U.S. SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   FORM 10-QSB


Quarterly report under Section 13 or 15(d) of the
Securities Exchange Act of 1934

For the quarterly period ended July 31, 1998
                               -------------

Commission File Number 333-61629
                       ---------

                               THE ARIELLE CORP.
                 ----------------------------------------------
                 (Name of Small Business Issuer in Its Charter)

       Delaware                                        11-3456837
------------------------                      ---------------------------
(State of Incorporation)                      (IRS Identification Number)

              26 Aerie Court, North Hills, New York 11030
              ------------------------------------------------------
              (Address of principal executive offices)    (Zip Code)

                                 (516) 621-8286
                ------------------------------------------------
                (Issuer's telephone number, including area code)


         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes     No X
   ---    ---


         As of July 31, 1998 there were 400,000 shares of the issuer's common
stock, $.0001 par value per share, issued and outstanding.



                                        1

<PAGE>




                               THE ARIELLE CORP.
                                   FORM 10-QSB
                                  July 31, 1998






                                      INDEX





PAGE

PART 1 - FINANCIAL INFORMATION

 Item 1 - FINANCIAL STATEMENTS (UNAUDITED)

         Balance Sheet -
          July 31, 1998 and April 30, 1998

         Statements of Operations
          Three Months Ended July 31, 1998

         Statements of Cash Flows
          Three Months Ended July 31, 1998

Item 2 - PLAN OF OPERATION

PART II- OTHER INFORMATION

                                        F-1

<PAGE>




                               THE ARIELLE CORP.
                                   FORM 10-QSB





                                 JULY 31, 1998


<PAGE>

<TABLE>
<CAPTION>


                                THE ARIELLE CORP.
                          (A development stage company)
                                 BALANCE SHEETS
                        JULY 31, 1998 AND APRIL 30, 1998
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------









                                                          7/31/98      4/30/98
                                                         ----------  -----------
                                                         (Unaudited)
                                     ASSETS
                                     ------

<S>                                                        <C>         <C>
CURRENT ASSET - Cash and cash equivalents                  $  2,477    $  2,642

OTHER ASSETS                                                   --           316

DEFERRED OFFERING COSTS                                      15,000      15,000
                                                           --------    --------

         TOTAL                                             $ 17,477    $ 17,958
                                                           ========    ========



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

ACCRUED EXPENSES                                           $   --      $    100
                                                           --------    --------

STOCKHOLDERS' EQUITY:
   Common stock, $.0001 par value; 20,000,000 shares
    authorized; 400,000 shares issued and outstanding            40          40
   Additional paid-in capital                                19,960      19,960
   Deficit accumulated during the development stage          (2,523)     (2,142)
                                                           --------    --------

         STOCKHOLDERS' EQUITY, NET                           17,477      17,858
                                                           --------    --------

         TOTAL                                             $ 17,477    $ 17,958
                                                           ========    ========

</TABLE>



                                      F-2



<PAGE>



<TABLE>
<CAPTION>


                                THE ARIELLE CORP.
                          (A development stage company)
                            STATEMENTS OF OPERATIONS
                    FOR THE THREE MONTHS ENDED JULY 31, 1998
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------




                                                                       3 months
                                                                        ended
                                                                       7/31/98
                                                                     ----------
                                                                     (Unaudited)

<S>                                                                   <C>
REVENUE                                                               $    --

GENERAL AND ADMINISTRATIVE EXPENSES                                         381
                                                                      ---------

         LOSS BEFORE INCOME TAX PROVISION                                  (381)

PROVISION FOR INCOME TAXES                                                 --
                                                                      ---------

         NET LOSS                                                     $    (381)
                                                                      =========



PER SHARE AMOUNTS:
   Net loss per common share outstanding                              $ (0.0010)
                                                                      =========


COMMON SHARES OUTSTANDING AT
   JULY 31, 1998                                                        400,000
                                                                      =========


</TABLE>



                                      F-3



<PAGE>





<TABLE>
<CAPTION>




                                THE ARIELLE CORP.
                          (A development stage company)
                            STATEMENTS OF CASH FLOWS
                    FOR THE THREE MONTHS ENDED JULY 31, 1998
--------------------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------------------





                                                                    Three months
                                                                       ended
                                                                      7/31/98
                                                                    ------------
                                                                     (Unaudited)

CASH FLOWS FROM OPERATING ACTIVITIES:
<S>                                                                     <C>
   Net loss                                                             $  (381)
   Item not affecting cash flow from operations:
     Other                                                                  316
     Accrued expenses                                                      (100)
                                                                        -------

         NET CASH USED IN OPERATING ACTIVITIES                             (165)
                                                                        -------

CASH USED IN INVESTING ACTIVITIES                                          --
                                                                        -------

CASH FLOWS FROM FINANCING ACTIVITIES                                       --
                                                                        -------

         NET DECREASE IN CASH AND
          CASH EQUIVALENTS                                                 (165)

CASH AND CASH EQUIVALENTS, beginning of period                            2,642
                                                                        -------

CASH AND CASH EQUIVALENTS, end of period                                $ 2,477
                                                                        =======


SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
   Cash paid for interest                                               $  --
                                                                        =======
   Cash paid for income taxes                                           $  --
                                                                        =======

</TABLE>


                                      F-4



<PAGE>











Item 2. Plan of Operation


         Arielle does not currently engage in any business activities which
provide any cash flow. The costs of identifying, investigating, and analyzing
business combinations are being paid with money in Arielle's treasury, and not
with proceeds received from Arielle's initial public offering.

         Arielle may seek a business combination in the form of firms which have
recently commenced operations, are developing companies in need of additional
funds for expansion into new products or markets, are seeking to develop a new
product or service, or are established businesses which may be experiencing
financial or operating difficulties and are in need of additional capital. A
business combination may involve the acquisition of, or merger with, a company
which does not need substantial additional capital but which desires to
establish a public trading market for its shares, while avoiding what it may
deem to be adverse consequences of undertaking a public offering itself, such as
time delays, significant expense, loss of voting control and compliance with
various Federal and State securities laws.

         Arielle will not acquire a target business unless the fair value of the
target business represents 80% of the maximum offering proceeds. To determine
the fair market value of a target business, Arielle's management will examine
the certified financial statements (including balance sheets and statements of
cash flow and stockholders' equity) of any candidate and will participate in a
personal inspection of any potential target business.

         Based upon management's experience with and knowledge of blank check
companies, the probable desire on the part of the owners of target businesses to
assume voting control over Arielle (to avoid tax consequences or to have
complete authority to manage the business) will almost assure that Arielle will
combine with just one target business. Management also anticipates that upon
consummation of a business combination, there will be a change in control in
Arielle which will most likely result in the resignation or removal of Arielle's
present officers and directors.

         On February 4, 2000, Arielle entered into a merger agreement with
Method Products Corp., a Florida corporation. Pursuant to this agreement, MPC
shall be merged into Arielle, with Arielle as the surviving entity. Thus, all
MPC shareholders shall become shareholders of Arielle as a result of the merger.

                                        2



<PAGE>





         MPC is a multi-service business communications systems company
specializing in the custom design, installation and service of total
communications network systems for businesses, with a focus on businesses
located in South Florida. MPC is involved with computer telephone integration,
fiber optic cabling and video conferencing, among other network systems.

           Since 1990, MPC has operated as a full service communications systems
provider offering businesses a single source for services and equipment required
for communications systems. MPC's goal is to provide "one stop shopping" for its
clients telecommunications needs. MPC is an authorized dealers for Fujitsu,
Niksuko America, Panasonic and Sony corporation among others.

           The executive offices of MPC are located at 1301 West Copans Road,
Suite F-1, Pompano Beach, Florida 33064.

     Pursuant to the merger agreement, MPC will be merged into Arielle.
Consummation of the merger is conditioned upon, among other things,
reconfirmation by holders of least 80% of the shares owned by the Rule 419
investors. Upon consummation of the merger, Arielle shall issue 5,335,000 shares
of the merged entity (representing 89.6%) to former MPC shareholders in
proportion to their holdings of MPC. Current Arielle shareholders shall retain
their 500,000 shares in Arielle, which amount represents 8.4% of the merged
entity. Additionally, Schonfeld & Weinstein, L.L.P. shall be issued 156,000
shares representing 2% of the merged entity. The shareholders of MPC have agreed
to place 595,500 of their shares in escrow to be released when MPC achieves
sales of a minimum of $5,000,000 in the first fiscal year following the merger.
In the event such sales are not achieved, the 595,5000 escrowed shares shall be
returned to the company's treasury. MPC will merge into Arielle with Arielle as
the surviving entity. The merger is intended to be consummated in such a manner
as to be tax-free to all parties involved under Internal Revenue Code Section
368(a)(1)(A).

Arielle filed a post effective amendment to its registration statement on Form
SB-2 on June 12, 2000. This amendment contained information regarding MPC
including audited financial statements of MPC and its subsidiaries.

Investors should note that any merger or acquisition effected by Arielle,
including the merger with MPC can be expected to have a significant dilutive
effect on the percentage of shares held by Arielle's then-shareholders,
including purchasers in this offering. On the consummation of a business
combination, the target business will have significantly more assets than
Arielle; therefore, management plans to offer a controlling interest in Arielle
to the target business.

Arielle and MPC have attempted to structure the acquisition in a so-called
"tax-free" reorganization under Sections 368(a)(1) or 351 of the Internal
Revenue Code of 1954, as amended (the "Code"). In order to obtain tax-free
treatment under the Code, it may be necessary for the owners of the acquired
business to own 80% or more of the voting stock of the surviving entity. In such
event, the shareholders of Arielle would retain less than 20% of the issued and
outstanding shares of the surviving entity, which would be likely to result in
significant dilution in the equity of such shareholders. Pursuant to the merger
agreement with MPC, Arielle shareholders and their assignees shall retain 8.4%
of the surviving entity. In addition, a majority of all of Arielle's directors
and officers may, as part of the terms of the acquisition transaction, resign as
directors and officers.



                                        3

<PAGE>


         Management anticipates that it may be able to effect only one potential
business combination, due primarily to Arielle's limited financing. As a result,
Arielle will not be able to offset potential losses from one venture against
gains from another.

         The analysis of business combinations was undertaken by the officers
and directors of Arielle, none of whom is a professional business analyst. In
analyzing prospective business combinations, management considered such matters
as the available technical, financial, and managerial resources; working capital
and other financial requirements; prospects for the future; nature of present
and expected competition; the quality and experience of management services
which may be available and the depth of that management; the potential for
growth or expansion; the potential for profit; the perceived public recognition
or acceptance or products; name identification; and other relevant factors.

         Management did not actively negotiate or otherwise consent to the
purchase of any portion of their common stock as a condition to or in connection
with the proposed merger with MPC.

         The securities to be issued in the merger shall be issued in reliance
on exemptions from registration under applicable federal and state securities
laws.

         The terms of the merger were based upon the respective needs and
desires of Arielle and MPC and the relative negotiating strength of Arielle and
such other management.

         Arielle has adopted a policy that it will not pay a finder's fee to any
member of management for locating a merger or acquisition candidate. No member
of management intends to or may seek and negotiate for the payment of finder's
fees.

         Arielle does not intend to raise any additional capital prior to
consummation of a business combination.




                                        4

<PAGE>


SIGNATURES

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


                                        THE ARIELLE CORP.




                                        By:  /S/ David Kass
                                             ----------------
                                             David Kass,


Dated: August 27, 2000                        /s/ David Kass
                                             -----------------
                                             David Kass, President, Director


Dated: August 27, 2000                       /S/ David S. Jacobs
                                             -------------------
                                             David S. Jacobs, Secretary,
Director


Dated:
                                             John E. Vidaver, Director









                                        5