and Ellen Robinson.

     10.21(*)  Letter Agreement between the Registrant and Wesley D. Minami.

     10.22     Corporate Agreement dated as of October 8, 1996 between the
               Registrant and On Command Corporation.

     21.1      Subsidiaries of the Registrant.

     23.1      Consent of Deloitte & Touche LLP.

     27        Financial Data Schedule

     (*)       Compensatory plan or arrangement.

     *         Incorporated by reference from the exhibit of the
               same number to Amendment No. 4 to the Registrant's Registration
               Statement on Form S-1 (No. 33-98502) filed on December 12, 1995

     **        Incorporated by reference from the exhibit of the same number to
               the Registrant's Registration Statement on Form S-1 (No. 33-
               98502) filed on October 23, 1995.

     ***       Incorporated by reference from the exhibit of the same number to
               Amendment No. 2 to the Registrant's Registration Statement on
               Form S-1 (No. 33-98502) filed on November 13, 1995.


                                       61
<PAGE>

                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized, in the City and County
of Denver, State of Colorado on March 31, 1997.

               ASCENT ENTERTAINMENT GROUP, INC.

                                By:   /s/ Charles Lyons
                                      -----------------
                                      Charles Lyons
                                      President & Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed by the following persons in the capacities indicated on March
31, 1997.
                                /s/ Charles Lyons
                                -----------------
                                Charles Lyons
                                President, Chief Executive Officer and
                                Director (Principal Executive Officer)


                                /s/ James A. Cronin, III
                                ------------------------
                                James A. Cronin, III
                                Executive Vice President, Finance and
                                Chief Operating Officer
                                (Principal Financial Officer)


                                /S/ David A. Holden
                                -------------------
                                David A. Holden
                                Controller
                                (Principal Accounting Officer)


                                /s/ C.J. Silas
                                --------------
                                C. J. Silas
                                Chairman of the Board


                                /s/ Edwin I. Colodny
                                --------------------
                                Edwin I. Colodny (Director)


                                /s/ Charles M. Lillis
                                ---------------------
                                Charles M. Lillis (Director)


                                /s/ Charles M. Neinas
                                ---------------------
                                Charles M. Neinas (Director)


                                /s/ Robert G. Schwartz
                                ----------------------
                                Robert G. Schwartz (Director)


                                /s/ Allen E. Flower
                                -------------------
                                Allen E. Flower (Director)



                                       62

<PAGE>

                        ASCENT ENTERTAINMENT GROUP, INC.
                SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
        FOR EACH OF THE THREE YEARS IN THE PERIOD ENDED DECEMBER 31, 1996
                                 (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                              Balance at   Charged    Charged                     Balance
                                                              beginning      to       to other       Deductions   at end
                                                              of year      expenses   accounts(a)       (b)       of year
                                                              -------      --------   -----------    ----------   -------
 <S>                                                          <C>          <C>        <C>            <C>          <C>
 1994:  Allowance for loss on
   accounts receivable . . . . . . . . . . .                   $  4,461      $  660    $    (818)     $    (410)  $  3,893
                                                               --------      ------   ----------     ----------   --------
                                                               --------      ------   ----------     ----------   --------
 1995:  Allowance for loss on
   accounts receivable . . . . . . . . . . .                   $  3,893      $  711    $     (94)     $  (1,270)  $  3,240
                                                               --------      ------   ----------     ----------   --------
                                                               --------      ------   ----------     ----------   --------
 1996:  Allowance for loss on
     accounts receivable . . . . . . . . . .                   $  3,240      $  758    $  (1,775)     $     (87)  $  2,136
                                                               --------      ------   ----------     ----------   --------
                                                               --------      ------   ----------     ----------   --------
</TABLE>


     (a)  Recoveries of amounts previously reserved and other adjustments.
     (a)  Uncollectible amounts written off.









                                       63

<PAGE>

                                INDEX TO EXHIBITS


Exhibit
  No.                              Description
--------                           -----------


10.11       Employment Agreement between the Registrant and James A. Cronin,
            III.

10.14       Amended and Restated Employment Agreement between the Registrant
            and Charles Lyons.

10.18       First Amended and Restated $140,000,000 Credit Agreement dated as of
            March 23, 1997 among   the Registrant, the lenders named therein and
            NationsBank of Texas, N.A., as administrative agent.

10.19       $125,000,000 Credit Agreement dated as of October 8, 1996 among On
            Command Corporation, the lenders named therein and NationsBank of
            Texas, N.A., as administrative agent, marked to show changes from
            the credit agreement filed with the Registrant's Current Report on
            Form 8-K (File No. 0-27192) filed on October 17, 1996.

10.19a      First Amendment to Credit Agreement dated March 23, 1997 among On
            Command Corporation, the lenders named therein and NationsBank of
            Texas, N.A., as administrative agent.

10.20       Employment Agreement between the Registrant and Ellen Robinson

10.21       Letter Agreement between the Registrant and Wesley D. Minami

10.22       Corporate Agreement dated as of October 8, 1996 between the
            Registrant and On Command Corporation.


21.1        Subsidiaries of Ascent Entertainment Group, Inc.

23.1        Consent of Deloitte & Touche LLP

27          Financial Data Schedule

                                       64